December 10, 2020- Ashok Kaushal v. Santa Fe Community Housing Trust, No. A-1-CA-37609

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in Odyssey.

IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO

Opinion Number:

Filing Date: DECEMBER 10, 2020
No. A-1-CA-37609
BOKF, N.A.,

Plaintiff,
Vv.
THE UNKNOWN HEIRS AND DEVISEES
AND LEGATEES OF LINORA P. PACHECO,
Deceased; JOSE PACHECO; SANTA FE
COMMUNITY HOUSING TRUST; NEW
MEXICO MORTGAGE FINANCE
AUTHORITY; and OCCUPANTS OF THE
PROPERTY,

Defendants,
and
ASHOK KAUSHAL,

Petitioner Appellant,

Vv.

SANTA FE COMMUNITY HOUSING
TRUST,

Petitioner Appellee.

Court of Appeals of New Mexico
Filed 12/10/2020 8:44 AM

Hue
Mark Reynolds

APPEAL FROM THE DISTRICT COURT OF SANTA FE COUNTY	1
David K. Thomson, District Judge	2
Holmes Law Firm, PC	3
Kevin P. Holmes	4
Albuquerque, NM	5
High Desert Lawyers, LLC	6
Eric N. Ortiz	7
Albuquerque, NM	8
for Appellant	9
VanAmberg, Rogers, Yepa & Abeita, LLP	10
Ronald J. VanAmberg	11
Santa Fe, NM	12
for Appellee	13

OPINION	1
HANISEE, Chief Judge.	2
{1} 	This appeal arises from litigation regarding assignment of redemption rights	3
to Appellant Ashok Kaushal by some, but not all, heirs of decedent Linora Pacheco	4
following a foreclosure judgment and sale of her residence. Kaushal appeals from a	5
district court order granting Appellee Santa Fe Community Housing Trust’s (the	6
Trust) petition for redemption and motion for summary judgment, the effect of	7
which was to reject Kaushal’s assigned redemption interest. On appeal, Kaushal	8
disputes the district court’s determinations that the statutory right of redemption	9
requires a unified interest and possession of title to the property being assigned and	10
redeemed. We reverse and remand.	11
BACKGROUND	12
{2} 	Pacheco obtained a mortgage on her home in March 2012, from National	13
Banking Association d/b/a Bank of Oklahoma (the Bank). Through a mortgage	14
subordination agreement, the Trust held a subordinate mortgage on Pacheco’s	15
property. The Bank initiated foreclosure proceedings in December 2014. Pacheco	16
died before the foreclosure action was brought to judgment and the case continued	17
against her estate. At the time of her death, Pacheco was survived by her four sons:	18
Raymond, Joseph, Bryan, and Richard. The Bank obtained a foreclosure judgment	19
on Pacheco’s property in June 2017. During the underlying proceedings, the district	20

2
court also recognized the Trust’s subordinate mortgage. In September 2018 the Bank	1
held a foreclosure sale at which it was the highest bidder. The district court entered	2
an order finalizing the foreclosure sale on October 24, 2017. By that date, Bryan and	3
Richard were deceased.	4
{3} 	After the foreclosure sale, Kaushal purchased the statutory right to redeem the	5
property from Pacheco’s two surviving sons, Joseph and Raymond. In November	6
2017 Kaushal tendered payment in the amount of $154,712.93 for the value bid at	7
the foreclosure sale, plus interest and fees, and filed a redemption petition. The Trust	8
subsequently filed its own redemption petition based on its status as a junior	9
lienholder. In connection with its redemption petition, the Trust also attempted to	10
tender a cashier’s check in the required amount; however, the district court clerk	11
refused to accept the Trust’s payment absent a court order requiring that it do so.	12
The Trust then filed a motion requesting the district court to issue an order allowing	13
the Trust to deposit funds for the property.	14
{4} 	Kaushal responded, arguing that the Trust’s redemption petition was invalid	15
and that, in any event, Kaushal’s right to redeem was superior as the assignee of the	16
owner’s right of redemption. The Trust then filed a supplement to its redemption	17
petition asserting that Richard’s daughter, Claudia Urioste, had assigned her	18
redemption right to the Trust. In his response thereto, Kaushal maintained that the	19
assignment from Urioste to the Trust was invalid because it was made six weeks	20

