Buckeye S. Bldg. L. Co. v. Ryan

George A. Bell was, in April, 1919, the owner of a farm in Clermont county, Ohio, and with his wife executed a mortgage for $15,000 to the Buckeye State Building Loan Company to secure two notes signed by them, one for $1,000, payable in two years, and one for $14,000, payable in five years.

In September, 1919, Bell and his wife conveyed the premises to S.M. Darby, who, in turn, conveyed to one Pugsley, who, by general warranty deed, conveyed to John A. Ryan. The warranty clause in the deed contained the following:

"Except a mortgage for $6,700 in favor of the Buckeye State Building Loan Company; also taxes and assessments falling due and payable hereafter."

There was in the deed no assumption or agreement by Ryan to pay the notes or mortgage. Ryan later conveyed the title to one Humbrecht.

On April 17, 1923, the Buckeye State Building Loan Company filed a petition praying for judgment against the makers of the notes, and against all subsequent owners of the farm to that date. This petition contained the allegation:

"On or about December 31, 1920, the defendant, John A. Ryan, assumed and agreed to pay the said note as a part of the consideration for the transfer of real estate to him by the defendant, Harry Pugsley, Jr."

Service was had on John A. Ryan at his residence, and later Murphy Joseph, as attorneys for Ryan, obtained 15 days further time in which to plead. No answer or demurrer was filed by John A. Ryan.

Later, all parties being in default for answer or demurrer, an entry was made awarding judgment for the plaintiff against seven defendants, including the makers of the notes, and including John A. Ryan, in the sum of $7,063.63, with interest. The judgment entry further provided that, unless this sum and costs were paid within three days from date, the equity of redemption would be foreclosed and the premises sold upon execution. This entry was signed: "Have seen, Murphy Joseph, attorneys for John A. Ryan and William F. Burwell." No exception was noted in this entry.

There is nothing to show that any evidence was introduced before the entering of the judgment against these seven defendants.

The judgment not being paid, the premises were sold, and, after payment of costs and the application of the balance to the mortgage indebtedness, there was a deficiency of $3,088.46.

George A. Bell, one of the makers of the original notes was the purchaser at the foreclosure sale. Proceedings were had to collect the entire deficiency judgment from John A. Ryan by levy and execution upon his real estate.

On April 23, 1925, said Ryan filed his petition in the original foreclosure case to vacate the judgment. Summons was issued for the Buckeye State Building Loan Company, directed to the sheriff of Franklin county, Ohio. Service was made. Motion to quash service was filed and overruled.

The Buckeye State Building Loan Company, while protesting against the jurisdiction of the court, answered, admitting that it secured said judgment, and admitting that it alleged in the original petition that said Ryan assumed and agreed to pay the said promissory note, secured by mortgage, and denied the other allegations of Ryan.

Upon hearing, the court granted the prayer of the petition to vacate the judgment, and gave leave to Ryan to file an answer.

A motion for a new trial was filed, and overruled. Error is now prosecuted, the grounds relied on being that the court erred in overruling the motion to quash the service of summons, and that the decision and judgment are contrary to law.

Counsel for plaintiff in error contend that Ryan could not file a petition to vacate in the original action, for the reason that plaintiff in error is a corporation, having its principal place of business in Franklin county, Ohio, and having no office or agent in Clermont county, and that the action, therefore, should have been brought in Franklin county.

The proceeding to vacate was filed under the provisions of Section 11635, General Code, and was, by petition, in the original action. Section 11635 provides:

"The proceedings to vacate the judgment or order on the grounds mentioned in divisions four, five, six, seven, eight, nine and ten, of the first section in this chapter [Section 11631], shall be by petition, verified by affidavit, setting forth the judgment or order, the grounds to vacate or modify it, and, if the party applying was defendant, the defense to the action. On such petition a summons shall issue and be served as in the commencement of an action."

