Court Opinion

ID: 6975318
Source: CourtListenerOpinion
Date Created: 2022-07-24 02:09:57.11932+00
Date Added: 2024-06-11T16:08:57.611772
License: Public Domain

Mr. Justice Cooke delivered the opinion of the court: Appellee, Flora Strause, brought suit in forcible entry and detainer in the circuit court of Peoria county to recover possession of certain premises from the appellants, Mae E. Dutch and Charles C. Dutch. On a hearing before the court on stipulation of the facts judgment was rendered for appellee. This judgment was affirmed by the Appellate Court for the Second District. Having secured a certificate of importance, appellants have appealed from that judgment. Appellants executed three trust deeds to the premises in question. The first and third in point of priority were given to secure notes held by the Interstate Bank and Trust Company for $5000 and $2500, respectively, and the second was to secure a note held by Arthur Keithley for $3000. The Interstate Bank and Trust Company brought suit to foreclose its first and third trust deeds, tO' which suit Keithley was made a party. Decree of foreclosure was entered at the May term, 1907. By this decree the amount due on each of the three trust deeds was found, a sale of the premises ordered, and the proceeds of the sale were directed to be applied, first, to the payment of the note secured by the first trust deed; second, to the payment of the note secured by the second trust deed held by Keithley; and third, to the' payment of the note secured by the third trust deed. The decree also provided that if the amount realized should not be sufficient to pay the full amount of the indebtedness due the Interstate Bank and Trust Company it should be entitled to a deficiency decree for the balance. The premises were sold under this decree for an amount sufficient to pay in full the note secured by the first trust deed and the costs of the suit and $400, which was applied on the Keithley indebtedness. The property was purchased by Edgar A. Strause, the husband of appellee. The sale was confirmed on September 11, 1907, and the Interstate Bank and Trust Company thereafter secured a deficiency decree against appellants for the sum of $2686.90, which decree provided “that plaintiff have execution therefor as. upon a judgment at common law.” No deficiency decree was entered in favor of Keithley. Neither the appellants nor any other persons authorized to do so by the statute redeemed from the sale within twelve months. On August 15, 1908, the Interstate Bank and Trust Company sued out an execution on its deficiency decree, paid to the sheriff the amount required to redeem from the master’s sale, (which amount was accepted by Edgar A. Strause,) and caused the execution to be levied upon the premises as provided by statute. On October 13, 1908, the premises were sold under this execution to appellee, and on December 13, 1908, the sheriff, in pursuance of the certificate of purchase issued at the time of the sale, executed to appellee a deed to the premises. It is under this deed that appellee claims title. The only question for our determination is, whether a mortgagee who has secured a deficiency decree after the sale of the mortgaged property in foreclosure proceedings is such a decree creditor as is entitled, under the statute, to redeem the premises sold. Upon the sale of the premises to Strause under the foreclosure decree the liens of the two trust deeds upon which the foreclosure suit was predicated were extinguished. Those liens no longer existed, and the complainant in the foreclosure suit had secured every benefit possible to be secured under such liens. The debt itself, however, was not extinguished. A portion of it remained unsatisfied by reason of the failure of the property to sell for the full amount of the indebtedness. Under such circumstances the creditor, if personal service has been had upon the debtor, may have a deficiency decree for the balance due, upon which execution may issue as on a money decree, (Hurd’s Stat. 1909, chap. 95, sec. 16,) or he may bring his action at law and secure judgment for the balance due. Such deficiency decree or judgment is secured by no lien whatever. It is not based upon the lien of the mortgage, but upon the personal liability of the mortgagor tO’ pay the full amount of the indebtedness secured by the mortgage. A creditor with such a decree or judgment is on the same footing with any other decree or judgment creditor of the debtor, and is entitled to employ the same means to enforce his decree or judgment. Our statute, after making provision for the redemption of property sold under execution or decree by any defendant, his heirs, administrators, assigns, or any person interested in the premises through or under him, within twelve months after the sale, provides: “If