Beverly v. Barnitz

• Decision Date: 07 December 1895
• Parties: JOHN L. BEVERLY v. MARTHA BARNITZ
• Court: Kansas Supreme Court

42 P. 725

55 Kan. 466

JOHN L. BEVERLY v. MARTHA BARNITZ

Supreme Court of Kansas

December 7, 1895

Motion for Rehearing.

THE nature of the action and the material facts appear in Beverly v. Barnitz, ante, p. 451, and in the opinion herein, filed December 7, 1895.

Judgment reversed and cause remanded.

E. A McMath, for plaintiff in error.

William J. Scott, for the motion.

Ferry & Doran, contra.

OPINION

MARTIN, C. J.:

On November 1, 1885, George A. Kirkland executed a negotiable promissory note to Martha Barnitz for $ 1,500, payable in five years, with interest at 8 per cent. per annum, and after maturity at the rate of 12 per cent. per annum, which note was secured by a mortgage on a quarter-section of land in Shawnee county, Kansas, appraisement being waived. The land was afterward sold to John L. Beverly, subject to the mortgage. On January 21, 1893, an action was commenced in the district court of Shawnee county to obtain judgment upon said note and to foreclose said mortgage. On July 7 1893, a personal judgment was rendered for $ 2,113.46, bearing interest from that date at the rate of 12 per cent. per annum, and $ 44.95 costs, and the land was ordered to be sold for the payment of said judgment. On January 9, 1894, an order of sale was issued, and the property was sold to Martha Barnitz by the sheriff on February 12, 1894, for $ 2,000. On February 19, 1894, John L. Beverly filed a motion asking that, upon confirmation of the sale, the court order, adjudge and determine that said real estate is subject to redemption as provided by chapter 109 of the Laws of 1893, (which took effect March 17, 1893,) and that the sheriff be ordered and directed to make to the purchaser the certificate of sale mentioned in said chapter, he being in actual possession of said real estate by his tenant, the same never having been abandoned, but being occupied in good faith. This relief was refused by the court, and it was ordered that the sale be confirmed and a deed executed by the sheriff to the purchaser for said premises, holding that said chapter 109 is unconstitutional so far as intended to apply to mortgages previously executed and delivered. On a proceeding in error in this court, said judgment was affirmed. The companion case of Watkins v. Glenn was decided at the same time, and the opinions appear ante pp. 417 et seq. (40 P. 316-326). The plaintiff in error asks a rehearing.

Does this statute impair the obligation of this prior contract? If it does so in the slightest degree it must be held unconstitutional as to such contract. If, on the other hand, the act affects only the remedy, or some provision of the contract which is inoperative and void under the laws of Kansas where the contract was made, then it must be held valid; and all legal presumptions, so far as this court is concerned, favor the validity of the act. (Cooley, Const. Lim. 216, 217). When Chief Justice Marshall delivered the opinion of the supreme court of the United States in Sturges v. Crowninshield, 4 Wheat. 122, 4 L.Ed. 529, the learning upon the inhibition "No state shall . . . pass any . . . law impairing the obligation of contracts" was well-nigh exhausted. Little was left for other or subsequent judges of that tribunal but to apply the law as there clearly laid down. The legislature of New York had in 1811 enacted an insolvent law which not only purported to liberate the person of the debtor, but to discharge him from all liability for any debt contracted previous to his discharge, on surrendering his property in the manner prescribed by the act; and it was held that, in so far as it purported to discharge a debtor from his obligation without performance, it was invalid, but not so as to releasing the debtor from imprisonment, then a common and very persuasive remedy. The court says (p. 197):

"A contract is an agreement in which a party undertakes to do, or not to do, a particular thing. The law binds him to perform his undertaking, and this is, of course, the obligation of his contract. In the case at bar, the defendant has given his promissory note to pay the plaintiff a sum of money on or before a certain day. The contract binds him to pay that sum on that day; and this is its obligation. Any law which releases a part of this obligation must, in the literal sense of the word, impair it. Much more must a law impair it which makes it totally invalid and entirely discharges it."

