by: Patrick A. Randolph, Jr.
Professor of Law
UMKC School of Law
Statutory redemption law is an arcane and mysterious topic, like unto Torrens recording systems, to many lawyers. But out in the midwest and northwest farm country, it's the mother's milk of the small town lawyer who has failed to land the local bank as a client. Redemption statutes have demonstrated remarkable tenacity over the past century, despite constant criticism that they add to foreclosure costs, encourage waste and chicanery, and generally fail to serve their designed purpose. Here's a recent court interpretation that treats such a statute tenderly.
MORTGAGES; STATUTORY REDEMPTION: Foreclosure redemption statutes are to be liberally construed. When there is no prejudice to the other parties, substantial compliance with the redemption statutes is sufficient to effect a redemption. Savoy v. Cascade County Sheriff's Department, 887 P.2d 160 (Mont. 1994). The defect here was the failure of the redemptioner to file information concerning the nature and amounts of its own secured claims. The court held that this was not fatally defective because the information was useful only to the then holder of the sale certificate and then only if that holder intended to "reredeem" from the redemptioner.
The missing information, in the view of the court, was readily available to the certificate holder because it had the record information concerning the mortgages from the foreclosure decree and it had the phone number of the redemptioner. It made no effort to reredeem during the sixty day period following the redemptioner's redemption. Consequently, the court holds, "no harm, no foul."
Comment: One interesting aspect of the case is the court's finding that the ability to call the redemptioner's office to get information is the equivalent of having a written statement of the information. This is really an extraordinary statement. Anything said over the phone could later be denied, and hardly has the force of a written statement in an officially required document. The court may have been influenced by the fact that the redemptioner was FmHA.
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