Oehler v. Philpott

• Decision Date: 14 December 1953
• Docket Number: No. 1,No. 43684,43684,1
• Citation: 263 S.W.2d 201
• Parties: OEHLER et al. v. PHILPOTT et al
• Court: Missouri Supreme Court

Page 201

263 S.W.2d 201

OEHLER et al. v. PHILPOTT et al.

No. 43684.

Supreme Court of Missouri, Division No. 1.

Dec. 14, 1953.

Paul J. Kaveney and Joyce Pueser, St. Louis, for defendants-appellants Frank R. Philpott and Clifford A. Falzone.

A. G. Schumacher, Clayton, for respondent.

LOZIER, Commissioner.

Defendants-appellants' appeal to this court was transferred to the St. Louis Court of Appeals for lack of appellate jurisdiction. 253 S.W.2d 179. After reversing and remanding, that court returned the cause for a re-examination of existing law, Art. V, Sec. 10, Const., 1 RSMo 1949, p. 63, 2 V.A.M.S.; Supreme Court Rule 2.06, 42 V.A.M.S.; Mo.App., 255 S.W.2d 90. We determine the case the same as on original appeal.

Plaintiffs-respondents' action was one to enjoin the sale of their real estate under a power of sale in a deed of trust executed by them on March 5, 1932. The deed secured plaintiffs-respondents' $600 principal note, payable on March 5, 1935, and several interest notes payable either before or on that same date. It was conceded that no payments were made upon the notes and that there was no agreement extending or renewing any of the notes beyond March 5, 1935.

On August 30, 1951, defendant-appellant Philpott caused to be filed in the recorder's office an affidavit wherein the deed of trust and the notes were described and an amount was stated to be still due and owing to Philpott as the owner and holder of the notes. (The sufficiency of the affidavit is not in issue. See Milby v. Murphy, Mo.App., 121 S.W.2d 169, 170, 171; Murphy v. Milby, 344 Mo. 1080, 130 S.W.2d 518, 519[2, 3]. In Rice v. Hughes, 240 Mo.App. 35, 208 S.W.2d 821, and Utz v. Dormann, 328 Mo. 258, 39 S.W.2d 1053, the affidavit was not filed.) Thereafter, defendant-appellant Falzone, the trustee in the deed of trust, instituted the foreclosure proceedings which the trial court enjoined prior to the published sale date.

As stated by the court of appeals, 'the only issue upon this appeal is whether the filing of' the affidavit, after the obligation of the notes themselves was barred but within twenty years after the maturity date of the notes, has 'the effect of permitting the lawful exercise of the power of sale * * *.' 255 S.W.2d 90, 91. The trial court ruled that issue in plaintiffs-respondents' favor. The court of appeals was inclined to approve the trial court's ruling but reversed in the belief that this court had ruled to the contrary in Carwood Realty Co. v. Gangol, 232 S.W.2d 399. Art. V, Sec. 2, Const., 1 RSMo 1949, p. 62, 2 V.A.M.S.

The statute involved is Sec. 516.150 (section numbers refer both to RSMo 1949 and V.A.M.S., unless otherwise indicated). As stated by the court of appeals: 'The common law rule required that a mortgage be foreclosed within twenty years or its enforcement was barred. The fact that the note was barred by the ten year statute [now Sec. 516.110] did not prohibit foreclosure under that rule. * * * In 1891, the legislature enacted the original statute of what is now Section 516.150. This act was substantially the same as the first clause of the present section.' 255 S.W.2d 91-92. In recognition of the common-law rule, Sec. 2 of the 1891 act, 1891 Laws, p. 184, expressly permitted foreclosure, within two years thereafter, of priorly executed instruments securing notes the obligations of which were barred under Sec. 1. See Hubbard v. Dahlke, 277 Mo. 516, 210 S.W. 652.

Section 1 of the 1891 act changed the common-law rule allowing foreclosure within 20 years, even though an action upon the notes was barred. Section 1 was: 'No suit, action or proceeding under power of sale to foreclose any mortgage or deed of trust, executed hereafter to secure any obligation to pay money or property, shall be had or maintained after such obligation has been barred by the statutes of limitations of this state.' The purpose of that section was 'to make the mortgage and note run concurrently, and when the note was barred the right to foreclose the mortgage was likewise barred.' Alewel v. Johnson, 212 Mo.App. 211, 253 S.W. 161, 162.

In 1921, 1921 Laws, Reg. Sess., pp. 202, 203, a semicolon was substituted for the period after the first clause of Sec. 1320, RSMo 1919 (now Sec. 516.150) and there was added, after the semicolon, the provisions upon which defendants-appellants rely. The section now reads: 'No suit, action or proceeding under power of sale to foreclose any mortgage or deed of trust, to secure any obligation to pay money or property, shall be had or maintained after such obligation has been barred by the statutes of limitation of this state; nor in any event after the lapse of twenty years from the date at which the last maturing obligation secured by the instrument sought to be foreclosed is due on the face of such instrument * * * unless before the lapse of said twenty years the owner of the debt thereby secured or some person for him shall file an affidavit duly verified, or file an instrument in writing acknowledged as deeds are required to be acknowledged in order to entitle them to record in this state, showing the amount due and owing thereon.' (Our italics.)

Thus, the first clause of Sec. 516.150 unequivocally prohibits foreclosure of an instrument at any time after the obligation which it secured has been barred by the general statutes of limitation. In other words, the right to foreclose any instrument securing a note expires when another statute of limitation bars recovery upon the note itself. Instant defendants-appellants concede that the first clause, standing alone, would deprive them of their rights to foreclose the deed of trust in the proceedings enjoined by the trial court. This, because the right to enforce the obligation of the notes secured by the deed was barred by the 10 year statute applicable to actions upon writings for the payment of money. Sec. 516.110.

Then, after the semicolon, is: 'nor in any event after the lapse of twenty years from the date' of the last maturing obligation secured as shown by the instrument 'unless' the affidavit is filed within such 20 year period. This language cannot refer to foreclosure of instruments securing notes upon which recovery is barred; foreclosure of such instruments is expressly, completely and finally covered in the first clause. We agree with plaintiffs-respondents that 'the only event that could happen to extend the time of foreclosure to 20 years is that the note is kept alive during this 20 year period and the time could be further extended past the special 20 year limitation...