Kraft v. Holzman

• Decision Date: 16 December 1903
• Parties: KRAFT et al. v. HOLZMAN.
• Court: Illinois Supreme Court

206 Ill. 548

69 N.E. 574

KRAFT et al.

v.HOLZMAN. ^*

Supreme Court of Illinois.

Dec. 16, 1903.

Appeal from Appellate Court, First District.

Action by Frederick Holzman against Frederick W. Kraft and others. From a judgment in favor of plaintiff, which was affirmed by the Appellate Court, defendants appeal. Affirmed.

F. William Kraft, for appellants.

Lackner, Butz & Miller, for appellee.

WILKIN, J.

This is an appeal from a judgment of the Appellate Court affirming a decree of the circuit court of Cook county foreclosing a deed of trust as a mortgage, given May 15, 1884, by William F. and Mary D. Nennemann to Philip Stein, as trustee, to secure their note of the same date for $2,000 payable four years after its date to their own order, with interest at 7 per cent. The note was indorsed by the makers, and, with the deed of trust, delivered to Stein. No question is made as to the consideration. On May 15, 1893, by their writing on the back of the note, signed by them, the makers extended the time of payment five years from that date, that is, to May 15, 1898. At the same time appellee, Frederick Holzman, purchased the note of Stein, and the makers made and delivered to said Holzman their agreement in writing, in addition to the one indorsed on the note, extending the time of payment for five years, and also made nine interest notes for $10 each, payable to their own order, one every six months, which they also indorsed, all of which said principal note and interest notes and said extension agreement were delivered to the appellee. The deed of trust had been duly recorded September 4, 1884, but the extension agreement was not recorded.

The first contention of the appellants is that, when the bill was filed to foreclose the deed of trust, the suit was barred by the eleventh section of the act in regard to limitations, which section is as follows: ‘No person shall commence an action or make a sale to foreclose any mortgage or deed of trust in the nature of a mortgage, unless within ten years after the right of action or right to make such sale accrues.’ Hurd's Rev. St. 1901, p. 1163, c. 83.

We have repeatedly held in such cases that the debt is the principal thing, and the mortgage or trust deed but an incident thereto; that section 11 of the limitation act must be construed in connection with section 16, applicableto promissory notes, and that the mortgage will not be barred until the debt is barred. Emory v. Keighan, 88 Ill. 482;Schifferstein v. Allison, 123 Ill. 662, 15 N. E. 275;Hibernian Banking Ass'n v. Commercial Nat. Bank, 157 Ill. 524, 41 N. E. 919;Aetna Life Ins. Co. v. McNeely, 166 Ill. 540, 46 N. E. 1130;Richey v. Sinclair, 167 Ill. 184, 47 N. E. 364;Wellman v. Miner, 179 Ill. 326, 53 N. E. 609;Murray v. Emery, 187 Ill. 408, 58 N. E. 327. In the Schifferstein Case it was held that where payment was made upon the note the statute would not run against the mortgage securing the note until the lapse of 10 years after such payment. In like manner, where the time of payment is extended, as it was in the case at bar, the statute will not run against the mortgage until it runs against the note. We see no ground upon which to base any distinction between this case and many others which we have decided, so far as the question here involved is concerned. Counsel for appellants has referred us to decisions in other states which take a different view of statutes somewhat similar to our own, but we are satisfied with the construction we have given to our statute, and are not disposed to depart from it. The extension of the time of payment of the note extended the time within which the deed of trust could be foreclosed. To have that effect it was not necessary to record the extension agreement. The deed of trust was of record and not released, and persons dealing with the land were bound to take notice of it, and ascertain, at their peril, whether the indebtedness it secured had been paid or barred, or the lien created by the deed of trust had ceased to exist.

But appellants, who claim under liens subsequent to that created by appellee's deed of trust, contend, further, that by section 30 of the act concerning conveyances the extension agreement must have been recorded before it would operate, as to subsequent lienholders or purchasers without notice, to extend the time within which the deed of trust could be foreclosed. The section referred to is as follows: ‘All deeds, mortgages and other instrumentsof writing which...