Canadian Birkbeck Investment & Savings Co. v. Williamson

Decision Date09 January 1920
Citation32 Idaho 624,186 P. 916
PartiesTHE CANADIAN BIRKBECK INVESTMENT & SAVINGS COMPANY, Now the CANADIAN MORTGAGE INVESTMENT COMPANY, Respondent, v. N. WILLIAMSON, Appellant
CourtIdaho Supreme Court

MORTGAGES-ACCELERATION CLAUSE-LIMITATIONS-JUDGMENTS-LAW OF FORUM.

1. Where a contract contains an acceleration clause, positive in its terms and without any optional features in it, a default under said clause renders the entire indebtedness due and the statute of limitations runs from such default.

2. The statute of limitations begins to run from the time when the cause of action accrues.

3. C S., sec. 6949, relative to the foreclosure of mortgages, has no extraterritorial effect, and relates exclusively to mortgages on property in Idaho.

4. A personal judgment rendered upon personal service had without the jurisdiction of the court is void and can be used for no purpose whatever.

5. In the absence of a local statute to the contrary, the limitation of time for bringing an action upon contract depends upon the law of the forum.

APPEAL from the District Court of the Second Judicial District, for Latah County. Hon. Edgar C. Steel, Judge.

Action for debt upon certain mortgages. Judgment for plaintiff. Reversed.

Judgment reversed, with directions. Costs awarded to appellant.

Morgan & Boom, for Appellant.

The statute of limitations begins to run against a cause at and from the time when an action may properly be commenced thereon. (Pridgeon v. Greathouse, 1 Idaho 359; Osburn v. Hopkins, 160 Cal. 501, Ann. Cas. 1913A, 413, 117 P 519.)

Where a contract contains an acceleration clause positive in its terms and without any optional features in it, a default under said clause renders the entire indebtedness due and the statute of limitations runs from such default. (Snyder v. Miller, 71 Kan. 410, 114 Am. St. 489, 80 P. 970, 69 L. R. A. 250; Buss v. Kemp Lumber Co., 23 N.M. 567 170 P. 54, L. R. A. 1918C, 1015; Lovell v. Goss, 45 Colo. 304, 132 Am. St. 184, 22 L. R. A., N. S., 1110, 101 P. 72.)

A personal judgment rendered upon personal service had without the jurisdiction of the court is void and can be used for no purpose whatever. (23 Cyc. 1583; Bennett v. Wilson, 122 Cal. 509, 68 Am. St. 61, 55 P. 390; Freeman on Judgments, sec. 117; Jefferson v. Gallagher, 56 Okla. 405, 150 P. 1071; National Bank of St. Johnsbury v. Peabody, 55 Vt. 492, 45 Am. Rep. 632; Iles v. Elledge, 18 Kan. 296.)

C. S., sec. 6949, has no extraterritorial effect and relates exclusively to mortgages in Idaho. (McGue v. Rommell, 148 Cal. 539, 83 P. 1000; Denver Stockyards Bank v. Martin, 177 Cal. 223, 170 P. 428.)

In the absence of a local statute changing the rule, it is established by the overwhelming weight of authority that the limitation of time for bringing an action upon a contract depends upon the law of the forum. (Thomas v. Clarkson, 125 Ga. 72, 54 S.E. 77, 6 L. R. A., N. S., 658.)

J. H. Forney, for Respondent.

The mortgages were made and all the terms and conditions thereof were to be performed in Alberta, Canada. The law of the place where the contract is made became a part of the contract. (9 Cyc. 582; Sterrett v. Sweeney, 15 Idaho 416, 424, 128 Am. St. 68, 98 P. 418, 20 L. R. A., N. S., 963; 5 R. C. L. 931; Meier & Frank Co. v. Bruce, 30 Idaho 732, 738, 168 P. 5.)

An agreement in a mortgage maturing the entire debt on default of any payment of interest when due is not inconsistent with the agreement made with defendant assuming the mortgages, in maturing the debt at the option of the plaintiff on default of payments of interest. (Clark v. Paddock, 24 Idaho 142, 151, 132 P. 795, 46 L. R. A., N. S., 475; Mason v. Luce, 116 Cal. 232, 237, 48 P. 72; White v. Krutz (McMillan), 37 Wash. 34, 79 P. 495; Core v. Smith, 23 Okla. 909, 102 P. 114.)

Statute runs against mortgage obligation when deficiency ascertained and not against grantee's promise to pay as a new and independent agreement. (Roberts v. Fitzallen, 120 Cal. 482, 52 P. 818, 819; Clark v. Paddock, supra.)