3
after expiration of the redemption period. The Trust then moved for summary	1
judgment, arguing among other things that Kaushal’s petition was invalid because	2
he was required to possess one hundred percent of the redemption rights passed from	3
Pacheco to her heirs and did not.	4
{5} 	The district court granted both the Trust’s petition for redemption and its	5
motion for summary judgement. In its written order, the district court explained:	6
The basic flaw in [Kashaul’s] argument is that he cannot redeem	7
what he does not legally own. There is nothing in the record that	8
transfers title of the property to the part[ies] that allegedly assigned the	9
redemption interest. While the person[s] assigning [their rights of	10
redemption] may be [heirs], they [the assignees] have to establish[]	11
legal ownership in the property.	12
{6} 	The district court’s order relied in part on a decision by the Alabama Supreme	13
Court 	dealing 	with 	the 	redemption 	of 	partnership 	property, 	Costa 	& 	Head	14
(Birmingham One), Ltd. v. Nat’l Bank of Commerce of Birmingham, which states:	15
“One who has an interest as a partner in mortgaged property may enforce his	16
equitable right to redeem. So, in the case of a mortgage of partnership property,	17
either partner is a debtor entitled to exercise a statutory right to redeem from a sale	18
on foreclosure, and he may redeem the entire property.” 569 So. 2d 360, 364-65	19
(Ala. 1990) (alteration, internal quotation marks, and citation omitted). The district	20
court distinguished Kaushal’s right to redeem from that determined to be valid in	21
Costa, concluding that unlike a legal partner, “one heir has no legal right to assign	22
the whole of the interest (an undivided interest) to a third party.” Kaushal appeals.	23

4
DISCUSSION	1
{7} 	On appeal, Kaushal raises three issues: first, he claims that a redemption	2
petitioner need not possess one hundred percent of the redemption interest to redeem	3
a property after foreclosure. Second, he argues that a former defendant owner’s heirs	4
need not first have received title to exercise or assign redemption rights. Third,	5
Kaushal asserts that the Trust’s petition for redemption is invalid because his petition	6
has priority and the Trust failed to deposit earnest money in the court registry as	7
required by the redemption statute. The Trust answers that Kaushal’s petition was	8
defective, as determined by the district court, because he lacked title to the entirety	9
of the property and failed to obtain a unified interest.1 Regarding the earnest money	10
declined by the district court, the Trust argues that it substantially complied with the	11
statutory redemption requirements. For the reasons explained below, we hold that	12
under New Mexico law, it was not necessary for Kaushal to obtain a unified interest	13
to exercise his assigned rights of redemption, and that Pacheco’s heirs need not have	14
first received title to the foreclosed property in order to assign their rights of	15
redemption. Kaushal’s interest, however, is limited to those interests possessed by	16
the assignees—two of Pacheco’s four surviving sons—at the time of assignment.	17
1 Kaushal additionally asserts that the assigned right of redemption from
Urioste is invalid because it occurred following the expiration of the redemption
period. However, we need not resolve that issue given our conclusion that Kaushal’s
interest is limited to the fifty percent he was assigned, which did not include the
interest purportedly assigned by Urioste to the Trust.

