Ham v. Ellis
| Decision Date | 17 November 1937 |
| Docket Number | No. 4192.,4192. |
| Citation | 76 P.2d 952,42 N.M. 241 |
| Parties | HAMv.ELLIS et al. |
| Court | New Mexico Supreme Court |
OPINION TEXT STARTS HERE
Appeal from District Court, Lea County; James B. McGhee, Judge.
Action by Jeff M. Ham against Doll Ellis and another, wherein C. D. Ham was by order made a party defendant. From the judgment, all parties appeal.
Judgment affirmed as to Doll Ellis and as to the other parties judgment reversed and cause remanded, with instruction.
A party whose title to realty was found to be based on a forgery and on a void release of mortgage could not claim a good title on theory that, having bought property when record was clear, subsequent changes in record could not affect title acquired.
G. L. Reese, Sr., and Lake J. Frazier, both of Roswell, for appellant.
W. H. Patten, of Hobbs, and Tom W. Neal, of Lovington, for appellees.
This is an action by Jeff M. Ham to foreclose a mortgage securing notes in the amount of $7,350 executed by Doll Turland. Two causes of action are set forth in the amended complaint; one asking judgment on the notes and seeking foreclosure of the mortgage, and another alleging that the defendant Doll Turland had removed improvements, and seeking damages for such removal in the amount of $1,000, and the appointment of a receiver. Will Terry is made a party defendant under an allegation that he claims some right in the property adverse to the plaintiff by assumption of the mortgage and notes, or otherwise.
Answers were filed on behalf of the defendant Will Terry and on behalf of the defendant Doll Ellis, formerly Doll Turland, issues were joined, and the case tried to the court.
C. D. Ham was by order made a party defendant, and appeared and answered in the case.
Judgment was entered for plaintiff for four-ninths of the amounts due on the notes and foreclosing the mortgage on 640 acres of the land in suit, and quieting title to 800 acres of the land in the defendant Will Terry.
[1] All of the parties to the action prayed and were allowed appeals to this court. The appeal of the defendant Doll Ellis (formerly Doll Turland) was not perfected, and accordingly the judgment of the lower court will be affirmed as to her.
The facts in the case are as follows:
Prior to August 15, 1929, the plaintiff owned 640 acres of land in Lea county, N. M., and C. D. Ham, the father of the plaintiff, owned 800 acres of land. On that date Doll Ellis (formerly Doll Turland) purchased the land, and executed and delivered to the plaintiff her notes in the principal amount of $7,350, and a mortgage securing the payment thereof covering the 1,440 acres of land purchased.
Some time prior to September 1, 1931, J. H. Atwood approached C. D. Ham and stated that he could sell the real estate for $6,000 if a release of plaintiff's mortgage and a surrender of the notes could be procured. C. D. Ham, without consulting plaintiff, or obtaining any authority from him, agreed to the proposition, and thereupon executed a release of the mortgage and a deed, signing the plaintiff's name thereto, and acknowledging them before a notary public in the name of plaintiff. Some time before September 9, 1931, pursuant to the arrangement between C. D. Ham and J. H. Atwood, said C. D. Ham sent the mortgage and notes, release of mortgage, and deed to the Lea County State Bank at Lovington, N. M., together with a letter to which he signed plaintiff's name without his knowledge, authority, or consent, which letter reads as follows:
“Lea County State Bank,
“Dear Sirs:
“Deliver the inclosed notes and satisfaction of mortgage to Mr. Patten upon delivery to you for me a $1000.00 Bank Stock, drafts and notes and mortgage from Will N. Terry in amounts as per stipulation for settlement between the lawyers and clients covering $500.00.
“Roswell, N. M.”
