Court Opinion

ID: 5446033
Source: CourtListenerOpinion
Date Created: 2022-01-08 18:10:53.027985+00
Date Added: 2024-06-11T08:32:11.531497
License: Public Domain

Paterson, J.
Appellant received from the state a certificate of purchase for the lands described in the complaint, on March 28, 1860, and in August following assigned the same to one Collins, to secure an indebtedness of thirty dollars, and thereafter a patent was issued from the state to Collins. Appellant paid Collins the amount due him; and the latter, by request of appellant, conveyed the land to John H. Allen, who paid no consideration therefor. Respondents thereafter advanced to the appellant certain sums of money for the payment of taxes which had become delinquent, and to secure the repayment to them of said sums, the appellant, on June 12, 1869, caused said John H. Allen to convey the lands to them as security for the repayment of the money they had advanced. This deed was absolute in *194form. John H. Allen received no consideration for the deed. Neither of the parties has ever been in actual possession of the land. The contract of loan was oral, and no time was fixed in which appellant was to make repayment. Plaintiff never made any demand for an accounting, or any offer to redeem, prior to the year 1885, and defendants did not, prior to that time, assert any claim of title to the lands adverse to plaintiff’s right to a reconveyance upon payment of the indebtedness. This action was commenced March 15,1887. The court below rendered judgment for the defendants. A motion for a new trial was denied,' and plaintiff appealed from the order and from the judgment.
1. The court below held that plaintiff’s cause of action was barred by the provisions of section 361 of the Code of Civil Procedure. That section provides: “ When a cause of action has arisen in another state or in a foreign country, and by the laws thereof an action thereon cannot be maintained against a person by reason of the lapse of time, an action thereon shall not be maintained against him in this state, except in favor of one who has been a citizen of this state, and who has held a cause of action from the time it accrued.” It is claimed by appellant that under that section it was incumbent on the respondents to set out the facts upon which they rely, to show that the cause of action arose in the state of New York, and that under the laws of that state it was barred by the statute of limitations. A complete answer to this contention is found in section 458 of the Code of Civil Procedure, which provides: “In pleading the statute of limitations, it is not necessary to state the facts showing the defense, but it may be stated generally that the cause of action is barred by the provisions of section (giving the number of the section and subdivision thereof, if it is so divided, relied upon) of the Code of Civil Procedure; and if such allegation be controverted, the party pleading must establish on the trial the facts showing that the cause of action is so barred.” The rule thus established was intended to simplify the form of *195pleading such defenses, and is one which the court can-, not depart from on a conjecture that the legislature intended to except from its operation cases of this kind. The contract was made in New York, where all the parties resided, and neither of them was in this state thereafter until the year 1885; and it is claimed by appellant that under sections 346 and 351 of the Code of Civil Procedure, and section 2903 of the Civil Code, the respondents’ right to foreclose their mortgage was not barred at the date of the commencement of this action; that appellant remained the equitable owner of the property, and his right to redeem was kept alive. Those sections read as follows: —
“ Sec. 346. An action to redeem a mortgage of real property, with or without an account of rents and profits, may be brought by the mortgagor, or those claiming under him, against the mortgagee in possession, or those claiming under him, unless he or they have continuously maintained an adverse possession of the mortgaged premises for five years after breach of some condition of the mortgage.”
“ Sec. 351. If, when the cause of action accrues against a person he is out of the state, the action may be commenced within the term herein limited after his return to the state; and if, after the cause of action accrues, he departs from the state, the time of his absence is not part of the time limited for the commencement of the action.”
“ Sec. 2903. Every .person having an interest in property subject to a lien has a right to redeem it from the lien at any time after the claim is due, and before his right of redemption is foreclosed.”
In support of this contention, counsel for appellant say, in substance: “ Respondents’ action to foreclose could have been brought only in this state. The word return,’ as employed in section 351 of the Code of Civil Procedure, is applicable to persons coming from abroad, as well as to citizens who have left the state for a temporary purpose and returned thereto. The statute had *196not commenced to run in 1885, because the respondents had never been in the actual occupancy of the premises. Section 2903 of the Civil Code, and section 346 of the Code of Civil Procedure, provided rules of limitation different from those which had previously been followed by the courts of this state, and those new rules are applicable to mortgages made before as well as those made after the adoption of the codes, unless the remedy was extinguished at the time the codes took effect. Respondents were not only mortgagees, but trustees of appellant; and the statute could not commence to run in their favor until an offer to redeem was made by appellant. There could be no laches on the part of appellant, because the legal title remained in him, and no adverse claim was made by respondents.” These contentions cannot be lightly passed over. They deserve to receive, and they have received, our careful attention.
