CHATTEL MORTGAGES — Foreclosure — Sale — Res Judicata. Where property is held by a party under bond in a replevin action, conditioned for the redelivery of the specific property, in the event he should not prevail in the action such property is to be considered in custodia legis, the same as if the actual possession was with the officer.
1a. Said property being in custodia legis, the proceeds of the sale thereof could not be applied as a credit upon the mortgage debt for the satisfaction of which the same was being replevined, in order to be foreclosed under a chattel mortgage, until such replevin action had been finally determined.
1b. The debt which was the basis of the replevin action in a separate action having been merged into a judgment, which had been satisfied, said replevin action thereafter failed.
Kane, C. J., dissenting.
(Syllabus by the Court.)
WILLIAMS, J. (after stating the facts as above).
The only question essential for determination in this case is, as to whether or not on August 26, A.D. 1905, the date on which the answer and counterclaim were filed by the defendants in the action on the $4,500 and $2,000 notes, foreclosing the real estate mortgage, the reasonable market value of the elevator at that time was adjudicated in said action, in said adjudication the defendants receiving the benefit thereof.
The plaintiff in error sought to prove on said trial that on August 8, A.D. 1905, it had applied a credit on said $4,500 note in the sum of $1,557.50, as the proceeds of said elevator foreclosure, less expenses of sale, etc. Nowhere does it appear from the record in said real estate foreclosure action, by any pleadings, that the plaintiff in error sought judgment on said notes, less such credit of $1,557.50, or that any allowance in said action was made to said defendants, or that they had knowledge or information that such was contemplated at said time, or that they consented or acquiesced in such application.
It is insisted by plaintiff in error that it having made the sale of the elevator under said chattel mortgage, and applied the same as a credit on said $4,500 note, said note by said credit was discharged pro tanto, and that said adjudication was made on confession of judgment, and the notes were merged into said judgment, said credit being carried into said merger, and that it amounted to an adjudication also of the replevin action as to the elevator on the chattel mortgage.
If the alleged foreclosure sale of the elevator under the chattel. mortgage was valid, and the application of the proceeds thereof, less the expenses, etc., as a credit on the mortgage debt, was a valid act, the contention of the plaintiff in error is correct.
But the contention is made by the defendants in error that the elevator having been taken by the plaintiff in error by means of a replevin proceeding on the chattel mortgage, and held by it under a bond given by it as plaintiff in the action, conditioned for the redelivery of the specific property, that it is to be considered in custodia legis, the same as if in the actual possession of the officer; and that any sale sought to have been made by said plaintiff in error by virtue of the chattel mortgage prior to the time of the final determination of that action was void as to the defendants in error. This appears to be the settled rule for the guidance of this court.
In the case of McKinney v. Purcell, 28 Kan. 446, in a well-considered opinion delivered by Mr. Justice Brewer, the Supreme Court of Kansas held that where goods are replevied pending the action of replevin they are deemed to be in custodia legis, and not subject to seizure on any other process; that whilst the plaintiff by giving a replevin bond obtains possession of the goods this does not change the fact that they are still the subject-matter of litigation, and by legal fiction still to be deemed in the possession of the law. It is also held in the same case that it is generally the rule that where property is held by a party under bond in a given action, conditioned for the redelivery of the specific property, it is to be considered in custodia legis, the same as if the actual possession was with the officer. The rule announced in that case is also supported by the cases of Turner v. Reese, 22 Kan. 322; National Bank v. Gerson, 50 Kan. 582, 32 P. 905; Sherburne v. Strawn, 52 Kan. 40, 34 P. 405.
Our Code of Civil Procedure, relating to the replevin of personal property, including article 10, c. 66 (Wilson's Rev. Ann. St. 1903, §§ 4361-4364), was borrowed or adopted from Kansas. Gen St. Kan. 1889, art. 10, §§ 4269-4272. It is a well-recognized rule of construction that where a statute has been adopted from another state, which has been previously construed by the courts of the state from which it was taken, the statute is deemed to have been adopted with the construction so given to it. Chisolm v. Weisse, 2 Okla. 611, 39 P. 467; United States v. Choctaw, etc., Ry. Co., 3 Okla. 404, 41 P. 729; Barnes v. Lynch, 9 Okla. 156, 59 P. 995; National Live Stock Com. Co. v. Taliaferro, 22 Okla. 177, 93 P. 984; Choctaw, Oklahoma Gulf Ry. Co. v. Burgess, 21 Okla. 653, 97 P. 276; Foreman v. Midland Valley Ry. Co., 7 Ind. T. 478, 104 S.W. 808; Sutherland, Stat. Constr. (2d Ed.) § 404.
