Olson v. Leith

• Decision Date: 19 May 1953
• Docket Number: No. 2596,2596
• Parties: OLSON et al. v. LEITH.
• Court: Wyoming Supreme Court

Page 342

257 P.2d 342

71 Wyo. 316

OLSON et al. v. LEITH.

No. 2596.

Supreme Court of Wyoming.

May 19, 1953.

C. E. Lane, Cheyenne, for appellant.

Ray E. Lee, Cheyenne, for respondents.

PER CURIAM.

This is an action for an injunction and for other equitable relief brought on October 26, 1951. The allegations of the petition are in substance as follows: On and prior to July 28, 1927, Donald Leith and Leonard Leith were the owners of the North Half of Section 18, Township 16 North, Range 66 West of the 6th P.M., and the North Half of Section 24, Township 16 North, Range 67 West of the 6th P.M., situated in Laramie County, Wyoming. On the date mentioned, these owners executed to R. B. (Russell B.) Davis a note for $1,500 secured by a mortgage on the foregoing premises, which mortgage was duly recorded and contained the ordinary power of sale. This mortgage was assigned to Chas. H. Wunnicke on February 21, 1944, and the assignment was duly recorded. The note and mortgage not having been paid, the latter was, after legal notice, duly foreclosed and sold to Wunnicke on April 7, 1944, and a certificate of sale and a sheriff's deed were duly issued to him. By mesne conveyances, the property was duly conveyed to the plaintiffs herein, who are now the owners thereof. On January 22, 1942, Donald Leith undertook to mortgage the whole of the property to the defendant Wilson R. Leith, and mortgage securing the payment of $3,500. On July 18, 1950, the plaintiffs herein commenced an action against Donald, Leonard and Wilson R. Leith so quiet the title to the property in controversy. Wilson R. Leith appeared in that action claiming to have a first mortgage on the property for $3,500, asking that the petition of the plaintiffs be denied and that he be authorized to foreclose his own mortgage. Without waiting for any order of the court and on September 28, 1951, defendant commenced to foreclose his mortgage by advertisement, and unless enjoined, it will be necessary for plaintiffs to bring another action to quiet title whereas 'the aforesaid action which is pending will conclusively determine the question of whether or not the said defendant Wilson R. Leith has a valid and subsisting mortgage as alleged by him and will settle the question which he has asked this court to adjudicate in the aforesaid action.' Plaintiffs have no means to protect themselves against the threatened foreclosure of defendant unless he be enjoined. The prayer of the petition is as follows:

'Wherefore, plaintiffs pray that the court forthwith hear this action and evidence in support thereof and make and enter a temporary restraining order enjoining and restraining said defendant, his agents, attorneys and representatives, from causing said premises to be sold pursuant to said notice of foreclosure sale pending the formation of the issues in this action, and that upon final hearing herein the court permanently enjoin and restrain the said defendant Wilson R. Leith from foreclosing or attempting to foreclose the mortgage which he holds and which is described in this petition on the grounds and for the reason that his attempted foreclosure is invalid and for the further reason that the foreclosure of the first mortgage on said premises has discharged the lien of the alleged mortgage of said Wilson R. Leith and said plaintiffs are entitled to have their title against said alleged mortgage forever quieted and set at rest. Said plaintiffs pray for such other, additional and different relief in the premises as may to the court seem just and proper.'