"Whenever a debt becomes due, and is not paid in accordance with the terms of the contract, a cause of action thereupon arises. This exists as an absolute and unqualified right independent of where the debtor may be. His absence from the state in no way affects the right of the creditor to commence his action. His absence from the jurisdiction simply affects the service of process, and avoids the possibility of the debtor securing a personal service on the defendant and a personal judgment against him, but it in no way affects a judgment in rem against any property he may have within the jurisdiction, nor does it affect the right to commence the action." ( West v. Theis, 15 Idaho 167, 128 Am. St. 58, 96 P. 932, 17 L. R. A., N. S., 472.)

REDDOCH, District Judge. Rice and Budge, JJ., concur.

OPINION

REDDOCH, District Judge.

--This action is based upon two mortgages covering real estate located in the Province of Alberta, Dominion of Canada, which were assumed by the appellant on Feb. 1, 1909. One of said mortgages is dated Nov. 14, 1906, and the other April 18, 1907. The first in point of time was given to secure the sum of $ 1,500, and provides that it shall be payable in monthly instalments of $ 22.50, payable on or before the first day of each month for a period of 96 months next ensuing from its date, the first instalment to become due and payable on the last day of December, 1906. The second in point of time was given to secure the sum of $ 2,000 and provides that it is payable in monthly instalments of $ 26.60, payable on or before the first day of each month for a period of 126 months next ensuing from its date, the first instalment to become due and payable on the last day of May, 1907. No promissory note was made by the parties in the execution of these instruments, and there is no fixed date for the complete maturity of either. Each contains an acceleration clause which, under certain conditions, renders the entire amount immediately due. In each it is provided that the mortgagee may pay all insurance premiums, and that any money so paid, with interest thereon, shall be added to the principal indebtedness and such money so expended shall be payable by the mortgagor with the next monthly instalment to thereafter fall due. Each further provides that all taxes may be paid by the mortgagee and numerous other expenses incurred by it, and that each and all of said items so expended shall become a lien upon the property and a charge against the mortgagor, and become due and payable on or before the first day of January of each year. The acceleration clause above referred to and which is the same in each instrument is as follows:

"It is hereby agreed between the parties hereto that if any default shall at any time be made in the payment of any of said monthly instalments or any part thereof, then and in such case the whole money hereby secured shall forthwith become due and payable in like manner and with the like consequences and effects to all intents and purposes whatsoever as if the time mentioned herein for payment of the last monthly instalment hereby secured had fully come and expired, but on payment of all arrears and costs at any time before judgment in the premises recovered, the mortgagor shall be relieved from the consequences of nonpayment of the instalments not then payable by lapse of time."

At the time the instruments were executed, one Arthur Collyns was the registered owner under the Land Title Act of the Province of Alberta of the land covered by said instruments. Thereafter said Collyns transferred the lands covered by said mortgages to one D. S. Alley, and on Feb. 1, 1909, appellant purchased from said Alley the premises covered by said mortgages and entered into two contracts, under and by virtue of which he assumed and agreed to pay said mortgages. Said contracts are the same in each instance, in which Douglas S. Alley of High River, Province of Alberta, Canada, is the party of the first part, and N. Williamson, of Moscow, Idaho, the party of the second part, and respondent herein, of the third part, and it recites the execution of the mortgages, that the party of the second part has purchased the lands and premises, and alleges he is the owner in fee simple thereof, subject to the said mortgage and has assumed payment of the mortgage debt and has agreed with the company to pay off the same; that in consideration of the premises and the sum of one dollar, it is agreed by and between the parties hereto as follows:

"1. That the party of the second part agrees to punctually pay the amount of principal money, interest and other charges as provided in the said mortgage to the said company upon the days and times and in the manner therein provided, and to faithfully observe and perform all of the covenants entered into by the party of the first part and contained in the said mortgage.

"2. Provided, that nothing herein contained shall in any way affect or prejudice the rights of the said company against the said party of the first part, his heirs, executors, administrators or assigns, or as against any surety for the payment of the said mortgage debt or any part thereof, or any other liability under the said mortgage.

"3. Provided further, that nothing herein contained shall affect the charge of the company on the said lands under the said mortgage, and that in default of payment of the moneys secured by the said mortgage or any part thereof, these presents shall, at the option of the said company, be null and void, and the mortgage with all its terms and conditions unaltered, be and remain in full force and effect."

It is alleged that certain expenditures were made by the mortgagee, under the first instrument, in 1911, which should...

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