5
We 	also 	conclude 	that 	the 	Trust 	substantially 	complied 	with 	the 	statutory	1
requirements applicable to its own right of redemption. We remand for further	2
proceedings.	3
Standard of Review	4
{8} 	Kaushal’s arguments on appeal challenge the application of law to the facts	5
of this case. “We review de novo the trial court’s application of the law to the facts	6
in arriving at its legal conclusions.” Kokoricha v. Estate of Keiner, 2010-NMCA-	7
053, ¶ 11, 148 N.M. 322, 236 P.3d 41 (internal quotation marks and citation	8
omitted). To the extent determination of the issues presented requires that we engage	9
in statutory interpretation, we engage in a de novo review in which “our charge is to	10
determine and give effect to the Legislature’s intent.” Little v. Jacobs, 2014-NMCA-	11
105, ¶ 7, 336 P.3d 398 (internal quotation marks and citation omitted).	12
I. 	Under the New Mexico Redemption Statute, Kaushal Need Not Possess a	13
Unified Redemption Interest to Redeem	14
{9} 	Kaushal argues that the plain language of the redemption statute makes it clear	15
that a redemption petitioner need not possess one hundred percent of the possible	16
redemption interests to redeem a property after a foreclosure sale. In New Mexico,	17
the statutory redemption right is created by the State’s foreclosure redemption	18
statute. NMSA 1978, Section 39-5-18 (2007). The redemption statute provides that	19
“real estate may be redeemed by the former defendant owner of the real estate or by	20
any junior mortgagee or other junior lienholder whose rights were judicially	21

6
determined in [a] foreclosure proceeding[.]” Section 39-5-18(A). Importantly for our	1
purposes, the redemption statute identifies the term “owner” as including an owner’s	2
“personal representatives, heirs, successors and assigns.” Section 39-5-18(D).	3
Consistent with the express language of the statute, New Mexico courts have held	4
that the right of redemption is an assignable right. See W. Bank of Las Cruces v.	5
Malooly, 1995-NMCA-044, ¶ 9, 119 N.M. 743, 895 P.2d 265 (holding that “our	6
redemption statute authorizes a holder-by-assignment of a junior lien to redeem from	7
the judicial sale of foreclosed property”).	8
{10} 	The statute also prioritizes the rights of former-defendant owners over the	9
rights of junior lien holders. See § 39-5-18(A)(3) (“[T]he former defendant owner	10
shall have the first priority to redeem the real estate. If the former defendant owner	11
does not redeem the real estate . . . each junior mortgagee or junior lienholder shall	12
have a right to redeem the real estate.”). In other words, each category of “former	13
defendant 	owner”—that 	is, 	“personal 	representatives, 	heirs, 	successors 	and	14
assigns”— has the first opportunity to redeem a foreclosed property in New Mexico.	15
However, the statute is silent on whether a prioritized redeeming former defendant	16
owner must possess a unified interest—i.e. one-hundred-percent—of the redemption	17
right.	18
{11} 	Section 39-5-18 was amended in 2007 and it is the amended language that the	19
parties argue requires or does not require that every heir assign their percentage	20

7
interest to a single assignee in order for the right of redemption to accrue in that	1
assignee. See id. Kaushal contends that the district court’s holding that “one heir has	2
no legal right to assign the whole of the interest (an undivided interest) to a third	3
party” is not supported by the language of the amended statute. Nowhere in the	4
redemption statute, he explains, did the Legislature declare that all heirs must act in	5
concert to redeem a deceased former owner’s property. Kaushal also asserts that the	6
district court’s conclusion is inconsistent with the plain language of the statute,	7
which he argues “makes clear that the [statutory] enumerated actors act on behalf of	8
the defendant-owner.” The Trust argues that the Legislature could not have intended	9
that opportunists and speculators could obtain a redemption right from an heir of a	10
decedent mortgage holder post foreclosure and thereby “spring ahead of legitimate	11
creditors.” The parties also present starkly contrasting public policy arguments	12
regarding the potential impact of a unity requirement. Kaushal suggests that such	13
would lead to “absurd, unworkable results that the Legislature could not have	14
intended.” The Trust, on the other hand, argues that if Kaushal’s position is correct,	15
it would cause a return to “the chaos which the 2007 amendment to the statute sought	16
to eliminate.”	17
{12} 	Prior to the 2007 amendment, the right of redemption, under the New Mexico	18
foreclosure statute provided that “[a]fter sale of [any] real estate pursuant to any such	19
judgment or decree of any court, the real estate may be redeemed by the former	20