In the solution of the question presented as to the effect of the deed, we must read as a part of the contract the laws of this state existing at the time the contract was made (Klinck v. Price, 4 W. Va. 4; United States v. Crosby, 7 Cranch, 115); although the nature and the construction of the contract of loan, which was made in New York, are determined by the latter state. (De Wolf v. Johnson, 10 Wheat. 367.) It is true, an action to foreclose must be brought where the property is situated; but it does not follow that respondents could have maintained an action to foreclose at the time this suit was commenced. Both parties resided in the state of New York, where the contract was made, and -either could have maintained an action there on the contract. The plaintiff could have enforced his right to redeem, and the defendants could have recovered the amount for which they held the land as security. (Montgomery v. Sped, 55 Cal. 352; Kanawha Coal Co. v. Kanawha & O. Coal Co., 7 Blatch. 415; Gardner v. Ogden, 22 N. Y. 327; 78 Am. Dec. 192; Williams v. Fitzhugh, 37 N. Y. 444.) In this state, when an action on a promissory note, secured by mortgage of the same date upon real property,
*197is barred by the statute of limitations, the mortgagee has no remedy upon the mortgage. (Lord v. Morris, 18 Cal. 482; Heinlin v. Castro, 22 Cal. 100.) The debt is regarded as the principal, and the mortgage as a mere incident. When the debt is barred, the remedy upon the mortgage is also barred. (McCarthy s. White, 21 Cal. 495; 82 Am. Dec. 754.) If, therefore, respondents could not maintain an action in New York for the recovery of the money due, they could not maintain an action in this state to foreclose the mortgage. (Code Civ. Proc., sec. 361.) At the time the conveyance was made by John H. Allen to the respondents, a deed absolute in form, but intended as a mortgage in this state, transferred the legal title, and there was left in the person executing it a mere equity of redemption; and whenever the debt to secure which the deed was made became barred by the statute of limitations, the right to redeem was barred. (Hughes v. Davis, 40 Cal. 117; Espinosa v. Gregory, 40 Cal. 58.) The right to redeem and the right of the creditor to sue on a contract were reciprocal. When one was lost, the other could not be enforced. (Cunningham v. Hawkins, 24 Cal. 403; 85 Am. Dec. 73; Arrington v. Liscom, 34 Cal. 366; 94 Am. Dec. 722; Grattan s. Wiggins, 23 Cal. 35.) No subsequent legislation could change the rights or obligations of the parties, or extend the time for action. The right and time to redeem were fixed by the laws in force at that time. (Bronson v. Kinzie, 1 How. 316; Walker s. Whitehead, 16 Wall. 318; Heyward v. Judd, 4 Minn. 483; Phinney v. Phinney, 81 Me. 450; 10 Am. St. Rep. 266.)
Under the decisions just cited, section 346 of the Code of Civil Procedure is inapplicable, because it would effect a material change in the rights and obligations of the parties. (Phinney v. Phinney, 81 Me. 450; 10 Am. St. Rep. 266; Heyward v. Judd, 4 Minn. 483.) And for the same reason, Raynor v. Drew, 72 Cal. 307, and other and later cases declaring the rule stated in that section, are not in point. They are based upon that section of *198the code, and it was passed posterior to the time the parties entered into the contract.
