Court Opinion

ID: 3835524
Source: CourtListenerOpinion
Date Created: 2016-07-06 08:04:57.060734+00
Date Added: 2024-06-11T07:40:17.977927
License: Public Domain

This cause was commenced in the district court of Oklahoma county, July 20, 1928, by V. S. Cook Lumber Company filing its petition in said court, seeking judgment on note and for foreclosure of mortgage against V.V. Harris and E. Highfill.
The petition was in the usual form, asked judgment for $4,750 principal, with interest and attorney fees. Plaintiff alleged said mortgage was subject to a mortgage in the sum of $15,000 given by W.E. Husselman and wife to the Local Building  Loan Association of Oklahoma City.
Petition alleged that said property was owned by Husselman, deeded to Highfill, and that when Highfill bought said property from Husselman, Highfill assumed and agreed to pay said mortgage to the Local Building  Loan Association.
Petition also alleged that Highfill executed the note and mortgage sought to be forclosed to the plaintiff; that after the execution of the same, on February 26, 1924, the defendant Highfill conveyed the property described in said mortgage to the defendant V.V. Harris; that, in the transaction between the said Highfill and Harris, the said Harris did deduct from the purchase price the indebtedness and obligations secured by the mortgage; that the defendant Harris assumed and made his own the obligations of the defendant Highfill to the plaintiff.
Thereafter, Young Pepper, upon application was permitted to intervene in said cause. Young Pepper in his answer denied all material allegations in plaintiff's petition and called for strict proof; pleaded that he was the owner and holder for value of the $15,000 Local Building  Loan Association note and mortgage; that the same for a good and valuable consideration was, on June 30, 1924 transferred, indorsed, and assigned to him, and asked for judgment against the maker of said note and for the forclosure of the mortgage securing same.
Thereafter, on the 14th day of February, 1925, V.V. Harris filed his answer in said cause, in which he denied each and every material allegation contained in plaintiff's petition except those specifically admitted; denied that he assumed and agreed to pay the obligation of Highfill; denied the amount due plaintiff was deducted from the consideration agreed upon by E. Highfill; denied the amount due on the mortgage of the loan association was deducted upon the consideration agreed upon by E. Highfill.
On the 24th day of February, 1925, plaintiff filed an answer to the cross-petition of Young Pepper and reply to answer of V.V. Harris and Young Pepper, in which it denied that Young Pepper was the owner of the said note and mortgage in due course, but alleged that the same was paid by V.V. Harris, and that the defendant V.V. Harris by the payment of said note and mortgage had discharged the same, and prayed for judgment decreeing plaintiff's mortgage to be a first lien on the property involved, and asked for judgment against V.V. Harris and for foreclosure of plaintiff's mortgage as a first lien on said property.
After the answer and replies, several in number, were filed, issues were joined, plaintiff contending that Harris, when he purchased said property, deducted the amount of plaintiff's mortgage and the building and loan mortgage from the purchase price, and thereby became personally liable for the same; and further contended that Harris had paid and satisfied the Building  Loan Association mortgage; and that Young Pepper had no right, title, or interest in said note and mortgage so assigned to Young Pepper; that the same was paid by V.V. Harris and assigned to Young Pepper at the instance and request of V.V. Harris, and that the payment by V.V. Harris to the said Building  Loan Association of said $15,000 mortgage satisfied the same, and that plaintiff's mortgage was the first lien and that V.V. Harris had assumed and agreed to pay the same by deducting the amount of said note and mortgage from the purchase price of the property at the time same was deeded to V.V. Harris by Highfill; intervener, Young Pepper, contends he was the owner of the note and mortgage; that the same was bought with partnership funds belonging to himself and V.V. Harris; V.V. Harris contends that he only bought the equity of the property, did not assume the mortgage and indebtedness against it, did not deduct the amount of the indebtedness from the purchase price and was not personally liable for the same.
On the issues joined the case came on for trial before a jury, and the issues were submitted to the jury by the court by agreement of counsel upon interrogatories or special verdict, and answers returned, which are as follows:
Interrogatory No. 1. "At the time Harris and Highfill exchanged properties, — that is, at the time Highfill deeded the property involved *Page 19 
in this cause to Harris, — did V.V. Harris assume and agree to pay the indebtedness due the Local Building  Loan Association and the V. S. Cook Lumber Company? Answer: No."
Interrogatories No. 2. "At the time referred to, was there an agreement between V.V. Harris and E. Highfill that the said V.V. Harris should not assume and become personally liable for the mortgages to the Local Building  Loan Association and the V. S. Cook Lumber Company? Answer: Yes."