8
defendant owner of the real estate, his heirs, personal representatives or assigns or	1
by any junior mortgagee or other junior lienholder.” Section 39-5-18(A) (1987). This	2
statute did not prioritize the redemption rights of the former defendant owner or his	3
heirs and assignees or junior lienholders. See id.	4
{13} 	In 2007 Subsection D of Section 39-5-18 was amended to provide and explain	5
that “the terms ‘owner,’ ‘junior mortgagee,’ ‘junior lienholder,’ and ‘purchaser’	6
include their respective personal representatives, heirs, successors and assigns.”	7
Section 39-5-18(D). The 2007 amendment to Subsection D of Section 39-5-18,	8
established a redemption priority for those parties falling within classification of	9
“owner.” See § 39-5-18(A)(3) (providing that “the former defendant owner shall	10
have the first priority to redeem the real estate”). The parties debate the legislative	11
intent behind the plural use of “heirs, successors and assigns.” Kaushal argues that	12
the Legislature’s use of the plural “heirs” was simply stylistic and provided	13
generalized terms, while the Trust claims that the use of the term “heirs” evidences	14
the Legislature’s intent to require a “unity of interest.” Additionally, the Trust claims	15
that by requiring a unified interest, the Legislature eliminated the need to address	16
conflicts between competing heirs and their assignees. Instead, the Trust argues that	17
to maintain the legislative intent behind the amendments, a redeeming petitioner	18
must unify however many interests exist in the property for which redemption is	19
sought. The Trust also suggests that a unified interest requirement would not prevent	20

9
heirs from maintaining the ability to save a family property. For instance, the Trust	1
posits that if the original mortgagor is unable to make a mortgage payment, any heir	2
can step in and help save the property from foreclosure. The Trust also insists that	3
because of the typically lengthy timeline of a foreclosure action, when a property	4
goes to a foreclosure sale, it is by then evident that none of the heirs are prepared or	5
interested in redeeming the property.	6
{14} 	We begin our analysis by noting that nothing about the amendment to Section	7
39-5-18 expressly resolves the question of whether the right of redemption requires	8
unification of interests. Thus, we agree with Kaushal that the plain language of the	9
current and applicable redemption statute, including use of a general plural term in	10
a provision that lists all party classifications plurally, does not require all heirs to act	11
in unity to redeem a former defendant owner’s property. Had the Legislature	12
intended to require redemption petitioners to act with one hundred percent of the	13
redemption interests, it could have expressly included such a requirement in the	14
amended statute. “The Legislature knows how to include language in a statute if it	15
so desires.” State v. Greenwood, 2012-NMCA-017, ¶ 38, 271 P.3d 753 (alteration,	16
internal quotation marks, and citation omitted); see also State ex rel. Helman v.	17
Gallegos, 1994-NMSC-023, ¶ 20, 117 N.M. 346, 871 P.2d 1352 (affirming that	18
courts may add words to a statute only “if it is necessary to do so to carry out the	19
legislative intent or to express the clearly manifested meaning of the statute”	20

10
(internal quotation marks and citation omitted)). The district court’s ruling and the	1
Trust’s interpretation of this statute would require this Court to add words that the	2
Legislature chose not to include, something we will not do.	3
{15} 	Indeed, New Mexico case law points away from such a requirement. In	4
Banker’s Trust Co. v. Woodall, a recently divorced husband and wife assigned each	5
of their redemption rights to foreclosed property to separate purchasers and both	6
assignees attempted to redeem. 2006-NMCA-129, ¶ 1, 140 N.M. 567, 144 P.3d 126.	7
We first determined that the husband and wife’s cotenancy was not “terminated	8
either by the foreclosure sale or their assignment of their rights of redemption to two	9
different parties.” Id. ¶ 2. We further concluded that because the foreclosure sale did	10
not terminate the cotenancy, under the doctrine of inurement, a redemption by one	11
cotenant would inure to the benefit of the other cotenant, triggering the latter’s right	12
of contribution. See id. ¶ 9; see also Velasquez v. Mascaranas, 1962-NMSC-157,	13
¶ 12, 71 N.M. 133, 367 P.3d 311 (stating that in New Mexico, “a cotenant who	14
redeems from a tax sale does so for the benefit of all the cotena[n]ts”). Cotenancy	15
interests are freely alienable and “[g]enerally, a tenant in common may convey his	16
or her own interest in the common estate to a stranger without the knowledge or	17
approval of other cotenants.” Woodall, 2006-NMCA-129, ¶ 12 (internal quotation	18
marks and citation omitted). In Woodall, we also explained that “by purchasing a	19
right of redemption from a divorced cotenant, the purchaser/assignee is charged with	20

