Cowley v. Shields

• Decision Date: 28 November 1912
• Citation: 180 Ala. 48,60 So. 267
• Parties: COWLEY v. SHIELDS.
• Court: Alabama Supreme Court

60 So. 267

180 Ala. 48

COWLEY v. SHIELDS.

Supreme Court of Alabama

November 28, 1912

Rehearing Denied Dec. 17, 1912.

Appeal from Chancery Court, Mobile County; Thomas H. Smith Chancellor.

Bill by William B. Shields against William Cowley. Decree for complainant, and defendant appeals. Affirmed.

Anderson and McClellan, JJ., dissenting in part.

Shelton Sims and William Cowley, both of Mobile, for appellant.

L. H. &amp E. W. Faith, of Mobile, for appellee.

ANDERSON J.

This bill was filed by the appellee to redeem as the assignee of the mortgagor's statutory right of redemption from a purchaser under a mortgage sale made since the Code of 1907 but which said sale was made under a mortgage executed prior to the said Code. The purchaser being an outsider, and not a party to the mortgage contract, and the statute authorizing redemption by the assignee of the statutory right, being in full force at the time of his said purchase, he cannot complain of same; nor can he invoke the Constitution as against the impairment of a contract to which he was a stranger. When the appellant purchased the property at mortgage sale, the law then existing (section 5746 of Code of 1907) authorized a redemption by the assignee of the statutory right of redemption, and this appellant cannot complain that such a right did not exist under the law when the mortgage was executed. Hooker v. Burr, 194 U.S. 415, 24 S.Ct. 706, 48 L.Ed. 1046, following Insurance Co. v. Cushman, 108 U.S. 51, 2 S.Ct. 236, 27 L.Ed. 648, and distinguishing Barnitz v. Beverly, 163 U.S. 118, 16 S.Ct. 1042, 41 L.Ed. 93; Bradley v. Lightcap, 195 U.S. 1, 24 S.Ct. 748, 49 L.Ed. 65; Bugbee v. Howard, 32 Ala. 713; Iverson v. Shorter, 9 Ala. 713.

As we understand the more recent rulings of the United States Supreme Court, as to whether or not statutes subsequent to the execution of the mortgage are obnoxious as impairing the obligation of the mortgage contract, the test is whether or not the statute as to redemption cuts off any existing right of the mortgagee, or places an additional burden on the mortgagor. A statute authorizing the redemption of property sold under a mortgage, where no right of redemption previously existed, or which extends the period of redemption beyond the time formerly allowed, cannot constitutionally apply to a mortgage executed before its passage. Neither could a statute so apply which cuts off the right or reduces the period of redemption, or which increases the burden of doing so. This rule, however, applies to the parties to the contract, and not to strangers who purchase at the sale as they are governed by the laws existing at the time of the sale with reference to the redemption of the property. But the courts hold that even where the mortgagee becomes the purchaser and the sum bid or paid is equal to or exceeds the mortgage indebtedness, he then ceases to hold as mortgagee, but as purchaser, and the property can be redeemed under the redemption laws existing when the sale was made without doing violence to the federal or state Constitutions. Insurance Co. v. Cushman, supra. On the other hand, if the mortgagee purchases for less than the debt, he still holds as a mortgagee, and a redemption law which would divest him of the property by paying, to redeem, less than the mortgage debt, or impairing his security in any way, would be repugnant to the Constitution if made applicable to existing mortgages. Bradley v. Lightcap, 195 U.S. 1, 24 S.Ct. 748, 49 L.Ed. 65; Barnitz v. Beverly, 163 U.S. 118, 16 S.Ct. 1042, 41 L.Ed. 93. We might add that even in cases where the mortgagee bought the property for less than the mortgage debt the new redemption law merely extending the right to the assignee of the mortgagor, without changing the time for redemption, could apply without colliding with the Constitution, if the law required payment of the full amount due upon the mortgage, regardless of the amount bid, and which is now required by section 5749 of the Code of 1907, subd. (4).

We therefore hold that the complainant, as assignee of the mortgagor's statutory right of redemption, had the right to redeem under section 5746 of the Code of 1907 notwithstanding the assignee of the statutory right was not included in the class given the right to redeem under the statute as existing when the mortgage was executed. We are not unmindful of the fact that this holding is opposed by the cases of Lehman v. Moore, 93 Ala. 188, 9 So. 590, and Jones v. Matkin, 118 Ala. 341, 24 So. 242. These cases were based upon the decision of the United States Supreme Court in the case of Howard v. Bugbee, 24 How. 461, 16 L.Ed. 753, wherein the case of same parties as decided by this court (32 Ala. 713) was reversed. The holding in 24 Howard has been greatly modified, if not, in effect, overruled by more recent decisions of said court, and we no longer feel bound by the ruling in said case; and the cases of Lehman v. Moore, 93 Ala. 188, 9 So. 590, and Jones v. Matkin, 118 Ala. 341, 24 So. 242, are expressly overruled on the point in question. It is insisted that even if the cases, supra, should be overruled, it should not, under section 5965 of the Code, affect the present case. This section has no application to the present overruled cases, but applies to overruling an existing opinion by a subsequent one in the...