Opinion
July 7, 1939.
1. RES ADJUDICATA: A Resident of the County. In an action to cancel deeds executed by a trustee pursuant to a sale under a deed of trust on the ground that the trustee was not a resident of the county and therefore not a suitable person to act as trustee, a judgment for defendants in a former action to enjoin the sale was res adjudicata as to that issue.
Though the court did not pass upon the question in the former suit, where it was pleaded by plaintiffs that the trustee was a resident of another county and the question could have been litigated, it was res adjudicata.
The fact that an additional party was named defendant in the present case, the purchaser of the property at the sale, does not defeat the plea.
A judgment on the merits, in a former suit between the same parties or their privies on the same cause of action, operates as an estoppel not only as to every matter which was offered to defeat the claim but as to every other matter which might have been litigated and determined in that action.
2. TRUSTEE'S SALE: Inadequacy of Price. In an action to set aside a trustee's sale and trustee's deeds pursuant to the sale, the plaintiff, having by his conduct chilled the bidding, is not in a position to appeal to a court of equity to set aside the sale because of the inadequacy of the price.
Appeal from St. Francois Circuit Court. — Hon. Taylor Smith, Judge.
AFFIRMED.
Samuel Richeson and W.A. Brookshire for appellants.
(1) The appointment of M.C. Matthes, a resident of Jefferson County, Missouri, did not give him authority to exercise the powers provided for in the deed of trust for land located in Washington County. R.S. 1929, secs. 3135-3137; Hunter v. Hunter, 39 S.W.2d 359, 327 Mo. 817. (2) A price of $1000 for real estate of a value of seven to eight thousand dollars is so inadequate as to shock the moral conscience of the court, and a sale at that price should be set aside. (a) A price of $500 for real estate of a value of $2500 is so inadequate as to shock the moral conscience of the court, and a sale at that price should be set aside. 1 Black on Rescission Cancellation, sec. 175; Middleton v. Baker, 262 Mo. 398; Vail v. Jacobs, 62 Mo. 130; West v. Axtell, 322 Mo. 415; Lunsford v. Davis, 300 Mo. 532; Lange v. McIntosh, 100 S.W.2d 458. (3) Section 3137, Revised Statutes 1929, is in derogation of the common law, and must be strictly construed. Hunter v. Hunter, 327 Mo. 817, 39 S.W.2d 359; Stone v. Railroad Co., 261 Mo. 75; Hitch v. Stonebraker, 125 Mo. 138.
T.E. Francis and Woodward Evans for respondents.
(1) The court is without jurisdiction to hear and determine this appeal for the reason that the principal issue in the suit concerns the validity of certain deeds to real estate which are alleged to be a cloud upon plaintiffs' titles, so that the title to real estate is directly involved, and exclusive jurisdiction of the appeal is in the Supreme Court. Mo. Const., Art. VI, Sec. 12; Salia v. Pillman, 328 Mo. 1212, 43 S.W.2d 1038; Brennecke v. Rieman, 102 S.W.2d 874; Balz v. Nelson, 171 Mo. 682, 72 S.W. 527; Thomas v. Scott, 214 Mo. 430, 119 S.W. 1098; Koewing v. Greene County B. L. Assn., 327 Mo. 680, 38 S.W.2d 40; Phillips v. Trust Co., 332 Mo. 327, 58 S.W.2d 318; Medich v. Stippec, 335 Mo. 796, 73 S.W.2d 998; Meredeth v. Pound, 92 S.W.2d 698; Castorina v. Hermann, 104 S.W.2d 297. (2) The mere fact that the trustee was a resident of a county adjacent to the one in which the land was situated did not disqualify him from acting and his appointment was not invalid under Section 3137, Revised Statutes 1929. Laws 1849, p. 127; Laws 1855; General Statutes 1865, chap. 154, sec. 2; Laws 1871-72, p. 67; 25 R.C.L. 964, sec. 219. (3) The question of the validity of the appointment of the substitute trustee is res adjudicata for the reason that a final judgment was previously rendered in a suit between the same parties and concerning the same subject matter in which this issue could have been raised by plaintiffs, and in which they intended and did attempt to secure a determination of the question and were frustrated simply because of the insufficiency of their pleadings. Cordia v. Matthes, 338 Mo. 308, 90 S.W.2d 101; Powell v. City, 335 Mo. 562, 73 S.W.2d 408; Spring v. Giefing, 315 Mo. 525, 289 S.W. 825; Custer v. Kroeger, 313 Mo. 130, 280 S.W. 1035; State ex rel. Gatewood v. Trimble, 333 Mo. 207, 62 S.W.2d 756; City v. United Rys. Co., 174 S.W. 78. (4) There was no gross inadequacy of the sale price such as to warrant a court in equity to set aside the sale. The petition does not charge nor is there a scintilla of evidence to indicate that there was any fraud or misrepresentation about the sale, but, on the other hand, the evidence conclusively shows that plaintiffs attempted to chill the sale by warning prospective purchasers not to bid. 19 R.C.L., p. 614; Rorer on Judicial Sales (2 Ed.), p. 233; McDonnell v. DeSoto Assn., 175 Mo. 250, 75 S.W. 444; House v. Clarke, 187 S.W. 60. (5) Plaintiffs cannot ask relief on the ground of alleged inadequacy of sale price, as they neither sought to redeem the property from the foreclosure sale, nor have they offered to tender back the sale price. Young v. Insurance Co., 329 Mo. 130, 43 S.W.2d 1046.
