Small v. Carey

• Court: Oregon Supreme Court
• Writing for the Court: Before O'CONNELL; TONGUE
• Citation: Small v. Carey, 522 P.2d 1202, 269 Or. 35 (Or. 1974)
• Decision Date: 31 May 1974
• Parties: Jim SMALL et ux., Appellants, v. Carol Bailey CAREY et al., Respondents.

Page 1202

522 P.2d 1202

269 Or. 35

Jim SMALL et ux., Appellants, v. Carol Bailey CAREY et al., Respondents.

Supreme Court of Oregon.

Argued and Submitted May 6, 1974.

Decided May 31, 1974.

Stephen Bruce Main, Pendleton, argued the cause and filed the brief for appellants.

Robert T. Mautz, Pendleton, argued the cause and filed the brief for respondents.

Before O'CONNELL, C.J. and McALLISTER, DENECKE, HOLMAN, TONGUE and HOWELL, JJ.

TONGUE, Justice.

This is a suit for declaratory judgment to have a warranty deed, absolute in form, declared to be a mortgage and to declare that plaintiffs are the owners of certain real property in Umatilla County. The trial court entered a decree in favor of defendants based upon defendant's motion for judgment on the pleadings. Plaintiffs appeal. We affirm.

The facts are not in dispute. In 1969 plaintiffs entered into a transaction with L. R. Bailey and his wife, who were residents of Washington and are now both deceased. As a part of that transaction, and in consideration of $21,000, plaintiffs delivered to the Baileys a warranty deed to their land in Oregon. At the same time, the Baileys gave plaintiffs a one-year option to repurchase the land for $26,000. Plaintiffs did not exercise the option and a dispute arose between the parties.

Plaintiffs then filed a suit in equity against the Baileys in the Superior Court of Benton County, Washington, alleging that the transaction was intended to be a loan at an usurious rate of interest, with the deed as security, and praying for a decree canceling and declaring void the deed and option, enjoining the Baileys from 'alienating title' in the land, and providing that 'should Defendants refuse to reconvey said real estate unto Plaintiffs' a commissioner would be appointed to execute and deliver to plaintiffs the 'necessary instruments' to restore title to them.

A written settlement agreement was then reached by the parties under which plaintiffs were given another year to exercise their option. On the basis of that agreement, and by stipulation and motion of both parties, the suit in Washington was then dismissed with prejudice.

Plaintiffs were again unable to exercise their option and commenced this suit to have themselves declared to be the owners of the property in fee simple and to have the deed and option declared to be a mortgage.

Defendants filed an answer alleging the filing and termination of the Washington proceedings as an affirmative defense and as Res judicata of the issues in this suit.

In appealing from the 'decree on the pleadings' plaintiffs contend that the decree of the Washington court was not Res judicata because it did 'not have jurisdiction to rule on questions of title concerning real property situated in another state,' citing Williams v. Williams, 83 Or. 59, 62, 162 P. 834 (1917), among other authorities. Plaintiffs also contend that 'jurisdiction cannot be waived by the parties by consent or stipulation, nor can want of jurisdiction be remedied by waiver or estoppel,' citing Wink v. Marshall, 237 Or. 589, 392 P.2d 768 (1964), among other authorities.

In response, defendants contend that the Washington courts recognize a distinction between the jurisdiction of its courts to pass judgment on the title to land in another state and jurisdiction over a transitory action or suit in personam 'aimed at personal relations of parties in connection with the property beyond the jurisdiction,' citing Silver Surprize, Inc. v. Sunshine Mining Company, 74 Wash.2d 519, 445 P.2d 334, 338 (1968). To the same effect, see Oestreich et al. v. Ocean Shores Estates, Inc., et al., 83 Wash.2d 143, 516 P.2d 507 (1973), and Smith v. Fletcher, 102 Wash. 218, 173 P. 19, 20 (1918).

The assumption underlying this contention by defendants is that this is a question to be determined by the law of Washington, rather than by the law of Oregon. Plaintiffs make no contention to the contrary. We need not decide in this case, however, whether the qrestion is to be determined by the law of Washington or by the law of Oregon, because it appears that the law of Oregon, as established by the decisions of this court, is substantially the same as the law of Washington on this question. Thus, Blue River Sawmills et al. v. Gates et al., 225 Or. 439, 358 P.2d 239 (1961), was also a suit in equity in which the plaintiffs sought to have a deed, absolute on its face as a conveyance of real property in Canada, declared to be a mortgage, just as these plaintiffs sought by their previous suit in Washington to have a warranty deed to land in Oregon declared to have been given as security for a loan.

In rejecting the contention that the Oregon court had no jurisdiction this court held (at 476, 358 P.2d at 256) that:

'A court of equity having jurisdiction over the parties, as here, may administer full relief without regard to the nature or situation of the property involved, and may compel action with respect to land which lies beyond its jurisdiction as by conveyance thereof, provided it...