Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1881-03-17
IMPORTANT DECISION.
THE NEW CONSTITUTION AND PRE-Ex-
IsTIKG MORTGAGE CONTRACTS.
The Party Required to Pay the Taxes
Upon the Amount Due Under
Such Mortgages.

sidered and decided below, while two or thr,
other points of interest are also included.
The case was as follows Upon the III
OF July, 1878, E. NJ. Skaggs gave his note
Robert Anderson for $1,000, and secured
by mortgage on the property at the soutl
east corner of Seventh and K streets in til
city. The mortgage contained clause prS
viding that in case the mortgagor failed
pay the taxes upon the property the NOR
! gage might do so, and the amount 80 pal
| should be covered and secured by the NOR
gage. The mortgage was subs 4uently as
signed by Anderson to VIM. Beckman. Las
year the mortgage was assessed, as provide
| by the new Constitution, to the holder there
of, for sthe full value-S10, 000-and tn
| property was assessed TO the mortgagorfo
its value, less the amount Of the mortgage
Beckman paid the tax assessed upon tn
/ mortgage. and also that assessed against tn
| land, as the mortgagor failed to do so. Tht
mortgage not being paid when due, BeckmaI
| brought the present suit to foreclose. The de
| PENDANT conceded the obligation to pay tn,
! taxes assessed on the rssiduary part above the
mortgage, but refused to repay the taxes as
! ssssed against the mortgage itself. The plain
tiff claimed the right to recover this part also,
I
| Constitution would otherwise be TO shift the
| burden from the mortgagor to the mort
gage. and make him actually pay the taxes
upon the land ITSELF or a portion thereof
and that the Constitution must be so con.
strued as not to impair the obligations of a
pre-existing contract. The following is the
OPINION OF THE COURT.
VIM. Beokman vs. E. N. Skaggs and W.
ND N 4beaf 20 -
were substantially agreed upon at the trial,
50 there is but little controversy except upon
questions OF law involved.
The action was brought to foreclose a mort
gage executed in favor of one Robert Ander.
son, and by him assigned to plaintiff. who is
now the holder and owner thereof The
debt secured by toe mortgage was past due
when the action was commenced, and there
was no valid or legally binding extension of
time for payment, even if defendants theory
of the transaction be assumed. Plaintiff had
the right to commence the action when he
did 50. The debt was due, and if plaintiff
promised to wait a day or two for payment
there is no pretense of any consideration for
such promise.
Suit was commenced on the 22d day of
January, a. d. 1881, and summons served on
the Oath day Of the same month. On the
18th of said month the defendant Wilson
rendered to the plaintiff the sum of So. $50. in
United States gold coin, as a payment in full
of the debt, with interest, and all payments
lawfully made for taxes and insurance, and
an attorneys fee for the foreclosure suit.
Plaintiff refused to accept said sum, and said
defendant then deposited said money IN the
bank of D. 0. Mills Il Co., in his own
name, but with instructions to pay il
to plaintiff If he would accept the same,
On the first day of February, A. D. 1881,
said defendant fled his answer herein aud
drew said IN 1ney out of said bank, and de-
posted the same with the clerk of this Court ;
and he now claims that by making such ten
der the debt was exinguished, ana plaintiff
cannot recover any costs incurred since the
making of such tender. Plaintiff replies to
this upon two grounds: First, that after suit
brought the law does not recognize a tender
as affecting the Htigation-an offer of judg-
ment for a-certain and sufficient sum and
costs being the only means by which q de-
PENDANT can stop the accumulation of costs
and, second that the amount rendered was
insufficient. The second objection need not
be considered here, as the first is, in my judg-
ment, well taken. The theory of the law is
that when party institutes legal proceedings
he is entitled to have not only his due, but
also judicial statement of the matter in
suit. A tender of O sum of money cut of
Court does not amount to judicial determi-
nation and settlement of the questions in
litigation, but the defendant has the right to
stop the accumulation of costs by rendering,
not the money, but an offer to allow judy
ment to be taken for all to which plaintiff is
entitled. He did not do this, and l hold that
his tender avaiis him nothing.
THE IMPORTANT QUESTION.
The principal matter of litigation, however,
is as to the amount which plaintiff is en-
titled to recover judgment for herein.
The following items are conceded or well
established:
Principal and interest on note to January
18th 81 300 %
Insurance paid Oct Der l, 1850, and int r
est to January 10th Observation-Disclosures. q q
Insurance paid December 10, 1850, and
interest TO January 26th. ...........,... 10 81
State and county taxes paid December 49,
1880. and interest to January 26th....... 81 q
Insurance paid December 20, 1850, and
interest TO January Goth. ............. so l6
Plaintiff also claims the sum Of S135,
actually paid by him for State aud county
taxes levied and assessed against the mort
gage debt in suit for 1880, and paid by him in
December. The mortgage in suit contains
the following provisions And it is hereby
agreed that it shall be lawful for the said
MORTGAGE, his successors or assigns, to pay
and discharge at maturity all taxes or assess
ments, liens or other membranes now sub
sisting or hereafter to be laid or imposed
upon said lot of land and premises, and
which may be in effect a charge thereupoh.
And that the mortgagor viii, on
demand, repay to the mortgage in gold coin
all sums which may have been paid by the
mortgage to discharge any tax. assessment
or other lien on said premises and
that this mortgage shall stand as security for
the repayment to the mortgage of all sums
which he shall have paid for any of the pur-
poses aforesaid" These are the only pro-
visions of the mortgage affecting the question
now under consideration The mortgage was
executed July II, 1873, before the adoption
of the present Constitution, and at time
when such securities were not liable to tax
alton.
Section of Article Kill, of the Consti
tuition adopted in 1879, among other things,
says: A mortgage, deed of trust, contract
or other obligation by which debt is Sc
cured shall, for the purposes of assessment
and taxation, be deemed and treated as an
interest N the property affected thereby.
Except as to railroad and other quasi public
corporations, in case of debts SO secured, the
value of property affected by such mortgage,
deed of trust, contract or obligation, less the
value of such security, shall be assessed and
taxed to the owner of the property, and the
value of such security shall be assessed and
taxed to the owner thereof, in the county.
city or district in which the property affected
thereby is situate
ASSESSMENT UNDER THIS PROVISION.
This provision of the Constitution is car
ried into effect by the amendment of Section
1927 of the Political Code which is virtually
an enactment in statutory form OF the above
Quoted constitutional provision.
Under this statute the Assessor of Sacra-
mento county in the year 1880 assessed TO the
mortgage the mortgage in suit at the face
value thereof; and to the mortgagor or his
vendee the land at the cash value thereof.
after deduoting the amount of tho mortgage.
The tax upon the mortgage for State and
county purposes was S135, and upon the
mortgaged property was $40 30. which
two SUMS were paid by the plaintiff as the
assignee OF the mortgage. There is no ques-
ton raised as to the tax upon the land. but
defendants resist the payment Of the S135
paid as taxes upon the mortgage.
1t may be laid down as an incoatrcvertible
proposition. and without argument, that no
statute law or State Constitution can impair
the obligations of contracts, because pro-
hibited by Section 10 of Article l. of the
Constitution Of the United States, and this,
whether attempted by direct or indirect
means. Cummings VS. Missouri, Wall,
325 j Henderson VS.. Mayor, etc, Otto,
26Sl.
Under the Constitution in force whom tbis