Northwestern Mutual Savings & Loan Ass'n v. White
| Decision Date | 02 July 1915 |
| Docket Number | 1915 |
| Citation | 153 N.W. 972,31 N.D. 348 |
| Court | North Dakota Supreme Court |
Appeal from the District Court, Grand Forks County; Cooley, J.
Affirmed.
Respondent recovered his costs in this appeal. Judgment affirmed.
W. J Mayer, for appellants.
In actions of this character, plaintiff is invariably required to establish his title as pleaded. Defendant is not required to set forth his claims to the property until plaintiff shows his right, and his proof and pleading must conform. Merrill v. Dearing, 47 Minn. 137, 49 N.W. 693; Gibson v. Chouteau, 13 Wall. 103, 20 L. ed. 538; Groves v. Marks, 32 Ind. 319; Stuart v Lowry, 49 Minn. 91, 51 N.W. 662; Dever v Cornwell, 10 N.D. 123, 86 N.W. 227; McClory v. Ricks, 11 N.D. 38, 88 N.W. 1042.
Plaintiff's complaint is defective in that it does not apprise defendants of its real claim or interest. "Estate or interest" does not mean the same as "lien or encumbrance." McHenry v. Kidder County, 8 N.D. 413, 79 N.W. 875; Power v. Bowdle, 3 N.D. 107, 21 L.R.A. 328, 44 Am St. Rep. 511, 54 N.W. 404; Hooper v. Henry, 31 Minn. 264, 17 N.W. 476; Buxton v. Sargent, 7 N.D. 503, 75 N.W. 811.
An amendment introducing an entirely new cause of action is never justified. Mares v. Wormington, 8 N.D. 329, 79 N.W. 441; Reeder v. Sayre, 70 N.Y. 190, 26 Am. Rep. 567; Button v. Schuyler's Steam Towboat Line, 40 Hun, 422; Davis v. Iowa State Ins. Co. 67 Iowa 494, 25 N.W. 745; Bruns v. Schreiber, 48 Minn. 366, 51 N.W. 120; Authorities in 1 Enc. Pl. & Pr. 548, 549.
The rule that pleadings may be amended to conform to proof does not apply when the evidence which it is claimed tends to establish a fact outside the issues was competent and relevant to actual issues in the case, unless such evidence was offered, to the knowledge of both parties, to prove the fact outside the issues. Buxton v. Sargent, 7 N.D. 503, 75 N.W. 811; 1 Enc. Pl. & Pr. 585.
The right to subrogation is not established. If the payment by a third person is voluntary, the debt (and its incidents) is extinguished as to all parties, and there is left neither the right to contribution nor to subrogation. Harvey v. Tama County, 53 Iowa 228, 5 N.W. 130; Wilson v. Brown, 13 N.J.Eq. 277; Pelton v. Knapp, 21 Wis. 64; Moran v. Abbey, 63 Cal. 56; Small v. Stagg, 95 Ill. 39; Conkling v. King, 10 N.Y. 440.
When a third party pays for protection, an equitable assignment results in his favor by virtue of the doctrine of subrogation, without the debtor's volition. Mosier's Appeal, 56 Pa. 76, 93 Am. Dec. 783; Cockrum v. West, 122 Ind. 372, 23 N.E. 140; Arnold v. Green, 116 N.Y. 566, 23 N.E. 1; Atlantic Ins. Co. v. Storrow, 5 Paige, 285; Weiss v. Guerineau, 109 Ind. 438, 9 N.E. 399; Wormer v. Waterloo Agri. Works, 62 Iowa 699, 14 N.W. 331; Curry v. Curry, 87 Ky. 667, 12 Am. St. Rep. 504, 9 S.W. 831.
"If the payment is in the first instance at the request of the debtor, the law will imply a promise for reimbursement. 22 Am. & Eng. Enc. Law, 537.
