Opinion
No. 38916.
June 5, 1944.
1. MORTGAGES: Schools and School Districts: School Fund Mortgage: Foreclosure Sale Not Required While Court in Session. The foreclosure sale of a school fund mortgage need not be held while the circuit court is in session.
2. MORTGAGES: Proof of Publication Sufficient. There was sufficient proof of publication of notice of the mortgage foreclosure sale, though no proof of publication was attached to the deed.
3. DEEDS: Acknowledgments: Void Acknowledgment: Deed Good Between Parties. The acknowledgment of the grantor taken by the grantee was void, but the deed was good between the parties.
4. MORTGAGES: Equity: Right to Redeem Barred by Laches: Rights of Innocent Purchasers. If the plaintiff ever had any right to redeem the mortgage it was lost by delaying her action for many years while innocent purchasers acquired title and made valuable improvements.
Appeal from Butler Circuit Court. — Hon. Randolph H. Weber, Judge.
AFFIRMED.
M.W. Henson for appellant.
(1) The foreclosure sale under the school fund mortgage was void because it was made in vacation of the circuit court. Wilcoxon v. Osborn, 77 Mo. 621; McClurg v. Dollarhide, 51 Mo. 347. (2) The foreclosure sale under the school fund mortgage was void for want of legal publication of the notice of sheriff's sale. Chap. 119, Secs. 14968-14969, R.S. 1939. (3) The foreclosure sale under the school fund mortgage was void because no report thereof was made by the sheriff to the county court, and no approval or confirmation of the sale was made by the county court. Waters et ux. v. Talbott, 166 A. 431. (4) The commissioner's deed from H.I. Ruth, commissioner, before an officer authorized to take his acknowledgment conveyed no title because it was executed and delivered without authority from the county court. Chap. 72, Art. 2, Secs. 10378, 10381, and 10389, R.S. 1939. (5) The commissioner's deed from H.I. Ruth, commissioner, to Irvin Waller was and is fraudulent and void, because it was not acknowledged by H.I. Ruth, commissioner, before an officer authorized to take his acknowledgment thereto, and it, therefore, conveyed no title to the land in suit. 1 Am. Jur., pp. 334, 335, secs. 52, 53; Blackman v. Henderson, 87 N.W. 655. (6) The foreclosure sale under the school fund mortgage was never made final by the confirmation of the sale by the county court. 31 Am. Jur., p. 455, sec. 108. (7) The absence of proof of the publication of the sheriff's notice of sale under the school fund mortgage on the record of the sheriff's deeds to Butler County, and the void acknowledgment of the commissioner's deed from H.I. Ruth, commissioner, to Irvin Waller, constitutes such notice to all of the other defendants as would preclude them from invoking the defense of laches. Meriwether v. Overly, 129 S.W. 1, 228 Mo. 218; Saline County v. Thorp, 88 S.W.2d 183. (8) The defense that a claim is stale is purely an equitable one, and unless there is some natural justice back of it, a court of equity will not entertain it. Bucher v. Hohl, 97 S.W. 922, 199 Mo. 320; Schwind v. O'Halloran, 142 S.W.2d 55, 346 Mo. 486.
C.T. Bloodworth and Tedrick Tedrick for respondent.
(1) Defendants' demurrer to plaintiff's petition should have been sustained since it does not state a cause of action. It attempts to plead "fraud" as grounds for setting aside the sheriff's deed conveying the property in controversy to the defendant Butler County (the only transaction with which plaintiff can be concerned). The allegations of fraud contained in the petition are as follows: "wrongfully, unlawfully and fraudulently caused said property of plaintiff to be sold without due process of law at a purported foreclosure sale under said school fund mortgage." This allegation is merely a conclusion of law and does not set out the facts constituting the alleged fraud, which is necessary in actions of this kind. 27 C.J. 30, 147; Dickey v. Volker, 11 S.W.2d 278; Lewis W. Thompson Co. v. Conran-Gideon Road Dist., 19 S.W.2d 1049. (2) The petition is also fatally defective for further reason it fails to offer to place the defendant Butler County in status quo, which is a condition precedent to setting aside a deed for fraud. The only allegation in the petition that can be construed to resemble such offer is as follows: " — and to declare this plaintiff to be the owner in fee simple, subject to the unpaid balance of a school fund loan of $700.00 in favor of the defendant Butler County, Missouri." There is no offer to pay the accrued interest, taxes or costs, or any other allegation that can be construed as such offer. Mo. Dig. (Cancellation of Instruments) Key No. 24(2); Fry v. Piersol, 66 S.W. 171; Hawkins v. Heagerty, 156 S.W.2d 642; Davidson v. Gould, 187 S.W. 591. (3) The point that the petition fails to state a cause