Leonard v. Western , 74 Mont. 513 ( 1925 )

Plaintiff instituted this action to enforce the following demands: That the deed from the sheriff to Western and the deed from Western to Cole be canceled of record; that Western account for the rents and profits of the land in question; that plaintiff be permitted to pay the amount found to be due and necessary to redeem the property; and that the sheriff execute and deliver to her a certificate of redemption. The cause was submitted to the trial court upon an agreed statement of facts as follows:

In January, 1923, J.W. Nugent recovered a judgment against A.B. Lindberg upon which an execution was issued, and the lands belonging to Lindberg were levied upon and were sold on February 17, 1923. At the sale Nugent became the purchaser of the property and received a certificate of sale, which he transferred immediately to J.W. Western. After the Nugent judgment was recovered, but before the sale, H.C. Thompson recovered a judgment against Lindberg, which became a lien upon the lands mentioned. About the same time James and Joseph Elzea commenced an action against Lindberg and procured a writ of attachment, which was levied upon the same lands. The Elzea claim was reduced to judgment and in October, 1923, the Thompson and Elzea judgments passed by assignment to Mary Leonard. On February 15, 1924, Mrs. Leonard deposited with the sheriff, the officer who made the sale, the amount for which the property had been sold, with interest thereon at one per cent per month, and offered to pay any assessments or taxes which Nugent or Western had paid on account of the property, with interest on such amount. At the same time she made due service of the papers required by section 9446, Revised Codes, and also served upon the sheriff and Western a notice of redemption and a demand for an accounting of the rents and profits received from the property from the date of the sale. The demand for an accounting was ignored, and on February 18, 1924, the sheriff executed and delivered to Western a deed for the property, and, on February 23, Western transferred a portion of the property by deed to Mabel E. Cole. These two deeds were duly recorded. On November 5, 1924, Lindberg paid into court the amount necessary to satisfy the Thompson and Elzea judgments, and, on November 15, Mrs. Leonard received and accepted the amount in full payment, satisfaction and discharge of the judgments, and the judgments were satisfied of record. The money deposited with the sheriff was never accepted or received by Western and still remains in the hands of the sheriff.

The trial court held that the money deposited with the sheriff is the property of Mrs. Leonard, subject to be withdrawn by her at any time; that she is not entitled to relief, and rendered and entered a judgment dismissing the complaint. From that judgment this appeal is prosecuted.

While Nugent was in fact the purchaser at the sale, he transferred all his right, title and interest to Western; hence, to avoid repetition and confusion, Western will be treated as the purchaser.

It is conceded for all purposes of this appeal that the property sold was subject to redemption; that Lindberg, the judgment debtor, and Mrs. Leonard, the redemptioner, were the only persons entitled to redeem, and that Lindberg did not attempt to exercise his right.

Most of the questions discussed in the briefs are too well settled to admit of serious controversy, and may be stated briefly:

Up to February 15, 1924, at least, Western was the actual[1, 2] owner of the property, subject only to the right of redemption. Section 9441, Revised Codes, declares: "Upon a sale of real property, the purchaser is substituted to and acquires the right, title and interest, and claim of the judgment debtor thereto; and when the estate is less than a leasehold of two years' unexpired term, the sale is absolute. In all other cases the property is subject to redemption." (McQueeney v. Toomey,36 Mont. 282, 122 Am. St. Rep. 358, 13 Ann. Cas. 316, 92 P. 561; Citizens' Nat. Bank v. Western Loan Building Co.,64 Mont. 40, 208 P. 893; Dyer v. Schmidt, 67 Mont. 6,213 P. 1117.) As such owner, he was entitled to protect his interest and to contest the right of Mrs. Leonard to redeem (3 Freeman on Executions, sec. 323), for her right to redeem was not a property right but a mere privilege (Hamilton v. Hamilton, 51 Mont. 509,526, 154 P. 717), which she could waive or be estopped to assert (23 C.J. 717), or which she could lose through the satisfaction of her judgments and the consequent destruction of her liens (Ex parte Lawrence, 4 Cow. (N.Y.) 417, 15 Am. Dec. 386; 3 Freeman on Executions, sec. 317). Whether Mrs. Leonard was or is entitled to redeem is a question which concerns her and Western only. (White v.Costigan, 134 Cal. 33, 66 P. 78.)