Appellants, plaintiffs below, filed this suit to cancel deeds executed by a trustee pursuant to a sale held under the terms of two deeds of trust; also to cancel the deeds of trust. There was a judgment for defendants and plaintiffs appealed. This is the third time a controversy over these deeds of trust and the notes described therein has reached this court. In Cordia v. Richards, 329 Mo. 1166, 48 S.W.2d 878, Division One of this court held that the notes described in the deeds of trust had not been paid, as was the contention of the plaintiffs in that case. This court reversed the judgment of the trial court which had enjoined a sale under the deeds of trust on plaintiffs' behalf. Thereafter the property described in the deeds was advertised for sale. Plaintiffs filed a suit to enjoin the proposed sale because they alleged the notes were then barred by the Statute of Limitations. The trial court denied plaintiffs' relief and an appeal was taken to this court. The judgment of the trial court was affirmed. [See Cordia v. Matthes, 338 Mo. 308, 90 S.W.2d 101.] [1] We held that the injunction proceedings, instituted by plaintiffs, tolled the Statute of Limitations. In the present suit the plaintiffs seek to cancel the deeds executed by the trustee pursuant to a sale had thereunder upon two grounds: First, that the trustee was not a suitable person to be named as a trustee; second, that the price bid for the property at the sale was grossly inadequate. The circuit court was called upon to appoint a substitute trustee. This occurred prior to the institution of the second suit. M.C. Matthes, special deputy finance commissioner in charge of the affairs of the DeSoto Trust Company, was named as trustee. Matthes was a resident of Jefferson County, Missouri. The land described in the deeds of trust here involved was located in Washington County, an adjoining county. Appellants insist that Matthes was not a suitable person to be named as trustee, because they claim that Section 3137, Revised Statutes 1929 (Mo. Stat. Ann., p. 8169), requires a trustee, when named by the circuit court, to be a resident of the county where the land is located. Respondents contend otherwise. They present a rather convincing theory in support of their contention. However, we need not decide that point because respondents in their answer plead res adjudicata, and we find that this plea must be sustained. In the second proceeding, being the case of Cordia v. Matthes, 90 S.W.2d 101, 338 Mo. 308, the plaintiffs, in the fore part of their petition, stated that the trustee named by the circuit court was a resident of Jefferson County, Missouri. Plaintiffs could well have litigated the question in that suit. They did brief the point in this court, but we held that the question was not raised by their petition. Being a matter that could have been litigated in that case the plea of res adjudicata must be sustained. The fact that an additional party was named defendant in this case, that is the purchaser of the property at the sale, does not defeat the plea. [34 C.J. 757, sec. 1166.] The trustee was a party defendant in the former suit and is a party defendant in this case. The plaintiffs are the same. The following statement of the rule in 34 Corpus Juris, 818, section 1236, is applicable to the present situation:
"A judgment on the merits, rendered in a former suit between the same parties or their privies, on the same cause of action, by a court of competent jurisdiction, operates as an estoppel not only as to every matter which was offered and received to sustain or defeat the claim, but as to every other matter which might with propriety have been litigated and determined in that action."
Cases from many jurisdictions are cited in support of the rule. [See. also, State ex rel. Gott v. Fidelity Deposit Co. of Baltimore, Md., 317 Mo. 1078, l.c. 1092, 298 S.W. 83, l.c. 90; Consolidated School Dist. No. 4 of Greene County v. Day, 328 Mo. 1105, 43 S.W.2d 428, l.c. 430 (3, 4).]
[2] Appellants' plea, asking that the sale be set aside on the theory of inadequacy of price, was properly denied by the trial court. Appellant Cordia was present at the sale and made an announcement to the effect that whoever bought the property would be buying a lawsuit. The sale was had on February 24, 1933. No attempt was made to redeem the property. The present suit was filed at the March Term of court 1936. If a re-sale were ordered it is doubtful whether a better bid could be obtained, in view of appellant's announcement that the purchaser would be subjected to a lawsuit. Cordia, having by his conduct chilled the bidding, is not in position to appeal to a court of equity to set aside the sale because of inadequacy of price. Again, who will replace the parties in statu quo? Appellants have not offered to do this. It is evident that the trial court properly denied appellants' plea. [Young v. Kansas City Life Ins. Co., 329 Mo. 130, 43 S.W.2d 1046, l.c. 1048 (5).]
The judgment is affirmed. Cooley and Bohling, CC., concur.
The foregoing opinion by WESTHUES C., is adopted as the opinion of the court. All the judges concur.