It has been held that such a petition filed in the original action is not a civil action, but is a special proceeding in an action after judgment. Taylor, Assignee, v. Fitch, 12 Ohio St. 169; Coates v. Chillicothe Branch of the State Bank, 23 Ohio St. 415;

Darst v. Phillips, 41 Ohio St. 514; Gifford, Admr., v. Ryan,9 Ohio App. 419.

It has also been held that this is a cumulative remedy, and not exclusive, and that, when brought under this section of the Code, is filed in the original action. These sections of the Code, providing where the proceedings shall be brought, determine the venue, and the proceedings were properly commenced in the original action in Clermont county.

The proceedings having been rightly brought in Clermont county, service could be had by summons issued to the sheriff of Franklin county, as was done in this case. Under Section 11635, General Code, a summons shall issue and be served as in the commencement of an action. It is proper in the commencement of actions, where by statute the venue is in a certain county, to secure service by summons issued to another county. This being a special proceeding in an action is not the commencement of a new action; summons and service thereon being required as in the commencement of an action.

The court of common pleas was not in error therefore in overruling the motion to quash.

Plaintiff in error contends further that the only question raised bearing on the merits was whether or not there was any fraud practiced by the Buckeye State Building Loan Company in obtaining said judgment or order, and that, as Ryan did not protect himself by making a defense, or by motion for a new trial, or by prosecuting appeal or error, he was guilty of laches, and, therefore, cannot secure any relief. This is not an action in equity, but is a proceeding authorized by the Code, which permits the setting aside of a judgment where fraud is shown, and where there is a good defense to the original action.

Many cases are cited by counsel for plaintiff in error in support of his contention, cases in which it has been attempted in an equitable action to vacate a judgment, after term, or to enjoin its enforcement, wherein relief has been denied for the reason that the party who sought such relief failed or neglected to plead or defend in the original action, or negligently omitted to apply in time for relief by motion for a new trial, or by way of appeal or error, or by proceedings to vacate the judgment. In such cases, to wit, equitable actions, laches on the part of the complainant would bar him from relief. The case in Ohio upon which plaintiff in error particularly relies is that of NavarreDeposit Bank v. Wilson Avenue Lumber Co., 22 C.C., (N.S.), 559, 34 C.D., 47. This, however, was an action in equity, seeking to enjoin the enforcement of a judgment at law and the levy of an execution, and to vacate and declare null and void said judgment. As before stated, equity will not relieve a party against a judgment which results from his own negligence or carelessness. But this is not an equitable proceeding, and is purely a special statutory proceeding.

Ryan now brings this special proceeding, under the Code, to vacate the judgment because of fraud.

The case of Ulman, Einstein Co. v. Effinger, 11 C.C., (N.S.), 383, 20 C.D., 791, which was affirmed without report in 60 Ohio St. 579, 54 N.E. 1101, seems to us to determine the question. It is therein decided:

"First. A judgment may be set aside for fraud notwithstanding the fact that no defense was made at the time it was rendered, although the defendant was properly served with summons by copy thereof left at her usual place of residence.

"Second. A judgment procured against a party on an account which she never owed, nor became either directly or indirectly liable for its payment, constitutes a fraud on the court rendering such judgment, which should be set aside in a proper proceeding brought for that purpose.

"Third. An averment in a petition that goods or merchandise were sold to a husband, and that afterwards, and before suit is brought to recover the price thereof, the plaintiffs inserted the name of the wife of such husband in said account, and without her knowledge or consent, is a sufficient averment of fraud to constitute a cause of action, and a demurrer to such petition and pertinent interrogatories attached thereto is properly overruled."

The petition herein discloses a good defense under this rule. See, also, Exr. of Pollock v. Pollock, 2 C.C., 143, 1 C.D., 410, and Trustees of Northern Dispensary of New York v. Merriam, 59 How. Prac., (N.Y.), 226.

For the reasons above stated, we find no error in the overruling of the motion to quash, nor in the judgment vacating and setting aside the judgment against Ryan, with leave to file an answer, and suspending the order of vacation pending the trial on the merits.

The judgment of the court of common pleas is affirmed.

Judgment affirmed.

HAMILTON and CUSHING, JJ., concur.