Ankeny v. Lieuallen , 169 Or. 206 ( 1942 )

Argued on rehearing May 5; suit dismissed July 14, 1942 ON REHEARING 127 P.2d 735 Since our former decision was rendered in this case, a rehearing was granted on petition of the plaintiff. It now appears from the records and files of the case that the mortgage sought to be foreclosed by the plaintiff in this case has been purchased by some of the defendant-mortgagors, who have moved the court that they be substituted as parties plaintiff in lieu of the original plaintiff and be permitted to continue the proceedings against the other defendant-mortgagors, in order to have the mortgage foreclosed and the mortgaged property sold to satisfy the mortgage debt.

Section 1-311, O.C.L.A., provides that no action shall abate by the transfer of any interest therein, if the cause of action survive or continue. Under this statute, as construed by this court, the plaintiff, in an action or suit, may transfer his interest pendente lite and the transferee may continue the action in the name of the original plaintiff. See Burns v.Kennedy, 49 Or. 588, 90 P. 1102, and cases there cited. See alsoOregon Auto-Dispatch v. Cadwell, 67 Or. 301, 135 P. 880; Smithv. Cram, 113 Or. 313, 230 P. 812; and Phegley v. Swender Co.,133 Or. 146, 289 P. 500. In the case last cited, the court said: "Notwithstanding the transfer of plaintiff's interests, the cause of suit survived and there was no reason for substitution; in fact, none could be made." Hence, under this statute, if there were no facts which take the case out of the operation of the statute, the transferees of this mortgage would be entitled to have the case proceed in the name of the original plaintiff.

However, in mortgage foreclosure cases, all the mortgagors, if living, or, if dead, their personal representatives, are proper and necessary parties defendant and, if not made defendants, their individual interests in the mortgaged property would not be affected by the foreclosure. Since the mortgage in question here created a lien upon lands in which all the defendants in the original action had an interest, each and all of the original defendants were not only proper but necessary parties defendant in the foreclosure proceedings.

It goes without saying that one and the same individual cannot be both plaintiff and defendant at the same stage of proceedings in any action or suit and, if substitution should be granted in this case, as requested by the mortgage-purchasing defendants, the remaining defendants would be deprived of a substantial right in that the mortgage as a whole could not be foreclosed and no proper decree could be granted in the case should the mortgage be found to be valid and enforceable.

Moreover, the pleadings in this case would not justify such a result for the answer of all the defendants alleged that the mortgage was invalid and unenforceable and, in the absence of some explanation therefor, the defendants now seeking substitution would be estopped to assert that the mortgage is now valid and enforceable as against their codefendants. If, as asserted, the moving defendants have purchased the mortgage, then the mortgage is paid and should be discharged of record and all that the purchasing defendants would be entitled to recover would be the amount which the court should find they were entitled to have contributed to them by the non-purchasing defendants. This remedy would be available in another suit brought for the purpose of compelling the non-purchasing defendants to contribute their proportional part of the amount paid in the purchase of the mortgage, if the same is found to be valid and enforceable.

For these reasons, there is nothing left for this court to do except to dismiss the suit.