Baker v. First Nat. Bank of Denver, 5105
| Decision Date | 29 November 1979 |
| Docket Number | No. 5105,5105 |
| Citation | 603 P.2d 397 |
| Parties | Robert W. BAKER, Appellant (Defendant), v. FIRST NATIONAL BANK OF DENVER, a National Banking Corporation, Appellee(Plaintiff). |
| Court | Wyoming Supreme Court |
V. Frank Mendicino, Cheyenne, for appellant.
Barry G. Williams and Richard E. Day, of Williams, Porter, Day & Neville, P. C., Casper, for appellee.
Before RAPER, C. J., and McCLINTOCK, THOMAS, ROSE and ROONEY, JJ.
This is an action to foreclose a mortgage on a piece of real property in Natrona County. The original note, payable to appellee-plaintiff in Colorado, was executed on November 24, 1965, by a corporation in which appellant-defendant was a major stockholder. On the same date, appellant and his now deceased wife, both residents of Colorado, executed a document personally guaranteeing payment of the note. On September 29, 1967, after the note was in default, appellant executed a mortgage on the Natrona County real property to secure payment of the note. On February 5, 1968, appellant's now deceased wife executed a similar mortgage on the same real property. All of the documents were executed in Colorado. Appellee is a Colorado entity. Additional payments were not made on the note and this action was filed on August 23, 1976. In his answer, appellant pleaded the statute of limitations as an affirmative defense. Several other persons and entities were parties to the action from time to time as it progressed through the trial court. For the purposes of this appeal, it is sufficient to note that a judgment of foreclosure was entered in conjunction with a stipulation of all the parties then in the litigation. The judgment recited a "default in the terms and provisions of the promissory note, guaranties and mortgages"; that the amount in default was $86,500.00; and that such was to be satisfied pursuant to the stipulation. A partial summary judgment had been entered prior to the stipulation and judgment of foreclosure, premised on the rulings: (1) that the Wyoming statute of limitations, rather than that of Colorado, was applicable (therefore, the action was not barred); and (2) that the piece of real property was held in tenancy in common under a conveyance to "Robert W. Baker (appellant), Ruth Jane Baker (appellant's now deceased wife), G. W. Hales, Jr., and Mary W. Hales" (therefore, the separate mortgages were valid). The judgment of foreclosure resolved all pending issues in the trial court but recited the specification of the stipulation to the effect that the appellant could appeal on the grounds of error in: (1) the ruling relative to the statutes of limitations; and (2) the ruling relative to the status of the estate as that of tenancy in common. Appellant here alleges error in these two respects. We find error in the ruling relative to the statutes of limitations and therefore reverse. Accordingly, we need not address the propriety of the ruling relative to the tenancy in common.
Appellee contends (and the trial court found) that the determinative statute of limitations in this case is § 1-3-105, W.S.1977, which provides in part:
Ten years did not elapse between the execution of the mortgages with subsequent continuing default and the institution of this action.
Appellant contends that the determinative statutes of limitations are § 1-3-117. W.S.1977 (the "borrowing" statute), which provides:
"If by the laws of the state or country where the cause of action arose the action is barred, it is also barred in this state,"
and § 13-80-110, C.R.S.1973, a Colorado statute, which provides:
Six years did elapse between the execution of the mortgages with subsequent continuing default and the institution of this action.
The mortgage also contained a promise or obligation to pay the indebtedness. The indebtedness was to be paid in Colorado at a specified time. It was not then and there paid. The cause of action accrued at that time and at that place. It was "the time and place where that is not done which ought to be done." Cantonwine v. Fehling, Wyo., 582 P.2d 592 (1978); Bliler v. Boswell, 9 Wyo. 57, 59 P. 798 (1900), reh. den. 9 Wyo. 57, 61 P. 867 (1900).
Appellee argues, with citations to legal authority, that the law of the forum governs with respect to limitation of actions upon a contract with respect to real property, and particularly with respect to foreclosure actions. It also notes that these mortgages contain a provision that the mortgagee may enforce the same "according to Wyoming Statutes governing mortgage foreclosures." We have no problem with this argument and law. We do find appellee's conclusion therefrom fallacious. This conclusion is that the ten-year Wyoming statute of limitations (§ 1-3-105) controls the disposition of this matter. This conclusion overlooks the fact that § 1-3-117 (the borrowing statute) is as much a part of Wyoming law as is the ten-year statute of limitations. Duke v. Housen, Wyo., 589 P.2d 334 (1979), reh. den. 590 P.2d 1340 (1979). In applying the law of the forum pursuant to appellee's argument, we must apply the borrowing statute as one of the laws of the forum.
