Meyer v. Lemley
| Decision Date | 13 November 1929 |
| Docket Number | 6449. |
| Citation | 282 P. 268,86 Mont. 83 |
| Parties | MEYER v. LEMLEY et al. OREGON MORTG. CO., Limited, v. KUNNEKE et al. |
| Court | Montana Supreme Court |
Rehearing Denied Dec. 5, 1929.
Appeal from District Court, Carbon County; Robert C. Stong, Judge.
Action by Alice Meyer against Peter A. Lemley, the Oregon Mortgage Company, Limited, and others, wherein defendant last named filed a cross-complaint. Judgment for plaintiff, and defendant last named appeals. Affirmed.
Appellant a corporation whose home office is at Edinburgh, Scotland during the period of time over which this inquiry extends maintained an office at Spokane, Wash. On May 12, 1912 appellant loaned to one Kunneke $10,000, for which it took his promissory note, due February 1, 1918, and a mortgage upon 636 acres of land in Carbon county, Montana. The mortgage was recorded June 3, 1912. In 1915 Kunneke sold the land, subject to the mortgage, to Lemley. On July 20, 1920, Lemley and wife mortgaged the land, and other land, to Meyer & Chapman State Bank to secure two notes, aggregating approximately $20,000. The bank later transferred the Lemley notes and mortgage to respondent, who in fact was the owner thereof at all times. Lemley paid the interest on the Kenneke note up to February 1, 1922, but no longer.
On June 24, 1924, the manager of the Spokane office wrote to Messrs. Grimstad & Brown, attorneys at law residing at Billings, advising them that the Kunneke note was wholly unpaid, and that the interest thereon had not been paid since February 1, 1922, and instructing them to foreclose the mortgage. Grimstad & Brown proceeded with the foreclosure. The action instituted was numbered 3289, and will be so referred to. In preparing the complaint they omitted from the description of the property 320 acres, the most valuable and essential part of the tract mortgaged. Contemporaneously with filing the complaint, the attorneys filed a notice of lis pendens with the county clerk of Carbon county, which contained a correct description of the property. All defendants defaulted. The decree entered September 15, 1924, followed the description set forth in the complaint, and this error was carried into the order of sale, the sheriff's notice of sale, and in the certificate of sale. All these papers were prepared by Grimstad & Brown.
The appellant, on the sale day, October 11, 1924, bought in the property described in the notice of sale for the full amount of the judgment, and on that day respondent began an action to foreclose her mortgage, making the appellant and others parties defendant. By letter dated October 30, 1924, an agent of appellant, writing from the Spokane office, called the attention of Grimstad & Brown to the fact that there was "a slight error" in the description of the property contained in the sheriff's certificate of sale. Upon receipt of the letter Mr. Brown immediately checked up the various papers and found the errors. Having determined that section 9187, R. C. 1921, afforded appellant an appropriate remedy, he prepared a motion to amend the decree. The motion was dated December 16, 1924, but was not filed until February 9, 1925. The district court, on February 24, 1925, granted the motion, whereupon a new decree was filed, embracing the property described in appellant's mortgage, the sale was set aside, and a new order of sale issued. Afterwards, on respondent's motion, the new decree was ordered set aside, and that order was sustained by this court. Oregon Mortgage Co., Ltd., v. Kunneke, 76 Mont. 117, 245 P. 539.
In the meantime appellant appeared, first by demurrer, and then by answer, in the action instituted by respondent to foreclose her mortgage. In the answer appellant alleged, in effect, that through inadvertence and clerical error a portion of the lands described in its mortgage was omitted from the decree and order of sale, and consequently was not sold by the sheriff on October 11, 1924, but that upon appellant's motion the court had amended the decree, issued a new order of sale based upon the corrected decree, and that the amended decree declared appellant's lien upon all the lands described in its mortgage to be paramount to the lien or interest claimed by respondent. This answer was filed April 28, 1925, and to it respondent demurred on May 7, 1925. No further action was taken in the case until July 24, 1926, when respondent filed a reply to the complaint, alleging that the district court had set aside the amended decree, that the appellant had appealed from the order, and the Supreme Court had affirmed the order.
