Larch Mountain Inv. Co. v. Garbade

• Decision Date: 17 March 1902
• Citation: 41 Or. 123,68 P. 6
• Parties: LARCH MOUNTAIN INV. CO. v. GARBADE et al. [1]
• Court: Oregon Supreme Court

68 P. 6

41 Or. 123

LARCH MOUNTAIN INV. CO. v. GARBADE et al. ^[1]

Supreme Court of Oregon

March 17, 1902

Appeal from circuit court, Multnomah county; John B. Cleland, Judge.

Action by the Larch Mountain Investment Company against T.A Garbade, John H. Woodward, C.C. Palmer, the Bridal Veil Lumbering Company, and William Frazier, sheriff of Multnomah county. Decree in favor of the defendants, and plaintiff appeals. Reversed.

This is a suit to determine the ownership of $2,271.21, deposited by the plaintiff with the sheriff of Multnomah county, for the purpose of redeeming from the defendant Garbade certain land sold under an execution on a judgment against it. The facts are that on September 28, 1898, one Gilchrist recovered a judgment against the plaintiff in the circuit court of Multnomah county for about $2,000. At the time the plaintiff was the owner of 1,200 acres of timber land in that county of the probable value of $25,000. On February 13, 1899, all its interest therein was sold under an execution issued on the Gilchrist judgment, and purchased by the defendant the Bridal Veil Lumbering Company, for $2,046.67, which sale was confirmed on March 7, 1899. Two days later the defendant Garbade, as a lien creditor under a judgment recovered by him against the plaintiff on January 9, 1899, for $9,108.26 redeemed from the lumbering company. Thereafter, and on March 14th, a decree was rendered against the plaintiff in favor of the lumbering company for $15 costs in a suit against the latter. On April 25th an execution was issued thereon, and the entire 1,200 acres levied upon, and advertised for sale on June 10th. On May 10, 1899, after the issuance of the execution on the $15 decree, and before the time fixed for the sale, the defendant lumbering company and Garbade entered into a written contract by the terms of which Garbade agreed that he would pursue such legal remedies as might be available to him to acquire the legal title to the property and sell the same to the lumbering company for $12,000 $4,000 of which was paid down at the time of the execution of the agreement, and the remainder after he should acquire title. It was stipulated in the agreement that, in case he failed to acquire title, he would refund the money received, with interest thereon at 10 per cent. per annum. It was also agreed that, in case the property should be redeemed from Garbade, he would repay to the lumbering company such sums as may have been paid by it, with interest thereon; and in case of any redemption other than upon the Gilchrist judgment he should return any moneys received by him under the agreement, it being understood, however, that, unless "on such redemption said party of the first part [Garbade] shall receive the moneys paid by him on redemption in said Gilchrist matter, there shall be deducted from any amount so agreed to be paid by the parties of the first part the sum of $2,067.86 (being the amount paid by said party of the first part on redemption in said Gilchrist sale), or such or any part of said amount as he shall fail to receive on such redemption, together with interest thereon at the rate of ten per cent. per annum from March 9, 1899; and the said party of the second part shall thereupon be entitled to all and every benefit or advantage which may exist by reason of the judgment and sale on execution in said Gilchrist matter." Thereafter the entire property was sold under the $15 decree in favor of the lumbering company, and purchased by Garbade for $40.25, and such sale was confirmed on June 16, 1899. The plaintiff had no actual knowledge of the sale or the confirmation until the time for the redemption had expired; but a short time after the sale, and in ignorance thereof, appealed from the judgment, and gave an undertaking to stay proceedings. On January 27, 1900, the plaintiff attempted to redeem from the sale under the Gilchrist judgment by paying to the sheriff the amount of money necessary therefor, but Garbade refused to receive it, or to recognize the validity of such attempted redemption. Thereafter, fearing that the first redemption was irregular, and perhaps invalid, the plaintiff notified Garbade that it would redeem on March 3, 1900, at which time it appeared by its attorney at the sheriff's office, and deposited with that officer $2,271.21, the amount necessary to effect such redemption. The defendants Woodward & Palmer, attorneys for Garbade, although present, refused to recognize the validity of this redemption, or to accept the money, and it remains in the custody of the sheriff. Thereafter, and while matters were in this condition, negotiations for the purchase of the property were opened between the plaintiff and the lumbering company, which finally resulted in a sale thereof to the latter for $25,000, in pursuance of which the plaintiff and defendant Garbade conveyed to the lumbering company on June 21, 1900, their respective interests in the property, and Garbade was paid the balance due him under his contract with the lumbering company of May 10, 1899. As soon as these transactions were consummated, and the money paid over to Garbade, one of his attorneys immediately appeared at the sheriff's office, and demanded the money deposited with that officer; but in the meantime the sheriff had been notified by the plaintiff that the attempt to redeem was abandoned, and not to pay the money over to Garbade or his attorneys. Thereafter this suit was brought against the sheriff and all parties interested in the fund to determine the ownership thereof. About the time it was commenced, Garbade and his attorneys, Woodward & Palmer, who had represented him in all the proceedings involved in this controversy, and through whom the entire negotiations were conducted, entered into an agreement to divide equally between themselves the money on deposit with the sheriff, and so they are all made parties to this suit. The decree of the court below was in favor of the defendants, and plaintiff appeals.