It is claimed by the appellant that the finding of the court, “ that the cause of action stated in the complaint is barred by the provisions of section 361 of the Code of Civil Procedure,” is not supported by the evidence. The defendant introduced in evidence section 91, chapter 3, title 1, of Waite’s Annotated Code of Procedure of New York. It is not disputed that this section applies to personal actions, and supports the fourteenth finding of the court, “ that by the laws of the state of New York an action upon a verbal agreement for the payment of money is barred within six months after the cause of action accrues thereon, and the right of defendants to maintain any action against plaintiff to recover the said sum of five hundred dollars, as security for which the said deeds from Cox and John H. Allen were executed to them, has been barred by the laws of said state at all times since the twentieth day of November, 1874; and the right of defendants to maintain any action against plaintiff to recover the moneys advanced by them to him, as stated in finding No. 11, has been barred by the laws of said state at all times since September 13,1877.” But it is claimed that as the appellant’s cause of action is one to ascertain the amount due upon a mortgage, and that he may be permitted to pay the same and remove a cloud from his title, the section referred to does not apply to the case, but is governed by section 97, which provides that an action for relief not otherwise provided for must be commenced within ten years after the cause of action shall have accrued. As we have seen, however, as soon as the debt is barred the remedy upon the mortgage is lost. Respondents could not have maintained an action in New York for the recovery of the money due. They therefore could not maintain an action in this state to foreclose the mortgage, and the right to redeem was lost; and as the right to redeem and the right to maintain an action on the contract are reciprocal, the fourteenth finding of the court, which is not attacked, is *199conclusive against the plaintiff’s right to maintain this action. If it be conceded that in New York an action to redeem from a mortgage of lands situated in that state can be maintained, although an action for the recovery of the money due could not be maintained there, the result must be the same, because, as stated before, the effect of this deed depends upon the laws of this state, existing at the time the contract was made. The interest of each party in the land was measured and controlled by the lex loci rei sitse. (Klink v. Price, 4 W. Va. 4; United States v. Crosby, 7 Cranch, 115.) The right to redeem is governed by the laws of this state.
It is claimed that at the time the contract was entered into, it was the established rule in this state that a conveyance absolute in form, but intended merely as security, did not pass the legal title to the grantee. It is true, there had been decisions to that effect; but in the year following it was held (Espinosa v. Gregory, 40 Cal. 58, and Hughes v. Davis, 40 Cal. 117) that a deed absolute in form, intended as a mortgage, did convey the legal title. These decisions did not change the law; they simply declared what was the law. Every one is conclusively presumed to know the law, although the ablest courts in the land often find great difficulty and labor in finally determining what the law is. The courts cannot make or repeal a law. “ They can say what a law means; and if after-wards they see that-they have made a mistake, they can correct their error by an overruling of a former decision, the consequence of which overruling is that the blunder is thenceforward deemed never to have been law.” (Bishop on Contracts, sec. 569.)
It has been held here, that although it appears the parties have entered into a contract relying upon a previous decision of the supreme court, they would not be relieved from the obligations thereof because of a subsequent decision by the same court, overruling the former one, and declaring a different rule upon the same subject. (Kenyon v. Welty, 20 Cal. 637; 81 Am. Dec. 137.) There are some cases in which the supreme court of the United *200States has held that the construction given to a statute by the highest tribunal in the state, whether sound or not, must be taken as correct, so far as contracts made under the act are concerned, and no subsequent decision altering the construction can impair their validity. The construction becomes a part of the statute, — as much so as if it were an amendment made by the legislature. (Gelpcke v. Dubuque, 1 Wall. 175; Louisiana v. Pillsbury, 105 U. S. 294; Douglass v. Pike, 101 U. S. 677; Thomson v. Lee, 3 Wall. 327.) These cases, however, all involved the question as to the validity of negotiable securities.
We think that the case of Oullahan v. Sweeney, 79 Cal. 357, is distinguishable from the case at bar. The amendment therein referred to simply required the purchaser of property sold for delinquent taxes to serve upon the owner of the property a notice stating that the property had been sold for delinquent taxes, the date of the sale, the amount forwhich it was sold, the amount then due, the time when the right of redemption would expire, and when the purchaser would apply for a deed. This requirement was a mere incident to the right of the purchaser to receive a deed; it merely prescribed the manner in which he should proceed to demand the deed to which he was entitled. It was conceded, “ for the purposes of the case, that the legislature cannot make an absolute extension of the time for redemption of property previously sold.”
We think the court below held the right view of the case, and the judgment and order are therefore affirmed.
McFarland, J., Harrison, J., Garoutte, J., and Ds Haven, J., concurred.
Sharpstein, J., concurred in the judgment.