Dighton v. First Exchange National Bank

• Court: United States State Supreme Court of Idaho
• Writing for the Court: MORGAN, C. J.
• Citation: 33 Idaho 273,192 P. 832
• Decision Date: 05 October 1920
• Parties: EDWARD DIGHTON, Respondent, v. FIRST EXCHANGE NATIONAL BANK, a Corporation, Appellant

192 P. 832

33 Idaho 273

EDWARD DIGHTON, Respondent,
v.
FIRST EXCHANGE NATIONAL BANK, a Corporation, Appellant

Supreme Court of Idaho

October 5, 1920

MORTGAGES-FORECLOSURE-LIMITATION OF ACTIONS.

1. A note and mortgage given to secure its payment must be construed together as one contract, and the remedy for the enforcement of the conditions thereof is the one referred to in C. S., sec. 6949, and is exclusive. Whatever will prevent the running of the period of limitations as to the debt will also prevent it as to the lien of the mortgage.

2. The grantee of a mortgagor, although not obligated to pay the debt, who has acquired his interest in the mortgaged premises before the right to foreclose was barred, cannot successfully plead the statute of limitations against suit to foreclose if the debtor has, by continued absence from the state, suspended the period of limitation with respect to the debt.

APPEAL from the District Court of the Eighth Judicial District, for Kootenai County. Hon. R. N. Dunn, Judge.

Suit to foreclose mortgage. Judgment for plaintiff. Affirmed.

Judgment affirmed. Costs awarded to respondent.

Ezra R. Whitla, for Appellant.

The mortgagor having sold the land cannot extend the statute by any act of his. (California Bank v. Brooks, 126 Cal. 198, 59 P. 302; Brandenstein v. Johnson, 140 Cal. 29, 73 P. 744; Cook v. Prindle, 97 Iowa 464, 59 Am. St. 424, 66 N.W. 781; Cottrell v. Shepherd, 86 Wis. 649, 39 Am. St. 919, 57 N.W. 983; George v. Butler, 26 Wash. 456, 90 Am. St. 756, 67 P. 263, 57 L. R. A. 396; Hubbard v. Missouri Valley Life Ins. Co., 25 Kan. 172; Damon v. Leque, 17 Wash. 573, 61 Am. St. 927, 50 P. 485; Hanna v. Kasson, 26 Wash. 568, 67 P. 271; Schumaker v. Sibert, 18 Kan. 104, 26 Am. Rep. 765; Stancill v. Spain, 133 N.C. 76, 45 S.E. 466; Hopkins v. Clyde, 71 Ohio St. 141, 104 Am. St. 737, 1 Ann. Cas. 1000, 72 N.E. 846; Arthur v. Sereven, 39 S.C. 77, 17 S.E. 640; Cook v. Bramel, 106 Ky. 803, 51 S.W. 600, 45 L. R. A. 212; De Voe v. Rundle, 33 Wash. 604, 74 P. 836; Colonial & U. S. Mtg. Co. v. Northwestern Thresher Co., 14 N.D. 147, 116 Am. St. 642, 8 Ann. Cas. 1160, 103 N.W. 915, 70 L. R. A. 814.)

The absence of the mortgagor from the state does not toll the limitations as to the purchaser of the land. (Boucofski v. Jacobsen, 36 Utah 165, 104 P. 117, 26 L. R. A., N. S., 898; Anderson v. Baxter, 4 Ore. 105; Eubanks v. Leveridge, 4 Sawy. 274, F. Cas. No. 4544; Fowler v. Wood, 28 N.Y.S. 976.)

Elder & Elder, for Respondent.

The mortgage is a mere incident to the note and stands and falls with the note. (Law v. Spence, 5 Idaho 244, 48 P. 282; Kelly v. Leachman, 3 Idaho 629, 33 P. 44.)