Where one who has no interest to protect pays the debt of another or advances money for that purpose, and seeks to succeed to the rights of the creditor, there must be a convention or agreement to that effect. Subrogation must take place at time of payment. 27 Am. & Eng. Enc. Law, 250; Sewall v. Howard, 15 La.Ann. 400; Harrison v. Bisland, 5 Rob. (La.) 204; Gernon v. McCan, 23 La.Ann. 84; New Hampshire Sav. Bank v. Colcord, 15 N.H. 119, 41 Am. Dec. 685; Sandford v. McLean, 3 Paige, 122, 23 Am. Dec. 773.
To entitle a third party, being merely a volunteer or stranger, to subrogation, the payment must be made upon an express agreement entered into at the time of payment. Swan v. Patterson, 7 Md. 164; Brice v. Watkins, 30 La.Ann. 21; Bank of United States v. Winston, 2 Brock. 254, Fed. Cas. No. 944; Virgin's Succession, 18 La.Ann. 42; Burr v. Smith, 21 Barb. 262; Mosier's Appeal, 56 Pa. 76, 93 Am. Dec. 783; Dillon v. Kauffman, 58 Tex. 696; Clark v. Moore, 76 Va. 262; National Bank v. Cushing, 53 Vt. 326; King v. Dwight, 3 Rob. (La.) 2; Baltimore v. Hughes, 1 Gill & J. 480, 19 Am. Dec. 243; Oury v. Saunders, 77 Tex. 278, 13 S.W. 1030; Dillon v. Kauffman, 58 Tex. 696; Flanagan v. Cushman, 48 Tex. 241; Fievel v. Zuber, 67 Tex. 275, 3 S.W. 273; Fuller v. Hollis, 57 Ala. 435; Owen v. Cook, 3 Tenn.Ch. 78; Mitchell v. Butt, 45 Ga. 162; New Jersey Midland R. Co. v. Wortendyke, 27 N.J.Eq. 658; Morgan v. Hammett, 23 Wis. 30; Caudle v. Murphy, 89 Ill. 352; Shreve v. Hankinson, 34 N.J.Eq. 81; Sandford v. McLean, 3 Paige, 117, 23 Am. Dec. 773; Shinn v. Budd, 14 N.J.Eq. 234; Dorrah v. Hill, 73 Miss. 787, 32 L.R.A. 631, 19 So. 961; Meeker v. Larsen, 65 Neb. 158, 57 L.R.A. 901, 90 N.W. 958; Henry v. Henry, 73 Neb. 746, 103 N.W. 441, 107 N.W. 789; Bible v. Wisecarver, Tenn. , 50 S.W. 670; Brown v. Rouse, 125 Cal. 645, 58 P. 267; Campbell v. Foster Home Asso. 163 Pa. 609, 26 L.R.A. 117, 43 Am. St. Rep. 818, 30 A. 222; McCleary's Appeal, 9 Sadler (Pa.) 271, 20 W. N. C. 547, 12 A. 158; Bradshaw v. Van Valkenburg, 97 Tenn. 316, 37 S.W. 88; Doxey v. Western State Bank, 113 Ill.App. 442; Norris v. Woods, 89 Va. 873, 17 S.E. 552; Herr v. Denver Mill & Mercantile Co. 13 Colo. 406, 6 L.R.A. 641, 22 P. 770; Berry v. Bullock, 81 Miss. 463, 33 So. 410; Howell v. Bush, 54 Miss. 437.
When the right of subrogation is dependent upon fraud or mutual mistake, it is obvious that these prerequisites to the court's jurisdiction must be first pleaded and proved. To constitute fraud or deceit, there must be first a false representation or act. 14 Am. & Eng. Enc. Law, 2d ed. 33.
A mistake of law occurs when a party having full knowledge of the facts comes to an erroneous conclusion as to the legal effect. "Courts of equity do not sit to reverse or correct errors and mistakes of law, and cannot attempt to prevent or redress all wrongs." 20 Am. & Eng. Enc. Law, 807; Frost v. Flick, 1 Dak. 131, 46 N.W. 508.