such redemption is not made, any decree or judgment creditor, his executors, administrators or assigns may, after the expiration of twelve months and within fifteen months after the sale, redeem the premises,” etc. (Hurd’s Stat. 1909, chap. 77, sec. 20.) Under this statute, which is plain and unambiguous in its terms, the Interstate Bank and Trust Company had a clear right to redeem the premises. To hold otherwise would not only have the effect of limiting the decree or judgment secured for the deficiency and putting it in a class by itself, but would work a hardship on the debtor. We have repeatedly held that a liberal construction is to be given to our redemption laws, to the end that the property of the debtor may pay as many of the debtor’s liabilities as possible. (Schuck v. Gerlach, 101 Ill. 338; Whitehead v. Hall, 148 id. 253; Strauss v. Tuckhorn, 200 id. 75.) The object in allowing judgment creditors to redeem is to prevent a sacrifice of the debtor’s estate, and to allow as many of his judgment creditors as can, to secure the payment of their judgments by making an advance which the debtor cannot or will not make himself. (Sweezy v. Chandler, 11 Ill. 445.) In this case appellants did not redeem, but their failure to redeem within twelve months did not deprive them of all interest in the premises. They still had an equity, which would not be extinguished until the full period of redemption had passed and a deed had issued to the purchaser. (Lightcap v. Bradley, 186 Ill. 510.) It is a matter of common knowledge that real estate values, either from general or local causes, make sudden and material advances. To deprive a creditor in a deficiency decree of the right to redeem as a judgment creditor might in many instances prevent the debtor from securing the full value of his equity and the extinguishment of his debt. It is insisted that a creditor cannot redeem from his own sale. No such general rule has been laid down by this court. On the contrary, in Tewalt v. Irwin, 164 Ill. 592, it was held that a creditor might redeem from his own sale. In that case Lagow foreclosed his mortgage against Tewalt. While the statutory period of redemption was running Tewalt died. The probate court allowed a claim against the estate in favor of Lagow. He assigned the claim to his attorney, who sued out a special execution and redeemed from the foreclosure sale. It was there coni tended that the redemption was, in fact, by Lagow and that he could not redeem from his own sale, but we held that a mortgagee who was also a creditor under a separate claim might redeem the premises from his own foreclosure sale, thus placing him in the same class with other debtors. The precise question here involved has never been presented to us for decision, but we can perceive no difference, in principle, between the case at bar and the Tewalt case, supra. Under the statute, Lagow, in the Tewalt case, secured no greater rights by his judgment against the estate of Tewalt than were secured by the Interstate Bank and Trust Company through its deficiency decree. They were creditors with equal rights and on an equal footing. By a mortgage or trust deed the grantor makes a conditional sale of his premises. Upon a failure of the grantor to comply with the conditions of his mortgage deed the grantee may foreclose and thus terminate the grantor’s equity of redemption from his conditional deed. By foreclosure all the equity retained by the grantor by virtue of his conditional deed is extinguished, but by the statute the grantor in the conditional deed is given a further equity of redemption. This equity of redemption does not exist by virtue of the mortgage but is purely statutory. If the grantor does not redeem within the twelve months allowed him under the statute he still retains an equity, which is subject to sale within the succeeding three months by “any decree or judgment creditor” who will reimburse the purchaser at the sale, in the manner prescribed by the statute. There exists no reasonable foundation for a rule which would prevent the grantee in the conditional deed from subjecting this statutory equity to- sale under his deficiency decree, and the statute plainly includes such a decree creditor within its terms. In support of their contentions appellants rely, among other cases, upon Seligman v. Laubheimer, 58 Ill. 124, Ogle v. Koerner, 140 id. 170, Lightcap v. Bradley, supra. and DeWitt County Bank v. Mickelberry, 244 id. 77. The question here presented was not before us in any of those cases, and what was said there was said in reference to the matters then presented for our decision. Our holding here, however, in no way conflicts with the holdings in those cases, but, on the contrary, is in entire harmony with them. The judgment of the Appellate Court is affirmed. Judgment affirmed.