Goldfrank, Frank & Co. v. Young, Case No. 5151.

• Decision Date: 23 June 1885
• Docket Number: Case No. 5151.
• Citation: 64 Tex. 432
• Court: Texas Supreme Court
• Parties: GOLDFRANK, FRANK & CO. v. WM. H. YOUNG.

64 Tex. 432

GOLDFRANK, FRANK & CO.

v.WM. H. YOUNG.

Case No. 5151.

Supreme Court of Texas.

Jun. 23, 1885.

APPEAL from Bexar. Tried below before the Hon. Geo. H. Noonan.

Waelder & Upson, for appellants, cited: 2 Jones on Mortgages, §§ 1170, 1198, 1723, 1728, 1742, 1743, 1751, 1763; Taylor v. Sonora Mining Co., 17 Cal., 594;Wofford v. Unger, 53 Tex., 641; Calkins v. Calkins, 3 Barb. S. C. Rep., 305; Grayson v. Taylor, 14 Tex., 674; 3 Wait's Act. & Def., 213; 7 Wait's Act. & Def., 301 et seq.; 4 Kent (7th ed.), marginal page, 189; Van Keuren v. Parmelee, 2 N. Y., 527; Harper v. Fairley, 23 N. Y., 444.

Shook & Ditmar, for appellee, cited: Smith v. Fly, 24 Tex., 353;Biddell v. Brizzolara, 56 Cal., 374-383; Wood on Limitations, secs. 79-85; De Cordova v. Galveston, 4 Tex., 482;Blackwell v. Barnett, 52 Tex., 326;Duty v. Graham, 12 Tex., 437;Locke v. Wilson, 9 Heisk. (Tenn.), 784.

STAYTON, ASSOCIATE JUSTICE.

The appellee, on the 27th day of February, 1882, sued out a writ of injunction to restrain the sale of certain real estate described in his petition, under a deed of trust with power of sale, which he had executed to A. M. Cohen, as trustee, to secure a note given by the appellee to Goldfrank, Frank & Co., of date February 12, 1877, payable twelve months after its date, for $6,000, and bearing interest from date, payable semi-annually, at the rate of twelve per cent. per annum.

There was no pretense in the petition that the note had been paid, and the sole ground on which the injunction was sought and granted was, that the note was barred by the statute of limitation, and that therefore the power given by the trust deed had ceased to be operative.

The deed of trust gave power to the parties for whose benefit it was executed to substitute another trustee should it become necessary; and the trustee named in the deed having declined to execute the trust, the beneficiaries, in the proper manner, named M. Krakauer such substitute, and he at once advertised the property for sale; same to be made on February 28, 1882.

The semi-annual interest was paid until August 12, 1880.

On 26th July, 1879, $1,000 was paid on the principal of the note, and the same indorsed thereon in the presence of the maker, who on that day obtained by writing a release of a part of the property from the operation of the lien given by the trust deed, and in the instrument by which this was done a lien was expressly retained on the residue of the property. That instrument was accepted by the appellee and he claimed the benefits which it gave him.

The appellee testified as follows: “The debt mentioned in the note and secured by the deed of trust was contracted for money loaned to me by Goldfrank, Frank & Co. I have asked and received indulgence (and time) at various times after the maturity of the debt, and up to a very short time before the filing of the petition in this case. There is no claim of payment or complaint of unfair dealing on the part of Goldfrank, Frank & Co.”

The court below perpetuated the injunction on the sole ground that the debt was barred by the statute of limitations.

That there is no essential difference between a mortgage with power of sale, or a deed of trust made to a third person with power to sell in default of payment of a debt which either is given to secure, and an ordinary mortgage, in reference to the right to foreclose either through a judgment or decree of a court, after the period of limitation has elapsed, if that be pleaded as a defense, is well settled. Duty v. Graham, 12 Tex., 427;Perkins v. Sterne, 23 Tex., 561;Ross v. Mitchell, 28 Tex., 151; Jones on Mortgages, 1769; McLane v. Paschal, 47 Tex., 366; Angell on Limitations, 7.

That the lien given by either, in such cases, cannot be enforced through the judgment or decree of a court, after the debt secured by the lien is barred, is well settled.

It may be considered as the settled law of this state, that in actions for the recovery of debt, and like actions, the statutes of limitation affect the remedy solely. Gautier v. Franklin, 1 Tex., 732;Hays v. Cage, 2 Tex., 506;De Cordova v. City of Galveston, 4 Tex., 480; Jones on Mortgages, 1203.