Interrogatory No. 3. "At the time said property was traded by Highfill to Harris, was the same traded subject to the mortgages, and were the amounts of said mortgages deducted from the consideration for said property? Answer: Yes."
Interrogatory No. 4. "To whom was the note and mortgage held by the Local Building  Loan Association transferred, — that is, whether to Young Pepper for use and benefit of V.V. Harris, or to Young Pepper for the use and benefit of the partnership or business arrangement existing between Harris and Young Pepper? Answer: Transferred to Young. Pepper for the use and benefit of V.V. Harris."
Plaintiffs in error, V.V. Harris and Young Pepper, did not object to the form of the verdict returned by the jury, and did not file a motion for a new trial within three days thereafter. The majority opinion holds that this was an equitable case and the answers of the jury to the interrogatories were merely advisory to the court.
Section 19 of art. 2 of the Constitution of Oklahoma provides, in part, as follows:
"The right of trial by jury shall be and remain inviolate."
This means the right of trial by jury as it existed at the time the Constitution was adopted.
Section 20 of art. 7 of the Constitution of Oklahoma provides:
"In all of the issues of fact joined in any court, all parties may waive the right to have the same determined by a jury, in which case the finding of the judge, upon facts, shall have the force and effect of a verdict by jury."
Section 21 of art. 7 of the Constitution of Oklahoma is as follows:
"In all jury trials, the jury shall return a general verdict, and no law in force, nor any law hereafter enacted, shall require the court to direct the jury to make findings on particular questions of fact; but the court may, in its discretion, direct such special findings."
It cannot be seriously contended that, prior to the adoption of the Oklahoma Constitution, the right of trial by jury did not exist. The Supreme Court of the United States, speaking of the Bill of Rights, says:
"So jealous were the people that these rights highly prized might be denied them by implication that, when the original Constitution was proposed for adoption, it encountered severe opposition. And but for the belief that it would be so amended as to embrace them, it would never have been ratified." Ex parte Milligan, 4 Wall. 2, 120, 18 L. Ed. 281.
The court in the majority opinion has not construed the Constitution, it has overlooked it, and the result is that it is made more difficult to determine what cases, and in what class of cases, a citizen may be granted a right of trial by jury. But the most serious proposition is the holding that the verdict of the jury may be ignored by the court.
Of what value is a trial by jury guaranteed to the citizens of this state by the Constitution if the courts can evade or ignore the verdict of the jury? Would the citizens of Oklahoma adopt a Constitution that denied them the right of trial by jury? I am frank in saying they would not.
On the issues joined plaintiff was entitled to a trial by jury. This court has so held.
In the case of Choctaw Lumber Co. v. Waldock, 78 Okla. 233,190 P. 866, this court in, the first paragraph of the syllabus, said:
"In an action for the recovery of money on promissory notes, although involving the foreclosure of a mortgage on real estate, issue being joined as to the amount due, defendant is entitled to a trial by jury as a matter of right."
In the case of Brewer v. Martin, 40 Okla. 350, 138 P. 166, first paragraph of the syllabus, this court said:
"In a cross-petition for judgment on a note and foreclosure of the mortgage lien, when an issue is joined as to the amount due, the trial must be had before a jury, unless the jury is waived."
In the case of McCoy v. McCoy, 30 Okla. 380, 121 P. 176, in the fifth paragraph of the syllabus, this court said:
"In all civil actions for the recovery of money or for the recovery of specific real or personal property, every issue of fact arising from the pleadings must be tried by a jury, unless a jury be waived by both parties to the action, or a reference be ordered as prescribed by statute. All other issues of fact (except those arising in actions for the recovery of money or specific real or personal property) and all issues of *Page 20 
fact arising in equity proceedings, may be tried by the court subject to its power to submit the issues to a jury or order a reference."
In the case of Osage Oil  Refining Co. v. Interstate Pipe Co., 124 Okla. 7, 253 P. 66, in the sixth paragraph of the syllabus, this court said:
"Where action is commenced to recover money judgment upon a promissory note and to foreclose a mortgage securing the same, and in such action the jurisdiction of the court is invoked in ancillary proceedings by garnishment and by attachment, which can only be done in actions for the recovery of money (Comp. Stat. 1921, secs. 340, 354), such action is primarily a personal action, for the recovery of money and not one in rem for foreclosure of mortgage."
In the case of Holmes v. Halstid, 76 Okla. 31, 183 P. 969, first paragraph of the syllabus, this court said:
"In an action to recover judgment on promissory notes executed by defendants and for foreclosure of mortgage lien, made to secure their payment, where issue is joined as to the indebtedness due, the case is one properly triable before a jury as provided in sec. 4493, Rev. Laws 1910."