On August 20, 1926, the district court granted appellant leave to file an amended answer and cross-complaint, which was done on that day. The cross-complaint gives a history of the entire proceedings. It alleges that the omission of the property from the complaint, judgment, order of sale, and certificate of sale was suffered by accident, and from the mistake, inadvertence, and excusable neglect of appellant, its officers, agents, and attorneys, which is explained at length. It is alleged that appellant has suffered injury, for the reason that the lands purchased at the sheriff's sale are worth much less than the debts secured by the mortgage; that respondent was cognizant of the mistake at all times, and will not be injured by an amendment of the complaint in cause No. 3289, and the foreclosure of appellant's mortgage which is alleged to be prior and superior to the lien of respondent's mortgage; that Kunneke and Lemley, at all times since February 1, 1922, have been and are now insolvent, and a judgment against them, or either of them, would be entirely worthless.
The essential allegations of the cross-complaint, except those as to the existence of appellant's mortgage, the foreclosure thereof, and what took place after the foreclosure, were denied by respondent. Replying further, respondent alleged that, by bidding in the property for the full amount of the judgment, appellant fully satisfied and extinguished the sale in all respects; that appellant's mortgage, at the time of the filing of the cross-complaint, was barred by the provisions of section 8267, R. C. 1921, for the reason that the appellant never filed any affidavit of renewal thereof as required by that section; that, although appellant claimed to have discovered the error or mistake in the description of the property purchased by it at sheriff's sale on or about the 30th of October, 1924, it made no attempt to correct the error or to have the same corrected until about the 9th of February, 1925, when it filed a motion for that purpose; appellant's failure in that proceeding is then set forth, and respondent pleads that, having selected that procedure for the purpose of correcting the alleged errors, and having pursued that remedy even to the Supreme Court without avail, it ought now to be barred and estopped from maintaining the cross-complaint and from obtaining any relief thereunder.
After trial, the court made findings of fact and conclusions of law. The findings are contradictory in many ways. As illustrating this, in finding 26 the court says that the failure of appellant to include all of the lands described in this mortgage in its complaint and subsequent papers in cause 3289 was caused by the negligence and carelessness of appellant and its attorneys, agents, and servants, and without fault or negligence on part of respondent or Meyer & Chapman State Bank, her predecessor in interest, while in finding No. 36 it is said that the error complained of was occasioned and suffered by the accident and from the mistake, inadvertence, and excusable neglect of the attorneys for the appellant. In view of the law as we have been constrained to determine it, it is unnecessary to refer to other findings.
The court concluded that judgment should go in favor of respondent for the full amount of her notes, interest, and costs, and that she should have a decree foreclosing her mortgage as prayed for, and that appellant should take nothing. Judgment and decree were entered accordingly. Both parties made numerous exceptions to the findings, all of which were overruled. Thereupon appellant brought the cause to this court.
Brown, Wiggenhorn & Davis, of Billings, and Gunn, Rasch, Hall & Gunn, of Helena, for appellant.
John G. Skinner, of Red Lodge, for respondent Meyer.
Albert Anderson, of Billings, for respondent Kunneke.
CALLAWAY, C.J. (after stating the facts as above).
From out the exhaustive and able arguments and briefs of counsel there appears one determinative question: Is the appellant upon its own showing entitled to relief in equity?
The rules in this state governing the vacation of decrees in equity and judgments at law are the same. With us decrees are but judgments. Raymond v. Blancgrass, 36 Mont. 449, 93 P. 648, 15 L. R. A. (N. S.) 976.
The general rule is that the equity power of a court Philbrick v. American Bank & Trust Co., 58 Mont. 376, 193 P. 59; Peterson v. School Board, 73 Mont. 442, 236 P. 670; Freeman on Judgments (5th Ed.) § 1194.
Section 9187, R. C. 1921, provides that the court, in its discretion, may, upon such terms as may be just, relieve a party or his legal representative from a judgment taken against him through his mistake, inadvertence, surprise, or excusable neglect, provided that application therefor be made within a reasonable time, but in no case exceeding six months after the judgment was taken.
The statute, though providing a remedy at law, is founded...
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