Court Opinion

ID: 6893148
Source: CourtListenerOpinion
Date Created: 2022-07-23 21:46:45.258983+00
Date Added: 2024-06-11T16:05:53.692728
License: Public Domain

Shattuck J.
The questions for decision by this court are these: 1st. What effect is to be allowed to these mortgages respectively, and relatively, to each other. 2d. What relation do the parties to this decree sustain to each other, and to the property involved. 3d. Had Wood a right to redeem; and if so, what estate, and upon what terms.
Chavener insists that his mortgage is a valid lien, prior to that of Wood, upon the whole lot, as well as upon the interest of H. H. Haines; and claims a full payment of his debt out of the proceeds of the property; although, on account of being the purchaser, he does not appeal from the decree of the court below. Wood, on the other hand, insists that Chavener’s mortgage is only an equitable mortgage, and should be postponed as to the interest of both the Haines brothers to his own.
We are of opinion that neither of these claims is altogether just, or authorized by our statutes. Upon authority of the elementary writers, and of the cases adjudged, as well as upon the reasonable and consistent view of such transactions, we hold that a deed made by one partner, in the name of the firm, purporting to convey away the property of the firm is valid and effectual, as a conveyance of the interest of the partner, who, as in this case, has affixed Iris own name to the deed and personally acknowledged it, as well for himself as for the firm. The circumstance of undertaking to convey the estate of his copartners, and describing the granters, as well in the body of the deed as in the signature, as “ I D. Sames c& Bro.f does not change the fact that I. D. Haines signed, sealed and acknowledged the deed for himself; nor can it alter the manifest intention of the party to convey his own interest. Story on Part., secs. 91, 119, 120, and authorities there cited; 2 Hil. R. Est., ch. 84, secs. 10-11, and references; 9 Johns., 285 ; Statutes of 1855, p. 116, sec. 1. We think the. mortgage to Chavener was a good and sufficient conveyance of the legal estate of I. D. Haines in the property mortgaged, for the purposes mentioned in the instru*186ment; and that as to the interest of I. D. Haines, it was duly recorded, and is prior to that of "Wood. "We also conclude, upon the authorities above referred to, that it is a good, equitable mortgage as to the interest of E. H. Haines; because he had knowledge of and assented to its execution, and the money for the payment of which it was given as a security, was used in the partnership business. As between Chavener and E. H. Haines, the whole land was equitably bound for Chavener’s debt; but it appears from the evidence that "Wood had no actual notice of the equities subsisting between Chavener and E. H. Haines, and did not, in fact, know' of Chavener’s mortgage until long after his own had been executed. He was, nevertheless, chargeable with knowledge from the record of that mortgage, so far as the same was properly admitted to record; that is, according to our views, as to the interest of I. D. Haines; but as to the interest of E. H. Haines, "Wood’s mortgage is prior to that of Chavener, because, besides having an equity, as a condition, equal to Ohevener’s, he has also the legal estate, and, according to the maxim in equity applicable in such cases, is to be preferred. "We hold, therefore, that the rulings and- decree of the court below were correct, and ought, in this respect, to be affirmed. The relations of the parties to this decree and to the property involved have been discussed. This depends upon the construction of the statute. Section 40 of the Code provides that, in a suit of this kind, “ any person having a lien subsequent to the plaintiff, &c., &c., shall be made a dfendamt, &c.” And section 412 requires the court to make “ a decree in reference to such lien, and the debt secured thereby, as if the defendant were a plaintiff in the suit.” Section 413, last clause of sub-division two, declares that such decree “ shall be deemed a separate decree” as to each person having a separate lien, and it “ may be enforced accordingly.” We hold that this decree is, in respect to the several rights of Chavener. and "Wood, by a fair construction of the statute, to be regarded as a separate decree for each; and that, for most purposes, it leaves the *187parties as they would be if there had been a separate suit and decree therein on behalf of each. Upon the question of redemption, it is claimed that, under the statute providing for redemption, the liens of these mortgages were merged in the decree, and, for the purposes of redemption, the parties have contemporaneous liens, and there is no place for redemption. This point is disposed of by the opinion we have expressed above concerning the relation of the parties to each other and to the property involved in the decree. The priority of a party’s lien is in no way affected by such decree. The decree may ascertain and declare what it was and legally ought to be, but cannot divest it. It is further claimed, that if "Wood had a right to redeem, he could do so only upon the payment of the whole of Chavener’s judgment and decree; since Chavener is purchaser on the sale, and the amount of his debt justly exceeds the amount of his bid. The money paid upon redemption was only the amount bid and interest, as required by statute. We do not think the claim here made should be allowed. Section 298 of the Code provides as follows: “ A lien creditor may redeem the property within sixty days from the date of the order confirming the sale, by paying the amount of the purchase money, with interest, at the rate of two per centum per month, thereon from the time of sale, together with the amount of any taxes which the purchaser may have paid thereon; and, if the purchaser be also a creditor, having a lien prior to that of the redemptioner, the amount of such lien, with interest.” The last clause of this section, providing that “ if the purchaser be also a creditor, having a lien,” &c., we think contemplates and refers to some other lien than that upon which the sale is made.
The object of a sale is to extinguish the specific lien upon the particular property sold by appropriating the property, or so much of it as is necessary to the payment of the debt. A purchase upon execution accomplishes this object, and divests the holder of the lien upon which execution issued, of any further claim; and by the purchase, a pur*188chaser acquires no rights as against a redemptioner, except to tack to his bid any lien he may hold, intervening between the judgments or decree on which the sale was made,, another lien of the redemptioner, or which Is altogether prior to the lién of the execution creditor. This is clearly so in case the pmchaser is a stranger to the judgment or decree on which the sale was made, and it cannot be contended that, when a stranger purchases property at an execution sale, the execution creditor has a right take the property from the purchaser by paying the amount bid and interest at two per centum per month, for the purpose of tacking thereto the unpaid balance of his judgment. We are unable to perceive any difference when the execution creditor is himself the purchaser. We do not think that an execution creditor, by becoming a purchaser upon his own execution,, can alter the character and effect of the sale, or establish any new relation between a purchase on execution and the lien upon which it is based. By bidding in the property, an execution creditor elects to take the land of his debtor for so much as he bids, and to look to other property of his debtor for the balance of his debt. Upon this construction of the statute, and upon the facts in this case, we hold that Ohavener is to be deemed to have a decree for the sale of the interest of I. D. Haines in the property mortgaged, and Wood to have a decree for the sale of the entire estate of both the Haines brothers in the property, subject, however, to the prior lien of Ohavener upon the undivided half belonging to I. D. Haines; and that the sale is in effect the same as a sale upon several executions issued upon such decrees. Chavener, by his bid, became the purchaser of the whole estate; of the interest of B. H. Haines, absolutely, as. to Wood, and of the interest of I. D. Haines, subject to-redemption by Wood. The interest of B. H. Haines is not redeemable by Wood, because it was sold as upon Wood’s execution, and he received the purchase money. The interest of I. D. Haines may be redeemed by Wood upon paying *189one-half the amount of the money bid for the whole property and interest at two per centum per month; and the order of the court below is modified in conformity with these views. Costs in this court and in the court below to be paid by the appellant and respondent in equal shares.
Let the judgment be so modified.