The right to redeem is conferred by statute, and if Mrs.[3] Leonard was entitled to exercise the right, and if she complied fully with the statutory requirements, she could not be defeated (Bailey v. Erny, 68 Colo. 211, 189 P. 18), and her compliance will be treated as a completed redemption (sec. 7450, Rev. Codes; Leet v. Armbruster, 143 Cal. 663, 669,77 P. 653; Colorado Mfg. Co. v. McDonald, 15 Colo. 516,25 P. 712). If, then, she did redeem the property on February 15, the sheriff was without authority to convey the property to Western thereafter, and the deed was a nullity (Phillips v. Hagart,113 Cal. 552, 556, 54 Am. St. Rep. 369, 45 P. 843), for her redemption operated to transfer to her all the right, title and interest which Western had acquired by his purchase (3 Freeman on Executions, sec. 321).

The term "redeem" means repurchase (McQueeney v. Toomey,[4] above; Bunn v. Braswell, 142 N.C. 113, 55 S.E. 85; Bouvier's Law Dictionary), and is an apt expression when applied to the right reserved to the judgment debtor, but is really a misnomer when applied to the right conferred upon a redemptioner. It is employed in the statute, however, and, as applied to a redemptioner, signifies the right to purchase the interest acquired by the purchaser, whether the latter is willing or not. (McNutt v. Nuevo Land Co., 167 Cal. 459, 140 P. 6.)

In a qualified sense the sheriff is the agent of the purchaser[5] to receive the money necessary for a redemption; that is to say, the sheriff is constituted the depositary of the money (Hamilton v. Hamilton, above), but he is not the agent in the sense that his receipt of the money necessarily constitutes an acceptance of it by the purchaser (Bennett v. Wilson,122 Cal. 509, 68 Am. St. Rep. 61, 55 P. 390).

With these principles in mind, the controversy before us is confined to very narrow limits. The primary question is: Did Mrs. Leonard effect a redemption of the property on February 15, 1924? If she did, she was entitled to a deed upon the expiration of sixty days from that date (sec. 9444, Rev. Codes), and the trial court erred in denying her any relief. If she did not effect a redemption on February 15, the question then arises: Did she lose her right to redeem?

Whether, as between herself and Lindberg, she had the right to redeem on February 15, and, if she had such right, whether the exercise of it would cut off Lindberg's right to redeem on February 16 or 17, are questions not presented on this appeal. As between herself and Western, it is assumed that she had the right to redeem on February 15, and it is conceded that she presented all the papers and documents required by the statute and that she deposited with the sheriff an amount sufficient to redeem the property.

Our redemption statute (secs. 9441-9448, Rev. Codes) indicates the property subject to redemption, the persons who may redeem, the notice and evidence necessary, and the person or officer to whom payment must be made. Section 9443, so far as material here provides: "The judgment debtor, or redemptioner, may redeem the property from the purchaser any time within one year after the sale, on paying the purchaser the amount of his purchase, with one per cent per month thereon in addition, up to the time of redemption."

Section 9448, as applied to the facts of this case provides: "The purchaser, from the time of the sale until a redemption, * * * is entitled to receive, from the tenant in possession, the rents of the property sold, or the value of the use and occupation thereof. But when any rents or profits have been received by the * * * purchaser * * * from the property thus sold preceding such redemption, the amount of such rents and profits shall be a credit upon the redemption money to be paid; and if the redemptioner * * * before the expiration of the time allowed for such redemption, demands in writing of such purchaser * * * a written and verified statement of the amount of such rents and profits thus received, the period for redemption is extended five days after such sworn statement is given by such purchaser. * * * If such purchaser * * * shall, for a period of one month from and after such demand, fail or refuse to give such statement, such redemptioner * * * may bring an action, in any court of competent jurisdiction, to compel an accounting and disclosure for such rents and profits, and until fifteen days from and after the final determination of such action, the right of redemption is extended to such redemptioner. * * *"