11
constructive knowledge of the existence of the other cotenant’s [redemption] rights.”	1
Id. Thus in Woodall, the separate assignees of cotenants’ redemption rights could	2
redeem the property as cotenants. See id. ¶ 9. Notably in Woodall, each assignee’s	3
non-unified right of redemption was determined to be valid, and only upon	4
redemption added up to a one-hundred percent right of redemption. See id.	5
{16} 	Kaushal declares that Woodall concludes that no redeeming petitioner must	6
possess one hundred percent of the redemption interests on a property to redeem,	7
given that clearly in that case neither assignee did. The Trust answers that because	8
Woodall was decided in 2006, prior to the 2007 amendments, it is inapplicable.	9
Further, the Trust claims that the Legislature is presumed to know existing case law	10
and therefore grasped “the problems” arising from Woodall. See State v. Cleve,	11
1999-NMSC-017, ¶ 14, 127 N.M. 240, 980 P.2d 23 (stating that “the Legislature is	12
presumed to act with knowledge of relevant case law”) (alteration, internal quotation	13
marks, and citation omitted). But Woodall’s applicability, and the question of a	14
unification requirement, does not turn on the 2007 amendment to the redemption	15
statute. We explain.	16
{17} 	As the assignee to two heirs’ redemption rights and the junior lienholder	17
respectively, Kaushal and the Trust hold valid and separate redemption rights. Under	18
New Mexico’s foreclosure redemption statute, Kaushal’s redemption rights have	19
priority given that an owner’s assignee is included in the statutory definition of a	20

12
defendant owner. Section 39-5-18(A). However, he holds only a fifty-percent	1
redemption interest in the property. To reiterate, in Woodall, we determined that	2
cotenants’ separate title is freely alienable to strangers and each assignee stands in	3
the shoes of the assignor. See Woodall, 2006-NMCA-129, ¶ 14. A formal opinion of	4
this Court is controlling authority. See Gulbransen v. Progressive Halcyon Ins. Co.,	5
2010-NMCA-082, 148 N.M. 585, 241 P.3d 183. As in Woodall, Raymond and	6
Joseph, separate heirs, assigned their rights of redemption to Kaushal. Because the	7
plain language of the 2007 version of Section 39-5-18 does not include a unity	8
requirement, 	and 	our 	case 	law 	has 	previously 	determined 	that 	the 	separate	9
assignments of redemption rights can be exercised by multiple assignees, we have	10
no basis to conclude that Kaushal was required to possess one-hundred percent of	11
the possible redemption interests. “We may only add words to a statute where it is	12
necessary to make the statute conform to the [L]egislature’s clear intent, or to	13
prevent the statute from being absurd.” State v. Maestas, 2007-NMSC-001, ¶ 15,	14
140 N.M. 836, 149 P.3d 933.	15
II. 	The Heirs of a Former Defendant Owner Did Not Need to Possess Title	16
to Assign Redemption Rights	17
{18} 	As mentioned above, the district court determined that Kaushal’s redemption	18
petition is invalid because there was “nothing in the record that transfers title of the	19
property to the party that allegedly assigned the redemption interest.” Kaushal argues	20
the district court erred because a former defendant owner’s heirs need not have first	21