A mortgage cannot be created in this state by an estoppel. A mortgage on real property can be created, renewed, or extended only by a writing executed with the formalities in the case of a grant of real property. Rev. Codes 1905, §§ 4951, 4968, 4973, 6149, Comp. Laws, 1913, §§ 5494, 5511, 5516, 6725.
An estoppel against the legal title to land will never lie unless actual fraud is shown, causing the other party to be deceived to his injury. Pom. Eq. Jur. 3d ed. 807.
The question of ratification is not here involved; nor are the principles of agency. Rev. Codes, 1905, § 5751, Comp. Laws, 1913, § 6319; 1 Am. & Eng. Enc. Law, 1035.
The land involved is the homestead not only of the defendant, but of defendant intervener and the minor children. "The husband may have a homestead right in property owned by the wife." Bremseth v. Olson, 16 N.D. 242, 13 L.R.A.(N.S.) 170, 112 N.W. 1056, 14 Ann. Cas. 1155.
The homestead is for the benefit of the family, and the head of the family is merely the representative or agent of the family. Dieter v. Fraine, 20 N.D. 484, 128 N.W. 684.
No claim for the homestead is necessary; it is absolutely exempt. Ibid.; Rev. Codes 1905, § 5052, Comp. Laws 1913, § 5608; Severtson v. Peoples, 28 N.D. 372, 148 N.W. 1054.
Scott Rex and Spalding & Shure, for respondent.
A statutory action to determine adverse claims may be either legal or equitable according as the issues are framed and as the proof may develop. Bausman v. Faue, 45 Minn. 416, 48 N.W. 13.
The amended complaint was, perhaps, unnecessary. In any event, its interposition upon the suggestion of the trial court was entirely without prejudice. Under our statute, no reply is permissible in a statutory action to determine adverse claims. "The statute dispenses with the necessity of framing issues by a proper pleading, as in other actions, and requires the court to determine the validity, superiority, and priority of the claims set up without a pleading asserting their validity." Spencer v. Beiseker, 15 N.D. 140, 107 N.W. 189.
There was no abuse of discretion in allowing the amended complaint. Finlayson v. Peterson, 11 N.D. 45, 89 N.W. 855; Anderson v. First Nat. Bank, 5 N.D. 80, 64 N.W. 114; Martin v. Luger Furniture Co. 8 N.D. 220, 77 N.W. 1003.
The mortgage in suit was a valid lien on the property. It is conceded that its foreclosure was regular. Therefore, the plaintiff is the owner of the property. The defendant is estopped by contract to deny the mortgage.
Where parties in making a contract agree upon or assume the existence of a particular fact as the basis of their negotiations, they are estopped to deny the fact so long as the contract stands. 16 Cyc. 719.
Where one having the right to accept or reject a transaction takes and retains the benefits thereunder, he becomes bound by the transaction, and cannot avoid its obligations or effect by taking a position inconsistent therewith. Ford v. Ford, 24 S.D. 644, 124 N.W. 1108.
The mortgage in suit is a valid lien, notwithstanding the claimed homestead character of the property, and may be enforced by a sale of the entire mortgaged property, the lien of the mortgage attaching only to the excess of the proceeds of sale, over and above the $ 5,000, homestead exemption value limit. Such a mortgage attaches to the excess, whether it be in area or in value. Scott v. Keeth, 152 Mich. 547, 116 N.W. 183; Tibbetts v. Terrill, 44 Colo. 94, 96 P. 978; Jones v. Losekamp, 19 Wyo. 83, 114 P. 673; 21 Cyc. 551; Wilson v. Wilson, 85 Neb. 167, 122 N.W. 856; Barrows v. Barrows, 138 Ill. 649, 28 N.E. 983; McClendon v. Equitable Mortg. Co. 122 Ala. 384, 25 So. 30; 15 Am. & Eng. Enc. Law, 677-684; Severtson v. Peoples, 28 N.D. 372, 148 N.W. 1054.
No homestead rights are involved in this action. There was a settlement and agreement...
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