Ueland v. More Bros.

• Decision Date: 25 November 1911
• Citation: 22 N.D. 283,133 N.W. 543
• Parties: UELAND v. MORE BROS. et al.
• Court: North Dakota Supreme Court

22 N.D. 283

133 N.W. 543

UELAND

v.MORE BROS. et al.

Supreme Court of North Dakota.

Oct. 26, 1911.

On Petition for Rehearing, Nov. 25, 1911.

Syllabus by the Court.

Plaintiff claims right to sheriff's deed on foreclosure after expiration of period of redemption, and denies the validity of More Bros.' redemption under a subsequent mortgage. The owner gave his first mortgage, the one foreclosed upon by plaintiff. Thereafter he deeded the land as a part payment for threshing machinery purchased of his grantees, with the understanding that the same should not be recorded and the purchase of the machinery be closed until the machinery should be tested and be approved by him. The machinery was delivered, proving worthless, and he rescinded the contract and delivered back the machinery, which was accepted by his grantors. More Bros. had full knowledge of the transaction, but, prior to said rescission, procured delivery to them by the grantors of the unrecorded deed, together with a mortgage given by said grantees to More Bros., securing a past indebtedness, and thereupon recorded both deed and mortgage. Thereafter the grantor obtained judgment against his grantees for reconveyance and cancellation, and the land was accordingly reconveyed. But More Bros. were not made parties to, and did not appear in, said action. Thereafter foreclosure of the first mortgage was had by this plaintiff, and More Bros. redeemed under said second mortgage. Plaintiff brings this action to cancel said voidable mortgage to More Bros., and compel sheriff to issue deed on foreclosure to plaintiff, instead of to More Bros., to whom sheriff has issued certificate of redemption. It is held: Under section 4954, Codes 1905, following holding in Sargent v. Cooley, 12 N. D. 1, 94 N. W. 576, the manual delivery of the deed to the owners' grantees being admitted, the intent of the parties that a condition precedent to its operation shall exist is abrogated by the statute, and such a delivery is absolute, and conveys title to the grantees to whom the same was by the grantor delivered.

Legal title existing in such grantees their mortgage to More Bros. is valid until set aside, and the judgment obtained to which said mortgagees were not parties in no wise affects their right of redemption under their mortgage, the judgment not operating against them in personam nor binding them as a judgment in rem; the judgment being subsequent to and no part of More Bros.' chain of title.

More Bros. under their statutory right to redeem are entitled to sheriff's deed on their redemption made.

Appeal from District Court, Lamoure County; Burke, Judge.

Action by L. A. Ueland against the More Bros. and another. From a judgment for plaintiff, defendants appeal. Reversed and remanded.

Davis, Warren & Hutchinson and Ball, Watson, Young & Lawrence, for appellants. F. H. Larsen and Engerud, Holt & Frame, for respondent.

GOSS, J.

Briefly recited, the following are the facts in this case: Plaintiff L. A. Ueland was a purchaser at a foreclosure sale, and there was issued to him the usual sheriff's certificate on foreclosure. The land so sold had previously belonged to and was mortgaged by M. A. Ueland, a brother of L. A. Ueland. Plaintiff brings this action to quiet title in him and to compel issuance to him of a sheriff's deed. He claims no legal redemption has been made during the redemption year, and that a subsequent mortgage of the premises by M. A. Ueland's grantees, Hiller & Hasz, under which More Bros. have sought to redeem, is void, and confers on them no right to redeem.

Some years after giving the mortgage on which foreclosure was had, M. A. Ueland and wife purchased certain threshing machinery through Hiller & Hasz, who, in turn, dealt with the machine company through More Bros. as state agents for said machine company. In addition to the usual order for machinery signed by M. A. Ueland and Hiller & Hasz, M. A. Ueland had the following separate agreement with Hiller & Hasz, viz.: “It is hereby agreed by and between Hiller & Hasz, as party of the first part, and M. A. Ueland, party of the second part, that, if the machinery (describing it) does not fulfill the guaranty as given by manufacturers of above machinery, then Hiller & Hasz are to take the same off from my land and return papers and all notes given in payment for above mentioned machinery without expense to me.” Contemporaneous with such agreement, and as the papers mentioned therein, M. A. Ueland and wife, grantors, executed their warranty deed to the land involved to Hiller & Hasz as grantees for and as a $2,165 payment of the contract purchase price of the machinery; also executing notes, secured by chattel mortgage, for $1,135, to Hiller & Hasz as payees, as the balance of the $3,300 purchase price for such threshing machinery. These papers were delivered to Hiller & Hasz with the understanding that the same would not be recorded until the machinery had proven satisfactory to M. A. Ueland, purchaser, which fact, together with the details of the agreement between Hiller & Hasz and M. A. Ueland, was known to More Bros., one of whom, J. L. More, was present during the transaction and signed as a witness the deed and chattel mortgage, and became fully aware of all of the details of the entire transaction. Under the terms of the order, the machinery was shipped to More Bros. in care of Hiller & Hasz, with purchase price to be paid by Hiller & Hasz to More Bros., with whom all settlements were to be had, practically making More Bros. the sellers of the machinery to Hiller & Hasz their agents, who, in turn, resold to M. A. Ueland, the real purchaser. Delivery was thereafter had of the machinery; the same proving worthless. Thereupon Hiller & Hasz in fulfillment of their contract accepted the machinery back from M. A. Ueland on his rescission of the contract. Prior to such rescission, during the time the machinery was being tried, More Bros. demanded a settlement with Hiller & Hasz, and procured from them the unrecorded deed from M. A. Ueland to Hiller & Hasz. They also procured Hiller & Hasz to give them, More Bros., a mortgage on the land to which Hiller & Hasz still held the unrecorded deed of M. A. Ueland and wife. This mortgage was for $1,805 and interest, the amount then owing on this and other transactions by Hiller & Hasz to More Bros., and was, together with said Ueland deed, immediately placed on record by More Bros. Afterwards M. A. Ueland began an action for rescission of the contract and cancellation of the deed of himself and wife to Hiller & Hasz, and secured a judgment against Hiller & Hasz by default, adjudging the mortgage void, canceling the notes given, and directing Hiller & Hasz to redeed the land to M. A. Ueland, which was done. More Bros. were not made parties to this action, and did not participate therein, although they held the mortgage of Hiller & Hasz to them, which mortgage was of record at and prior to the time of commencement of the action by M. A. Ueland against Hiller & Hasz. The deeds above mentioned and the mortgage from Hiller & Hasz to...