13
received title to foreclosed property in order to exercise the statutory right of	1
redemption as to that property, and that the district court’s reliance on Costa	2
confused the statutory right of redemption with that of equitable redemption.	3
Kaushal points to language, within Costa, relied upon by the district court stating	4
that “[o]ne who has an interest as a partner in mortgaged property may enforce his	5
equitable right to redeem.”2 569 So. 2d at 364 (internal quotation marks and citation	6
omitted). The Trust responds that the district court’s holding relates to the unity of	7
interest argument upon which it prevailed.	8
{19} 	Kaushal again relies on the plain meaning of Section 39-5-18 to argue that	9
title need not be received to exercise redemption rights on the land. Kaushal contends	10
that because the plain language of the redemption statute and the Legislature’s	11
definition of former “defendant owner” includes the former defendant owner’s heirs,	12
the heirs stand in the shoes of the former defendant owner. Thus, actual title need	13
not have been transferred to an heir in order for the heirs to assert or assign a right	14
of redemption.3 The Trust maintains that title is, as the district court determined,	15
2Kaushal also suggests that the Alabama redemption statute is not nearly as
explicit as the New Mexico redemption statute on who may exercise the right of
redemption. However, he has not provided the specific Alabama statute, nor has he
developed this argument further. See Corona v. Corona, 2014-NMCA-071, ¶ 28,
329 P.3d 701 (“This Court has no duty to review an argument that is not adequately
developed.”).
3 Kaushal also claims that even if the redemption statute in New Mexico
required the heirs to first have title before assigning their redemption rights, the
heirs’ assignment would have been valid under the doctrine of after-acquired title.

14
required and that Kaushal “at best holds a [fifty-percent] tenancy in common	1
redemption interest.” For the following reasons, we hold that title is not required to	2
exercise redemption rights.	3
{20} 	Kaushal is correct that the plain language of the redemption statute does not	4
require that heirs first have title to the entirety of the property to assign or exercise	5
redemption rights. Again, had the Legislature intended to require redemption	6
petitioners to acquire title prior to exercising redemption rights, it could have	7
included such a requirement in the amended statute. See Greenwood, 2012-NMCA-	8
017, ¶ 38. Notably, the redemption statute identifies the term “owner” as including	9
an owner’s “heirs” and “assigns.” Section 39-5-18(D). It would be redundant for the	10
Legislature to employ the terms “heirs” and “assigns” in that context if in fact such	11
parties would first have to acquire title—thereby becoming owners, and falling	12
within the first category of those entitled to redeem under the statute. See United	13
Nuclear Corp v. Allstate Ins. Co., 2012-NMSC-032, ¶ 28, 285 P.3d 644 (noting that	14
Although it is not necessary to address this argument given our holding today, we
assume, without deciding, that the doctrine is not applicable to the circumstances
herein. Rather, our New Mexico Supreme Court has applied the doctrine when there
are two chains of title originating from a common grantor. See Hays v. King, 1989-
NMSC-078, ¶ 8, 109 N.M. 202, 784 P.2d 21. The doctrine “estops a grantor who
obtains title to land after already granting the land from claiming the land as against
the grantee.” Rendleman v. Heinley, 2007-NMCA-009, ¶ 3, 140 N.M 912, 149 P.3d
1009.

15
interpreting statutory terms to avoid redundancy is one rule of construction, though	1
not absolute).	2
{21} 	Moreover, by amending the statute to clarify the definition of a term in a	3
manner that included classifications that by their nature contemplate an absence of	4
titled ownership, the Legislature expressed its intent in a manner inconsistent with	5
the Trust’s argument. See § 39-5-18(D). To conclude that heirs or assignees require	6
title in order to exercise their right of redemption would reclassify them as a different	7
category of owner under the statute, rendering the statute’s use of the terminology	8
“heirs” or “assignees” a legal nullity. “We presume that the Legislature is well	9
informed regarding existing statutory and common law and does not intend to enact	10
a nullity.” Benavidez v. Sierra Blanca Motors, 1996-NMSC-045, ¶ 18, 122 N.M.	11
209, 922 P.2d 1205. We are precluded from interpreting a statute in a manner that	12
excludes terminology chosen by the Legislature or adds terminology not chosen by	13
the Legislature. Rather, it is our task to discern the plain language using ordinary	14
definitions of a given legislative enactment, and effectuate its purpose based upon	15
those words and applicable precedent. “New Mexico courts have long honored this	16
statutory command through application of the plain meaning rule, recognizing that	17
when a statute contains language which is clear and unambiguous, we must give	18
effect to that language and refrain from further statutory interpretation.” Quynh	19
Truong v. Allstate Ins. Co., 2010-NMSC-009, ¶ 37, 147 N.M. 583, 227 P.3d 73	20