The defendant had been trying to buy the land in question and had a number of conversations with Atwood. When Atwood advised that a deal could be made the defendant employed W. H. Patten, an attorney, to represent him, and to see that he got good title. As a requisite in connection with the title, Attorney Patten required that this action to foreclose the mortgage, which was then pending, and another action which was also pending, should be dismissed. Atwood obtained orders of dismissal, and after the papers had been received by the bank, together with the letter of instructions, Atwood met with the defendant, Patten, who represented the defendant, and with Melvin Neal, an attorney, who represented Doll Ellis, with regard to the transaction. At that time the defendant executed an assignment of eight shares of the capital stock of the Lea County State Bank, of the par value of $800, a note for $1,800 to Jeff M. Ham, and a mortgage covering the real estate to secure the payment of the note, and also executed a note for $1,000 to Doll Ellis and made out a check for $500. Attorneys Neal and Patten went to the bank and delivered the bank stock and assignment, and the $1,800 note and mortgage to the bank, and received the original notes and mortgage, the release, and deed. The original notes and mortgage were delivered to Attorney Neal as representative of Doll Ellis, and were destroyed. Attorney Neal also received the $1,000 note executed by defendant, on behalf of Doll Ellis, and received $250 of the $500 paid by defendant, which was retained. The release of mortgage and deed to defendant were placed of record, and also a deed from Doll Ellis to the defendant. The bank forwarded the bank stock and $1,800 note and mortgage as directed in the letter to them, and immediately it was returned by plaintiff, who refused to accept it.
A value of $1,000 was placed on the bank stock by the defendant, who stated he had paid that amount for it, and that it was included in the deal for that amount. However, within a few months after the assignment of the stock the Lea County State Bank closed, and a 100 per cent. assessment was placed against all stock. Suit was brought against the plaintiff to collect the assessment and judgment was rendered by default against him, and the $1,800 note and mortgage levied upon and sold to satisfy the judgment. This note and mortgage remain unpaid in the hands of the purchaser at the sale. The $1,000 note to Doll Ellis was subsequently paid by the defendant.
The court set aside the orders of dismissal procured as hereinbefore set out and, upon trial of the cause, entered judgment against the defendant Doll Ellis for four-ninths of the amount due on the notes, and decreed that the mortgage should be foreclosed as to the 640 acres originally owned by plaintiff, and ordered that the release appearing of record be canceled in so far as it affected the 640 acres, and that the notes and mortgage be reinstated as to the four-ninths part and the 640 acres, and quieted title in the defendant as to the 800 acres of land originally owned by C. D. Ham.
The defendant Will Terry was granted an appeal to this court. The major portion of his brief is directed toward sustaining the lower court's decree quieting title to the 800 acres in him. Although objections were made to findings of fact made by the court, none of these findings are attacked by him in this court, and accordingly, so far as his appeal is concerned, they stand as the facts of the case.
Three propositions of law are argued by defendant Terry, on his appeal, as follows:
(1) C. D. Ham, having possession of the notes and mortgage, had the right to release them.
(2) C. D. Ham, being the joint owner of a common debt, had the right to release the same.
(3) Will Terry, having bought the property when the record was clear, subsequent changes in the record could not affect the title acquired.
[2][3][4] As to the first point, it is clear that mere possession of a mortgage does not give the right to release. The mortgage in the instant case stood in the name of Jeff M. Ham. C. D. Ham did not attempt a release as the owner and holder of the mortgage, but signed the name of Jeff M. Ham.
“The person shown by the record to be entitled to receive payment is in general the proper party to enter satisfaction of the mortgage upon the record, in the absence of a countervailing express provision of the statute, as, for example, the mortgagee where no assignment appears of record, or the last assignee of record, or the attorney in fact of the person entitled to enter satisfaction, or a duly accredited agent, although his authority does not take the form of a power of attorney.” 41 C.J. 812.
In this case it cannot be contended that C. D. Ham released the mortgage as the “duly accredited agent,” since it purports to be a release by the mortgagee himself, and also in view of the fact that the lower court specifically found that he was not such an agent of Jeff M. Ham.
[5] The authorities cited in support of the second point are all to the effect that one of two joint mortgagees may receive payment and discharge the mortgage. This is not such a mortgage, and the rule contended for does not go so far as to permit one who has an equitable interest in a mortgage, upon receiving payment, to forge the name of the legal owner thereto, so as to give an effective release, at least of anything more than the interest of the one so acting.
[6] As to point 3 made by defendant Terry, on this appeal, suffice it to say that the court below found the title of Terry to be based on a forgery, and on a release void for fraud and as a forgery. This being true, even though the point were well taken, and this we doubt, it could avail him nothing, since his title was otherwise fatally defective.
Having disposed of the contention made by the defendant ...
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