Neikirk v. Boulder Nat. Bank

• Decision Date: 07 October 1912
• Citation: 127 P. 137,53 Colo. 350
• Parties: NEIKIRK et al. v. BOULDER NAT. BANK et al.
• Court: Colorado Supreme Court

127 P. 137

53 Colo. 350

NEIKIRK et al. v. BOULDER NAT. BANK et al.

Supreme Court of Colorado

October 7, 1912

Error to District Court, Boulder County; James E. Garrigues, Judge.

Action by the Boulder National Bank and another against Emily Neikirk and others. There was a judgment for plaintiffs, and defendants bring error. Affirmed.

Guy D Duncan, of Boulder, for plaintiffs in error.

Richard H. Whiteley, for defendants in error.

MUSSER J.

In 1901, the plaintiffs in error, Henry and Emily Neikirk, were indebted to the Boulder National Bank on three promissory notes, which were secured by trust deeds upon real estate owned by the Neikirks. All of the real estate, except one lot, was released from the trust deeds, and with other property conveyed to Switzer by quitclaim deed absolute on its face. The court found from ample supporting evidence that the conveyance to Switzer was made to secure the notes then held by the bank and future advances that might be made to the Neikirks or either of them. The form of the bank's security was thus changed from the trust deeds to the conveyance to Switzer to facilitate the sale and conveyance of the land which had been platted into lots as an addition to Boulder. The answer of the Neikirks and a declaration of trust made by Switzer show that the lots were to be sold that the proceeds were to be used in paying taxes and other necessary charges on the property and interest and principal of the indebtedness secured; that any surplus was to be paid to the Neikirks, and, when the indebtedness was discharged the unsold lots, if any, were to be conveyed to them. For several years the matter continued thus. Lots were sold by Mr. Neikirk from time to time, and, at his request, conveyed by Switzer, and the proceeds paid into the bank. While many of the lots were sold, it is evident that they did not sell as rapidly as was expected, and after about five years the bank commenced an action to foreclose the trust deed still remaining on the one lot, and, alleging that the conveyance to Switzer was a mortgage, sought also to foreclose that for the purpose of paying the balance due on the three notes as well as two other small ones given for advancements made. After a trial, a decree of foreclosure was entered as prayed for, and it is that decree that is now here for review.

In the reply brief, for the first time, a question is raised as to the validity of the judgment on account of the time and manner of its pronouncement. The opening brief does not mention this question, nor was any leave of court obtained to raise it in the reply brief, nor good cause shown for the omission from the opening one. On the face of the judgment roll the decree appears to be regular. A salutary rule of practice will not permit the consideration of a question raised under such circumstances. Isabella G. M. Co. v. Glenn, 37 Colo. 165, 86 P. 349.

A motion of the defendants in the foreclosure suit for a bill of particulars was sustained, and a bill was filed. This was not as specific as the defendants wanted, and they again moved for a more specific statement, claiming that the bill as filed did not comply with the order of the court. This second motion was overruled, and this ruling is claimed to be reversible error. Perhaps the court erred in its ruling on the motion. If it did, it is not shown that the error was prejudicial. If technical error alone would require the reversal of a judgment, the lower courts would have to go out of business, for in the hurry of trials it is next to impossible to keep out error altogether. The defendants sought to have Switzer and the bank account for all proceeds of lots sold. The complaint alleged that certain payments had been made on the notes, and the defendants sought a statement of the time and source of these payments. Every lot that was conveyed was sold by Neikirk, and he knew as much about it as Switzer or the bank. In an affidavit he said that he did not keep account himself, but relief upon the bank to do so. At the trial a statement was furnished of the receipts by Switzer and the bank. It is impossible to conceive that the ruling of the court on the motion prejudiced the defendants in any way.

Plaintiffs in error contend that the conveyance to Switzer created such a trust as forbade the remedy by judicial foreclosure, and as we understand them, that the remedy of the bank was to have Switzer sell the lots as he had been doing, or, if he refused, to have a court remove him and appoint a successor who would do so. There is such a thing as a trust that is unconditional and indefeasible and another thing that is a trust in the nature of a mortgage that is conditional and defeasible. Jones' Mort. (6th Ed.) § 62. Take the trust deed in this case covering the one lot. There is a trust in the nature of a mortgage wherein the lot is pledged for the payment of the debt, and, whenever the debt is paid, the conveyance is defeated, and the trustee must convey the lot to the trustor. Such trust deeds, formerly when made to any third party, and now under a statute to an official called a public trustee, were and are used quite generally in this state instead of mortgages; and, even though the right of the trustor may be cut off by the exercise of the power of sale given therein, there is no doubt that they may be treated as mortgages and foreclosed by judicial proceedings. Denver B. & M. Co. v. McAllister, 6 Colo. 261; Stephens v. Clay, 17 Colo. 489, 30 P. 43, 31 Am.St.Rep....