of action can be raised by demurrer, or at any other stage of the proceedings, even, for the first time, on appeal. Hawkins v. Heagerty, 156 S.W.2d 642. (4) A partial tender or offer is not sufficient. To be effective for any purpose, it must be for the full amount, including interest and costs. St. Louis v. Senter Comm. Co., 124 S.W.2d 1180. (5) Plaintiff is barred from recovery in this case by laches. Kline v. Vogel, 1 S.W. 733; Hatcher v. Hatcher, 39 S.W. 479; Davidson v. Gould, 187 S.W. 591. (6) The fact that this suit was brought within the Statute of Limitations fixing the time in which a suit for the recovery of real estate may be brought, makes no difference in this case, as this is purely an equitable action and the doctrine of laches applies regardless of the statute. Kline v. Vogel, 1 S.W. 733. (7) The defendants Harris, Hayes and Pulliam all testified that they had no knowledge surrounding the foreclosure sale of plaintiff's property, and therefore cannot be charged with notice of fraud, if any existed. Smith v. Holdoway Const. Co., 129 S.W.2d 894; Morris v. Hanssen, 78 S.W.2d 87; Ludwig v. Scott, 65 S.W. 1034. (8) The fact that the foreclosure sale was made in vacation does not render the sale void. Sec. 10385, R.S. 1939; Grant v. Huston, 106 Mo. 97, 16 S.W. 680. (9) There was a legal publication as testified by the witness Bob Wolpers same was introduced in evidence. Sec. 14969 provides that "the affidavit of the publisher, with a copy of such advertisements annexed stating the number and date of the papers, in which the same was published shall be sufficient evidence of the publication," but this statute does not preclude a litigant from making proof by some other method. Sec. 14969, R.S. 1939; Raley v. Guinn, 76 Mo. 263; Robbins v. Boulware, 190 Mo. 33, 88 S.W. 674; McDaniels v. Sprick, 297 Mo. 424, 249 S.W. 611. (10) The statute of this State does not require a report to be filed and approved by the county court in order to validate a sale under a school fund mortgage. Secs. 10385, 10387, R.S. 1939. (11) The County Court of Butler County, Missouri, on January 15, 1935, made an order appointing H.I. Ruth, Land Commissioner of all the lands owned by Butler County; this gave him sufficient authority to execute the deed from Butler County to Irvin Waller. However, respondent contends that even if he had no authority to execute the deed appellant is in no position to complain as she had already been divested of her title by the foreclosure sale and it was no concern of hers if subsequent transfers were irregular. (12) The irregularity complained of by appellant which consisted in the taking of an acknowledgment of H.I. Ruth, Land Commissioner, by Irvin Waller, the grantee in the deed does not invalidate or affect the conveyance between the parties but only affects the registration of the deed. Staples v. Shackleford, 51 S.W. 1032; Finley v. Bab, 73 S.W. 180; Bennett v. Shipley, 82 Mo. 448; Williams v. Moniteau Natl. Bank, 72 Mo. 292; Black v. Gregg, 58 Mo. 565.
This is an action to set aside a deed, foreclosing a school fund mortgage, and subsequent conveyances of the real estate (town lots) involved. The court found against plaintiff and dismissed her petition. Plaintiff has appealed.
Plaintiff borrowed $700.00 on school fund mortgage in 1924 and paid no interest after 1928; nothing was ever paid on principal. Foreclosure was made in 1935, when the amount due was $1010.30. The lots were bid in by the county for $500.00. Plaintiff knew about this foreclosure sale and gave up possession. About a year later, defendant Waller (County Clerk) purchased the lots from the county for $450.00, receiving a deed from the County Land Commissioner, whose acknowledgment was taken by him. In 1941, Waller conveyed the lots to defendant Mann for $725.00. (Waller sold to defendant Harris in 1937 but got the lots back in 1940.) Mann sold them to defendant Hayes for $750.00. Hayes sold to defendant Pulliam for $1950.00, after making improvements, receiving a deed of trust for $1150.00 for part of the purchase price. Plaintiff lived within two blocks of the property but never told any of the subsequent owners that she claimed some right to it at any time prior to bringing this suit in 1943. In 1941, Hayes modernized the house at a cost of $750.00. Pulliam built a garage and coal shed costing $150.00.
Plaintiff contends that the School Fund mortgage foreclosure was invalid on the grounds that the sale was made in vacation of Circuit Court; that there was no legal publication of notice of sale; and that there was no report of sale by the sheriff or confirmation by the County Court. Plaintiff further contends that the deed from the county to Waller was void because the grantee, as County Clerk, took the acknowledgment of the Land Commissioner.
