Federal Farm Mortg. Corporation v. Thiele
| Decision Date | 01 March 1940 |
| Docket Number | 30654. |
| Citation | 290 N.W. 471,137 Neb. 626 |
| Parties | FEDERAL FARM MORTG. CORPORATION v. THIELE. |
| Court | Nebraska Supreme Court |
Syllabus by the Court.
1. Section 1, ch. 41, Laws 1933, section 20-2141 Comp.St.1929 (now Comp.St.Supp.1937, sec. 20-2141) providing: " When a petition shall be filed for the satisfaction of a mortgage, the court shall have the power only to decree and compel the delivery of the possession of the premises to the purchaser thereof," held not to abolish actions at law on debts secured by real estate mortgages, and suit may be brought on a promissory note secured by a real estate mortgage at the election of the creditor.
2. Sections 20-2142, 20-2144, and 20-2145, Comp.St.1929 providing for the contingency of the creditor electing to sue on a note (debt), were left intact and not amended or repealed by the legislature of 1933, in passing chapter 41, Laws 1933, sections 20-2141, 20-2143, Comp.St.1929.
3. " Statutes should be so construed as to give effect to the intention of the legislature, and if a statute is plain and unambiguous, there is no room for construction or interpretation." Shellenberger v. Ransom, 41 Neb. 631, 59 N.W. 935, 25 L.R.A. 564.
Appeal from District Court, Platte County; Lightner, Judge.
Action by the Federal Farm Mortgage Corporation against William H. Thiele to recover on a note secured by a real estate mortgage. From a judgment in favor of the plaintiff, the defendant appeals.
Affirmed.
Wagner, Wagner & Albert, of Columbus, for appellant.
Walter, Flory & Schmid, of Columbus, and Phillip M. Wellman, Wm. W. Graham, and Franklin L. Pierce, all of Omaha, for appellee.
Heard before SIMMONS, C. J., and EBERLY, CARTER, MESSMORE, and JOHNSEN, JJ.
Plaintiff brought this action at law on a promissory note for $1,500, dated May 22, 1934, and secured by a real estate mortgage. The cause was tried to the court, judgment rendered in favor of plaintiff, and defendant appeals.
Defendant in his answer alleges that the note was secured by a real estate mortgage; that defendant owned the real estate at the time the note and mortgage were executed and delivered; that plaintiff is not entitled to sue on the note because such a proceeding is an indirect proceeding to satisfy the mortgage, and the plaintiff is limited in its relief to possession of the real estate. The second defense is that plaintiff had agreed with defendant to look solely to the real estate for the satisfaction of the debt.
Appellant contends that the court erred in holding that the holder of a note secured by a real estate mortgage, executed after the deficiency law (Laws 1933, ch. 41) became effective, may maintain suit upon such note.
Section 1, ch. 41, Laws 1933 (Comp.St. Supp.1937, sec. 20-2141) provides: " When a petition shall be filed for the satisfaction of a mortgage, the court shall have the power only to decree and compel the delivery of the possession of the premises to the purchaser thereof." (Italics ours.)
Appellant's contention is that the word " only" appearing in said section provides the only remedy for satisfaction of a mortgage in Nebraska, and the suit on the note, secured by a real estate mortgage, is a proceeding to satisfy that mortgage; that this provision of the statute limits the mortgagee to the sale of the mortgaged property. In furtherance of this contention appellant states: " The law in force where a contract is made is as much a part of the contract as if it were expressed therein," citing Watkins & Co. v. Kobiela, 84 Neb. 422, 121 N.W. 448; 13 C.J. 560; 12 Am.Jur. 14, § 386; that, therefore, the contract is that the debt shall be satisfied by the sale of the real estate securing it, and that the only remedy is the right to sell the real estate and deliver possession.
The case of Seieroe v. First Nat. Bank of Kearney, 50 Neb. 612, 70 N.W. 220, 221, is cited by appellant on the proposition of law that agreements to look to security alone are valid, which, for the purposes of this case, would mean that the law relating to deficiency judgments, in effect at the time of the signing of the note in question, secured by a real estate mortgage, governs and becomes a part of the contract between the mortgagee and the mortgagor, wherein, by such law, the mortgagee is to look to the land only for the payment of the debt. The cited case was an action on a promissory note secured by a real estate mortgage containing this clause: " But no general execution shall issue herein against the maker or indorser of said note, but the mortgagee or his assigns shall be entitled to immediate possession of the premises * * * and shall take the same in full satisfaction of said debt; " that is, upon failure of the mortgagor to comply with the conditions of the mortgage for nonpayment of interest or taxes; and the court held such clause " to exempt the makers and indorsers of the note from personal liability thereon, and to restrict the remedy of the holder of the mortgage security."
It will be readily ascertained that the clause quoted is a direct agreement between the parties, stating definitely in what manner they would be bound, and presents a clear distinction between the Seieroe case and the one at bar, for the reason that in the instant case there was no such agreement between the mortgagee and the mortgagor at the time of the execution and delivery of the note secured by the real estate mortgage, and the construction of a statute was not involved.
The case of Grand Island Savings & Loan Ass'n v. Moore, 40 Neb. 686, 59 N.W. 115, is of no assistance to the appellant for the proposition of law claimed. In that case the mortgage contained a provision permitting the mortgagee to elect to collect the whole amount due on the happening of a contingency, and to authorize the mortgagee, on the happening thereof, to proceed not only to foreclose the mortgage, but to enforce personal liability on the note. This constituted an agreement between the mortgagee and the mortgagor and likewise did not involve the construction of a statute.
In the case of Kennedy v. Hungerford, 110 Neb. 22, 192 N.W. 959, at the time the note and mortgage were executed the payee agreed with the maker that he should not be liable personally on the note until the remedy provided by the mortgage against the land had been exhausted. It was therein held that, " as between the original parties such an agreement, if adequately proved, would abate the action upon the note until the condition of the agreement had been fulfilled." The court in the opinion stated: " Of course, in the absence of such an agreement there is no obligation upon the part of the mortgagee to foreclose the mortgage before beginning an action at law upon the note which it is given to secure." Citing Grable v. Beatty, 56 Neb. 642, 77 N.W. 49, and Meehan v. First Nat. Bank of Fairfield, 44 Neb. 213, 62 N.W. 490.
This court has held that a creditor whose debt is secured by...
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