The supreme court of Washington, in considering a statute[6] substantially the same as the two sections just quoted, held that it provides two separate and distinct methods for determining the amount to be paid by a redemptioner to effect a redemption (State ex rel. Bryant v. Starwich, 131 Wash. 101,229 P. 12), and the correctness of that conclusion is apparent. The court might have gone further, for it is equally apparent that the statute also provides different periods within which the redemption may be made. If the redemptioner proceeds under section 9443, the amount necessary to be paid is merely a matter of mathematical calculation, which amount must be tendered within the period of redemption, which in that event is limited strictly to one year from the date of the sale; if, however, he proceeds under section 9448, the amount necessary to be paid by him can be determined only by an accounting, hence a tender is not necessary until the amount is determined, and the period within which the redemption may be made is extended according to the circumstances. If the purchaser renders the account in response to the demand made upon him, the period of redemption is extended five days after such accounting is made; if the account is not rendered by the purchaser within thirty days after the demand for it, the redemptioner must then resort to a suit for an accounting, in which event the period of redemption allowed to him is extended fifteen days after the final determination of the action. In other words, section 9448 confers upon the redemptioner the right to redeem by paying an amount which may be much less than the amount paid by the purchaser, and it also extends the time within which the redemption may be made. The demand for an accounting, to be effective for any purpose, must be made before the expiration of one year after the sale, but, when made within that time, it suspends the running of the statute, and the accounting itself determines the amount necessary to be paid to effect the redemption; but the redemption is not made until the amount is determined and paid or tendered, and then only in the event such amount is paid or tendered within the period so extended.

It is alleged in the complaint and established by the agreed statement that, at the time the money was deposited, a demand for an accounting of the rents and profits was made, and one purpose of this action is to compel such an accounting to the end that the amount necessary for Mrs. Leonard to pay to redeem the property may be determined.

When on February 15, 1924, Mrs. Leonard made the demand for an accounting and thus secured a suspension of the running of the[7] statute, she obtained all the benefits afforded by section 9448. The right to redeem is purely statutory, and, when she thus availed herself of the statute (section 9448), she was required to assume its burdens in order to enjoy its benefits (State v.O'Connor, 6 N.D. 285, 69 N.W. 692; Union Esperanza Min. Co. v. Shandon Min. Co., 18 N.M. 153, 135 P. 78). Under section 9448 the redemption is not completed until the accounting is had, the amount determined and paid or tendered within time.

A redemptioner cannot proceed under both sections at the same[8] time, and the attempt to proceed under section 9443, by making a deposit of the amount necessary to redeem under that section, is nullified by making a demand for an accounting, which can be done only by section 9448. Therefore it is clear that a redemption was not effected on February 15, 1924, when the demand for an accounting was made.

But, as indicated above, by making the demand for an[9] accounting, Mrs. Leonard secured an extension of the time within which to redeem, and the second question then arises: Did she lose the right to redeem by accepting payment and satisfaction of her judgment?

By the express terms of section 9442 her right to redeem was dependent upon the fact that she held the Thompson and Elzea judgments, each of which was a lien upon the property. Before she redeemed, and while she was seeking to compel an accounting to determine the amount necessary to be paid by her, she accepted full payment and satisfaction of each of her judgments. The instant the judgments were satisfied, they ceased to be liens upon the property. (Sec. 9410, Rev. Codes; 34 C.J. 630.) In Inre Black's Estate, 32 Mont. 51, 53, 79 P. 554, 555, this court said: "When a judgment has been paid, it has passed beyond a review; the satisfaction of it being the end of the proceeding. `Payment produces a permanent and irrevocable discharge, after which the judgment cannot be restored by any subsequent agreement, nor kept on foot to cover new and distinct engagements.'" It follows that the extinction of the judgment liens before the redemption had been effected destroyed the right to redeem. (Ex parte Lawrence, above; 3 Freeman on Executions, sec. 317.)

The judgment is affirmed.

Affirmed.

MR. CHIEF JUSTICE CALLAWAY and ASSOCIATE JUSTICES GALEN, STARK and MATTHEWS concur.

Rehearing denied December 10, 1925.