Court Opinion

ID: 6698477
Source: CourtListenerOpinion
Date Created: 2022-07-20 22:01:50.291612+00
Date Added: 2024-06-11T16:01:19.833680
License: Public Domain

DeviN, J.,
dissenting: Tbe only question raised by this appeal is tbe application of tbe lis pendens statutes (C. S., 500-504). -The pertinent provisions of these statutes are as follows:
*733“In action affecting the title to real property, the plaintiff, at or any time after the time of filing the complaint, . . . may file with the clerk of each County in which the property is situated a notice of the pending of the action, containing the names of the parties, the object of the action, and the description of the property in that County affected thereby” (0. S., 500). “Any party to an action desiring to claim the benefit of a notice of lis pendens, whether given formally under this article or in the pleadings filed in the case, shall cause such notice to be cross-indexed by the clerk of the superior court in a docket to be kept by him to be called Record of Lis Pendens, which index shall contain the names of the parties of the action, where such notice (whether formal or in the pleadings) is filed, the object of the action, the date of. indexing, and sufficient description of the land to be affected to enable any person to locate said land” (C. S., 501).
“From the cross-indexing of the notice of lis pendens only is the pendency of the action notice to a purchaser or incumbrancer of the property affected thereby; and every person whose conveyance or incum-brance is subsequently executed or subsequently registered is a subsequent purchaser or incumbrancer, and is bound by all proceedings taken after the cross-indexing of the notice to the same extent as if he were made party to the action. For the purpose of this section an action is pending from the time of cross-indexing the notice” (C. S., 502).
The provision as to cross-indexing of notice of lis pendens, originally applicable to Buncombe County only, was made State-wide by ch. 31, Public Laws 1919. These statutes are clear and explicit and do not admit of construction contrary to the manifest legislative intent.
It is admitted that at the time of the conveyance to the defendants Irvin in 1939 they had no knowledge whatever of the pendency of the action, or actual knowledge of the deed of trust under which the land is now sought to be sold.
In the majority opinion the decision is made to turn upon the fact that the deed of trust executed in 1927 by Knox and wife was duly recorded, and that by virtue of the registration statutes constructive notice was thereby given to subsequent purchasers. Unquestionably the defendants Irvin, who purchased the land in 1939, and who hold the title of the mortgagors, took with constructive notice of the deed of trust. Though they did not know it, the law fixed them with notice that a deed of trust had been given on this land in 1927. But what notice did they have that a suit to sell the land under this deed of trust had been instituted? The fact that defendants had available means of ascertaining that a twelve-year-old deed of trust remained uncanceled on the record should not be construed as notice that a suit had been instituted thereunder to sell the land upon allegations of failure to pay the debt secured. *734A search of the records in the office of the register of deeds would not have revealed the pendency of a suit involving the title to the land. A search of the records in the clerk’s office would have been equally futile, since the pendency of the action did not appear cross-indexed on the lis pendens docket in that office. A searcher of titles is now no longer required to examine the multitudinous files of civil actions to determine whether an action affecting the title of the land has been instituted. The statute was intended to facilitate the examination of titles and to afford a convenient means of giving notice of suit, and to guard against the consequences of transfers of title pending the action. In this case the plaintiff, apparently, realized the effect of its failure to file notice of lis pendens, for after it learned of the deed to defendants Irvin, it had them made parties to the action. But as to them the statute of limitations had run. While it would be unfortunate for the plaintiff to hold this action barred, it must be remembered that defendants are innocent purchasers for value without notice of the suit. Presumably, if the státute had been observed by the plaintiff, the defendants would not have purchased, and this controversy would not have arisen. The defendants Irvin do not contest the validity of the deed of trust from Knox to the plaintiff. They do not deny constructive notice of its existence. They base their defense on the admitted fact that in good faith they bought the land for full value and without notice of the suit to foreclose. They contend that in the absence of notice of Us pendens they were entitled to a day in court when served with summons, and that they had a right when given notice and made parties in 1940 to interpose any defense at that time available. I do not think the fact of registration of the deed of trust in 1927 should render inapplicable the plain provisions of the statute that, in actions affecting the title to real property, from the cross-indexing of the notice of Us pendens only is the pendency of the action notice to purchasers of the property. No notice of the suit appearing on the Us pendens docket in the clerk’s office and defendants having no other notice, actual or constructive, that a suit had been instituted, as to them there was no suit, and hence when made parties by summons served in 1940 they had the right to set up the defense of the statute of limitations. This is in accord with the explicit language of the North Carolina statutes which, in my opinion, are controlling upon the facts of this case.
I cannot agree that the Us pendens statutes do not cover an action to foreclose a deed of trust on land. A suit for foreclosure is an “action affecting the title to real property.” Its purpose is to sell the land, to transfer the title, to take the title out of one party and put it in another. The prayer for relief is that the land be sold and the title conveyed to the purchaser. 34 Am. Jur., 382; 38 C. J., 33; Horney v. Price, 189 N. C., 820. 128 S. E.. 321.
*735The only authority cited in support of the opinion on this point is Pierce v. Mallard, 197 N. C., 679, 150 S. E., 342. In that case it was held that proceedings in attachment were not required to be docketed on the record of lis pendens. But this decision was based expressly on the ground that the statutes refer to an action affecting the title to real property. The Court said: “A warrant of attachment is not an action ‘affecting the title to real property.’ The warrant of attachment is not an action, but is ancillary and auxiliary to the action. ... As said, the warrant of attachment is not an action affecting the title to the real property. The title of the owner of the land is not brought into dispute. The attachment merely seizes the property and holds it in custodia legis until the final determination of the action or until the property is released pending the action, when seized without proper cause. All the notice anyone is entitled to in cases where warrants of attachment are issued, is such as is contained in C. S., 807, supra.”
It seems to me clear that the words “action affecting the title to real property,” ex vi termini, by force of the unambiguous language employed, necessarily include an action to sell land under the power contained in a deed of trust. To exclude foreclosure suits from the coverage of the statutes would seem to restrict their provisions contrary to the intention of the lawmaking power.
It may be noted that the statute originally contained specific reference to actions to foreclose mortgages (Rev., 460), and required that notice of Us pendens in those cases be filed twenty days before judgment. This limitation was stricken out by ch. 106, Public Laws 1917, and foreclosure suits placed on the same footing as other actions affecting the title to real property.
Jones v. Williams, 155 N. C., 179, 71 S. E., 222, cited in the opinion, was decided in 1911, before the enactment of the lis pendens statute now in force. At that time the filing of the complaint describing the land, the title to which was to be affected by the suit, was regarded as sufficient notice of the pendency of the suit. Since then the unequivocal language of the statute has declared, “From the cross-indexing of the notice of Us pendens only is the pendency of the action notice to a purchaser or incumbrancer of the property affected thereby.”
While a purchaser cannot acquire a greater interest than his grantor possesses, in many instances sanctioned by the law a purchaser in good faith for value and without notice has a different standing from that of his grantor, and is freed from restrictions and limitations otherwise applying, and may avail himself of defenses not open to his grantor. C. S., 1009; Bank v. Mackorell, 195 N. C., 741, 143 S. E., 518; Spence v. Pottery Co., 185 N. C., 218, 117 S. E., 13; Cox v. Wall, 132 N. C., 730, 44 S. E., 635. Nor do I agree that harmful consequences might *736flow from the application of a plainly worded statute, the observance of which is both convenient and simple. Tax foreclosures and mechanics’ liens are not affected. In the one case, notice is presumed, and in the other the lien is recorded in the clerk’s office. 34 Am. Jur., 383.
I think there was error in the ruling of the court below.