Haffner v. Commerce Trust Co.

• Decision Date: 06 December 1938
• Docket Number: Case Number: 28480
• Court: Oklahoma Supreme Court
• Parties: HAFFNER et al. v. COMMERCE TRUST CO.

1938 OK 615

86 P.2d 331

184 Okla. 212

HAFFNER et al. v. COMMERCE TRUST CO.

Case Number: 28480

Supreme Court of Oklahoma

Decided: December 6, 1938

Syllabus

¶0 1. APPEAL AND ERROR - Validity of Appeal Bond as Common-Law Undertaking Though Invalid as Statutory Supersedeas Bond.

A bond given to supersede a judgment of the district court pending an appeal from said judgment may be valid as a common-law undertaking though invalid as a statutory supersedeas bond.

2. SAME - Judgment Creditor's Abstinence From Issuance of Execution as Consideration Supporting Recovery on Bond.

The judgment creditor's abstinence from the issuance of execution upon a judgment of the district court pending an appeal from said judgment is sufficient consideration to support a recovery upon a bond given by the judgment debtor to supersede said judgment.

3. SAME - That Bond May Have Been Impotent to Compel Stay of Execution no Defense to Action on Bond.

In an action by judgment creditor to recover upon his judgment debtor's supersedeas bond, the charge that said bond may have been impotent to compel a stay of execution upon said judgment is no defense to the action, if no proceedings for execution were in fact had until a final decision on the appeal from said judgment.

4. SAME - Obligors Estopped to Deny Recitals in Bond.

The obligors upon a supersedeas bond are bound by the recitals in the bond, and when sued by the obligee upon said bond, they are estopped to deny said recitals.

Appeal from District Court, Dewey County; W.P. Keen, Judge.

Action by the Commerce Trust Company against John F. Haffner and others upon a supersedeas bond. Judgment for the plaintiff, and defendants appeal. Affirmed.

McKeever, Stewart & McKeever, for plaintiffs in error.

Cohoon & Heiple, for defendant in error.

DAVISON, J.

¶1 This is an appeal from a judgment of the district court of Dewey county, Okla., in favor of the defendant in error, Commerce Trust Company, against John F. Haffner and Anna Haffner, as principals, and John Brookhoven, August Brookhoven, Tom Crawford, and Isaac H. Wilson, as sureties, on a supersedeas bond. The events leading up to the execution and filing of said bond are as follows: The defendant in error had recovered a money and real estate mortgage foreclosure judgment against John and Anna Haffner on January 17, 1934. This judgment was not appealed from, but on August 17, 1935, the Haffners filed a motion to vacate same, and said motion was overruled August 21, 1935. On August 23, 1935, the same parties filed a motion for a new trial, and on September 18, 1935, that motion was overruled. The Haffners then gave notice of appeal and filed the bond which is the subject of this action. The result of their appeal is reported as Haffner et al. v. Commerce. Trust Co., 177 Okla. 313, 58 P.2d 863, wherein this court dismissed said appeal because it was lodged after the statutory period had expired even though the case-made was filed within six months after the motion for new trial was overruled, and held that the motion for new trial did not extend the time for appeal.

¶2 No attempt appears to have been made to secure execution on the foreclosure judgment during the pendency of the appeal proceeding, but after the decision of Haffner et al. v. Commerce Trust Co., supra, the land involved was sold at sheriff's sale and the proceeds thereof applied upon the trust company's judgment. It was for the purpose of collecting the deficiency remaining on said judgment after all proper credits had been deducted therefrom that said company brought the present action upon the aforesaid supersedeas bond. The principals and sureties on the bond have brought this appeal from the judgment rendered against them in favor of the trust company by the trial court. The litigants will herein be designated "plaintiff" and "defendants," as they appeared in the district court.

¶3 The defendants' denial of liability on the bond is based upon the claim that it was a nullity for the reason that it was unauthorized; that it was without consideration and that there was nothing for it to supersede.

