State Construction Corporation v. Scoggins

485 P.2d 391, 259 Or. 371, 1971 Ore. LEXIS 382
CourtOregon Supreme Court
DecidedMay 26, 1971
StatusPublished
Cited by20 cases

This text of 485 P.2d 391 (State Construction Corporation v. Scoggins) is published on Counsel Stack Legal Research, covering Oregon Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State Construction Corporation v. Scoggins, 485 P.2d 391, 259 Or. 371, 1971 Ore. LEXIS 382 (Or. 1971).

Opinions

DENECKE, J.

Mrs. Scoggins brought a suit in equity to set aside [373]*373a deed of property upon which her house was located. The deed was from the City of Portland to State Construction Corp. and was given because Construction Corp. purchased the property at a sale foreclosing the City’s lien which secured a delinquent assessment for sidewalk construction.

In 1959 the City of Portland constructed a sidewalk upon the property of Mrs. Scoggins and her then husband. An assessment was made against the property and Mrs. Scoggins and her husband made several annual payments. Mrs. Scoggins was divorced in 1964; however, she remained upon the property. According to her testimony she thereafter received no notice of the annual installments and made no payments. The assessments became delinquent, the property was put up for sale, and was sold, all, according to Mrs. Scoggins’ testimony, without any kind of notice to her.

In June 1965 the property was sold to State Construction Corp. for $225.44, the amount of the delinquency and the maximum which could be received by the City under OES 223.525. The property is allegedly worth $10,000. In June 1968 the City delivered a deed to Construction Corp.

Mrs. Scoggins alleged in her complaint that she did not receive notice of the proceedings; that Construction Corp. would be unjustly enriched if it retained the property; and prayed for a decree that the deed to Construction Corp. be declared void. The trial court found for Mrs. Scoggins and Construction Corp. appeals.

The procedure is governed by OES 223.505-223.595. The statutes provide for notice of sale to the delinquent owner, for public sale and a certificate of sale to the purchaser, and a one-year period of re[374]*374demption which can be accomplished by paying the purchase price, interest and a penalty. If no redemption is had within the year, the City delivers a deed to the purchaser. OES 223.575 provides:

“The effect of the deed shall be to convey to the grantee therein named the legal and equitable title in fee simple, to the real property described in the deed, excepting only the lien of the city on such assessments or liens as were not included in the foreclosure proceedings. The deed shall be prima facie evidence of title in the grantee, except as stated in this section,' and that all proceedings and acts necessary to make such deed in all respects good and valid have been had and done. Such prima facie evidence shall not be disputed, overcome or rebutted, or the effect thereof avoided, except by satisfactory proof of either:
“(1) Fraud in making the assessment or in the assessment, or in the procuring of the lien.
“(2) Payment of the assessment or lien before sale or redemption after sale.
“(3) That payment or redemption was prevented by fraud of the purchaser.
“(4) That the property was sold for a lien or assessment for which neither the property nor its owner, at the time of sale, was liable, and that no part of the assessment or lien was assessed or levied upon the property sold.”

This statute provides in essence that the deed is prima facie evidence that all notices required by statute, such as notice of foreclosure, sale, etc., have been given. The act also provides that this prima facie evidence cannot be disputed except for the four grounds set out in the statute.

At trial Construction Corp., in essence, introduced its deed from the City and rested. Since ade[375]*375quaey of notice is not in issue under the statute, Construction Corp. did not attempt to put in any evidence of what notice the City had given Mrs. Scoggins. Mrs. Scoggins testified that she had not received any notice of actions taken by the City. Mrs. Scoggins did not claim at trial or in this court that the failure to give notice deprived her of her property without due process of law.

The trial court reasoned that Construction Corp. knew or should have known that Mrs. Scoggins would not have suffered her $10,000 house to be forfeited to pay $225 unless she was unaware of what was happening. For this reason the trial court was of the opinion that Construction Corp. had a duty to inform Mrs. Scoggins of the facts and its failure to do so constituted fraud within the meaning of the above-quoted statute and, therefore, the prima facie case made by the deed had been successfully rebutted.

1, 2. The trial court was in error for two reasons: First, fraud was not pleaded nor made an issue in the trial court or this court. Second, there is no evidence of fraud. A trial or appellate court sitting as a court of equity is not free to disregard clear statutory requirements regardless of the apparent injustice of the result. Evans Products v. Jorgensen, 245 Or 362, 372, 421 P2d 978 (1966).

Mrs. Scoggins alleged in her complaint that the City published notice of the sale in the Daily Journal of Commerce, a newspaper; however, Mrs. Scoggins was not apprised of the sale. She further alleged: “The defendant has been unjustly enriched in the approximate amount of $9,700.00 at the expense of plaintiff, who had no notice of the proceedings nor the opportunity to pay the lien.”

[376]*3763,4. Fraud is only one of many grounds for claiming that the other party was unjustly enriched. Restatement, Restitution, Table of Contents. The purpose of pleadings is to inform the parties of the issues. A pleading of unjust enrichment without pleading the alleged ground such as mistake, coercion, undue influence, or fraud does not adequately inform.

Even more important, in the trial court Mrs. Scoggins did not claim fraud. In oral argument in this court counsel was explicit in stating that he was not contending that she was entitled to relief upon any of the statutory grounds, including fraud. He stated that the reason he had gone into equity was to seek avoidance of the unjust result that the application of the statute would bring about. With fraud not being made an issue in the trial court, Construction Corp. would be prejudiced if we now considered the issue. At trial Construction Corp.’s attorney stated that he had checked the record and as far as he could see the City had given notice to Mrs. Scoggins in accordance with the statute; however, Mrs. Scoggins’ contentions and the posture of the case in the trial court made that issue irrelevant.

Even if fraud, as that term is used in the statute, were in issue, there is no evidence of fraud.

5. In lieu of any evidence to the contrary, we must assume that the legislature was using “fraud” in its customary legal sense. “Fraud” in its customary legal sense does not encompass the failure of one in Construction Corp.’s position to notify one in Mrs. Scoggins’ position that she must pay $225 within a certain period or lose her home.

6. A failure to disclose facts can be fraud; however, such a failure amounts to fraud only where there is a [377]*377duty to disclose. The Comment to Restatement, Restitution § 8, p 33, states: “Except in a few special types of transactions, such as insurance contracts and transactions between a fiduciary and his beneficiary, there is no general duty upon a party to a transaction to disclose facts to the other party.

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State Construction Corporation v. Scoggins
485 P.2d 391 (Oregon Supreme Court, 1971)

Cite This Page — Counsel Stack

Bluebook (online)
485 P.2d 391, 259 Or. 371, 1971 Ore. LEXIS 382, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-construction-corporation-v-scoggins-or-1971.