Whilst we should follow the construction placed upon these provisions by the Supreme Court of the state of Kansas prior to the time the same were transplanted to Oklahoma Territory on account of the foregoing rule, yet such construction also seems to be sustained by both reason and authority. Morh v. Langan, 162 Mo. 474, 63 S.W. 409, 85 Am. St. Rep. 503; Lockwood v. Perry, 9 Metc. (Mass.) 440; Hunt v. Robinson, 11 Cal. 262; Rives v. Wilborne, 6 Ala. 46; Hagan v. Lucas, 10 Pet. 400, 9 L.Ed. 470; Cobbey on Replevin (2d Ed.) § 706; Shinn on Replevin, § 228; Wells on Replevin, §§ 476-480.
Said property being in custodia legis, the plaintiff in error selling the same under the powers of the chattel mortgage prior to the final determination of the replevin action, and said action never having been finally determined in favor of the plaintiff, such sale was thereby invalid, and the alleged credit on said note of the proceeds thereof was without authority, and not thereafter validated.
A regular judgment, whilst it remains in force, is conclusive as to every matter that might have been given in evidence or pleaded to the action in which it was rendered, except matters growing out of separate and independent causes of action which might have been pleaded in offset, and the same principle obtains in cases of judgment by confession. Barney v. Goff et al., 1 D. Chip. (Vt.) 304; Squires v. Whipple, 2 Vt. 111.
A judgment confessed has the effect to conclude the right and estop all parties thereto. The most important interest, not only property and liberty, but life itself, is habitually concluded judicially by solemn confession made by the party in interest in the face of a court of justice. Secrist v. Zimmerman, 55 Pa. 446.
In the case of Orr v. Mercer County Ins. Co., 114 Pa. 391, 6 A. 698, the court said:
"The defendant, conceding that the judgment would be conclusive against him so far as such defense is concerned, had it been entered on a verdict after a trial on the merits, contends that at most the judgment by confession is only evidence to be considered with all the other evidence touching the question of settlement, in its determination. We think that proposition cannot be maintained. If the cause was at issue, and the only matter of defense was pleaded formally on the record, or so set up as to be known, and on the eve of the calling of the case for trial the defendant confesses judgment in open court, the judgment is as conclusive as if entered on a verdict."
In the case of Dodds v. Blackstock. 1 Pittsb. R. 46, it is held that when a defendant offers to confess judgment for a part of the plaintiff's claim, and the plaintiff enters judgment for the amount so tendered and proceeds to execution, he cannot recover the balance of the claim. See, also, Black on Judgments, 1891, vol. 2, § 698.
In this case, the matter relating to the seizure of the elevator by the plaintiff in error in the replevin action involved a separate and independent action, and did not grow out of the action to foreclose the mortgage on the real estate and there is nothing to indicate in the pleadings that it was the intention of the parties to adjudicate in that action the rights involved in the replevin action; and the plaintiff having taken judgment by confession in that action, the said notes, to wit, the $4,500 and $2,000 notes, were merged into said judgment, and, when such judgment was satisfied, at all events said replevin action failed, the debt upon which it was based being discharged.
So far as the record in that action is concerned, it does not appear that this does the plaintiff in error an injustice, for in the first count of the petition it was declared that there was due and unpaid on said $4,500 note the sum of $2,450, with interest at the rate of 10 per cent. per annum from August 10, A.D. 1904, and in the second count that there was due on the $2,000 note the sum of $1,355.78, with interest thereon at the rate of 10 per cent. per annum from August 10, A.D. 1904, making the sum total of $3,805.78, with interest, etc., and in the answer the defendants claimed credits in the sums of $1,000 and $2,800 by way of payments, and the sum of $1,250 as counterclaim, making the sum total of $4,050. Judgments was confessed in the sum of $1,685 and costs. On this status of the record, there does not appear to have been any injustice done to the plaintiff in error; but if so, it is the result of its own act in accepting the confessed judgment on the record as it existed at that time, and no fault of the law. As was said in the case of Secrist v. Zimmerman, supra, the most important interest, not only property and liberty, but also life itself, is habitually concluded judicially by solemn confession made by the party in interest in the face of a court of justice; and when such an adjudication has been made, unless there at the time exists fraud and deception, and there has been neither contention nor claim made in this case of any fraud or deception, courts will not disregard the plain terms of such adjudication.
There appearing to be no error in the judgment of the court below, the same is accordingly affirmed.
Dunn, Hayes, and Turner, JJ., concur; Kane, C. J., dissents.
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