16
(alteration, internal quotation marks, and citation omitted). Because the Legislature	1
did not include a requirement that the heirs or assigns of a former defendant owner	2
possess title to exercise or assign redemption rights, we cannot add such a	3
requirement to Section 39-5-18.	4
{22} 	Finally, in New Mexico, a foreclosure sale is subject to redemption by the	5
former defendant owner until the redemption period expires. See § 39-5-18(A). The	6
statutory right to redeem treats certain categories of non-owners, such as assignees,	7
as well as heirs, as defendant owners. See § 39-5-18(D). It provides a right “to regain	8
actual physical possession of the property” by the identified categories of defendant	9
owner. Woodall, 2006-NMCA-129, ¶ 8. As such, the “right to possess” property is	10
not destroyed by a foreclosure sale until the period of redemption expires because a	11
former defendant owner still has the right to possess the whole until then. See id.	12
Because the defendant owners hold the right to possess the property until the	13
expiration of the redemption period, it would be impractical to require an assignee	14
to obtain title during such period. For these reasons, the district court erred in	15
concluding that Joseph and Raymond needed to first obtain title prior to the	16
assignment of their redemption rights, and Kaushal was therefore assigned invalid	17
rights of redemption.	18

17
III. 	The Trust and Kaushal Substantially Complied With the Statutory	1
Requirements for Redemption	2
{23} 	Kaushal finally contends that the Trust’s redemption petition is invalid and	3
unenforceable for two reasons. First, he argues that the plain language of the	4
amended redemption statute provides that a junior lien holder’s redemption right	5
only accrues if the property owner does not exercise his or her right. Second, he	6
contends that the Trust’s petition was rendered invalid by the Trust’s failure to	7
deposit money in the district court’s registry as required by the foreclosure	8
redemption statute. The Trust does not appear to dispute the priority of its	9
redemption petition, but argues that it substantially complied with the statutory	10
requirements for redemption even though it failed to deposit money in the court	11
registry. The Trust also argues that Kaushal did not serve his petition for redemption	12
on any of the parties to the foreclosure proceedings, particularly any representative	13
of the Trust, and therefore his petition is defective.	14
{24} 	The plain language of the New Mexico redemption statute provides two	15
requirements that must be met to redeem property. See § 39-5-18(A) (2); Chapel v.	16
Nevitt, 2009-NMCA-017, ¶ 27, 145 N.M. 674, 203 P.3d 889. Under Section 39-5-	17
18(A)(2), “the debtor must (1) petition the district court and (2) deposit a sum of	18
money in the court registry within nine months from the date of the sale.” Nevitt,	19
2009-NMCA-017, ¶ 27 (emphasis omitted). “Our cases have consistently held that	20
substantial compliance with both statutory requirements is required in order to	21

