Hodge v. Briggs

643 S.W.2d 576, 7 Ark. App. 16, 1982 Ark. App. LEXIS 907
CourtCourt of Appeals of Arkansas
DecidedDecember 15, 1982
DocketCA 82-108 & CA 82-109
StatusPublished

This text of 643 S.W.2d 576 (Hodge v. Briggs) is published on Counsel Stack Legal Research, covering Court of Appeals of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hodge v. Briggs, 643 S.W.2d 576, 7 Ark. App. 16, 1982 Ark. App. LEXIS 907 (Ark. Ct. App. 1982).

Opinions

George K. Cracraft, Judge.

On October 31, 1979 Wilburn M. Briggs commenced an action to foreclose two real estate mortgages which were then in default. The first of these mortgages was executed by L. Gene Worsham on April 5, 1976 to secure an indebtedness of $125,000 evidenced by a note payable to Capitol City Savings & Loan Association and subsequently assigned to Briggs. He further alleged that he was the holder of a separate note for $150,000 executed by Worsham on April 28, 1977, which was also secured by a mortgage on the same property. The appellant Paul L. Hodge was named as a defendant on allegations that “he may claim an interest by virtue of a second mortgage on the property” executed by Worsham on the 20th day of September, 1976 to secure an indebtedness owed to Hodge in the sum of $10,000. The only relief prayed against Hodge was that the two mortgages held by Briggs be declared to be superior to that of Hodge.

Rea Britton was also named a defendant on allegations that she too “may claim” an interest as assignee of a mortgage and notes on that property dated April 4, 1977. It was alleged that Britton’s mortgage was void and, in any event, was inferior to those of Briggs. There were other parties to the suit against whom relief was sought. These parties and issues are not involved in this appeal, which is narrowed solely to the issues of the priorities as to the mortgages of Briggs, Hodge and Britton.

Britton filed an answer denying all allegations of the complaint and counterclaimed against Briggs asserting that her lien was a valid one and was superior to Briggs’. Britton cross-complained against all other co-defendants except Hodge.

Although Hodge was properly served with a copy of the Briggs complaint, he was not named as a cross-defendant or served with a copy of the answer and counterclaim filed by Britton. Hodge did not appear and filed no responsive pleading in the case.

On August 27, 1981 the court, reciting that Hodge was in default, entered a foreclosure decree “as a part of an agreement between Briggs and Britton.” This decree ordered foreclosure, declared that Briggs had a first lien by virtue of his two mortgages, found that Britton’s lien was subordinate only to that of Briggs, and that the lien of Hodge was subordinate to both liens. Appellant had notice neither of the filing of the answer, counterclaim and cross-complaint nor the entry of the judgment until after the decree had been entered. On September 4,1981 he filed a timely motion to set aside the decree on the grounds that he had not been made a party or served with notice of Britton’s answer, counterclaim and cross-complaint and that any interest claimed by Britton was in fact subordinate to his own. The court denied this motion and a timely notice of appeal was filed in that case.

On that same day the appellant brought a separate action to foreclose his second mortgage asserting that only the mortgage executed by Worsham to Capitol City Savings and Loan Association (held by Briggs under an assignment) was superior to his. Worsham did not answer. Briggs and Britton moved to dismiss as to them asserting that the question of priority of this lien had been fully adjudicated in the decree in cause No. E-79-581. The court entered a personal judgment by default against Worsham in favor of Hodge in the amount of the debt but granted the motions of Briggs and Britton, holding that the priority of their liens had been fully adjudicated in the prior decree. Appellant also appeals from that order and both appeals were consolidated in this court.

In the complaint Briggs alleged that he was the holder of the notes secured by the two mortgages on the property. One mortgage dated April 5, 1976 had been assigned to him by Capitol City Savings & Loan. He also alleged that he was holder of a note in the amount of $150,000 executed by Worsham secured by a mortgage on the same property dated the 28th of April, 1977. Even though the appellant’s mortgage was prior in time to the second of the Briggs mortgages, the complaint alleged that it was inferior to Briggs’ lien. The only relief prayed for against the appellant was that the two Briggs mortgages be declared superior to that of the appellant. The appellant filed no responsive pleading controverting the superiority of the Briggs mortgage which had been filed for record subsequent to his own.

