Court Opinion

ID: 8198307
Source: CourtListenerOpinion
Date Created: 2022-09-09 23:21:53.280857+00
Date Added: 2024-06-11T16:40:50.131008
License: Public Domain

The following memorandum was filed October 9, 1934:
Wickhem, J.
(on motion for rehearing). While the motion for rehearing in this case was pending, the cases of Marshall & Ilsley Bank v. W. J. Durham Lumber Co., First National Bank of Neenah v. W. J. Durham Lumber Co., and First National Bank of Menasha v. W. J. Durham Lumber Co., post, p. 66, 256 N. W. 783, were argued and submitted. Since the appeals in these cases involve the constitutionality of sec. 269.58 as applied to a mortgagee who completely owned the debt as well as the security, and since the subject is of great importance, the court has restudied and reconsidered the entire matter, and the conclusions here set forth dispose not only of the motion for rehearing but also the appeal in the Marshall & Ilsley Bank, First National Bank of Neenah, and First National Bank of Menasha Cases.
The original decision in this case was expressly grounded upon the contract clause of the constitution of the United States, as construed in the Blaisdell and Worthen Cases. Sec. 269.58, Stats., was held to be unconstitutional and void as applied to bondholders having no control over the proceedings to foreclose the security, for the reason that it unconditionally and indefinitely denied to them the only remedy over which they had any substantial measure of control. After a careful reconsideration of the Blaisdell and Worthen *63Cases, we adhere to this conclusion. It is contended in the briefs that the doctrine of the Blaisdell Case does not require that a balanced quid pro quo, approximating in value the right impaired, be given the mortgagee. While this may be true, it was definitely required, as we read the cases, that conditions taking reasonable account of the rights and interests of the mortgagee be imposed. Since none were imposed by the section under examination, it is unnecessary to consider what the precise character of these conditions must be to measure up to the requirement of reasonableness set forth in the Blaisdell and Worthen Cases.
It was further held that sec. 269.58 was wholly unconstitutional and void as to all mortgages existing at the time of its enactment, first, because it was incapable of being separately applied to mortgagees who completely owned the debt and security, and, second, because it was not limited in duration to the period of the emergency. These conclusions made it unnecessary for this court to consider whether, as to those who completely owned the debt and security, the legislature could validly postpone or destroy the action at law upon the debt, leaving only the remedy of foreclosure as a means of enforcing the debt, and no opinion was expressed as to the validity of such legislation under such circumstances.
We are urged to reconsider the conclusion that the act cannot be separately applied to mortgages wholly owned by a single mortgagee. This contention is based upon the fact that sec. 4 of ch. 125, Laws of 1933, reads as follows:
“If any provision of this section or the application thereof to any person or circumstance is held unconstitutional the remainder of the act and the application of such provision to other persons or circumstances shall not be affected thereby.”
It is contended that the word “section” as used in sec. 4 refers to the whole of ch. 125, and requires, in the event that the law is held to be unconstitutional in its application to any person, that it be sustained as to others with reference to *64whom it is not subject to constitutional objections. The saving clause is unquestionably ambiguous, in that it is capable of being construed as applying only to sec. 278.106, as the word “section” and its relation to sections immediately preceding seem to imply, or to the entire act, as its numbering, and the use of the words “remainder of the act” seem to imply. There would appear to be considerable merit to the claim that the act is capable of being separately applied. We withdraw the opinion originally expressed upon this contention, and express no opinion upon it for the reason that its disposition becomes immaterial in view of the fact that the court adheres to its opinion that the act is required to be limited in duration to the period of the emergency, and that it fails to meet this requirement. A reconsideration of the Worthen Case fortifies us in the opinion originally entertained that the act must be limited in duration to the emergency. There may be reasonable doubt whether this limitation must be accomplished by setting a positive date after which the legislation shall have no effect. But it was held in the Worthen Case that a mere reference to the emergency is not sufficient to warrant the conclusion that the act was intended to cease at the end of the emergency.
The Arkansas law, under examination in the Worthen Case, contained a preliminary clause reciting, in much the same manner as does the preamble to sec. 269.58, the existence of an emergency arising out of “the desperate financial situation now existing,” and recites the evil consequences to citizens of the state, which the law was intended to mitigate. The court, in the Worthen Case, said:
“The legislature sought to justify the exemption by reference to the emergency which was found to exist. But the legislation was not limited to the emergency and set up no conditions apposite to emergency relief. ...”
We can only construe this to mean that a mere reference to an emergency as the occasion for enacting a law is not *65sufficient to indicate a legislative intention that the law be limited in duration to the period of the emergency.
It is argued that, properly construed, sec. 269.58 has a definite period of termination, and that this date is March 1, 1935. This contention requires a consideration of the form of the act as adopted. Ch. 125 was divided into five sections. Sec. 1 provides for adding to the statutes two new sections, secs. 269.58 and 278.106. Such ambiguity as is present is the result of the use of the word “section” to indicate the various divisions of ch. 125 as presented to the legislature, and also to designate secs. 269.58 and 278.106. Sec. 269.58 concededly has no express time limitation. Sec. 278.106, which in substance extends the period of redemption in ordinary mortgage foreclosures, provides that in any action commenced prior to March 1, 1935, the benefits of an emergency extension of the period of redemption shall be granted. It provides that “this section shall terminate on March 1, 1935,” and that “this section shall apply to all proceedings commenced prior to March 1, 1935.” It contains five references to the date of March 1, 1935, and in each one of them it is plain that the word “section,” where used in connection with this date, refers to and is to be printed in the statutes as a part of sec. 278.106, and is not intended to refer to sec. 269.58.
Under these conditions we conclude that the legislative history of the statute does not disclose any intention to limit the duration of sec. 269.58. Whether this was because the legislature intended to give to this section not only a retrospective but a prospective and general application need not be here decided, nor is there any occasion to consider whether, if so intended, it is capable of being separated and its validity to this extent established.
We have been favored with exceptionally able briefs which have been of great assistance to the court. The briefs in support of the validity of the law have contained careful and useful analyses of the social and economic situations which *66form the background of this legislation, and are asserted to establish its reasonableness.. We have not addressed this opinion to any of these arguments for the reason that we consider ourselves bound to consider and apply to these cases the Blais dell and Worthen decisions.
A motion for a rehearing was denied, with $25 costs, on October 9, 1934.