Passenger v. Coan, 5984.

• Decision Date: 20 November 1931
• Docket Number: No. 5984.,5984.
• Citation: 61 N.D. 569,238 N.W. 773
• Parties: PASSENGER v. COAN.
• Court: North Dakota Supreme Court

61 N.D. 569

238 N.W. 773

PASSENGER

v.COAN.

No. 5984.

Supreme Court of North Dakota.

Oct. 26, 1931.

Rehearing Denied Nov. 20, 1931.

Syllabus by the Court.

Where a homestead entryman on the public lands of the United States gives a mortgage on his land prior to the issuance of patent, thereafter makes final proof and receives his patent, the title acquired through the patent inures to the benefit of the mortgagee as of the date of the execution and delivery of the mortgage.

Syllabus by the Court.

The evidentiary value of an acknowledgment to an instrument executed in conformity to law and the weight to be attached thereto is not to be overcome by a mere statement on the part of the person purporting to have made the acknowledgment that he did not know he had signed the instrument, as such acknowledgment, when regular on its face, is presumed to state the truth. Proof to overthrow it must be very strong and convincing.

Syllabus by the Court.

Under the provisions of section 8099a of the Supplement, notice of intention to foreclose a mortgage need not be served upon one not the title owner according to the records in the office of the register of deeds, even though such a one claims title to the land and is residing thereon.

Syllabus by the Court.

The findings of the trial court in an action properly triable to the court are entitled to consideration, especially where witnesses appear before the court and testify; but such findings are not controlling upon trial de novo in this court.

Syllabus by the Court.

In this action-an action to determine adverse claims and involving the validity of a mortgage, foreclosure proceedings and the title acquired thereunder-the evidence has been examined, and it is held the record shows clearly that the plaintiff is the owner of the land and that title thereto should be quieted in her.

Appeal from District Court, Ward County; George H. Moellring, Judge.

Action by Helen E. Passenger against Frank Coan. From the judgment rendered, both plaintiff and defendant appeal.

Reversed in accordance with opinion.

C. E. Brace, of Minot, for appellant.

F. B. Lambert, of Minot, for respondent.

BURR, J.

This is an action to determine adverse claims to property; each party claiming to be the owner in fee simple. The trial court found for the defendant; but found the plaintiff has a lien on the land in the sum of $1,018.87, with interest, because of taxes paid; and is also entitled to the proceeds of the 1930 crop. From the judgment entered, both parties appeal, demanding a trial de novo.

An abstract of title was introduced and received in evidence, and from this and other testimony we find as undisputed facts:

The defendant made homestead proof on the land in April, 1909. On May 5, 1909, he executed a preliminary mortgage on the land to the State Bank of Berthold for $850; and another to the same bank on June 26, 1909, for $346.20. On October 28th he executed a preliminary mortgage for $140 to one H. E. Johnson, and on the same day a preliminary mortgage for $200 to one Balsukot; the latter mortgage being recorded five minutes later than the Johnson mortgage. A patent to the land was issued by the United States dated December, 1909, and recorded June, 1910. In April, 1910, the defendant gave a mortgage on this land to Hagen & Erickson for $233.90. In 1911 the Johnson mortgage was foreclosed, and the land sold for $205.35; the certificate of sale being dated February 15, 1911. The Balsukot mortgage was foreclosed and the land sold on March 23, 1911, to Balsukot for $278.47; the certificate being issued that day and recorded the next day. On March 22, 1912, Balsukot assigned his certificate of sale to one Stevenson, an officer of the State Bank of Berthold, who mortgaged the land to one Churchill to secure the payment of $2,000 due in 1917, and gave another mortgage on the land to secure the sum of $400; both mortgages being given March 25, 1912. On the 26th of March, 1912, both mortgages to the State Bank of Berthold were satisfied of record and the land redeemed from the Johnson foreclosure-the certificate of redemption being dated Feb. 10, 1912-and on March 28, 1912, Stevenson received a sheriff's deed. Exhibits received in evidence show that, prior to the time Stevenson got this sheriff's deed, there were docketed in the district court nine unsatisfied judgments against defendant for $927.63, without interest; six of them for $647.25 being docketed prior to final proof and the other three after the Balsukot mortgage was given.

On May 24, 1917, Stevenson and wife mortgaged the land to one Griffith, to secure the payment of $2,000 due May, 1922, and on the 29th day of May there was recorded a satisfaction or release of the Churchill mortgage. In June, 1917, this Griffith mortgage was assigned to one Hanks.

On June 1, 1922, the defendant executed to the holder of the mortgage an extension of mortgage loan agreement wherein it is stated that “at the special instance and request of the said Frank Coan” the time and payment of the note and mortgage is extended for five years, and in said instrument the defendant “as consideration of said extension” agreed “to pay said principal sum (on the mortgage) at its maturity as hereby extended with interest” for the succeeding five years in accordance with the terms of “five extension interest coupon notes bearing even date” with the instrument, which notes were signed by the defendant. The defendant in said extension agreement “further agreed that all the stipulations and provisions of said principal note and all the stipulations, provisions and covenants of the mortgage deed given to secure the same, including the power of sale therein contained, shall remain in full force and effect, so far as it can be applied hereto, and nothing herein contained shall be construed to impair the security or lien of the holder of said mortgage, nor to affect nor impair any rights or powers which he may have under said note and mortgage for unfulfilment of this agreement.” This extension agreement was acknowledged before a notary public in Ward county on June 10, 1922, but was not recorded. Disputed facts will be mentioned hereafter.

Under the claim that the defendant had not paid the extension interest coupon notes due May, 1923, May, 1924, and May, 1925, the holder of the Griffith mortgage, the executrix of the estate of Hanks, deceased, foreclosed the mortgage, and the certificate of sale was assigned to the plaintiff, who on January 17, 1927, obtained sheriff's deed to the land. Notice of intention to foreclose was served on Stevenson, the record title owner and the mortgagor, but no notice was served upon Coan. It is not contended that the foreclosure of the mortgage by the executrix is not regular in all respects, unless notice of intention to foreclose should have been served upon the defendant Coan, who was living on the land.

The defendant claims the Balsukot mortgage was void because given before the issuance of patent; that he never signed any extension agreement, or, if he did, his signature thereto was obtained by fraud; that the assignment of the certificate of sale on the foreclosure of the Balsukot mortgage was obtained fraudulently by the said Stevenson; that he himself furnished the money to redeem from the foreclosure; that he paid to Stevenson, or to the bank of which Stevenson was an official, all money necessary to pay and satisfy the Churchill mortgage, and that said mortgage was in fact released; that the giving of the Griffith mortgage by Stevenson was in fraud of defendant's rights; that subsequent thereto, through financial transactions, he paid to the bank more than enough to discharge in full the said Griffith mortgage; and that at such time both the bank and Stevenson were agents of the holder of the mortgage to receive said payments.

The trial court found that the Churchill mortgage and the Griffith mortgages executed by Stevenson “were null and void from the beginning”; that Stevenson fraudulently secured for himself an assignment of the certificate of sale under the Balsukot foreclosure while acting as agent for ...