An indorsement upon a note and mortgage promising to pay the same is not a renewal of the note and mortgage and does not constitute a separate and distinct contract, but is an acknowledgment to pay the debt. (Moulton v. Williams, 6 Idaho 424, 55 P. 1019; Vollmer v. Estate of Reid, 10 Idaho 196, 77 P. 325; Dern v. Olsen, 18 Idaho 358, Ann. Cas. 1912A, 1, 110 P. 164, L. R. A. 1915B, 1016.)

The general rule is that the mortgage is but a mere incident to the note which it is given to secure, and nothing short of payment of the debt or its extinguishment by operation of the law will discharge the mortgage lien. (Brown v. Rockhold, 49 Iowa 282; Jinks v. Shaw, 99 Iowa 604, 61 Am. St. 256, 68 N.W. 900; London & San Francisco Bank v. Bandman, 120 Cal. 220, 65 Am. St. 178, 52 P. 583; McGovney v. Gwillim, 16 Colo. App. 284, 65 P. 346; Balch v. Arnold, 9 Wyo. 17, 59 P. 434; Richey v. Sinclair, 167 Ill. 184, 47 N.E. 364; Mackie v. Lansing, 2 Nev. 302.)

The absence of the mortgagor from the state suspends the running of the limitation against the action to foreclose the mortgage. (Sterrett v. Sweeny, 15 Idaho 416, 128 Am. St. 68, 98 P. 418, 20 L. R. A., N. S., 963; Robertson v. Stuhlmiller, 93 Iowa 326, 61 N.W. 986; Smith v. Pekins, 10 Kan. App. 577, 63 P. 297.)

MORGAN, C. J. Budge, J., concurs. RICE, J., Dissenting.

OPINION

[33 Idaho 275] MORGAN, C. J.

On May 13, 1910, T. G. Kaesemeyer and Emma Kaesemeyer, his wife, executed their note in favor of respondent for the sum of $ 2,000, due one year after date, together with a mortgage, which was recorded on May 18, 1910, conveying to respondent certain real estate by way of security for the payment of the note. On April 12, 1912, the mortgagors deeded the premises in question to appellant, by way of security, and in November of that year they departed from the state and had not returned at the time of the trial in the district court. On March 7, 1916, the Kaesemeyers executed a deed conveying the mortgaged premises to appellant and therein recited that it was "not intended as security but as a complete and absolute conveyance of said property." On April 30, 1917, they signed the following indorsement on the note due to respondent: "that there is now due upon the foregoing note the sum of $ 2,000, with interest at 8% per annum, less payments which have been made on the interest." Suit to foreclose respondent's mortgage was instituted on the last-named date and the mortgagors answered admitting the execution of the note and mortgage and that there was due thereon the sum of $ 2,000 with interest at the rate of 8% per annum from May 13, 1910, less $ 1,010 paid on the interest on the dates specified in the complaint, and they consented that decree of foreclosure be entered for the amount due on the note. Appellant alleged in its answer that the cause of action was barred by the statute of limitations. The trial court found adversely to this contention and entered its decree accordingly.

[33 Idaho 276] The principal question involved in this case is: Can the grantee of a mortgagor, who acquired his interest in the premises before the right to foreclose was barred, and who is not obligated to pay the debt secured by the mortgage, plead the statute of limitations against a suit to foreclose, when the cause of action is not barred as against the debtor because of his continued absence from the state?

Many courts have held an action to foreclose a mortgage to be a remedy distinct from that by which the creditor may enforce the personal obligation for the debt secured by it, and that one of these remedies may be barred when the other is not. The cases so holding seem to proceed on the theory that the owner of a note and mortgage has two distinct remedies which may be pursued independently of each other: 1. A suit in equity to foreclose the mortgage and for a deficiency judgment, if deficiency should remain; 2. An action at law to recover the amount of the debt.

Decisions based on such a theory cannot aid us, for C. S., sec. 6949, provides: [192 P. 833] ...