And again (pp. 200, 201):

"The distinction between the obligation of a contract and the remedy given by the legislature to enforce that obligation has been taken at the bar, and exists in the nature of things. Without impairing the obligation of the contract, the remedy may certainly be modified as the wisdom of the nation shall direct. Confinement of the debtor may be a punishment for not performing his contract, or may be allowed as a means of inducing him to perform it; but the state may refuse to inflict this punishment, or may withhold this means, and leave the contract in full force. Imprisonment is no part of the contract, and simply to release the prisoner does not impair its obligation."

See, also, Mason v. Haile, 12 Wheat. 370, 6 L.Ed. 660; Beers v. Haughton, 9 Pet. 329, 359; Penniman's Case, 103 U.S. 714, 717.

In Bronson v. Kinzie, 1 How. 311, 315, 316, 11 L.Ed. 143, the court, speaking through Chief Justice Taney, in respect to an Illinois mortgage, said:

"If the laws of the state passed afterwards had done nothing more than change the remedy upon contracts of this description, they would be liable to no constitutional objection, for, undoubtedly, a state may regulate at pleasure the modes of proceeding in its courts in relation to past contracts as well as future. It may, for example, shorten the period of time within which claims shall be barred by the statute of limitations. It may, if it thinks proper, direct that the necessary implements of agriculture, or the tools of the mechanic, or articles of necessity in household furniture, shall, like wearing apparel, not be liable to execution on judgments. Regulations of this description have always been considered in every civilized community as properly belonging to the remedy, to be exercised or not by every sovereignty, according to its own views of policy and humanity. It must reside in every state to enable it to secure its citizens from unjust and harassing litigation, and to protect them in those pursuits which are necessary to the existence and well-being of every community. And, although a new remedy may be deemed less convenient than the old one, and may in some degree render the recovery of debts more tardy and difficult, yet it will not follow that the law is unconstitutional. Whatever belongs merely to the remedy may be altered according to the will of the state, provided the alteration does not impair the obligation of the contract. But if that effect is produced, it is immaterial whether it is done by acting on the remedy or directly on the contract itself. In either case it is prohibited by the constitution."

In Terry v. Anderson, 95 U.S. 628, 24 L.Ed. 365, it was held that an enactment reducing the time prescribed by the statute of limitations in force when the right of action accrued is not unconstitutional, provided a reasonable time be given for the commencement of a suit before the bar takes effect. The court says (p. 633): "The parties to a contract have no more a vested interest in a particular limitation which has been fixed than they have an unrestricted right to sue."

In Antoni v. Greenhow, 107 U.S. 769, 774, 775, 27 L.Ed. 468, 2 S.Ct. 91, although the Virginia funding act of 1871 required the state to receive certain coupons for all taxes and demands due her, and authorized the writ of mandamus to compel the proper tax-collector to receive the same, yet the act of 1882, which required the coupon holder to first pay his taxes in cash and file his coupons in the court of appeals, and after a circuitous proceeding receive back his cash in lieu of the coupons, was held to affect only the remedy, and not to constitute an impairment of the contract.

In Life Ins. Co. v. Cushman, 108 U.S. 51, 27 L.Ed. 648, 2 S.Ct. 236, it was decided that the Illinois statute of 1879 entitling the purchaser, in case of redemption, to receive interest

upon his bid at the rate of 8 per cent. per annum (the previous law prescribing 10 per cent.) was applicable to all decretal sales of mortgaged premises thereafter made, although the mortgage was given before the passage of that statute; that such reduction in the rate of interest did not impair the obligation of the contract between mortgagor and mortgagee, because the amendatory statute did not diminish the duty of the mortgagor to pay what he agreed to pay, or shorten the period of payment, or affect any remedy which the mortgagee had by existing law for the enforcement of his contract; and that existing laws with reference to which the mortgagor and mortgagee must be assumed to have contracted are only those which in their direct or necessary legal operation controlled or affected the obligations of their contract. And in the opinion the court says (pp. 64, 65):

"The rights of the purchaser at the decretal sale, if one was had were not of the essence of the mortgage contract, but depended wholly upon the law in force when the sale occurred. The company ceased to be a mortgagee when its debt was merged in the decree, or at least when the sale occurred. Thenceforward its interest in the property was as purchaser, not as mortgagee. And to require it, as purchaser, to conform to the terms for the redemption of the property as prescribed by the statute at the time of purchase does not, in any legal sense, impair the obligation of its...