Murray v. Bender

• Decision Date: 14 September 1903
• Docket Number: 836.
• Citation: 125 F. 705
• Parties: MURRAY v. BENDER.
• Court: U.S. Court of Appeals — Ninth Circuit

125 F. 705

MURRAY v. BENDER.

No. 836.

United States Court of Appeals, Ninth Circuit.

September 14, 1903

J. C Campbell, W. H. Metson, L. S. B. Sawyer, T. H. Breeze, John J. McHatton, and John W. Cotter, for appellant.

Crittenden Thornton, L. O. Evans, and John F. Forbis, for appellee.

Appeal from the Circuit Court of the United States for the District of Montana.

See 109 F. 585, 48 C.C.A. 555; 116 F. 813, 54 C.C.A. 317.

In Murray v. Bender, 109 F. 585, 43 C.C.A. 555, this court had before it nearly all of the facts involved in this case. The decree of the lower court in this case was also before this court in King v. Bender, 116 F. 813, 54 C.C.A 317, and the judgment of this court on that appeal has disposed of one of the questions involved in the present appeal. A statement of the facts in this case appears to be necessary to a clear understanding of the law of the case, as established by the previous judgment of this court, and the remaining questions to be determined on this appeal.

In the year 1888 the Grand Opera House Company, a corporation, was the owner of certain real property in the city of Butte, in the then territory of Montana. On September 29, 1888, the corporation conveyed the premises to one John Maguire, taking from him a note secured by a mortgage for the purchase price amounting to $17,000. After the execution, delivery, and recording of this mortgage, Maguire undertook the erection of an opera house upon the mortgaged premises. In the construction of this building Maguire incurred considerable indebtedness for labor performed and materials furnished for the building, resulting in the creation of liens upon the property under the statute of the state. These liens were in due course of proceedings foreclosed by a decree dated January 27, 1890, and the property sold thereunder on the 19th day of May, 1890. On April 10, 1891, the appellant, Murray, who was the last of several redemptioners from such foreclosure sale, became invested with the title to the property by sheriff's deed. On May 29, 1891, the Opera House Company commenced an action for the foreclosure of its mortgage upon the property, executed by Maguire in 1888. In this action Murray was made a party defendant, and in a decree entered on March 12, 1895, it was adjudged that the mortgage lien upon the land was superior to the title of Murray, but, as to the building, Murray's title was adjudged to have priority over the mortgage lien. It was further adjudged and decreed that Murray might at any time after the sale of the premises, and before the expiration of the period for redemption as provided by law, remove from the said premises the building and improvements thereon; but, if he should fail to do so within the time prescribed, then the building and improvements should become a part and portion of said lots, and, after the time for removal specified in the decree, Murray should have no right to remove said improvements, or any of them. This decree was affirmed by the Supreme Court of the state on appeal. Opera-House Co. v. Maguire, 14 Mont. 558, 37 P. 607. The premises were sold, pursuant to the decree, on April 18, 1896, and were purchased by the Grand Opera House Company. The right to redeem from this sale expired under the law of the state on October 18, 1896, but prior to that time negotiations were had between Murray and the Grand Opera House Company for either a purchase or sale that would vest the ownership of the entire property in one of the parties. But the negotiations failed, and Murray proceeded to remove the chairs, scenery, and other furniture from the building, and the building from the lot. The chairs, scenery, and other furniture were removed to a warehouse, and when Murray had torn down the front end of the building it was suggested to him that he could buy a controlling interest in the stock of the Opera House Company, which would be much better than removing the building, as the building was of brick. Murray thereupon bought 1,000 of 1,100 shares of the stock of the corporation, which gave him the controlling interest in it. He then suspended the removal of the building, and proceeded to reconstruct it. When the building was reconstructed, Murray had the chairs, scenery, and other furniture removed to the opera house. This removal was completed by December 3, 1896, and on December 10, 1896, the opera house was opened to the public.