Rule 55, Arkansas Rules of Civil Procedure, provides that where a party against whom a judgment for affirmative relief is sought has failed to appear or otherwise defend as provided by the rules, judgment by default will be entered by the court. The relief sought by Briggs against the appellant was a declaration that the liens of both Briggs’ mortgages were superior to that of the appellant, notwithstanding that only one of Briggs’ notes was superior in time. When Briggs asserted that the appellant claimed an interest in the land but that it was inferior to his liens, the appellant was required to plead and prove whatever interest he had which he might claim to be superior to that of the appellee. Having failed to do so, he is in no position now to claim a superior lien. Bank of Commerce v. Ryan, 152 Or. 614, 52 P.2d 1139 (1936); Rule 55 (c), Arkansas Rules of Civil Procedure. There is nothing in the record showing excusable neglect, unavoidable casualty or any other just cause for setting the decree aside. We find no error in the court’s refusal to set aside that part of the decree which declared appellant’s lien to be inferior to both of those of Briggs or in holding that appellant was estopped by the prior decree to raise that question in the separate action brought by him.

Appellant next contends that the chancellor erred in both deciding the issue of priority of liens between Hodge and Britton in the first action and in holding that determination to be a binding adjudication of the issue between them in the second case. We agree that the pleadings in the original suit did not raise that issue for the court’s determination.

Britton’s pleading was two-pronged. It was an answer to the allegations made by Briggs against her in his complaint and a counterclaim against Briggs and a cross-complaint against other co-defendants seeking affirmative relief against them. Hodge was not named a party in the cross-complaint, and no relief was prayed against him. He was not served with a copy of the pleading.

An answer to a complaint is responsive only to the allegations of the plaintiff and cannot raise j usticiable issues as to other co-defendants. In order to properly seek affirmative relief from a co-defendant it is necessary to cross-complain against him stating the facts on which the relief is sought and to serve him with it. Marr v. Lewis, 31 Ark. 203 (1877); Ringo v. Woodruff, 43 Ark. 469 (1884); Pillow v. Sentelle, 49 Ark. 430, 5 S.W. 783 (1887); Reynolds v. Jones, 63 Ark. 259, 38 S.W. 151 (1896); Luttrell v. Reynolds, 63 Ark. 254, 37 S.W. 1051 (1896); Miller v. Mattison, 105 Ark. 201, 150 S.W. 710 (1912); Fox v. Pinson, 182 Ark. 936, 34 S.W.2d 459 (1930).

In Ringo the court stated:

But neither of them made his answer a cross-complaint. Failing to do this, there was lacking the pleading which was necessary to authorize the court below to grant them such relief.

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Related

Fox v. Pinson
34 S.W.2d 459 (Supreme Court of Arkansas, 1930)
Arkansas Bond Company v. Harton
87 S.W.2d 52 (Supreme Court of Arkansas, 1935)
Board of Directors of St. Francis Levee v. Raney
76 S.W.2d 311 (Supreme Court of Arkansas, 1934)
Bank of Commerce v. Ryan
52 P.2d 1139 (Oregon Supreme Court, 1935)
Marr v. Lewis
31 Ark. 203 (Supreme Court of Arkansas, 1876)
Ringo v. Woodruff
43 Ark. 469 (Supreme Court of Arkansas, 1884)
Pillow v. Sentelle
49 Ark. 430 (Supreme Court of Arkansas, 1887)
Luttrell v. Reynolds
37 S.W. 1051 (Supreme Court of Arkansas, 1896)
Reynolds v. Jones
38 S.W. 151 (Supreme Court of Arkansas, 1896)
Miller v. Mattison
150 S.W. 710 (Supreme Court of Arkansas, 1912)
Schulte v. Walthour
393 S.W.2d 242 (Supreme Court of Arkansas, 1965)

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Bluebook (online)
643 S.W.2d 576, 7 Ark. App. 16, 1982 Ark. App. LEXIS 907, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hodge-v-briggs-arkctapp-1982.