Stierle v. Rohmeyer

• Decision Date: 30 April 1935
• Citation: 260 N.W. 647,218 Wis. 149
• Parties: STIERLE ET AL. v. ROHMEYER ET AL.
• Court: Wisconsin Supreme Court

218 Wis. 149

260 N.W. 647

STIERLE ET AL.

v.ROHMEYER ET AL.

Supreme Court of Wisconsin.

April 30, 1935.

Appeal from a judgment of the Circuit Court for Wood County; Byron B. Park, Circuit Judge.

Reversed.

FRITZ, FAIRCHILD, and WICKHEM, JJ., dissenting.

Action in equity by J. C. Stierle and another against Rosa Rohmeyer and others, commenced November 29, 1932. From a judgment dismissing the complaint entered September 4, 1934, the plaintiffs appeal.

The action is for foreclosure of a mortgage on real estate executed in 1924, to secure a promissory note for $5,500. At the time the real estate mortgage was executed, the mortgagors, as additional security, executed a chattel mortgage on some cattle and horses to secure the mortgage note, and two years later executed another chattel mortgage on other stock and some farm machinery to secure the same debt. Both chattel mortgages were in force on August 1, 1932, when a constable, acting for the plaintiffs under their chattel mortgages, without the consent of the owner of the property, seized certain of the stock and machinery covered by the mortgages and on the 6th day of August sold it at a public sale for $122. The plaintiffs bid in all of the property sold except one heifer sold to another for $10. The expenses incident to the sale were $49.50. The property sold was found by the court to be worth $260. The affidavit required by section 241.15, Stats., was not filed within 10 days after the sale, although an affidavit was filed 18 days thereafter, but it did not state the amount of the indebtedness secured by the mortgage, and did not contain a copy of the notice of sale, both which are required by said section to be incorporated in the affidavit. No notice of sale was ever given to or served upon the owner of the property seized as required by section 241.13, Stats. There was at the time of the sale $4,500 due on the principal of the note secured by the three mortgages and a large sum as interest, the exact amount of which does not appear. The trial court found that the plaintiffs, upon seizing and selling the property, had failed to comply with the sections of the statutes above cited; that, because of such failure, the note secured by the mortgages was “satisfied, cancelled and extinguished,” and that the real estate mortgage was “satisfied, cancelled and extinguished” by reason of the satisfaction, cancellation, and extinguishment of the note. The court also found that the defendant owner of the property sold sustained $138 damages for the unlawful sale of the property, and was entitled to the $25 penalty for noncompliance with the statutes cited governing chattel mortgage sales. Judgment was entered canceling the real estate mortgage of record, dismissing the complaint, and awarding the defendant owner $163 damages. From this judgment, the plaintiffs appeal.Goggins, Brazeau & Graves, of Wisconsin Rapids, for appellants.

Chas. E. Briere, of Wisconsin Rapids, for respondents.

FOWLER, Justice.

Sections 241.13 and 241.15, Stats., prescribe the procedure to subject property covered by a chattel mortgage to the mortgage debt without the consent of the mortgagor. The former provides that notice of the sale must be given to the owner of the equity of redemption. The latter provides for the filing within a specified time after the sale with the register of deeds of an affidavit reporting the sale and containing specified facts relating thereto. Each section provides that for violating any provision thereof the owner of the equity may recover damages sustained through the violation and a penalty of $25, and that the debt secured by such mortgage shall be deemed fully satisfied and the mortgage canceled.

For omission to comply with these statutes, of whose existence the plaintiffs were ignorant and left the matter to be handled by an attorney at law, a debt of about $5,000 principal and interest, upon which property of the value of only $260 was taken to apply, was adjudged satisfied, the lien of a real estate mortgage executed as security for the debt was adjudged discharged, the complaint was dismissed, and the plaintiffs were mulcted for $163 in damages besides. Thus, the law, as administered, has deprived the plaintiffs of about $4,900 and transferred their property of that value from them to the defendants. We are to decide whether this adjudication can be upheld. If the statute is valid, it must be, in the main at least, according to a prior decision of this court.

