Higbee v. Dæley

• Decision Date: 04 October 1906
• Citation: 15 N.D. 339,109 N.W. 318
• Parties: HIGBEE v. DÆLEY et al.
• Court: North Dakota Supreme Court

15 N.D. 339

109 N.W. 318

HIGBEE

v.DÆLEY et al.

Supreme Court of North Dakota.

Feb. 9, 1906.

Rehearing Denied Oct. 4, 1906.

Syllabus by the Court.

A foreclosure by advertisement made in the name of the mortgagee by the assignee, whose assignment is unrecorded, is voidable, but is not a nullity.

One who seeks to have a voidable sale adjudged void, must show affirmatively that he asserted his rights promptly after discovering the facts.

Evidence examined and held, that the plaintiff failed to show proper diligence in seeking relief from the voidable sale.

Appeal from District Court, Ramsey County; C. J. Fisk, Judge.

Action by William E. Higbee against Richard Dæley and others. Judgment for defendants, and plaintiff appeals. Affirmed.Siver Serumgard & Newman and Holt & Frame, for appellant. McClory & Barnett, M. H. Brennan, and Burke & Middaugh, for respondents.

ENGERUD, J.

Plaintiff, claiming to be the owner in fee of the quarter section of land in question, brought this action to enforce his alleged right to redeem said premises from a mortgage lien thereon, and to require the defendants to account for the rents and profits of the land as mortgagees in possession. The defendants deny the plaintiff's title and right to redeem, and assert that, if plaintiff ever had any title, it was extinguished by a valid foreclosure by advertisement of the mortgage from which the redemption is sought. The case is before us for trial de novo on all the evidence.

The pivotal question is whether or not title has been acquired by the foreclosure of the mortgage in question. One Mary Fagnant owned the land in fee from 1888 until May 2, 1892, when she conveyed the same by quitclaim deed to this plaintiff. When this conveyance was made the premises had been unoccupied about two years, and remained vacant until 1895. On April 1, 1889, said Mary Fagnant, the then owner, mortgaged the land to the Western Farm Mortgage Trust Company of Kansas, to secure a debt of $700, and interest, which debt was evidenced by a promissory note upon which the interest was payable annually, and it was due April 1, 1894. The mortgage contained the usual power of sale in case of default, and provided further that, if the mortgagor failed to pay any interest when due, the mortgage could be foreclosed for the entire debt. The mortgage was duly recorded. Shortly after its execution, this mortgage, with the debt secured thereby, was assigned by the mortgagee to Charles E. Vedder, one of the defendants. The assignment was in writing, but was never recorded. In April, 1892, the interest being in default, Vedder sent the mortgage, notes, and assignment to Moen & Connelly, a firm of real estate dealers at Devils Lake, and directed them to have the mortgage foreclosed and authorized them to bid in the premises at the sale in Vedder's name. This firm employed an attorney of that city, to conduct the foreclosure. Proceedings to foreclose by advertisement were commenced in July, 1892, and culminated in a sale of the premises to Vedder on September 3, 1892. The foreclosure was made in the name of the Western Farm Mortgage Trust Company. It is conceded that there is no other defect in the proceedings. After the time for redemption had expired the sheriff's deed, in proper form, was executed to Vedder, and recorded. Thereafter in May, 1895, Vedder conveyed the land by warranty deed for a valuable consideration, to defendant Richard Dæley, who took actual possession of the land, and prepared it for cultivation by breaking and otherwise improved the same. Dæley farmed in land either in person or by tenants until he conveyed it by deed to defendant Brown. The latter contracted to sell the land to defendant Hurst, and placed him in possession. Brown subsequently conveyed the land to defendant Agnes Whitford, subject to the Hurst contract.

It is conceded that the record disclosed an apparently perfect title in Vedder based on a foreclosure which appeared to be regular. It is also conceded that Dæley and those claiming under him purchased in good faith, and had no notice of the concealed defect in the foreclosure proceedings. It is also apparent that the defect is not one which could, under the circumstances of the case, cause any actual loss or prejudice to the plaintiff or any one else. There was a default which authorized a foreclosure, and the actual owner of the debt caused the apparent foreclosure to be made and reaped the fruits thereof. The owner of the fee, or any other person entitled to redeem, were given the same notice of sale, and had the same right to redeem as they would have had if the foreclosure had been made in the name of the assignee of the mortgage. The foreclosure, however, was not properly made in accordance with the terms of the statute, and it is, doubtless, true that it would be voidable if attacked in due season by the mortgagor or any one claiming under him, even though no actual detriment or prejudice did or could result from the irregularity. Hathorn v. Butler, 73 Minn. 15, 75 N. W. 743. The proceeding, although irregular and voidable, is not, in our opinion, an utter nullity as claimed by appellant. If this plaintiff or any other person entitled to redeem, had seen fit to exercise that right within the year after sale, such redemption would have effectually freed the land from any claims on the part of Vedder as assignee of the mortgage. It is self-evident that he would be estopped to allege his actual but undisclosed ownership as a ground for invalidating the apparently good foreclosure which he had brought about. Curtis v. Cutler, 76 Fed. 16, 22 C. C. A. 16, 37 L. R. A. 737;Bottineau v. Insurance Co., 31 Minn. 125, 16 N. W. 849;Merrill v. Luce, 6 S. D. 354, 61 N. W. 43, 55 Am. St. Rep. 844. So also, if Vedder, ignoring the foreclosure, had afterwards brought an action against the...