Robinson & Co. v. Cosner

67 So. 468, 136 La. 595, 1914 La. LEXIS 1970
CourtSupreme Court of Louisiana
DecidedJune 8, 1914
DocketNo. 20024
StatusPublished
Cited by10 cases

This text of 67 So. 468 (Robinson & Co. v. Cosner) is published on Counsel Stack Legal Research, covering Supreme Court of Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Robinson & Co. v. Cosner, 67 So. 468, 136 La. 595, 1914 La. LEXIS 1970 (La. 1914).

Opinions

PROVOSTY, J.

This is an hypothecaryaction by Robinson & Co. against Geo. W. Cosner to enforce a judgment obtained by Robinson & Co. against one Neely, and duly recorded while the property now sought to be proceeded against stood of record in Neely’s name.

Neely failing to pay the credit part of the price of the sale by which he had acquired this property, his vendor, John H. Lewis, obtained a judgment against him, and caused a fi. fa. to issue on it, and the property to be seized and sold, and purchased it at the sheriff’s sale. He subsequently sold it to Cosner, who has called him in warranty to defend the suit.

Included in this judgment for the vendor’s claim was a debt which, for want of registry, was not secured by any mortgage or privilege as to third persons, and the fi. fa. was issued for both debts, and the sale was made for both. Lewis’ bid was the only one made at the sale, and was for the full amount called for by the writ; that is to say, for the full amount of the two debts, plus the costs. The sheriff’s deed to Lewis recited that the price of the adjudication was paid by Lewis; but the sheriff’s return on the writ shows the contrary, since it contains the statement that the money was received from Lewis and paid to his attorney. As a matter of fact, no part of the price of the adjudication was paid, except to an amount sufficient for the costs. The sheriff’s deed to Lewis which was duly recorded, directed the clerk of court and ex officio recorder of mortgages to cancel 'all mortgages subsequent in date of registry to Lewis’ said vendor’s claim; and, under this instrument, the registry of Robinson & Co.’s said judgment was canceled. And it was after this cancellation that the defendant, Cosner, bought the property from Lewis. He did so in good faith, relying upon the records of the recorder’s office,' which showed said property to be free of mortgages.

The property was Neely’s homestead, and he was present at the sale for the purpose of asserting his homestead right of $2,000 against any excess of the price of the adjudication over and above the amount of Lewis’ judgment. He could not claim the homestead as against Lewis' judgment, because one of the debts for which it had been rendered was for the purchase price of the property, and the other was for labor and materials that had gone towards improveing the homestead. Const, art. 245. This other debt, not having ever been recorded, did not bear mortgage or privilege upon the property as against third persons, and, while priming the homestead, was itself primed by Robinson & Co.’s judicial mortgage. Robinson & Co., though present 'at the sale through an agent for the purpose of asserting any rights they might have, made no attempt to interfere. Doubtless, they considered that, inasmuch as their claim was inferior in rank to the vendor and homestead claims, which together exceeded the amount of the adjudication, they could get nothing by interfering. That this was the reason for their nonaction is not shown affirmatively, but results by a very strong implication. It was only some nine months later that they awoke to their present idea of their having rights in the premises, and brought'this suit. The date of the sale was August 5, 1911. This suit was filed June 10, 1912.

The question is, of course, whether at said sheriff’s sale the property passed to Lewis free of their said judicial mortgage, or burdened with it. If it passed free, the sheriff was authorized to direct the inscription of said mortgage to be canceled. If it passed burdened with said mortgage, the cancellation of the inscription of said mortgage was [599]*599unauthorized, and cannot affect Robinson & 00.’s mortgage rights.

The rule is that the property sold at a sheriff’s sale passes burdened with the mortgages resting upon it, which are superior in rank to the claim of the seizing creditor, but free- of those which are inferior (O. P. arts. 679, 683-685, 708, 710), unless the inferior mortgages are special, and a balance remains after the seizing creditor’s claim is satisfied ; in which event the purchaser retains in his hands this balance to an amount equal to that of these inferior 'special mortgages (Tessier v. Bourgeois, 38 La. Ann. 256). But he cannot retain this balance when the inferior mortgages are not special, but are general— 1. e., legal or judicial. Pasley v. McConnell, 38 La. Ann. 474. In Fortier v. Slidell, 7 Rob. 398, this court said that the Code had made no provision for the mode of raising subsequent general mortgages when at a sheriff’s sale there remains a surplus, and propounded the question, “What is to be done in such a case?” and answered the question by saying that this surplus must be paid to the sheriff, to be attributed by him to satisfying these subsequent general mortgages. This view was expressly reaffirmed in La Gourgue v. Summers, 8 Rob. 175, and has never been departed from.

All this we do not understand the learned counsel for Robinson & Co. as contesting in any way; in fact, they have cited the said articles of the Code and decisions as authority on their side. Their contention is that, unless the sheriff does apply the surplus to the subsequent mortgages, they are not extinguished, but continue to remain upon the property, and that in the instánt case he did not do so, but applied it in part to the satisfaction of the second item of Lewis’ judgment, which was inferior in rank to Robinson & Co.’s mortgage.

We do not think that the manner in which the sheriff has distributed the price of á sale made by him can exercise any influence upon the question of whether the property passed to the purchaser burdened with, or free of,, the mortgages subsequent in rank to the claim of the seizing creditor, unless, indeed, the subsequent mortgages are special, and the surplus of the price of adjudication has been paid to the holder of them; in which case, of course, these special mortgages would be extinguished by payment, and could no longer affect the property. The purchaser at a sheriff’s sale is not required to supervise the distribution of the proceeds of the sale. All he is required to do is to comply with his bid. The law then regulates the situation; and, according to this law, the property passes to him free of the general mortgages inferior in rank to the claim of the seizing creditor.

Indeed, if the sale in this case .had been made to satisfy only that part of Lewis' judgment which was for the vendor’s claim, and Lewis had paid the price of the adjudication, the case would appear to us to be wholly free from difficulty. But the sale was made to satisfy both the vendor’s claim and the unsecured claim included' in the judgment. The judgment was for both claims, and the fi. fa. was for both, and the sale was, in form and in fact, made to satisfy both, and Lewis paid no part of the price; he and the sheriff merely went through the paper ceremony of exchanging receipts.

Under these circumstances, doubt has arisen in our minds whether, to the extent that the sale was thus made to satisfy the unsecured claim, it must not be considered as having been for a debt inferior in rank to Robinson & Co.’s said mortgage, with the result that the property passed subject to said mortgage.

We have concluded, however, that while the sale was, in fact, made to satisfy both claims, it was, in legal contemplation, made to satisfy only the vendor’s claim. Our rea[601]

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Bluebook (online)
67 So. 468, 136 La. 595, 1914 La. LEXIS 1970, Counsel Stack Legal Research, https://law.counselstack.com/opinion/robinson-co-v-cosner-la-1914.