The penalizing provision of these statutes or the like of it is not to be found in the statutes of any other state in the Union, and we venture to say that the like of it cannot be found among the statutes of any government that pretends to afford protection of the right of its citizens to hold private property. It has been several times before this court. The court has declared it drastic and highly penal, and that the statutes must be strictly construed. The constitutionality of these provisions has not heretofore been considered. It has been applied according to its terms, even in a case like the present, where both a real estate mortgage and a chattel mortgage were given as security for the purchase price of farm machinery, and sale of the mortgaged property without compliance with the sections cited was held to satisfy the debt and to prevent foreclosure of the real estate mortgage. American Hardware Co. v. Moore, 177 Wis. 190, 187 N. W. 996. In another case based on a land contract which was secured by a chattel mortgage, the court inferentially refused to allow the owner of property covered by the chattel mortgage the rights the statute by its terms conferred upon him. The suit was for an injunction to restrain waste by the vendee under the contract. It was set up in defense that the vendor-mortgagee had sold the personalty mortgaged and failed to comply with the statute. By the terms of the statute, the land contract debt was thereby paid, and, if so, the vendor had no right to restrain waste in order to protect his security as vendor under the land contract. The court, in a per curiam decision, upheld an injunction issued by the circuit court. A dissenting opinion was filed by Mr. Justice Barnes, characterizing the penalty of the statute as “grossly excessive” and the statute as “shocking to the court's sense of right and justice,” but saying, in effect, that the way to secure relief from the penalty was not to ignore it, but to enforce it, and thereby secure its repeal by the Legislature. Berntzon v. Edwardsen, 161 Wis. 180, 152 N. W. 832. This case is not mentioned in the opinion in the American Hardware Co. Case, supra, although it was cited in the brief of respondent. The decision of the court in the Berntzon Case merely was: “In this case, though the idea prevails that the judgment should be affirmed, there is such conflict of views as to the ground therefor, it is considered the general practice in such a case of pronouncing judgment of affirmance without any opinion being filed should be followed, and such is the order.”

None of the present court was a member when the case was decided, and we can only surmise as to the diversity of reasons for the affirmance. That the constitutional aspect of the statute has never been considered seems manifest. The penalizing provision is so outrageous in its effects in the present case that its constitutionality should now be passed upon. If it is unconstitutional, it should now be so declared, else we become for the nonce a court for the perpetuation of errors rather than the correction of them.

That the penalizing provision is unconstitutional seems plain upon reflection and due consideration. It is stated in Cooley on Constitutional Limitations (7th Ed.) pp. 505-508: “When the government through its established agencies (whether by courts, administrativebodies or the legislature) interferes with the title to one's property * * * and its action is called in question as not in accordance with the law of the land, (due process) we are to test its validity by those principles of civil liberty and constitutional protection which have become established in our system of laws. * * * Due process of law in each particular case means, such an exercise of powers of government as the settled maxims of law permit and sanction, and under such safeguards for the protection of individual rights as those maxims prescribe for the class of cases to which the one in question belongs. * * * There is no rule or principle known to our system under which private property can be taken from one person and transferred to another, for the private use and benefit of such other person, whether by general law or by special enactment. The purpose must be public, and must have reference to the needs and convenience of the public, and no reason of general public policy will be sufficient to validate other transfers when they concern existing vested rights.”

The principles thus enunciated by Cooley are applied to legislative enactments by the courts of the United States and the several states in the cases below cited and many others. They were enunciated by the Supreme Court of the United States in Bank of Columbia v. Okely, 4 Wheat. 235, 244, 4 L. Ed. 559, where it is said, in reference to the phrase “The law of the land,” which is uniformly held equivalent to the phrase “due process of law” as used in the Fourteenth Amendment to the Constitution of the United States: “As to the words from Magna Charta, incorporated into the constitution of Maryland, after volumes spoken and written with a view to their exposition, the good sense of mankind has at length settled down to this: that they were intended to secure the individual from the arbitrary exercise of the powers of government, unrestrained by the established principles of private rights and distributive justice.”

This idea is again expressed in Barbier v. Connolly, 113 U. S. 27, 31, 5 S. Ct. 357, 359, 28 L....