Dimond v. Manheim
| Decision Date | 24 May 1895 |
| Docket Number | 9300--(131) |
| Citation | 63 N.W. 495,61 Minn. 178 |
| Parties | JOHN DIMOND v. JOSEPH A. MANHEIM and Others |
| Court | Minnesota Supreme Court |
Appeal by defendants from a judgment of the district court for St Louis county, entered in pursuance of an order for judgment by Moer, J. Reversed.
Cash Williams & Chester and Thomas L. Kennan, for appellants.
J. W Bull, for respondent.
This is an action to have adjudged void certain foreclosure proceedings, which are the basis of defendants' claim of title to certain real estate, and to have it decreed that defendants have no title or interest therein. The trial court found as a conclusion of law that the plaintiff was the owner of the land, and that defendants had no title to, interest in, or lien upon it; and the only question presented by this appeal is whether this conclusion of law was justified by the findings of fact.
These findings, so far as here material, are as follows: In October, 1873, the plaintiff, then the owner of the land, executed to one Perkins a mortgage thereon to secure the payment of two promissory notes, -- one for $ 125, payable in 60 days; and the other for $ 470, payable in a year, -- both bearing interest at 10 per cent. per annum until paid. This mortgage, which contained the usual power of sale, was duly recorded. In January, 1874, Perkins assigned these notes and mortgage to John Mitchell, and Claus H. Watke. The assignment was filed for record, and, when returned to the assignees, had indorsed upon it the certificate of the register of deeds that it had been so recorded; but, by a clerical mistake of the register, the names of the assignees were recorded "Joseph Mitchell" and "Chas. H. Watke." In July, 1874, the assignees, in ignorance of the mistake of the register, proceeded to foreclose the mortgage under the power in their own proper names, and bid in the premises for $ 727.86, the amount of the debt and costs, which was considerably in excess of the value of the land at that time. A certificate of sale to Mitchell and Watke, in regular form, was executed and recorded. Plaintiff, who was a resident of Duluth, where the foreclosure proceedings were had, knew that they were being carried on; and, within a month or two after the sale, was inquired of by the attorney of the assignees of the mortgage whether he would redeem. Plaintiff continued to reside in Duluth until May, 1877. During the next two years he resided part of the time in Dakota, and part of the time in Moorhead and Brainerd, in this state, and on one occasion made a visit in Duluth of three weeks. In May, 1879, he removed from the state, but returned to Duluth in May, 1889, where he has ever since resided. From the time of the foreclosure sale, in 1874, up to the time he commenced this action, in 1894 (almost 20 years), the plaintiff paid no attention to the land, paid no taxes on it, and neither exercised any of the rights nor performed any of the duties of ownership. During all this time, Mitchell and Watke and their grantees have claimed to own the property, and have paid all the taxes on it, amounting with interest to $ 300.
The land has remained vacant and unoccupied. In January, 1886, Watke conveyed his undivided half of the land to Mitchell; and on December 14, 1889, Mitchell sold and conveyed the whole to defendants Manheim and Haag for $ 1,800, part of which was paid in cash, and the balance, $ 800, in one year. At the time of this sale, Mitchell delivered to Manheim and Haag the muniments of title to the land, including plaintiff's notes and mortgage, the assignment of the mortgage, and the certificate and affidavits of foreclosure sale. Before purchasing, they procured an abstract of title, but did not examine the records in the register of deed's office. The abstract did not disclose the error in recording the assignment of the mortgage. Within three days after this purchase from Mitchell, upon Manheim and Haag informing plaintiff of the fact, he, in response, stated to them that "he used to own said land," and shortly afterwards he handed them an unrecorded satisfaction of a mortgage which he had executed on the land prior to the Perkins mortgage, saying, "It is of no use to me, and it may do you some good." At this time Manheim and Haag had not yet paid to Mitchell the last $ 800 of the purchase money; and, assuming that it had not been paid by the foreclosure sale, plaintiff's note, secured by the Perkins mortgage, was still a valid subsisting personal obligation against him, although the right to enforce the mortgage security was already barred, by action in October, 1884, and under the power in October, 1889. Plaintiff has never paid any part of the debt secured by the mortgage, and it is now barred by the statute of limitations. In August, 1891, Manheim and Haag conveyed an undivided third of the land to defendant Ash. The certificate and affidavit of foreclosure sale and all of the subsequent conveyances under which defendants derive their title were all recorded shortly after their execution, and all of the defendants purchased in good faith, and without any actual knowledge or notice of the defect in the record of the assignment of the Perkins mortgage. Neither had plaintiff any actual knowledge of the defect until he was informed of the fact by an attorney in May, 1893. Hence this suit. Plaintiff's contention is that the foreclosure under which defendants claim title was void, because, by reason of the error in the record of the assignment of the mortgage, the ownership of the mortgage did not appear of record to be in the parties in whose names it was foreclosed. This is virtually admitted by defendants, but their contention is that the plaintiff is estopped by his own conduct from asserting the invalidity of the foreclosure.
The equitable doctrine of estoppel by conduct, which is altogether different from technical legal estoppels in pais so far from being odious, is a favored doctrine of the courts. Equitable estoppel, in the modern sense, arises from the "conduct" of a party, using that word in its broadest meaning, as including his spoken or written words, his positive acts, and his silence or negative omission to do anything. Its foundation is justice and good conscience; its object is to prevent the unconscientious and inequitable assertion or enforcement of claims or rights which might have existed or been enforceable by other rules of the law, unless prevented by the estoppel; and its practical effect is, from motives of equity and fair dealing, to create and vest opposing rights in the party who obtains the benefit of the estoppel. Pomeroy, Eq. Jur. § 802. Horn v. Cole, 51 N.H. 287. While originally the creature of equity, it is now thoroughly incorporated into the law, and is as available in a legal action as in an equitable one; and while at one time the courts hesitated to apply the doctrine so as to give or divest an estate or interest in land, as being opposed to the letter of the statute of frauds, yet it is now well settled that a person...
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