Rohrich v. Rohrich, 880019
| Decision Date | 09 January 1989 |
| Docket Number | No. 880019,880019 |
| Citation | 434 N.W.2d 343 |
| Parties | Roger S. ROHRICH, Sandra B. Rohrich and Wilbert Rohrich, Plaintiffs and Appellees, v. Clarence ROHRICH; Oswald R. Miller, dba Miller Insurance Agency; Michael Kramer, dba K & H Electric; United Accounts, Inc. and all other persons unknown claiming any estate or interest in, or lien or encumbrance upon, the property described in the Complaint, Defendants, and Helen J. Rohrich, Defendant and Appellant. Civ. |
| Court | North Dakota Supreme Court |
Francis C. Rohrich (argued), Linton, for plaintiffs and appellees.
Lundberg, Nodland, Schulz & Lervick, Bismarck, for defendant and appellant; argued by Irvin B. Nodland.
Helen Rohrich has appealed from a summary judgment quieting title to certain real property in Roger, Sandra, and Wilbert Rohrich. We remand for modification of the judgment and, as so modified, we affirm.
Helen and Clarence Rohrich were divorced in 1981. As part of the property settlement Helen quit-claimed to Clarence her interest in certain real property, situated in Emmons County, which was subject to a prior mortgage to the Federal Land Bank. In 1982, Clarence deeded an undivided one-half interest in the land to his brother Roger.
In 1984, Helen obtained a judgment against Clarence in the amount of $20,205. Helen filed the judgment in Emmons County, thereby obtaining a judgment lien against Clarence's interest in the Emmons County property. See Section 28-20-13, N.D.C.C. The Federal Land Bank commenced a foreclosure action in 1985. Helen was named as a defendant but was not properly served. Judgment of foreclosure was entered on June 19, 1986, and on July 24, 1986, the Federal Land Bank purchased the property at the sheriff's sale. On July 14, 1987, the Federal Land Bank assigned the sheriff's certificate of sale to Roger. 1
On May 18, 1987, Helen moved to set aside the judgment in the foreclosure action, alleging that she had not been served or afforded an opportunity to defend. The court ruled that Helen had not been properly served and that the foreclosure proceedings were null and void as to her. On November 18, 1987, an amended judgment was entered, providing in part:
"The above-judgment, as it pertains to defendant Helen J. Rohrich, is in all things null and void and of no force or effect whatsoever as no valid or effective service of process was made upon her at any time in the above matter, and any buyer takes subject to any rights she may have."
While Helen's motion was pending, Roger commenced this quiet title action. Helen answered, asserting that her judgment lien had not been affected by the foreclosure action because she had not been properly served. The court 2 granted Roger's motion for summary judgment, concluding that the failure to serve Helen in the foreclosure action did not elevate the priority of her judgment lien and that the only interest she had in the property was a right of redemption. Although noting in its memorandum opinion that Helen had redemption rights, the court crossed out a provision in the order for judgment which would have given Helen one year from the amended foreclosure judgment dated November 18, 1987, to redeem. The quiet title judgment entered on January 8, 1988, quiets title in Roger without mentioning any redemption rights in Helen. Helen appeals.
Helen argues that the quiet title action is an impermissible collateral attack upon the amended judgment in the foreclosure action, based upon her assertion that the amended foreclosure judgment established the continued validity of her judgment lien. We do not, however, read the foreclosure judgment as determining the priority or validity of Helen's lien. The foreclosure judgment states only that "any buyer takes subject to any rights she may have." The court did not purport to determine what those rights were. Because Helen was not a party to the proceedings and had not raised any defenses, the court clearly could not have determined the extent of her rights in the property.
Helen cites Nelson v. Walrod, 53 N.D. 409, 206 N.W. 218 (1925), error dismissed and cert. denied, 273 U.S. 745, 47 S.Ct. 449, 71 L.Ed. 870 (1927), to support her argument that the result in the prior foreclosure judgment bars the subsequent quiet title action. In Nelson, Walrod had foreclosed a mortgage. Nelson had been served as a party in the foreclosure action, and the judgment of foreclosure specifically "forever barred" Nelson from asserting any interest in or lien upon the property. Nelson's subsequent attempt to bring a quiet title action was held to be an impermissible collateral attack upon the prior judgment of foreclosure.
Nelson is clearly distinguishable from this case. The court in Nelson relied heavily upon the fact that Nelson had been made a party to the foreclosure proceedings and that the judgment specifically decreed that her interest was inferior to Walrod's mortgage. In this case, however, the foreclosure judgment did not determine the extent of Helen's interest in the property or its priority vis-a-vis the Federal Land Bank's mortgage. Nelson does not support Helen's position.
Helen asserts that, in any event, the effect of the foreclosure judgment is to continue her judgment lien against the property. Helen argues that because the Federal Land Bank's mortgage was extinguished and released in the foreclosure action, her lien now enjoys first priority status.
In effect, Helen asserts that the failure to serve her in the foreclosure action has elevated the status of her lien and has given her more rights than she had before the foreclosure action. Courts in other jurisdictions have rejected similar arguments.
Buchner v. Gether Trust, 241 Wis. 148, 5 N.W.2d 806 (1942), is remarkably similar to this case. The mortgagee sought to foreclose its mortgage and named as a party Gether Trust, which had a judgment lien. Gether Trust was not properly served in the foreclosure action. In a subsequent action, Gether Trust asserted that the foreclosure proceedings did not cut off its lien and that, because the foreclosure had extinguished the prior mortgage, Gether Trust's lien was promoted to first priority. Buchner, supra, 5 N.W.2d at 807. In rejecting this assertion the Supreme Court of Wisconsin stated:
"The only cases bearing upon the point in this state, and all of the authorities outside of the state so far as we can discover, hold that where a senior mortgage has been foreclosed without making the claimant of a subordinate lien a party, the proceedings are not null and void but leave the holder of the subordinate lien with the same rights that he would have had had he been made party to the foreclosure proceedings. This implies that his rights are not improved, or the rank of his judgment lien advanced. The rights of the subordinate lien claimant duly served with process in the foreclosure of a senior mortgage are to pay the mortgage or to redeem the property. These rights are unimpaired and unchanged by the defective foreclosure.
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