Hibernia Savings & Loan Society v. Ordway

Sanderson, J., delivered the opinion of the Court: This is an action to foreclose two mortgages and to remove an alleged cloud upon the title to the mortgaged premises, which cloud is alleged to have been created by the joint fraudulent and collusive action of the mortgagors and their co-defendant, Anderson, for the purpose of defrauding the plaintiff of its lien. The cloud consists of a judgment in an action of ejectment, founded upon a tax deed, by Anderson, against the mortgagors, by which he recovered of them the possession of the mortgaged premises. The action of ejectment was brought after the execution of the mortgages, but was founded upon a tax sale and deed, alleged to be null and void, which tax sale took place prior to the execution of the mortgages, although the deed was not made until afterwards.

The mortgagors made default. Anderson appeared and denied the averments of the complaint in relation to the ejectment and the invalidity of the tax sale and deed, and claimed that the title to the mortgaged premises had come to him; through the tax deed, unencumbered by the plaintiff’s mortgages. The Court below found these issues against Anderson, who, having first moved for a neYV trial without success, has brought the case here. The appeal is from the judgment and the order denying a new trial.

Two principal points are made :

First—-That the Court erred in allowing the judgment to draw interest at the rate of two per cent, per month, instead of only seven per cent, per annum, as provided by the statute in relation to interest then in force. The point is well taken, but the question is one in Avhich Anderson has no possible interest, and he is not, therefore, prejudiced by the error. There is no personal judgment against him, and if the land is his, it is his unencumbered 'by. the plaintiff’s judgment, for his title antedates the plaintiff’s mortgages.

[681]Second—That the plaintiff was entitled to no relief in respect to the alleged cloud.

(a.) In support of this point, it is argued that titles held by parties claiming under the mortgagors, which titles were obtained prior to the date of the mortgage, cannot be litigated in an action to foreclose the mortgage, but must be tried in a different action, because they generally give rise to questions of purely legal cognizance, and in support of the argument, the case of San Francisco v. Lawton (18 Cal. 465 —-21 Cal. 589), is cited. Without considering whether, that case is in point or not, we are of the opinion that the question, so far as it rests upon this reasoning, has not been made in the proper mode. The reasoning goes to the point that there has been a misjoinder of causes of action and of parties. Both of these are objections which the statute declares shall be deemed waived, unless they are interposed by demurrer. There was a demurrer filed in which the latter ground ivas taken, but it was not prosecuted, as the record affirmatively shows, and was overruled by the Court for that reason. Under these circumstances, we' are disposed to hold that these objections, which have really been made for the first time in this Court, have been waived. In the case upon which counsel relies, the point was expressly made upon the face of the record, and heard and determined in the Court below.