No court in the Union has gone further to sustain this rule than the supreme court of this state. Bender v. Crawford, 33 Tex., 745;Wood v. Welder, 42 Tex., 409;Grigsby v. Peak, 57 Tex., 147. Whether the rules laid down in the cases last cited, in their full scope, can be maintained on principle or authority need not be examined in this case.

Before the adoption of the Revised Statutes it was held that an adverse possession of property, real or personal, for the period and under the circumstances prescribed by the statute, would give title to the thing possessed and destroy the title of the former owner. Cochrane v. Winburn, 13 Tex., 144;Claiborne v. Tanner, 18 Tex., 78;Thurmond v. Trammell, 28 Tex., 380;Smith v. Montes, 11 Tex., 24;Moody v. Holcomb, 26 Tex., 719;Winburn v. Cochran, 9 Tex., 125;Scott v. Rhea, 5 Tex., 260;Cunningham v. Frandtzen, 26 Tex., 41.

In reference to realty the statute now declares that: “Whenever in any case the action of a person for the recovery of real estate is barred by any of the provisions of this chapter, the person having such peaceable and adverse possession shall be held to have full title, precluding all claims” (R. S., 3196); thus, as to realty, putting the question as to the effect of the statutory bar beyond controversy; and as the same language is used in the statutes now in force, in reference to actions for personal property, as was used in the statutes in force prior to the adoption of the Revised Statutes, we must presume that it was intended they should receive the same construction as to the effect of the statutory bar upon the title of the former owner.

The legislature having declared what shall be the effect of the statutory bar in “actions or suits” relating to the title to real property, in the absence of such declaration, or of a settled construction giving to the bar of the statute a similar effect in other classes of “actions or suits” mentioned in the statute, it is but reasonable to infer that it was not the intention of the legislature to give the same effect to the bar in the other classes of cases.

The statute now in force, in reference to the bar of limitation, evidences clearly the intention of the legislature that the same rule was not intended to apply in cases in which the failure to bring suit or action within the prescribed time is the sole ground on which the defense arises, as will apply in cases in which this, coupled with adverse possession of the thing in controversy, whether realty or personalty, is made the ground on which the defense is based.

In the one case, the facts which create the statutory bar destroy the right of the former owner and vest title in the possessor; in the other, the law denies to the holder of the claim any remedy through the courts for its assertion or enforcement, but does not declare the debt satisfied as by payment, or otherwise so totally annulled as to be deemed to have no existence on which any right may be based.

If it had been the intention of the legislature utterly to annul a cause of action given by contract, such as is evidenced by the note given by the appellee to Goldfrank, Frank & Co., so that it could not, under any circumstances, constitute the basis of a right, it would have been so declared, as is it, in terms and in effect, in cases in which the recovery of specific things is sought after the statutory bar has been completed under an adverse possession.

In the one case, the expiration of the time prescribed, attended with the requisite adverse possession, destroys the right of the former owner and vests title to the thing in the adverse possessor, while in the other, the creditor is simply denied a remedy through the courts, if his adversary asserts the statutory bar as a defense.

A barred debt has constantly been held a sufficient consideration for a new promise.

In reference to the operation of the statutes of limitation in any matter in which the recovery of money is sought, the statute itself limits it to “actions or suits in courts” (R. S., 3202, 3203, 3205), and it provides within what time “actions or suits” in the different classes of cases may be brought, but it does not attempt to deter mine within what period any one must enforce a right which the debtor has placed it in the power of the creditor to enforce otherwise than by an “action or suit in court.”

That the legislature might fix a period within which steps must be taken to enforce rights otherwise than through the courts, when such right and power have been given, by contract, by one person to another, as may it prescribe a period within which actions or suits must be brought in courts, there is no doubt; but the declaration that persons must institute “suits or actions in courts” within a fixed period to enforce their claims, which can be enforced only in that manner, is not equivalent to declaring that a creditor who has been given, by contract, a right and means by which he may enforce his claim otherwise than through the courts, shall not enforce it after the time at which he might institute an action or suit, without subjecting himself to the bar which could be urged by a plea of limitation.

It is not always true that rights which cannot be enforced through the courts are valueless, nor that contracts which the courts cannot enforce are invalid.

This is well illustrated by the decisions in this state in reference to the right of a creditor who, prior to the adoption of the present constitution, had acquired a deed of trust or mortgage with power of sale, on a homestead properly executed by a husband and wife, to secure a debt.

The constitution forbade the forced sale of the homestead, which was the only way in which a court could have subjected such property to the payment of the debt; hence they had no power in this...