In case of Collins v. Industrial Savings Society,78 Okla. 319, 190 P. 670. in the first paragraph of the syllabus, this court said:
"Under section 4993, Rev. Laws 1910, in a foreclosure proceeding where a personal judgment for money is sought by plaintiff against defendant, the defendant is entitled to a jury trial, unless a jury is waived or a reference ordered."
The majority opinion cites Limerick v. Jefferson Life Insurance Co., 67 Okla. 178, 169 P. 1080, as authority for the holding in the case at bar. At page 180, Okla. Reports, of that case, this court said:
"At any rate, it is obvious, from the statement of the proceedings hereinbefore fully set out, that the parties themselves and the trial court, without objection, treated the issues joined by the pleadings as of purely equitable cognizance, and so counsel have presented the cause to this court for review in their respective briefs. In these circumstances, even if this was originally a proper case for a trial by jury, requiring the return of a general verdict, the parties having treated it as one of purely equitable cognizance making no objection to the mode of trial in the trial court, they will not now be permitted to change the theory of their case. Nowlin v. Melvin, 47 Okla. 57, 147 P. 307; Harris v. First Nat. Bank of Bokchito, 21 Okla. 189, 95 P. 781; Border v. Carrabine, 24 Okla. 609, 104 P. 906."
The reasoning in that case, relied on in the majority opinion, is against the result reached by the majority opinion, for the reason that plaintiffs in error made no objection to the interrogatories or special verdict of the jury and saved no exceptions to the same and filed no motion for a new trial.
This court, in the case of Stanard v. Sampson, 23 Okla. 14,99 P. 796, in the third and fourth paragraphs of the syllabus said:
"3. A general verdict not having been returned, but answers to specific questions, both sides having filed and presented motions for judgment thereon, in the absence of a timely objection with proper exceptions and the assigning of such action as error in a motion for a new trial, the same will not be reviewed here.
"4. When the special answers or findings are returned, the jurors each being polled ad seriatim answered that the same as read by the clerk were his. No objection was made by either party, or request, that such special findings or answers should be signed, and each party filed and presented a motion for judgment in his or their favor on such special findings. Held, that this was a waiver of the irregularity in the foreman not signing the answers or findings as required by the statute."
This court, in the St. Louis Carbonating  Manufacturing Co. v. Lookeba State Bank, 59 Okla. 71, 157 P. 1046, in the first paragraph of the syllabus, said:
"Where a case is tried before the court, special findings of fact and conclusions of law made, no exceptions taken to either the findings of fact or conclusions of law, and the only error assigned is that upon the facts found, the court erred in its conclusions of law, this court is limited in its inquiry whether, based upon the facts found, the conclusions of law were correct."
At page 72 of the Okla. Reports in said case, this court said:
"No exceptions were reserved to either the findings of facts or conclusions of law, but plaintiff filed a motion for a new trial therein assigning that the decision and judgment of the court is contrary to law. There being no exception saved to the finding of facts, there is nothing before us to review except the record proper. The findings of fact stand, therefore, as conclusive or as in agreed case and it is for us to inquire only whether the conclusions of law upon the finding of facts were correctly pronounced."
In the case at bar, no exceptions were saved to the findings of the jury on the facts, and there being no exception and no motion for a new trial, the same were conclusive on the trial court.
This court, in Davis v. Grey, 39 Okla. 386, *Page 21 134 P. 1100, in the first and second paragraphs of the syllabus, said:
"1. In an action of replevin the jury found for the plaintiff for a return of the animal in controversy. At the time of trial, the animal was in the defendant's possession. The verdict did not fix the value of the animal, nor was any objection made to the form of the verdict, until three days thereafter, when it was assigned as error in the motion for a new trial. Held, that, no timely objection to the form of the verdict having been made, no reversible error is presented.
"2. Under the ruling that, before a new trial will be granted because of newly discovered evidence, it must be made to affirmatively appear that the new evidence would be sufficient to probably produce a different result, a certain amount of discretion is vested in the trial court, and his ruling will not be reversed here, unless we are able to see that such evidence would probably produce a different result."
This court, in the case of the First Nat. Bank of Shawnee v. Oklahoma Nat. Bank of Shawnee, 29 Okla. 411, 118 P. 574, in the third and fourth paragraph of the syllabus, said:
"3. To secure a review of the evidence taken on a trial before a referee, a motion for a new trial must be filed in the trial court and not before the referee, and, except for the cause of newly discovered evidence, must be at the term the report is filed, and, unless unavoidably prevented, within three days thereafter; nor will filing of motions to secure a correction or annulment of the report stay the running of the statutory time so fixed.