On December 3, 1896, John O'Rourke commenced an action against the Grand Opera House Company, joining in his complaint two causes of action, one upon the promissory note of the corporation for $762, the other for $585, claimed by O'Rourke to have been paid out by him for the corporation. On the same day, under writ of attachment issued in said cause for both causes of action, the property of the Opera House Company was attached. The corporation appeared and answered the complaint, not controverting the first cause of action, but denying the facts alleged as to the second. On September 16, 1897, judgment was rendered for O'Rourke on the first cause of action, and the case continued pending as to the other. Upon the judgment so made and entered as execution was issued, and upon December 27, 1897, the attached property was sold by the sheriff to Silas F. King. On December 3, 1896, the same day on which O'Rourke's action was begun, John O. Bender, the appellee in the present case, began an action against the corporation upon three causes of action, aggregating $700, and on the same day attachment was issued upon his complaint, and thereupon the property of the Opera House Company was attached, subject to the attachment of O'Rourke. The appellee obtained judgment in his action on May 21, 1898. On December 3, 1896, John F. Forbis also began an action against the corporation to recover $500. On the same day he also caused a writ of attachment to issue and the same property to be attached. His attachment was subsequent to those of O'Rourke and the appellee. On May 21, 1898, Forbis obtained a judgment against the Opera House Company in his action. On December 27, 1898, 12 months after the sale to King, O'Rourke, claiming to have a right of redemption upon his attachment still subsisting for his controverted cause of action, which continued pending after judgment had been entered upon his first cause of action, tendered to King the amount of the purchase money which the latter had paid, together with the statutory interest thereon, for the purpose of redeeming the property. On the same day the appellee served upon the sheriff of the proper county his notice of redemption, and under his said notice paid to the sheriff, for O'Rourke, the amount of money which O'Rourke had tendered to King, together with the amount which O'Rourke claimed to have been secured by his attachment. The appellee, then, as agent and attorney for O'Rourke, receipted to the sheriff for the money which he had tendered for O'Rourke, and as the agent for O'Rourke received the same. These redemptions were made within one year from the date of the sale under execution, that being the time allowed by the Montana law for redemption from execution sales. On January 10, 1899, and within the 60 days allowed by law to redeem from a redemptioner, Forbis, upon his judgment, redeemed from the redemption made by O'Rourke and the appellee. On January 19, 1899, notwithstanding these redemptions, the sheriff executed to the appellant, as purchaser under the O'Rourke judgment, a deed to the premises in controversy. On February 25, 1899, Forbis conveyed back to the appellee all rights which he acquired under his redemption. On April 4, 1899, J. O. Bender instituted a suit against King and McFarland in the Circuit Court of the United States for the District of Montana, praying that the latter be declared trustee for him as to all rights acquired under the sheriff's deed. The answer of the defendants denied that O'Rourke, at the time when he attempted to redeem said property, was a creditor of the corporation having a lien against the property subsequent to that upon which the same was sold, or that under said attachment line he redeemed the property from sale, and denied that the attachment lien of the appellee was subsequent to the judgment and attachment of O'Rourke, and denied that the attachment of Forbis was subsequent to the lien on which the property was sold on execution, and denied that Forbis redeemed from said sale or from said attempted redemption. The defendant McFarland alleged that he was in possession of the property under a lease from, and that he was paying rent to, the Grand Opera House Company. The decree of the lower court was in favor of Bender, and King appealed. On appeal, this court affirmed the judgment of the lower court, and found all the facts in favor of Bender, decreeing him to be the owner of the real property, and that King held the same in trust for him. King v. Bender, 116 F. 813, 54 C.C.A. 317.

In this suit the lower court appointed a receiver, who took possession of the property and collected the rents from February 1, 1900. Murray had received these rents up to this time, and insisted that he should still collect them, and also claimed to be the owner of the seats, fixtures, scenery etc., in the opera house, claiming this property as personalty and not a part of the realty; whereupon the court ordered that Murray be made a party to this suit. On September 23, 1899,the complainant, Bender, filed an amended bill, making James A. Murray and the Grand Opera House Company defendants. In this bill Bender alleged the facts hereinbefore recited, and further alleged that the defendant Murray claimed the chairs, stage scenery, and other fixtures in the opera house, but that the same were annexed to the realty and...