¶4 As we understand the brief, it is first argued that the bond was unauthorized and a nullity because the trial court had lost jurisdiction of the foreclosure action at the time said bond was filed. In support of this proposition it is asserted that the foreclosure judgment was valid on its face and that the motion to vacate said judgment contained no defense to the foreclosure action and that therefore said motion was insufficient under paragraph 3, section 556, O. S. 1931, to invoke the jurisdiction of the trial court to vacate said judgment. Upon the premise that the court was thus without authority to vacate said judgment, it seems to be counsel's conclusion that said court lacked jurisdiction to allow an appeal from its order overruling said motion to vacate or to allow said order or judgment to be superseded by the bond herein sued upon. Counsel for the plaintiff maintains that this alleged want of jurisdiction is no defense to this action for the reason that said bond is a valid common-law undertaking even though its invalidity as a statutory supersedeas bond were admitted.

¶5 There is no doubt that recovery may be allowed upon a bond as a common-law undertaking even though it may be invalid as a statutory supersedeas bond. See Maryland Casualty Co. v. Marshall (Ky.) 10 S.W.2d 485; Rippey et al. v. Cone, 171 Okla. 324, 43 P.2d 76; Swofford Bros. Dry Goods Co. v. Livingston (Colo. App.) 65 P. 413, and many others. In the last-cited case, it was said:

"* * * Conceding to the defendants that the appeal bond is not a compliance with the statute, and that everything done in connection with the attempted appeal was a nullity, they are not, therefore, excused from liability on their bond. That the bond fails of conformity with the statute is not, of itself, available as a defense. There is no restriction upon the liberty of parties to enter into lawful contracts, and an obligation assumed voluntarily, and for a sufficient consideration, if consistent with the policy of the law and repugnant to no statutory provision, is valid at common law." (Citing authorities.)

¶6 The only reason advanced by the defendants for denying that liability has accrued upon the bond in question, under the principles enunciated in the foregoing authorities, is that said bond lacked consideration, which, of course, is essential to every valid contract. They claim that there could have been no consideration for the undertaking involved, because it was impotent to stay execution of the foreclosure judgment which it purported to supersede. Endeavoring to demonstrate the bond's impotence, they assert that it was filed at a time when no appeal in reality was pending, for the reason that no effective notice of appeal had been given. It is conceded that no notice of appeal from the order overruling the motion to vacate the foreclosure judgment was ever given and that the only time that the judgment debtors gave notice of appeal was when their motion for a new trial was overruled, after more than the statutory period for giving notice of appeal from the order overruling the motion to vacate had expired. Since in Haffner et al. v. Commerce Trust Co., supra, the order overruling the judgment debtors' motion for a new trial was held ineffective, the defendants conclude that the notice of appeal therefrom was a nullity and that therefore no appeal was ever pending, that the bond in question is a nullity, that the trial court never lost jurisdiction of the cause and that execution could have issued on the foreclosure judgment at any time. While we are not concerned with whether such alleged defects would invalidate the instrument in question as a statutory supersedeas bond, yet, if they wrought a failure or want of consideration for the bond, it could not be said to be a valid contract and enforceable as a common-law undertaking. Unquestionably, however, the defects alleged can have no bearing upon the matter of consideration in this case. All of the benefits to be derived by the obligors to the detriment of the obligees by the giving of the bond have been enjoyed. All of the consideration that was to move from the Commerce Trust Company to the Haffners by reason of the execution and filing of said bond has passed. Execution on its judgment against them had been delayed during the entire period that their appeal was pending. The benefits of execution thus foregone by the plaintiff is sufficient consideration for the contractual obligation assumed by the defendants under the bond in question. See Swofford Bros. Dry Goods Co. et al. v. Livingston and Maryland Casualty Co. v. Marshall, supra. We are referred by counsel for the defendants to Reed v. Chambers (Ariz.) 201 P. 98, and Estado Land & Cattle Co. v. Ansley (Tex. Civ. App.) 24 S.W. 933, wherein the sureties on supersedeas bonds were relieved from liability thereon and said bonds were considered nullities because no notice of appeal had been given. Neither of these cases are in point, for in neither of them was execution delayed until the causes in which they were filed had been appealed. After the execution of the bond in the Arizona case, the sureties promptly applied for and were granted a release from liability on the bond, and in the Texas case execution was issued on the trial court's judgment before an appeal therefrom had been lodged in the appellate court. In neither instance was execution delayed until an appeal was had. The consideration for the execution of the bonds never passed and neither ever became an executed contract. The probability that the judgment creditor could not have been forced to forego execution by reason of the bond does not in any manner diminish the value of the delay or stay of execution as a good consideration for the obligation of those executing said...