"4. The findings of fact of a referee, where not challenged within a proper time and manner, become final, and exceptions to a judgment rendered thereon are of law, and not fact, and cannot be raised on a motion for a new trial."
The majority opinion states the trial court stated that it did not believe the answers to the interrogatories on which judgment was rendered were sustained by sufficient evidence. The court in its journal entry on page 373 of the case-made states as follows:
"In passing, I am of the opinion that the answers to the interrogatories propounded to the jury, in so far as questions Nos. 2 and 3 are concerned, are incorrect, contrary to the evidence, and the jury, in my judgment were not justified under the evidence in answering the interrogatories as they did and the answers to those interrogatories, are disapproved, and if the court had the power would be set aside for the reasons stated above. The court is of the opinion that a motion for new trial should have been filed in this case within three days after the jury returned these answers into court, but the same was not done, and the court is now powerless to disturb these answers in any way, whatsoever. The court is further of the opinion that, under the record as it stands, the plaintiff is entitled to a judgment upon the interrogatories propounded to and answered by the jury."
So it is clear from the record and the journal entry in this cause that the court did not disapprove all the interrogatories and answers, but only disapproved 2 and 3. However, the court did approve the interrogatories and verdict of the jury, and in so doing followed the law as heretofore announced by this court without exception.
The evidence of Young Pepper and V.V. Harris, plaintiffs in error, supports the finding of the jury in interrogatory No. 4, which was that the Building  Loan Association note and mortgage was paid by V.V. Harris. Young Pepper testified that he lived at Franklin, Ky., that he was a brother-in-law of V.V. Harris, and at page 180 of the case-made was asked this question:
"Q. Doctor, did you on or about the 30th day of June, 1925, purchase a note and mortgage from the Local Building  Loan Association of Oklahoma City? A. Not to my knowledge. * * * Q. Do you, Doctor, have in your possession any correspondence between you and V.V. Harris with reference to any such transaction? A. No, sir."
He testified that in the existing partnership between him and V.V. Harris, for the last 15 or 20 years, he had no knowledge of such a transaction, and that no such purchase was made for him individually.
At page 225 of the record, Mr. Harris testified as follows:
"Q. And you purchased it for the partnership because you thought it was a good investment, didn't you? A. No, no; I didn't. Q. You didn't? A. No. I wouldn't say that. Q. Why did you purchase it? A. I purchased it for the partnership because the Building  Loan had the first mortgage, and I knew that if something was not done, they were going to foreclose, and I wanted to get it in hand where it wouldn't be foreclosed. Q. That is the reason you got it in the hands of the partnership? A. That's right. Q. In order to save you and your property? A. Absolutely. I might have bought it in my own name if it hadn't been for that."
This testimony of Young Pepper and V.V. Harris alone is sufficient to support the finding of the jury that the building and loan mortgage was paid by V.V. Harris to protect his own property, and the assignment made to Young Pepper was to defeat the note and mortgage of the V. S. Cook Lumber Company. This is what the jury found, and *Page 22 
under the evidence in this record the jury would not be justified in finding anything else, and if this was an equity case, which it is not, no court of conscience would permit V.V. Harris to pay and satisfy the first lien on his property when such lien was part of the purchase price, and then assign it to his brother-in-law and have the same foreclosed in order to defeat the second lienholder. A court of equity would not be a party to such a scheme or approve such a transaction.
The judgment of the trial court was in all things correct except as to interrogatory No. 3, wherein the jury found that, at the time said property was traded by Highfill to Harris, the same was traded subject to the mortgages and the amount of said mortgages was deducted from the purchase price for said property. This finding of the jury is supported by competent evidence, and no exception was saved to said finding by the jury, and no motion for new trial having been filed, this court is limited in its inquiry, based upon the facts found. Were the conclusions of law correct? The court reached the conclusion from this finding of fact that the plaintiff was entitled to a personal judgment against Harris for the amount of its note and for foreclosure of its mortgage, which was a first lien on the property involved.
It is my opinion the finding that the plaintiff was entitled to a personal judgment against Harris is erroneous for the reason that there was no contractual relation between Harris and the plaintiff, and although Harris did deduct the amount of the plaintiff's mortgage from the purchase price, this was an obligation to Highfill and not to plaintiff.
The judgment of the trial court should be affirmed in all things except the personal judgment against V.V. Harris. Said judgment should be modified by vacating said personal judgment against V.V. Harris and in all other respects affirmed.
SWINDALL, J. I concur in this dissent.