Luschen v. Stanton

1943 OK 177, 137 P.2d 567, 192 Okla. 454, 1943 Okla. LEXIS 203
CourtSupreme Court of Oklahoma
DecidedMay 11, 1943
DocketNo. 30068.
StatusPublished
Cited by25 cases

This text of 1943 OK 177 (Luschen v. Stanton) is published on Counsel Stack Legal Research, covering Supreme Court of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Luschen v. Stanton, 1943 OK 177, 137 P.2d 567, 192 Okla. 454, 1943 Okla. LEXIS 203 (Okla. 1943).

Opinion

WELCH, J.

One Lawrence owned the lot in question in 1907, such ownership duly appearing of record. In 1927 one Brown was granted an award against Lawrence under the Workmen’s Compensation Act. Copy of such award was filed in the district court of Oklahoma county; execution issued thereon and the lot was sold at sheriff’s sale thereunder to Brown, credit being allowed upon the award for the purchase price. Sheriff’s deed dated April 21, 1927, was given Brown, which was duly recorded on April 29, 1927. Brown immediately went into possession. The lot was vacant and prior to that time had at all times been in the possession of Lawrence, so far as concerns this record as to notice.

On August 16, 1927, plaintiff Luschen purchased the lot for an adequate cash consideration, and the warranty deed therefor given by Brown was duly recorded August 22, 1927. Plaintiffs went into immediate possession and have ever since so remained.

On November 3, 1930, there was recorded a deed dated May 12, 1909, from Lawrence and others to one Stanton, who died in 1932, leaving the defendants herein as his heirs.

In December, 1939, plaintiffs brought this action to quiet title, deraigning title through Brown as above shown. Defendants claimed title by virtue of the deed from Lawrence and others, and sought possession and to have the title quieted in them. Plaintiffs, by reply, among other things, plead laches and estoppel.

The trial court denied plaintiffs relief and rendered judgment for defendants as prayed, upon the finding and conclusion that plaintiffs were not bona fide purchasers. There is no evidence or contention that Brown or plaintiffs had actual notice of the Stanton deed prior to the recording thereof, and the record is silent as to the date upon which such actual notice was had.

The question to be determined here is whether plaintiffs were bona fide purchasers. We shall determine whether Brown was a bona fide purchaser for value, and, if so, we need not proceed further, for it is contended only that plaintiffs have no such status because Brown was not so situated, and, indeed, such seems to be the general rule.

It is pointed out that Brown purchased at his own execution sale, and it is said that a purchaser at his own execution sale is not a bona fide purchaser. That is generally true, or we may better say, that is most frequently true because of the facts. We have so concluded in several cases, some of which we will presently discuss. Three principal elements must be present to constitute one a “bona fide purchaser.” An apt definition is to be found in 66 C. J. page 1092, par. 905, as follows:

“The doctrine of equity by which protection is afforded to a bona fide purchaser against prior equities of which he has no notice is based upon the theory that, in reliance upon the legal title, he has parted with a consideration of value or divested himself of some legal right or been induced to change his condition so that a deprivation of the legal title would work him injustice. In other words, where a bona fide purchaser for a valuable consideration, and without notice, has acquired the legal title, a court of equity will not interfere to deprive him of his legal advantage. ...”

And the elements thereof are stated in the same text under paragraph 906 as follows:

“The essential elements of a ‘bona fide purchaser’ of land are: (1) The payment of a valuable consideration; (2) good faith and absence of purpose to take an unfair advantage of third persons; (3) absence of notice, actual or constructive, of outstanding rights of others; although good faith may often *456 be implied where the other two elements, that is, valuable consideration and absence of notice, are shown. These elements must concur or the defense will be unavailing.”

In determining whether one who purchases at his own execution sale is a bona fide purchaser, the above rules and elements govern, the same as if the examination was being made as to any other purchaser. The authorities which we have examined disclose that one or more of the above elements are absent where it has been determined that the purchaser at his own execution sale is not a bona fide purchaser. Such cases are numerous, we think, because of the fact that in nearly all cases such purchaser, being a party to the suit and generally responsible for its integrity, is possessed of either actual or constructive notice of the fault or defect in the suit or proceeding which is the cause of and supports the conclusion that the judgment or sale is defective. Thus he has notice. Harjo v. Johnston, 187 Okla. 561, 104 P. 2d 985; see, also, cases to the same effect cited in notes 23 C. J. 764, par. 813, and 33 C. J. S. 587-8, par. 295.

There is also a class of cases where it has been held that a judgment lien-holder is not an encumbrancer for value as against an outstanding equity, because he has parted with nothing of value. J. I. Case Threshing Machine Co. v. Walton Trust Co., 39 Okla. 748, 136 P. 769; Oklahoma State Bank v. Burnett, 65 Okla. 74, 162 P. 1124; Kennedy v. Roff, 178 Okla. 71, 61 P. 2d 1041, and others.

There are other cases, not so numerous, including two of our own, Gilbreath v. Smith, 50 Okla. 42, 150 P. 719, and Harris v. Southwest National Bank, 133 Okla. 152, 271 P. 683, which have carried the same rule of the lien cases, supra, past the point of purchase at sheriff’s sale, upon the theory that even then, and in the given case, the purchaser has paid no valuable consideration; that he still retains his judgment debt and that he is in no worse position than he was before the purchase. Those cases are based upon the conclusion that the element of “the payment of a valuable consideration” is not present, and that the purchaser was capable of placing himself in status quo.

Other cases show actual or constructive notice before the purchase: Scott-Baldwin Co. v. McAdams, 43 Okla. 161, 141 P. 770; Lunn v. Kellison, 66 Okla. 168, 153 P. 1136, and Streeter v. Anderson, 172 Okla. 113, 43 P. 2d 53. In most of the cases we find the expression of the general rule to the effect that a purchaser at his own execution or judicial sale is not a bona fide purchaser. We find few, if any, such expressions or applications of the rule, however, where one or more of the “elements” referred to is not missing. Generally, each case involving the application of equitable principles is to be examined with most careful attention to all the facts in the given case. We observe that the text writers generally assert that there is considerable division of opinion on the exact question we now have. Our search leads us to believe that any such differences are due to the application of the legal principles rather than to the rules themselves.

In the present case it is beyond question that there is present the element of “absence of notice, actual or constructive, of outstanding rights of others.” Actual notice is not shown or suggested. Constructive notice is not shown because the Stanton deed was not recorded at the time Brown purchased at sheriff’s sale, and claim of defendants is not based upon any fault in the proceedings sponsored by Brown or under his control and for which he was responsible. Thus there is no notice to Brown of anything forming the basis of defendants’ claim. It is to be seen, therefore, that this case is not of the class of cases based upon notice, actual ,or constructive.

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Bluebook (online)
1943 OK 177, 137 P.2d 567, 192 Okla. 454, 1943 Okla. LEXIS 203, Counsel Stack Legal Research, https://law.counselstack.com/opinion/luschen-v-stanton-okla-1943.