Hays v. King

• Decision Date: 14 December 1989
• Docket Number: No. 18085,18085
• Citation: 109 N.M. 202,784 P.2d 21,1989 NMSC 78
• Parties: Newell R. HAYS, and Ruby C. Hays, his wife, Plaintiffs-Appellants, v. Joe KING, a single man, and Elizabeth F. Silva, a single woman, Defendants-Appellees.
• Court: New Mexico Supreme Court

Page 21

784 P.2d 21

109 N.M. 202

Newell R. HAYS, and Ruby C. Hays, his wife, Plaintiffs-Appellants, v. Joe KING, a single man, and Elizabeth F. Silva, a single woman, Defendants-Appellees.

No. 18085.

Supreme Court of New Mexico.

Dec. 14, 1989.

[109 N.M. 203] Burrough & Rhodes, F. Randolph Burroughs, Alamogordo, for plaintiffs-appellants.

Gary C. Mitchell, Ruidoso, for defendants-appellees.

OPINION

SOSA, Chief Justice.

This foreclosure action by vendors Newell R. Hays and Ruby C. Hays (Hays) resulted in a judgment in favor of purchasers Joe King and Elizabeth F. Silva (King¹). Hays attempted to enforce a promissory note and mortgage upon property he allegedly owned and tried to sell to King. King, having been informed by the title company prior to closing that he already owned the property, counterclaimed to quiet title. After a bench trial, the court dismissed the complaint, rendered void a recorded mortgage from King to Hays, quieted title to 10.688 acres in Joe King subject to an undisputed mortgage to a third party, and awarded King costs and the return of $1,100.00 paid to Hays. We affirm.

The following is a summary of the district court's findings of fact pertinent to the issues on appeal. The 10.688 acres, which are part of a 756-acre tract sold by the original grantors, the Gabaldons, to Lanis L. Bosworth, include a 7.0333-acre tract that is the subject of the mortgage Hays sought to foreclose. The Gabaldon-Bosworth real estate contract was entered into in 1968 and recorded in March 1973. In 1977, a warranty deed was recorded that conveyed the 10.688 acres from Bosworth to Petroleum Leasing Services, Inc. In 1981, a quitclaim deed for the 10.688 acres from Petroleum Leasing to Ivy Heymann was recorded. Heymann conveyed the land to Joe King, who recorded the quitclaim deed in May 1985. Finally, in June 1985, a warranty deed from Gabaldon to Bosworth was recorded in an attempt to clear any clouds upon the title.

When the property was conveyed to King "the only title defect of which the grantor knew (and told to King) was the inability to obtain a partial release of the Gabaldon/Bosworth contract from the Gabaldons' heir * * *. The defect known to defendant King was cured with the completion of the Gabaldon/Bosworth contract." Accordingly, the court concluded: "There were no defects in Joe King's chain of title other than the Gabaldon contract. Under the doctrine of after-acquired title, title passed back through Bosworth to King upon completion of the Gabaldon Contract."

The court also found that there had been several agreements to assign contract rights by Bosworth to Hays, but concluded they were not conveyances of interests in real property. Nevertheless, in June 1978, Hays quitclaimed any interest he might have had in the property back to Bosworth in an attempt to clear any clouds on the title. In June of 1982, for reasons unknown, Bosworth conveyed the entire 756-acre parcel to a Mr. Franzen who then deeded it to Hays; however, the court concluded these conveyances were outside King's chain of title. The court further concluded that "Bosworth had no interest in the 10.668 (sic) acre tract to convey at that time because of the prior conveyance of Bosworth to Petroleum." This conclusion of law is challenged by Hays, who claims superior title over King through the warranty deed from Franzen that was recorded in 1983.

Hays' main contention is that the district court erred by applying the doctrine of after-acquired title in order to quiet title in King. Hays asserts King should not benefit from this equitable doctrine because he was a remote grantee in the Bosworth-Petroleum chain of title, he possessed knowledge of alleged title defects at the time of the conveyance by Heymann, and he received title by quitclaim deed. Cited as authority are cases supporting the propositions that a quitclaim deed vests only the title held by the grantor at the time of the conveyance, and that the after-acquired title doctrine does not apply to one claiming title under a quitclaim deed. While we have no quarrel with the substance of these cited authorities, we find them inapplicable to the case at bar for the reasons set forth below.

Other issues raised by Hays are whether delivery of a deed, note and mortgage from King to Hays was completed, and whether King is estopped from objecting, or waived objection, to the enforcement of the terms of the mortgage, note and deed. The viability of these issues rests upon the success of Hays' main argument.

The dispositive issue, then, is whether the district court erred by applying the after-acquired title doctrine, which effectively operated to clear any cloud on King's chain of title. It appears that Hays may have misconstrued the court's use of the doctrine as applying exclusively and directly to the Heymann-King conveyance rather than to the entire Gabaldon-Bosworth chain of title.

The common law doctrine of after-acquired title is one under which title to land subsequently acquired by a grantor who previously attempted to convey title to the same land,...