Court Opinion

ID: 7064365
Source: CourtListenerOpinion
Date Created: 2022-07-24 07:24:21.063367+00
Date Added: 2024-06-11T16:12:18.981147
License: Public Domain

On Petition eor Rehearing.
Myers, J.
Apellants have filed a petition for a rehearing, assigning many reasons therefor, and supporting the same by a vigorous brief.
10. In view of their apparent earnestness in this matter, we have again taken the time thoroughly to consider the record and arguments of counsel. Erom this investigation we are led to believe that appellants’ trouble comes from a mistaken idea of the theory of this suit. They admit they “were misled to directing a defense of a complaint to quiet title upon the ground of undue, fraudulent practices upon appellee during mental incapacity, whereby he was prevented from a hearing in court on the foreclosure suit.” The complaint does contain a number of averments relative to appellee’s mental condition prior to and about the time the foreclosure proceedings were had. What may have been the pleader’s object in *328pleading these facts is not clear, unless it was for the purpose of showing an excuse for not sooner offering to redeem, but these facts are not the leading and controlling facts in the pleading, and upon an examination of the whole record, evidence and briefs of counsel (Carmel, etc., Improv. Co. v. Small [1898], 150 Ind. 427, 435) it is apparent that the cause was tried upon the theory of an equitable proceeding to redeem the land from the foreclosure sale, as well as to quiet the title thereto.
2. Appellants’ petition is largely predicated upon the fact that we did not, in our original opinion, take up each pleading separately and pass on it. There is no reason for extending the opinion for such purpose, where the special findings exhibit the same facts as those found in the pleadings, and error is assigned on an exception to the conclusions of law. Ray v. Baker (1905), 165 Ind. 74; Ross v. Van Natta (1905), 164 Ind. 557.
3. A reference to our former opinion will show that the particular defects in the complaint most earnestly insisted upon by appellants, namely,
5. failure to aver disaffirmance by appellee of his deed to Skinner, and facts showing that Alvey was not a good-faith purchaser, are therein referred to and decided, and upon a reexamination of these questions we find no reason to change our former conclusion.
11. Appellants also insist that the complaint is not sufficient to withstand a demurrer for want of facts, as a complaint for equitable redemption, because there is no averment of a tender or offer to pay the amount of the insurance company’s judgment, together with interest thereon. While the complaint contains no direct averment of this fact, yet the facts averred show an excuse for not offering to pay the sum then due by averring facts showing that appellant insurance company is holding certain credits to which appellee is entitled, in reduction of the amount due to redeem, which can only be determined *329upon an accounting, which is prayed, and that he “be allowed to redeem from the sale, as aforesaid, made by the sheriff by paying said defendants, or either of them, as the court may determine, such sum as the.court may find to be due.”
In our opinion, the facts pleaded are sufficient to bring the case within the equitable doctrine, that where a lien holder has credits in his hands which should be applied to the discharge of the lien, it is not necessary to aver in a complaint for an equitable redemption a tender of the amount fixed by the lien, or an offer to pay that amount, but an offer to pay whatever sum shall be found due upon taking the account. Kemp v. Mitchell (1871), 36 Ind. 249, 255, and cases cited; Horn v. Indianapolis Nat. Bank (1890), 125 Ind. 381, 9 L. R. A. 676, 21 Am. St. 231; Coombs v. Carr (1876), 55 Ind. 303, 309; Nesbit v. Hanway (1882), 87 Ind. 400.
12. Appellee was the mortgagor and was claiming to be the owner of the land, and that his deed to Skinner had been procured by fraud and without consideration. Appellant insurance company had notice of these claims upon the part of appellee while it was still a lien holder. These claims it could have put at rest by a suit to foreclose appellee’s equity of redemption. Curtis v. Gooding (1884), 99 Ind. 45, 48. This it did not do, and as appellee was not a party to the foreclosure proceedings, such proceedings as to him were a nullity. Watts v. Julian
(1890), 122 Ind. 124; Petry v. Ambrosher (1885), 100 Ind. 510; Curtis v. Gooding, supra; Scates v. King (1883), 110 Ill. 456; Gage v. Brewster (1865), 31 N. Y. 218.
13. But appellants say that because appellee conveyed the land to Skinner prior to the beginning of the proceeding to foreclose its mortgage, he was therefore not a necessary party. As a general proposition, this statement is correct, where the mortgagee is simply insisting upon the benefit of his Hen; but where a personal *330judgment is sought against the mortgagor or grantor, as was done' in that case, “then he must be made a partj to the action in order to obtain a judgment against him, bar his equity of redemption or foreclose his rights” (Petry v. Ambrosher, supra), and in any event was a proper party, and the better practice required that he be made a party. Curtis v. Gooding, supra. The exception to the general rule in this regard is well illustrated in the case at bar, as future developments proved the truth of appellee’s contention, and therefore the controversy arising upon such a state of facts is properly submitted to a court of equity, that the interest of the parties may be considered and determined purely from merit, freed from formality, to the end that neither shall have an unconscionable advantage of the other.
14. We find no reason for changing our former opinion as to the effect of the lis pendens notice. The doctrine of such notice originated In equity, and is recognized as an important factor in determining property rights. Being wholly equitable in character, its application must be made along the line of equitable principles, and the maxim, equity regards substance and intent rather than form. Therefore it cannot be said that the advantage of this notice in the furtherance of exact justice shall be rendered ineffectual by technical construction. In speaking of this notice, appellants confidently assert that there is great difference between ownership absolute, as stated in the Us pen-dens, and notice of a right to redeem. This is true, for a right to. redeem does not necessarily imply ownership or title, while ownership or title does carry with it, as a matter of law, the right to redeem. It must be admitted that appellant Alvey was a purchaser pendente lite, and as such had notice of the then pending suit and of every fact pertinent to that issue.
