Court Opinion

ID: 3681980
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:27:29.646684+00
Date Added: 2024-06-11T15:29:31.872098
License: Public Domain

I cannot agree with the conclusion reached in the foregoing opinion, nor subscribe to all that is said in reaching that conclusion.
The facts speak loudly for themselves. In October, 1934, the mortgagor borrowed $5,000. He contracted to repay that money with interest as the same should fall due. To insure this repayment he also contracted that the lender might sell certain of the borrower's land if the money were not otherwise forthcoming and apply the proceeds on the debt. He further contracted that so long as the loan was unpaid he would pay the taxes on this land as the same accrued. He did not pay the principal when the same was declared due, as it might be under the terms of the contract. He did not pay the interest on the loan — *Page 532 
more than $900 was owing at the time of the sale. He did not pay the taxes as they accrued — they amounted to $720. So the land was sold as he had contracted it might be. All the requirements of the law were followed in making the sale. There is no reason to infer that it was not fairly made. It was pursuant to an order of the court. It was held at the time and place appointed. Due notice was given and it was made to the highest bidder. There were no exceptional circumstances — no inclement weather, no untoward happening, no act on the part of the mortgagee — to hinder. But the mortgagor was dissatisfied and asked that the sale be set aside because the amount bid and paid was inadequate, although he was not hurt thereby since he could redeem within one year by paying the sales price with interest. So it was set aside and a new sale was ordered, albeit there was no assurance that more could be realized at a subsequent sale. In the meantime, interest and taxes were accumulating at the rate of more than $500 a year. And, in the meantime, the mortgagor had the use of and profits from the land. Thus, though the mortgagee was not at all at fault, he had to pay the expenses of the first sale and was delayed in realizing on his security. And thus, the mortgagor was enable to defer the payments of his debt indefinitely and to longer enjoy the use of the property without any increased burden to himself, all wholly at the expense of the mortgagee. The land was sold for $1,680, and the accrued taxes were $720, making a total of $2,400, almost half of the original debt, and five twelfths of the value of the land as found by the court. Of course, when the transaction originated, the mortgagee made only a loan and not a contract to buy the land at the market price. And few borrowers are able to borrow up to the full value of the security pledged. So clearly, considering all the circumstances, the mortgagee's contract rights were impaired contrary to the provisions of both the Constitution of the United States and of the Constitution of the state of North Dakota. True, this was done pursuant to the statute, which it is claimed deals only with the matter of remedy. But even if this be so, since it defeats the mortgagee's contract rights it does not make the statute or acts done under it immune to constitutional challenge. And even though "the states continue to possess power `in relation to the operation of contracts' to `safeguard the vital interests of the people'" nevertheless they may not exercise this power to the extent of impairing *Page 533 
substantial contract rights of individual citizens without due compensation any more than they may, for the same reason, take or damage their other property.
BURR, J., concurs.