E.B. Watson and Frank Schlegal, for appellant.

J.H. Woodward, W.E. Thomas, and W.D. Fenton, for respondents.

BEAN C.J. (after stating the facts).

The plaintiff contends as a matter of law: (1) That under the contract of May 10, 1899, between the Bridal Veil Lumbering Company and Garbade, the money in controversy, if the redemption from the Gilchrist sale is to be treated as valid belonged to the lumbering company, and, as its interest therein has been transferred to the plaintiff, it should prevail in this suit; (2) that Garbade's refusal to accept the money, or to recognize the validity of the redemption, was a waiver of any claim to it on his part, which became irrevocable when plaintiff notified the sheriff that the attempted redemption was at end, and not to pay it over to him. But we do not deem it necessary to consider either of these questions, because we are all agreed that upon the facts the equities are with the plaintiff, and it is entitled to the relief demanded. The evidence shows beyond controversy that the defendants Woodward & Palmer, who were the representatives and acted for the defendant Garbade in all the transactions, not only refused to accept the money deposited with the sheriff for the redemption, but insisted that such redemption was void until after Garbade had parted with all his interest in the property and had received all the money he was entitled to either on account of his judgments against the plaintiff or the contract between himself and the lumbering company of May 10, 1899; and that they allowed and permitted the property to be sold and conveyed by the plaintiff to the lumbering company under the belief, induced by their acts, silence, and conduct, that Garbade had and would make no claim to the money deposited with the sheriff for redemption. Mr. Joseph, attorney for the plaintiff, testifies that, although Garbade and his attorneys were notified of the purpose to redeem, neither of them appeared at the sheriff's office on January 27th, at the time the first redemption was attempted; that shortly afterwards he met the defendant Palmer, who claimed that the redemption was invalid because not authorized by the plaintiff corporation; that, after looking the matter up, he concluded, in order to avoid question about the matter, to redeem again. A meeting of the board of directors was thereupon called, and a resolution passed authorizing the redemption. Notice was served upon Garbade, and witness further testifies that on March 3d "I went to the sheriff's office to make this redemption. Mr. Garbade was represented by Messrs. Woodward & Palmer, who appeared at that time. The sheriff had obtained a certificate of deposit for the money paid him January 27, 1900, and at the time of the redemption on March 3d I simply added the accrued interest from the date of the last redemption, and paid that in money to the sheriff. Messrs. Woodward & Palmer appeared there, and asked if the sheriff had the money. The sheriff said, 'Yes.' They said, 'Produce it.' The sheriff then produced the certificate of deposit, and Mr. Palmer laughed, and said: 'That don't go. You have got to produce the money,--the cash itself,--and this is money that has been paid in at a prior time. This certificate of deposit cannot be used,'--and then they left the sheriff's office. *** The same afternoon I telephoned Mr. Thielson that I thought I better get the money and tender it to Messrs. Woodward & Palmer, or at least get...