18
redeem property.” Id. It is a violation of public policy “to prevent redemption that is	1
in accordance with the statute.” Dalton v. Franken Const. Cos., 1996-NMCA-041,	2
¶ 9, 121 N.M. 539, 914 P.2d 1036 (internal quotation marks and citation omitted).	3
{25} 	Kaushal asserts that our courts have been reluctant to honor “reasonable	4
attempts” or “substantial compliance,” in this context, and when they have honored	5
such attempts they have required absolute proof that attempted compliance would	6
have been successful and that no other bars to a successful petition exist. Kaushal	7
points to Dalton to support this assertion, where we held that the tender of an	8
unendorsed cashier’s check did not satisfy the statute. Id. ¶ 12. The cashier’s check	9
in Dalton could only be negotiated after an endorsement “by all three payees[, b]ut	10
the bank refused to endorse the check.” Id. We also noted that Dalton’s “failure to	11
deposit cash with the district court clerk was more than merely a technical	12
deficiency[,]” and that “[i]t is effective action, not good intentions, that the statute	13
calls for.” Id. ¶¶ 14, 19 (internal quotation marks and citation omitted). Kaushal also	14
relies on Chapel, in which our New Mexico Supreme Court held that a redeeming	15
petitioner did not substantially comply when that petitioner never deposited any sum	16
of money in the district court registry. See 2009-NMCA-017, ¶ 30. Rather, the	17
petitioner’s only attempt at compliance was the tender of a $2,000 check (one	18
percent of the purchase price) and the execution of a promissory note. Id. ¶¶ 7, 30.	19

19
{26} 	The Trust argues that its actions constitute substantial compliance and	1
distinguishes its effort from that of the petitioners in Dalton and Chapel. We agree.	2
It is undisputed that the Trust petitioned the district court and met the first	3
requirement of New Mexico’s redemption statute. See § 39-5-18(A). Additionally,	4
the Trust attempted to tender a cashier’s check made out to the First Judicial District	5
Court in the amount of $155,091. Because the district court clerk refused to accept	6
the cashier’s check, the Trust filed a motion requesting that the district court issue	7
an order permitting the Trust to deposit funds for the property. Unlike the petitioner	8
in Dalton who attempted to deposit an unendorsed nonnegotiable check, the Trust	9
tendered a fully negotiable instrument. Additionally, unlike the petitioner in Chapel	10
who attempted compliance by delivering a check for $2,000, the Trust attempted to	11
submit a check for the entire purchase price. The Trust’s failure to deposit the check	12
in the district court registry—because its check was rejected by the district court—	13
was therefore “merely a technical deficiency.” Dalton, 1996-NMCA-041, ¶ 14.	14
{27} 	Despite the Trust’s contentions to the contrary, we similarly conclude that	15
Kaushal substantially complied with the redemption statute requirements. The	16
amended redemption statute provides that “[c]opies of the petition for redemption	17
shall be served upon the purchaser of the real estate at the judicial foreclosure sale	18
and upon all parties who appeared in the judicial foreclosure case[.]” Section 39-5-	19
18(A)(2). Our review of the record reveals that although Kaushal failed to serve his	20

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redemption petition on the Trust, he petitioned the district court and did serve	1
Pacheco’s heirs and the Bank. See § 39-5-18(A). He also deposited a fully negotiable	2
instrument 	for 	the 	fully 	required 	amount 	of 	the foreclosure 	sale 	within 	the	3
redemption period. Because Kaushal served the parties other than the Trust,	4
petitioned 	the 	district 	court 	and 	tendered 	a 	fully 	negotiable 	instrument, 	he	5
substantially complied with the redemption statute requirements. See Nevitt, 2009-	6
NMCA-017, ¶ 27. Kaushal’s failure to serve his redemption petition on the Trust	7
was not more than “merely a technical deficiency.” Dalton, 1996-NMCA-041, ¶ 14.	8
For these reasons, we conclude that both Kaushal and the Trust substantially	9
complied with the statutory redemption requirements and therefore the parties’	10
redemption petitions were valid.	11
CONCLUSION	12
{28} 	For the foregoing reasons, we reverse the district court’s order granting the	13
Trust’s redemption petition and summary judgment for the Trust and remand to the	14
district court to allow for the exercise of Kaushal’s, along with the Trust’s, rights to	15
redemption consistent with this opinion.	16
{29} 	IT IS SO ORDERED.	17
_____________________________	18
J. MILES HANISEE, Chief Judge	19

1

WE CONCUR:

Lastoe be

ith
udge

JAC INE R. MEDINA, Judge

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