In applying § 1-3-117, we find that it bars an action in Wyoming if it is barred "by the laws of the state or country where the cause of action arose." As already indicated, the cause of action arose in Colorado. Is it barred by the laws of Colorado?
Section 13-80-110, C.R.S.1973 (set forth supra) sets six years as the bar to an action "of debt founded upon any contract or liability in action." The statute applies to actions on notes. First National Bank of La Junta v. Mock, 70 Colo. 517, 203 P. 272 (1921); Purdy v. Deprez, 39 Colo. 68, 88 P. 972 (1907).
Section 38-40-105, C.R.S.1973, provides:
" * * * No action shall be brought or maintained to foreclose any mortgage, trust deed, or other lien, unless such action is brought within fifteen years after the maturity of the last installment or payment of the principal indebtedness in the said mortgage, trust deed, or other lien mentioned as the same appears of record * * *."
However, § 38-40-112, C.R.S.1973, provides:
" * * * The lien created by any instrument shall be extinguished, regardless of any other provision in this article to the contrary, at the same time that the right to commence a suit to enforce payment Of the indebtedness secured by the lien is barred by any statute of limitation of this state." (Emphasis supplied).
Pursuant to these enactments, this action would clearly be barred in the state of Colorado. The Wyoming borrowing statute therefore precludes the action in the state of Wyoming. 2
Reversed. 3
I too dissent from the opinion of the court but will express my views in a somewhat different manner from my Brother Thomas. As I view the case, our borrowing statute, § 1-3-117, W.S.1977, provides that if a cause of action is barred in the state where it arose it is likewise barred in this state. Inherent in this statute is the philosophy that if one has unduly neglected to assert his rights in the state where the cause of action arose, he should not be permitted to do so in Wyoming. But this necessarily presupposes that there existed a right which the party could have so enforced. If the right asserted in our court is one which could not have been enforced, there is then nothing upon which the foreign limitation could operate. It therefore cannot be used to defeat an action in Wyoming that only its courts could entertain.
I believe it unquestioned law that the validity, effect and enforcement of mortgages on real property in Wyoming are a matter of Wyoming law. Insofar as the plaintiff in this case sought to foreclose its mortgage on Wyoming property there was no cause of action that it could have asserted in Colorado. I shall not attempt an exhaustive analysis of the authorities, but the principle is fully explained in Beach v. Youngblood, 215 Iowa 979, 247 N.W. 545 (1933). A note payable in Iowa and mortgage had been executed in that state but the mortgaged property was located in Minnesota. Upon default in payment of the note, the holder thereof brought action in Iowa, seeking to foreclose the mortgage upon the Minnesota land. The trial court entered judgment for the amount of the note, declared the mortgage a lien superior to the claims of all other parties, and directed the county sheriff in Iowa to advertise and sell the Minnesota property in the same manner as sales are made of Iowa property. The owner of the property was ordered at the end of the period of redemption to deliver possession of the premises to the purchaser at the sheriff's sale. On appeal it was argued that the Iowa court had no jurisdiction of the foreclosure phase of the action, wherefore the order of foreclosure was a nullity.
The Iowa Supreme Court discusses the applicable principles at some length, referring to numerous cases, all of which deny the power of the courts of one state to decree a foreclosure on property within another state, and in the course thereof makes these pertinent statements:
"It is a well and universally established principle that the disposition of real estate, either by deed, descent, or any other method, must be governed by the law of the state where the same is situated." 247 N.W. at 549.
The court then points out that under Iowa law an action to foreclose a mortgage on real property shall be brought in the county where the property or some part thereof is situated. (Justice Thomas has pointed to...
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...requiring payment to be made “at the head office of the First National Bank of Boston, in Boston, Massachusetts”); Baker v. First Nat'l Bank, 603 P.2d 397, 398 (Wyo.1979) (noting that the debt was “to be paid in Colorado at a specified time” but was not then and there paid, and therefore th......
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...must be applied where payment on a promissory note executed by a Nicaraguan defendant was payable at Boston. In Baker v. First National Bank, 603 P.2d 397, 398 (Wyo.1979), where the mortgaged property and the mortgagor are located in Wyoming and mortgagee is located in Colorado, the Wyoming......
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