*33115. *330The character of his deed would also be a material fact in this proceeding. By reference to the special findings it *331will be observed that in 1895 appellant insurance company conveyed the land by deed to its coappellant Alvey. This finding is in accordance with Alvey’s answer and the evidence. Therefore, the conveyance being by deed, and the kind of deed not found, we look to our statute, where we find two forms designated— quitclaim and warranty — and, nothing to the contrary appearing, it may be inferred that one or the other of these forms was used. If the first, it served to pass only the present interest of the grantor. §§3343, 3347 Burns 1901, §§2924, 2928 E. S. 1881; Stephenson v. Boody (1894), 139 Ind. 60. If the latter, it shall be deemed to convey a fee-simple title with covenants that the grantor “is lawfully seized of the premises, has good right to convey the same, and guarantees the quiet possession thereof; that the same are free from all encumbrances, and that he will warrant and defend the title to the same against all lawful claims.” §3346 Burns 1901, §2927 E. S. 1881. The force and effect of these deeds as a warning to the purchaser as to the strength or character of title or interest conveyed is widely different. The former is of itself notice to the purchaser that he is accepting a doubtful title, and is sufficient to put him upon inquiry regarding it. Meikel v. Borders (1891), 129 Ind. 529, 533; Steele v. Sioux Valley Bank (1890), 79 Iowa 339, 44 N. W. 564, 7 L. R. A. 524, 18 Am. St. 370; Arlington, etc., Elev. Co. v. Yates (1898), 57 Neb. 286, 77 N. W. 677; Peters v. Cartier (1890), 80 Mich. 124, 45 N. W. 73, 20 Am. St. 508; Condit v. Maxwell (1898), 142 Mo. 266, 44 S. W. 467; Smith v. Rudd (1892), 48 Kan. 296, 29 Pac. 310; Goddard v. Donaha (1889), 42 Kan. 754, 22 Pac. 708; Gest v. Packwood (1888), 34 Fed. 368; Clemmons v. Cox (1896), 114 Ala. 350, 21 South. 426; 2 Pomeroy, Eq. Jurisp. (3d ed.), §753.
While a “title by warranty, for like reason, the form of the latter deed furnishes sufficient assurance to justify confidence that upon inquiry the title” will be found good and *332unencumbered. Rinehardt v. Reifers (1902), 158 Ind. 675.
16. Applying tbe rule that all reasonable presumptions are to be indulged by this court in favor of the proceedings of the trial court (Campbell v. State [1897], 148 Ind. 527; Center School Tp. v. State, ex rel. [1898], 20 Ind. App. 312), it-might be said that the deed in this ease, in the absence of a contrary showing, was a quitclaim, and that appellee was entitled to the benefit of this fact in support of his judgment.
As bearing on the question of facts known to the purchaser, or which he might have known by making inquiry, this court in Toledo, etc., R. Co. v. Fenstemaker (1892), 3 Ind. App. 151, 154, said: “One can not purchase property where therp are facts known to him sufficient to put him on inquiry, and hold it free from prior claims or equities of which due inquiry would have given him information. A party in possession of certain information will be chargeable with knowledge of all facts which an inquiry suggested by such information would have disclosed to him.”
17. Appellee’s right to redeem after the year allowed by statute therefor, as we see this case, is beyond question. It might be inferred from appellants’ argument that they question this proposition, for in substance they say, if appellee was the owner of the land at the time he filed his Us pendens, he has ever since been the owner, and might have redeemed at any time during the year allowed by our statute for redemption. This is true, but if he was not a party to the foreclosure proceeding, and was the owner of the land, or rather the equity of redemption, his right to redeem was not limited to the statutory period. Jewett v. Tomlinson (1894), 137 Ind. 326, 329; Nesbit v. Hanway, supra; Hodson v. Treat (1858), 7 Wis. *263.
*33318. Appellants also bitterly complain of the action of the trial court in taking into account the question of taxes, rents and improvements. They insist that any question in that regard ought not to have been injected into this controversy, upon the theory that they are independent of appellee’s right to redeem, and one that requires an entire separation in order to adjust the rights between appellants. Appellee tendered this issue. He was in a court of equity, and was entitled to have this issue, as between appellants and himself, determined. Gaskell v. Viquesney (1890), 122 Ind. 244, 248, 17 Am. St. 364; Dailey v. Abbott (1883), 40 Ark. 275, 282; Ruckman v. Astor (1842), 9 Paige 517.
In Dailey v. Abbott, supra, it is held: “As long as the right of redemption exists, the mortgagor is entitled to rent, if the mortgagee is in possession, taking the rents and profits. The statute prolongs the mortgagor’s right of redemption for one year after the sale. The purchaser at the sale takes the place of the mortgagee, and if he takes possession of the land before the period of redemption expired, there is no good reason why he should not be accountable for the rents and profits. On redemption he gets the purchase money with interest at ten per cent. His vendor occupies no better position. 2 Jones, Mortgages, §1118.”
As between appellants, this issue was not tendered, hut we see no reason why their rights might not have been adjudicated in this suit, had they chosen to tender that issue, upon the theory of preventing a multiplicity of suits, but as this question is not before us, we decline further to, consider it.
19. Appellants in their petition for a rehearing complain because we did not consider the sufficiency of the evidence to support the special findings. In their original presentation of the case this question was not raised, and, not having been presented then, they are not entitled to raise it now and have it considered on a petition *334for a rehearing. Indiana Power Co. v. St. Joseph, etc., Power Co. (1902), 159 Ind. 42; Sunnyside Coal, etc., Co. v. Reitz (1896), 14 Ind. App. 478.
Finding no reason for changing onr former opinion in this case, the petition for a rehearing is overruled.