Walden-Page Memorial Hospital, Inc. v. Founders, Inc.

1966 OK 123, 418 P.2d 343, 1966 Okla. LEXIS 442
CourtSupreme Court of Oklahoma
DecidedJune 28, 1966
DocketNo. 41496
StatusPublished
Cited by1 cases

This text of 1966 OK 123 (Walden-Page Memorial Hospital, Inc. v. Founders, Inc.) 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
Walden-Page Memorial Hospital, Inc. v. Founders, Inc., 1966 OK 123, 418 P.2d 343, 1966 Okla. LEXIS 442 (Okla. 1966).

Opinion

BLACKBIRD, Justice.

Plaintiff in error, hereinafter referred to as plaintiff, acquired title to certain Wagoner, Oklahoma, real estate from Frona J., and Dewey Hobson, Walden, before Bentsen Development Company obtained an assignment of the mortgage on it from three mortgagees by the name of “Young”. Thereafter, when the Company and its copartners, which we will sometimes refer to merely as “the Bentsens”, foreclosed the mortgage in Federal Court, they named the Waldens as sole defendants, and left the plaintiff herein unnamed in, and omitted from, that action. After the Bentsens obtained judgment in the foreclosure action, and thereafter bid the property in at the foreclosure sale which followed, and went into possession of the property upon filing their Marshal’s Deed of record in February, 1953, plaintiff, more than five years later instituted the present action in 1958, to recover the property and damages against the Bentsens and their successors in title, hereinafter referred to collectively as “defendants”. In the action’s first appeal, Walden-Page Memorial Hospital v. Bentsen, Okl., 370 P.2d 5, we held that the trial court’s judgment for the defendants on the ground that the action was barred by the 5-year limitation period prescribed by Tit. 12 O.S.1951 and 1961, sec. 93(1) was error, and remanded the case for a new trial.

Thereafter, when the new trial was had in 1964, the trial court again rendered judgment for the Bentsens, but this time it was pursuant to their cross petition praying for (a belated) foreclosure of their mortgage against plaintiff. The court rejected plaintiff’s defense that such foreclosure was barred by expiration of a limitation period and that the mortgage deed had been cancelled by, and the mortgage merged into, the foreclosure judgment. On the contrary, the court specifically found that a major portion of the original mortgage indebtedness ($99,689.64, to be specific) was unsatisfied and ruled “that it was necessary” for plaintiff to tender that amount to the Bentsens in open court in order to proceed with its action to eject them', from the property. It was after plaintiff’s refusal to make this tender that the-court received evidence in support of the Bentsens’ cross petition, and thereafter rendered judgment upholding it, and foreclosing their mortgage against plaintiff.

In the present appeal, plaintiff’s general position is that the trial court exceeded its authority in purporting to foreclose the Bentsens’ mortgage against it at that late date, on two grounds, namely: (1) Their cause of action was barred by limitations, and (2) The subject mortgage had already been foreclosed, and merged into the aforementioned Federal court judgment, which extinguished said mortgage’s lien.

On the first of these issues, plaintiff relies almost exclusively on Tit. 12 O.S.1961, sec. 95 “First”, and First Nat’l Bank and Trust Co. of Oklahoma City et al. v. Stark et al., 207 Okl. 183, 249 P.2d 117. In the cited case, where, after the first trial of said mortgage foreclosure action in 1942, one W. J. Stark, who purchased a small interest in the mortgaged real estate from one Scruggs, who had not been a party to-the foreclosure judgment, was subsequently made a party to the action before its second trial, and then asserted, as his defense, the expiration of the limitation period, we held the bank’s right to foreclosure against Stark was then barred, as the note and mortgage had matured in 1941, and he did not become a party to the action until' nearly eight years later.

Defendants’ contention that since they have been in possession of the subject property at all times since obtaining it under their Marshal’s Deed in 1953, no limitation is applicable to them, in as much as they (with regard to such a bar) are in the same position as mortgagees in possession. Among other authorities, they cite the case of Higgs v. Renfrow, 195 Okl. 545, 159 P.2d 749, in which we held:

“The statute of limitations does not run against a mortgagee in possession during the continuance of such posses[345]*345sion, and until the mortgage debt has been fully paid the owner may not oust .such mortgagee from possession or quiet his title as against such mortgagee.”
“It is not necessary to the status of a -mortgagee in possession that possession ■of the land shall have been taken under the mortgage or with the consent of the -mortgagor. It is sufficient if the possession be taken peaceably and lawfully.”

In Plaintiff’s reply brief, it relies heavily on Layden v. Layden, 228 N.C. 5, 44 S.E.2d 340, and cites other authorities for expressions which are correct, as abstract principles of law, but, like the Stark ■Case, supra (which, unlike the present one, was not an action of ejectment against a mortgage foreclosure purchaser) have no ■application to the facts of this case. Of ■course, in this jurisdiction, where a real •estate mortgage gives the mortgagee — instead of title to, or possession of, the mortgaged property — only a lien upon it, with the right to foreclose, upon the mort.-gagor’s failure to comply with certain of its •contract provisiQns, there is, legally and strictly speaking, no such character as a '“mortgagee in possession”; but, this does mot mean that, under certain conditions, .a mortgagee’s relationship to the mort■gaged premises may not be regarded in equity, and for certain purposes, the same ■as that of a mortgagee in possession. Perhaps one of the soundest and most com-prehensive discussions of the crucial issue "here, and related questions, is found in the early case of Stouffer v. Harlan, 68 Kan. 135, 74 P. 610, 64 L.R.A. 320, in which the court, among other things, said:

“ * * * The expression ‘mortgagee in possession’ has been adopted by the courts and law writers as a convenient phrase to describe the condition of a mortgagee who is in possession of mortgaged premises under such circumstances as to make the satisfaction of his lien a prerequisite to his being dispossessed, even in jurisdictions where the mortgage itself can confer no possessory right either before or after default; * * *.
* * * * * *
In Cooke v. Cooper, 18 Or. 142, 22 Pac. 945, 7 L.R.A. 273, 17 Am.St.Rep. 709, the second paragraph of the syllabus, which is quoted with approval in Kelso v. Norton, supra, reads as follows: ‘If, for any cause, in the foreclosure suit, the proceeding is ineffectual to foreclose the mortgage, and the mortgagee purchases at a sale under such void proceedings, and enters into the possession under such sale, his relation to the mortgaged premises is that of a mortgagee in possession.’ * * *»

After a rather detailed discussion of the origin of, and reasons for, the subject equitable doctrine, the court further said:

“And in Tallman v. Ely, 6 Wis. 244: ‘It would be unwise and inequitable to permit the grantee of the mortgagor to obtain the possession, as against the mortgagee or his assigns, while the mortgage debt remains unpaid. Under such circumstances, if the grantee desired to obtain possession of the premises, he could file his bill to redeem, and the court could properly aid him in obtaining possession after the incumbrance was discharged. In this way equity could be fully done between all the parties.

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