State ex rel. Hale v. McGee

WHITING, J.

[1] This cause comes before us upon the íeturn made by defendants to a writ of certiorari issued by this court and1 upon a motion by defendants asking a dismissal of such writ. The return to the writ show-s tire following, which we deem-to -be the only material faicts for our consideration: Plaintiff Hale, being the mortgagee named in, and the holder of a certain real estate mortgage given to harm ’by the defendants Thomson, Undertook to foreclose 'the same by advertisement under the power of sale in such mortgage contained. The proceedings upon such foreclosure -were in all things regular. Foreclosure sale was had, and Hale .became the purchaser at such -sale; the period for redemption had nearly expired’, when the mortgagors presented an affidavit to the circuit judge and asked for an order, under section) 636, C. C. P., enjoining the execution of a sheriff’s deed, and requiring that all further proceedings on foreclosure be had in court. The order asked for ‘.vas granted, but in the form- of a count order. Defendants moved the dismissal of the writ on 'the ground that the order, being a court order, was appealable, and, the action of the lower court being reviewable on appeal, certiorari would not lie. Section 636, C. C. P., provides:

“Every mortgage of real property containing therein a power of sale, upon 'default being made in the condition of such, mortgage, may be foreclosed by advertisement, in the cases and manner hereinafter specified; provided, that when the mortgagee or his assignee has commenced procedure by advertisement, and it shall be made to appear by affidavit of the mortgagor, his agent or attorney, to the satisfaction of the judge of the circuit court of the county wherein the mortgaged property is situated, that the mortgagor has a legal counterclaim or * * * other defense against the collection of the whole or any part of the amount claimed to- be due on such mortgage, such judge may by an order to that effect, enjoin the mortgagee or his assignee *262 from1 foreclosing such mdrtgiage by advertisement, and direct that ail further proceedings for the foreclosure be had 'in the circuit court properly having jurisdiction of the subject-matter * * *”

This proceeding is neither an action nor a special proceeding in court. It provides a method by 'which a foreclosure can, at the option of the mortgagor, at the proper time and upon a proper showing, 'be thrown into court. The statute does not contemplate that such proceeding shall take the place of air action in equity wherein the right to> equitable relief would be determined upon the issues of fact raised by pleading; the proceeding is one purely ex parte 'before a judge. While the order obtained ma3r form the basis' for an action or proceeding in court, in case such order should be disregarded, yet such statute does' not provide for a court order’. Therefore the order in question, though in form a Court order, must be held to- be an order of -the judge, and, not being an order made in a action or special proceeding in court, it cannot be followed by an order of the court made in the same proceeding, and therefore can only be reviewed by cer-tiorari.

[2] Plaintiff 'contends that the time within which relief can be granted under section 636 is confined to the time pending- the sale — that after a sale has been held under a power of sale, if the mortgagor desires to restrain further proceedings, he must proceed by a proper action in court just as he would have to-before sale if it were not for the proviso in section 636. The plaintiff is -clearly right in such contention. This statute was enacted for the purpose: (a) Of authorizing an exercise of a power of sale, a purely statutory right; (b) to give to the mortgagor the absolute power, upon a proper showing, to prevent the exercise of such power. The moment such, power has been exercised' it has ceased to exist and' is past restraint. If it should be thought that the wording of such statute is ambiguous, then, in order to determine what must have been the intent of the Legislature in enacting the same, we have a right to consider the results that might flow from the ¡construction of the statute contended for by defendants. A sale held under a power of sale, where the statute has1 been complied with in the giving of notice, etc., is a valid sale, and passes to the purchaser a conditional equitable estate. This equitable estate is a vested estate; it will. *263 except there be redemption — the condition to1 'which it is subject — ¡ripen into an absolute estate by mere lapse of time. Wood v. Conrad, 2 S. D .405, 50 N W. 903; McGregor v. Pierce, 17 S. D. 51, 95 N. W. 281 . This absolute estate entitles the holder thereof to be vested with the legal title through the sheriff’s deed. Upon the sal'e, the mortgage debt, to the extent of the proceeds! of the sale applicable to its payment, is wiped out, and ceases to exist. Take the case of a sale at which some party, other than the mortgagee, is the purchaser. Can his vested equitable estate be taken away by an ex parte proceeding? In what manner is he proteoted? H!is money has gone to the mortgagee, who may be irresponsible — perchance a resident of another state. 'Certainly the Legislature did not intend such a thing. To give to this statute a construction permitting of such a result would necessitate our holding it unconstitutional, as one which would take from a party his property without due proceess of law. We are of the opinion that such statute should! be construed as merely giving the right to terminate the power of sale. The defendant judge having, at the time of the application for same, no power or jurisdiction to make the order sought, the proceedings therefore should be quashed, and judgment will issue toi that effect, but without costs. Kirby v. Court, 10 S. D. 196, 72 N. W. 461 .