## Facts

- Robert Hanford Dalton owned five parcels later sold at a foreclosure Special Master’s sale on April 7, 1994, each subject to a right of redemption.
- The district court confirmed the sale on April 12, 1994.
- Dalton was a Chapter 7 debtor; the right of redemption initially belonged to the bankruptcy estate and was controlled by the bankruptcy trustee.
- Dalton asked the trustee to abandon the redemption rights; the trustee filed a notice of abandonment on June 2, 1994, allowing Dalton to pursue redemption personally.
- By agreement under NMSA 1978, § 39-5-19, the redemption period was shortened to two months; the final day to redeem was June 13, 1994.
- Dalton redeemed four parcels within the redemption period; the remaining parcel had been purchased at the sale by Franken Construction Companies, Inc.
- Dalton obtained only conditional loan approval on June 7, 1994; the lender required (1) assurance of a first lien and (2) assurance that funds would be returned if redemption failed.
- A cashier’s check was issued on June 7 payable to Dalton, the district court clerk, and the lender; it was placed in a trust account pending satisfaction of the lender’s conditions and endorsements.
- Dalton obtained a title commitment on June 9 showing the lender could hold a first lien, satisfying one lending condition.
- On June 13, Dalton’s counsel attempted to file a motion to obtain court-ordered assurances needed to satisfy the lender, but the filing was not accepted that day because hard-copy delivery did not occur until June 14.
- The court entered an order on June 14, but the cashier’s check was still not fully endorsed, and funds were not deposited with the clerk until June 17.
- The district court denied Dalton’s petition to recognize redemption of the Franken parcel as untimely.

## Issues

1. Whether a judgment debtor timely exercises statutory redemption under NMSA 1978, § 39-5-18(A) when fully negotiable funds are not deposited with the court within the redemption period.
2. Whether a multi-payee, conditionally negotiable cashier’s check held in trust constitutes “cash” or its equivalent for statutory redemption purposes.
3. Whether substantial compliance or equitable relief can excuse failure to tender unconditional payment within the statutory (or agreed) redemption deadline absent wrongful conduct by the purchaser.

## Decision

- The Court of Appeals of New Mexico affirmed.
- Dalton did not timely redeem because the redemption price was not tendered in cash or its equivalent within the redemption period.
- The multi-payee cashier’s check, dependent on additional endorsements and conditions and not delivered as unconditional funds within the period, did not satisfy the statutory payment requirement.
- Dalton did not substantially comply because the essential statutory requirement—timely tender of payment—was not met.
- Equitable relief was denied because there was no showing of fraud, misconduct, or other wrongful conduct by Franken, and equity could not extend a clear statutory deadline on these facts.

## Legal Principles

- The post-sale right of redemption is statutory and must be exercised strictly within the time and manner prescribed by statute or lawful agreement.
- Under NMSA 1978, § 39-5-18(A), the redemptioner must tender the redemption price within the redemption period; failure to timely tender extinguishes the right.
- “Cash” or its equivalent requires unconditional, immediately available funds; a cashier’s check that is not fully negotiable and remains subject to third-party conditions is not equivalent to cash for timely redemption.
- Substantial compliance does not excuse failure to satisfy the core statutory requirement of timely payment.
- Equitable relief will not override a clear redemption deadline absent purchaser misconduct or similarly compelling circumstances.

## Conclusion

The court held that Dalton’s attempted redemption failed because unconditional cash (or its equivalent) was not deposited within the agreed two-month redemption period, and neither substantial compliance nor equity justified extending the statutory deadline in the absence of wrongful conduct by the purchaser.


Dalton v. Franken Constr. Cos., 914 P.2d 1036 (N.M. Ct. App. 1996)