Hess v. State Bank of Goldendale

• Decision Date: 04 June 1924
• Docket Number: 18311.
• Citation: 226 P. 257,130 Wash. 147
• Court: Washington Supreme Court
• Parties: HESS v. STATE BANK OF GOLDENDALE et al.

226 P. 257

130 Wash. 147

HESS v. STATE BANK OF GOLDENDALE et al.

No. 18311.

Supreme Court of Washington

June 4, 1924

Department 2.

Appeal from Superior Court, Klicketal County; Kirby, Judge.

Suit by Charles M. Hess, individually and as executor of the Estate of Minnie Hess, deceased, against the State Bank of Goldendale and others. Decree for defendant Bank, and plaintiff appeals. Reversed and remanded.

Bixby &amp Nightingale, of Bellingham, and Brooks & Brooks, of Goldendale, for appellant.

John R McEwen, of Goldendale, for respondent.

BRIDGES, J.

This case involves the statute of limitations.

On June 1, 1910, the defendants Morgan and wife gave the appellant Chas. M. Hess their promissory note for $5,000, payable on or before two years from that date, and secured it by a mortgage upon certain real estate then owned by them. About a year later they gave the respondent their note for $12,000, and secured it by a mortgage upon the same property. When these mortgages were given that to the appellant was the first and that to the respondent the second mortgage. Both mortgages were duly recorded. On February 27, 1915, the Morgans conveyed their land to the defendant Morgan Milling Company. They and the milling company from time to time paid the interest and a part of the principal of the first mortgage debt, the last payment being made August 15, 1921. We are unable to determine from the record when the Morgans ceased making payments. In 1921 the respondent foreclosed its so-called second mortgage, but did not make the appellant a party thereto. At the foreclosure sale the respondent bought in the property. About a year later, and in September, 1922 the appellant brought suit to foreclose his so-called first mortgage, making the respondent and others defendant parties. The respondent as defendant pleaded the statute of limitations. Upon trial the court held that the statute had run and the mortgage could not be foreclosed. The plaintiff who was the holder of the first mortgage, has appealed.

The respondent contends that a mortgagor cannot, by act or agreement, toll the statute of limitations as against either a subsequent grantee or a subsequent incumbrancer of the land first mortgaged, and chiefly relies on Raymond v Bales, 26 Wash. 493, 67 P. 269. The appellant, while admitting that a mortgagor has no power to toll the statute as against a subsequent grantee, contends that so long as the legal title remains in him he has such power as to a junior mortgage or lien, citing Bode v. Rhodes, 119 Wash. 98, 204 P. 802.

We have held that when a debt is once barred the mortgagor cannot revive it as against a subsequent grantee of the mortgaged lands. Damon v. Leque, 17 Wash. 573, 50 P. 485, 61 Ann. St. Rep. 927. We have also held that the absence of a mortgagor from the state will not suspend the running of the statute of limitations as to a subsequent grantee of the mortgaged lands. George v. Butler, 26 Wash. 456, 67 P. 263, 57 L. R. A. 396, 90 Am. St. Rep. 756. We have also held that payments on his mortgage indebtedness made by a mortgagor after he has parted with the title will not extend the statute of limitations as against a subsequent grantee. Hanna v. Kasson, 26 Wash. 568, 67 P. 271. While these cases hold that a mortgagor may not, after he has parted with the title to the land, suspend the running of the statute of limitations as against his grantee, yet they do not determine the exact point involved here, which is: Can a mortgagor by payments made on his first mortgage while he owns the mortgaged land, toll the statute of limitations as against a subsequent mortgage made by him on the same property, his payments having been made after the giving of the second mortgage?

We have two cases, however, which do apparently decide the question involved here, the one decision being in conflict with the other, the later one not expressly overruling the earlier one. See Raymond v. Bales, supra, and Bode v. Rhodes, supra. Since the writing of the Raymond opinion the court seems to have assumed that the question involved there was the right of a mortgagor to toll the statute as against a subsequent grantee of the mortgagor, and not a subsequent mortgagee or lienor. In White v. Krutz, 37 Wash. 34, 79 P. 495, referring to that and other of our cases, Judge Fullerton, speaking for the court, said:

'But it will be observed that in these cases the mortgagor attempted to extend the lien of the mortgage after he had parted with his interests in the mortgaged property, and this it is held he could not do.'

Again, in the Bode Case, referring to the Raymond and other cases, Judge Hovey, speaking for the court, said: 'These are cases where the mortgagors had partes with their title to the property and do not apply to this case.'

But, notwithstanding what we have said about the Raymond Case, a careful reconsideration of it convinces us now that it did concern a subsequent lien, and not a subsequent transfer of the title, and that it supports the contentions of the respondent. The facts there were these: On the 30th of September, 1889, one Wood gave a mortgage upon certain real estate to secure his indebtedness. In February, 1896, Bales secured a judgment against Wood which on that date became a lien on the mortgaged land. He subsequently sold the land under his judgment lien, bought it at the sale, and after the year of redemption--in April, 1901--obtained from the sheriff a deed thereto. The last payment made by Wood on the mortgaged indebtedness was in February, 1899. The suit to foreclose the mortgage was begun in February, 1901. It will thus be observed that the payments by Wood were made while Bales had his judgment lien but before the sheriff's deed to him, which, of course, had the effect of transferring the legal title from Wood to Bales, so that the exact question involved there was whether payments made on the mortgage after the judgment lien attached could toll the statute as against the person having the lien. We quoted fully from, and approved the doctrine of, Wood v. Goodfellow, 43 Cal. 185, which held, what seems to have been the doctrine of the California courts since that time, that the mortgagor may not toll the statute as against a subsequent grantee, a second mortgagee, or a subsequent lienor. A part of our quotation from the Goodfellow Case is as follows:

'But this court has repeatedly decided

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