Johnson v. Tootle

• Decision Date: 09 March 1897
• Docket Number: 761
• Citation: 47 P. 1033,14 Utah 482
• Court: Utah Supreme Court
• Parties: JOHNSON ET AL., RESPONDENTS, v. KATE TOOTLE ET AL., APPELLANTS

47 P. 1033

14 Utah 482

JOHNSON ET AL., RESPONDENTS, v. KATE TOOTLE ET AL., APPELLANTS

No. 761

Supreme Court of Utah

March 9, 1897

Appeal from the Fourth district court. Hon. W. M. McCarty, Judge.

Action by L. Johnson and others against Kate Tootle and others. From a judgment for plaintiffs defendants appeal.

Affirmed.

Booth Lee & Gray, for appellants.

"Payment by grantee who has assumed the entire mortgage debt completely extinguishes the mortgage; he cannot be subrogated to the rights of the mortgagee and keep the mortgage alive for any purpose." Vol. 3, Pomeroy Equity Jurisprudence p. 192, sec. 1206 and note; Winans v. Wilkie, 41 Mich. 264; Birke v. Abbott, (Ind.) 1 N.E. 485; 1 Jones on Mortgages, sec. 743; Bunn v. Lindsay, (Mo.) 7 S.W. 473; Shirk v. Whitten, 131 Ind. 455; Kellogg v. Colby, 83 Iowa 513; First Nat. Bank v. Thompson, (Iowa) 34 N.W. 184; Fort Dodge Bldg. & Loan Assn., (Iowa) 53 N.W. 283.

"He is thereby made the principal debtor, and the land is the primary fund for payment. If he pays off the mortgage, it is extinguished." Vol 2, Pomeroy Eq. Jur., sec. 797; Russell v. Pistor et al., 7 N.Y. 171; Lilly v Palmer, 51 Ill. 331; 24 Am. & Eng. Ency. of Law, 255 and notes on page 256; Bunn v. Lindsay, 7 S.W. 476; Rubens v. Prindle, 44 Barb. 345.

Payment by one primarily liable ordinarily extinguishes an incumbrance or debt so that no right to subrogation arises therefrom. Abbott v. Kasson, 72 Pa. St. 183; Klippee v. Shields, 90 Ind. 81; Carlton v. Jackson, 121 Mass. 592.

Cancellation of the record when the mortgage has been redeemed, paid, and discharged, is an absolute bar and discharge of the same in the absence of fraud, accident, or mistake. Garwood v. Eldridge, (N. J.) 34 Am. Dec. 195; Liles v. Rogers (N. C.) 37 Am. St. Rep. 627; Goodyear v. Goodyear, 72 Iowa 328; Weidman v. Thompson, 69 Iowa 36.

"The fact that a party is ignorant of a recorded judgment is due to his own negligence, against the consequences of which a court of equity cannot relieve him by interfering with the rights of others who are without fault." Bunn v. Lindsay, (Mo.) 7 S.W. 473; Mather v. Jenswald, 72 Iowa 550.

Thurman & Wedgewood, for respondents.

It appears from the agreed statement of facts in this case: That on the 23d day of December, 1890, Lorenzo Hatch was the owner of the real estate in Vernal, Uintah county, Utah, described in the plaintiff's complaint, which was subject to a lien of a certain trust deed made, executed and delivered by Lorenzo Hatch and wife, on July 29, 1890, to one Little, to secure the payment of $ 3,000, with interest at 12 per cent per annum from date, to the Deseret Savings Bank, a corporation. That on December 23, 1890, defendants Tootle, Hosea & Co. recovered judgment against Lorenzo Hatch for the sum of $ 820 and $ 75.50 costs in the district court for the First judicial district at Provo, Utah, said district embracing Uintah county, which was situated many miles from Provo. That on May 23, 1891, the predecessors in interest of the plaintiff the Farmers' Co-operative Association purchased a portion of the property described in the complaint from Lorenzo Hatch and wife, and agreed, in consideration for such purchase of said premises, and as a part of the purchase price, that said Farmers' Co-operative Association would pay the amount of said trust deed, and release and discharge Hatch from liability therein. That in pursuance of said agreement, and as a part of the consideration for the said premises, and as a part of the purchase price, the said amount due on said trust deed was paid to the Deseret Savings Bank, and the said bank thereafter caused a release and discharge of the said trust deed to be sent to and entered for record with the county recorder of Uintah county, where the premises are situated. That at the time of such purchase and contract made by plaintiffs and their predecessors in interest to which plaintiffs have succeeded in interest, said Hatch represented to said plaintiffs and their predecessors in interest that there were no judgments outstanding against him which were or might be liens upon said property, and no transcript of the judgment aforesaid or any judgment had ever been filed in the recorder's office of Uintah county, and, relying upon the representations of said Hatch that said premises were free and clear from all liens, judgments, and incumbrances, except said trust deed to the Deseret Savings Bank, and having no knowledge whatever to the contrary, the said predecessors in interest of the said plaintiffs purchased said property, and took a deed therefor October 7, 1891. It was further agreed and stipulated as facts in the case that the plaintiffs and their predecessors in interest by their acts had released from the lien of the trust deed all said lands described in plaintiff's complaint except that part conveyed by Hatch to plaintiffs and their predecessors by deed dated October 7, 1891, which land is the subject of this litigation; that the balance of the land so released has been sold upon appellant's execution, but, outside of the exemption, did not satisfy said execution. It also appears from the testimony that a judgment docket kept in the First judicial district court, where such judgment was entered, contained the names of judgment debtors entered indiscriminately, without regard to any alphabetical order required by the statute. Execution was not issued upon the judgment until September, 1894. The court found the facts substantially as agreed upon. As a matter of law the court found the facts set forth constituted a fraud and mistake such as entitled the plaintiffs to equitable relief, and held, in consequence thereof, that plaintiffs should be subrogated to the rights of the Deseret Savings Bank in and to the trust deed paid by them, and that as such equitable mortgagees the plaintiffs were entitled to have that portion of the premises described in the complaint, and purchased by them, and levied upon by the defendants, sold under such trust deed, and the proceeds thereof applied--First, to the payment of the costs and expenses of this proceeding; second, to the payment of the sum of $ 3,000, due the plaintiffs; and that the balance, if any, be applied to the satisfaction of the execution of Tootle, Hosea & Co. against Lorenzo Hatch,--and a decree was entered accordingly. From this judgment and decree this appeal is taken.

MINER, J. ZANE, C. J., and BARTCH, J., concur.

OPINION

MINER, J. (after stating the facts):

It appears that when the appellants procured their judgment against Hatch the trust deed was a valid lien upon the property in question for upwards of $ 3,000, and the judgment was subject to this lien. The respondents purchased the land in good faith, relying upon the representations of Hatch that the trust deed was the only incumbrance upon it, and were in utter ignorance of the judgment. They purchased the land, and as a part of the purchase price paid off the trust deed for the benefit of the...