The requirements for foreclosure of School Fund mortgages are set out in Secs. 10385 and 10387. (Except as otherwise specified all references are to R.S. 1939 and Mo. R.S. Ann.) The order of sale required by Sec. 10387 is essential to a valid sale [Benton County v. Morgan, 163 Mo. [734] 661, 64 S.W. 119]; but the County Court did make such an order in this case. Plaintiff relies on McClurg v. Dollarhide, 51 Mo. 347 and Wilcoxon v. Osborn, 77 Mo. 621, holding such foreclosure sales void when not made during a session of Circuit Court. The statute has been changed since these cases. (Laws 1874, p. 159, Sec. 7111, R.S. 1879.) Present Sec. 10385 provides for the mortgage to contain a power of sale authorizing the sheriff to sell the mortgaged land, after giving notice "of the time and place of sale", and specifying the manner of publication of this notice. This contains no requirement of sale during court sessions. While Sec. 10387 (which was retained in its old form, see R.S. 1855, p. 1425, Sec. 30, Chap. 143) seems to contemplate proceedings under the court's order as under fieri facias, this section does not specifically fix the time for sale as does Sec. 1362 providing requirements for sale of real estate under execution on Circuit Court judgments. However, prior to 1874, it seems to have been the only method of foreclosure. It was held in Grant v. Huston, 105 Mo. 97, 16 S.W. 680, that a sale in accordance with the power of sale stated in a school fund mortgage was good, even though not made during a session of the Circuit Court when the power of sale in the mortgage did not require it. We hold that this sale was not void for this reason.
The Sheriff's deed recites proper publication of notice in the Poplar Bluff Republican but no proof of publication was attached to the deed. However, the manager of the Poplar Bluff Printing Company testified that the notice, a copy of which was introduced in evidence, was published four times, on November 7th, 14th, 21st and 29th, 1935. He produced the files of the newspaper in court showing the publication on these dates. It is true that the record does not specifically show (as plaintiff says) that these were the files of the same newspaper recited in the foreclosure deed. Nevertheless, the papers were before the court without objection or claim that they were not copies of the same paper. Proof of publication can be made otherwise than by the printers affidavit authorized by Sec. 14969. [Raley v. Guinn, 76 Mo. 263; Robbins v. Boulware, 190 Mo. 33, 88 S.W. 674; McDaniel v. Sprick, 297 Mo. 424, 249 S.W. 611. See also Sec. 3481 concerning recitals in the deed.] Plaintiff offered no proof to the contrary either as to the compliance of the newspaper with Sec. 14968 or as to the sufficiency of the publication. We hold that defendants' proof of legal publication was sufficient. As to report of sale to and confirmation by the County Court, plaintiff cites no statute or authority making such a requirement in the case of school fund mortgage foreclosures. The county was authorized by Sec. 10389 to bid in the land, accepted its conveyance, and sold it, which should be sufficient to bind it. We hold that the foreclosure was not void.
[3, 4] The County Clerk had no authority to take the acknowledgment to his own deed but that made only the acknowledgment void and left the deed good between the parties. [Woolridge v. La Crosse Lumber Co., 291 Mo. 239, 236 S.W. 294, 19 A.L.R. 1068; Williams v. Moniteau National Bank, 72 Mo. 292.] If the foreclosure was not void and divested plaintiff of her title, no defect in later deeds could harm her or give her any superior rights over the subsequent purchasers. Even if plaintiff might have had a right to redeem, upon a proper showing of harmful result therefrom, because of failure to sell when circuit court was in session (which we do not hold), while the county still owned the land or while the County Clerk owned it, she brought no action then and even this is not such an action. [See Richards v. Earls, 345 Mo. 260, 133 S.W.2d 381.] Plaintiff's claim is on the ground that the foreclosure was wholly void. [See Benton County v. Morgan, supra.] Plaintiff did not allege that she could or would pay the mortgage debt. She only asked that the title be declared vested in her subject to the mortgage, and she seeks to take the property from innocent subsequent purchasers. According to the evidence as to value, even confiscating improvements made by such bona fide purchasers, if the mortgage should be reinstated the debt and with delinquent interest added to date would very nearly equal its value. The result would be to take all from them and give her nothing. Plaintiff makes no offer to do equity to the present owner and trust deed holder who have made or paid for improvements apparently sufficient to double the value of the property. She lived nearby while these improvements were being made by innocent purchasers without asserting any claim and the court properly found against her on the defense of laches and lack of equity in her claim. [Kline v. Vogel, 1 S.W. 733, 2 S.W. 408, 90 Mo. 239; [735] Ferguson v. Soden, 111 Mo. 208, 19 S.W. 727; Ludwig v. Scott (Mo. Sup.), 65 S.W.2d 1034.] As we said in Morris v. Hanssen, 336 Mo. 169, 78 S.W.2d 87: "The relief of cancellation will not be granted against a bona fide purchaser for value and without notice of the fraud or other ground for cancellation. This rule applies irrespective of the grounds on which the rescission or cancellation is sought."
The judgment is affirmed. All concur.