Defendant appeared in the case and in his answer admitted that Donald Leith and Leonard Leith owned the property as mentioned in the petition, and that they mortgaged it to R. B. Davis as alleged and further that the mortgage to defendant was given and that he started to foreclose it as stated in the petition herein. He further alleged the various matters of alleged fraud set out in the case of Wunnicke v. Leith, 61 Wyo. 191, 157 P.2d 274, the details of which need not be mentioned again in this opinion. The gist of these allegations is that Wunnicke fraudulently acquired a note for $1,294.30 which belonged to the Frank A. Rodel estate; that he sued thereon and obtained a judgment thereon which was entered by the clerk of the district court; that the judgment was void and was so held in Wunnicke v. Leith, supra; that Wunnicke caused an execution to be issued on that void judgment and caused the land to be advertised for sale; that the property was sold for $3,675, made up thus: The assumption of the first mortgage of Russell B. Davis; the assumption of the second mortgage in favor of the Federal Land Bank Commissioner in the sum of $777 and the balance of said bid, to-wit $1,698 to be applied on the judgment of plaintiff upon which the execution was issued; that Wunnicke obtained certain advantages by reason of the void judgment, consisting of the eviction of the Leiths from the premises, preventing an injunction in the action for forcible entry and detainer action for the possession of the property in controversy and having an injunction in the Federal court in connection with the bankruptcy proceedings of the Leiths released; that by reason of these facts, Wunnicke was bound by his assumption of the Davis mortgage and the plaintiffs are equally bound as having notice of the proceedings; that plaintiffs have never tendered to the defendant any amount under his mortgage, and that his mortgage is a good and subsisting lien on the property. Defendant also interposed several demurrers, one of which will be mentioned hereafter. A cross-petition was interposed based on the same facts as alleged in the answer. Damages in the sum of $1,000 were asked, and defendant prayed that the injunction herein issued be dissolved and for other equitable relief.

A temporary injunction was issued to restrain the defendant from foreclosing his mortgage. After trial of the case, without a jury, the injunction was made permanent and the title to the property in controversy was quieted in the plaintiffs against any claims of the defendant. From that judgment defendant Wilson R. Leith has appealed.

1. The main contention, repeatedly stated in the answer of defendant and in his brief, appears to be that since Wunnicke, the predecessor in interest of the plaintiffs, assumed the R. B. Davis mortgage when the sale was made under the void judgment heretofore mentioned, and since he gained some advantages under that void judgment, therefore he should be bound by that assumption of the Davis mortgage, and that hence the mortgage of the defendant is the first lien on the property in controversy. Counsel for the defendant has unfortunately either not investigated the authorities or, after investigation, has found none to support his contention. At least he has cited none. We have attempted to find some authority to sustain that contention, but have found none. In Wunnicke v. Leith, supra, which deals with the void judgment here in question, we cited 31 Am.Jur. 91, § 430, which states the effect of a void judgment as follows: 'A void judgment is not entitled to the respect accorded a valid adjudication, but may be entirely disregarded or declared inoperative by any tribunal in which effect is sought to be given to it. It is attended by none of the consequences of a valid adjudication. It has no legal or binding force or efficacy for any purpose or at any place. It cannot affect, impair, or create rights. It is not entitled to enforcement and is, ordinarily, no protection to those who seek to enforce it. All proceedings founded on the void judgment are themselves regarded as invalid. In other words, a void judgment is regarded as a nullity, and the situation is the same as it would be if there were no judgment. It, accordingly, leaves the parties litigant in the same position they were in before the trial.' According to this authority then, a void judgment cannot impair any rights, and all proceedings thereunder are invalid. The assumption of the R. B. Davis mortgage was a part of the proceedings under the void judgment and hence was invalid the same as any other part of the proceedings. Counsel have cited us to no authority that the fact that Wunnicke received some advantage under the void judgment--for instance that he ousted the Leiths from the possession of the property in controversy--alters the conclusion above mentioned. We might say in this connection that counsel for defendant contends that inasmuch as plaintiffs filed no reply to the answer, defendant was entitled to judgment herein. However, the gist of the defendant's answer consists of the contention that plaintiffs are bound by the assumption of the Davis mortgage by Wunnicke. Whether or not that contention is valid is, under the facts pleaded, a question of law so the answer did not need a reply.

2. Counsel for appellant asserts that the court was without jurisdiction to issue the temporary injunction herein. Counsel's assertion is not supported by any authority cited by him. We are not prepared to hold that the court was without jurisdiction. It is held that a court of equity has power to issue a temporary injunction and to maintain the status quo of the property in controversy when an action...