22 Cal. 116 | Cal. | 1863

Crocker, J. delivered the opinion of the Court—Cope, C. J. and Norton, J. concurring.

This action was brought in the District Court to foreclose an instrument claimed to be a mortgage. The plaintiffs recovered judgment, and the defendant appeals to this Court.

The first ground of error is that the complaint does not state facts sufficient to constitute a cause of action, and therefore the Court below erred in overruling the demurrer filed by the defendant setting up that ground. Upon this point the defendant contends that the instrument sued on is not a mortgage, but a conveyance of the fee in trust, and that therefore this action cannot be maintained to enforce it.

The complaint sets forth that the defendant executed to French, Wells & Co. his note for $10,000; to the Boston and Sandwich Glass Company for $15,000, and to Jarvis & Cormerais for $15,000, and to secure the payment of said notes, he executed to said Cormerais a mortgage whereby he granted, bargained, sold, aliened, released, conveyed, and confirmed to the said Cormerais, Ms heirs and assigns, certam property therein described, with the proviso, however, and upon the express condition that if the said Genella should well and truly pay said notes and the Mterest thereon, then the said indenture of mortgage should be void, and if default should be made m the payment of the same, then it should be lawful for *124the said Cormerais, his executors, administrators, or assigns, upon four months’ notice of his or their intention so to do, to enter upon the mortgaged premises and to sell and dispose of the same, and all benefit and equity of redemption of said Genella, his heirs, executors, administrators or assigns therein, at public auction, according to law, and out of the proceeds of the sale to retain the principal and interest then due on the notes, with the costs of the sale, rendering the overplus, if any, to said Genella ; which sale so to be made should forever be a perpetual bar both in law and in equity against said Genella, his heirs and assigns, and all other persons claiming or to claim the said premises under him or them. This is clearly a mortgage, with an ordinary power of sale—an instrument in common use in many States, especially those having special laws, regulating the mode and manner of conducting sales under them. It has all the usual conditions and provisions of a common mortgage, with the addition thereto of a power of sale vested in the mortgagee. It differs entirely from the class of instruments known as trust deeds, one of which was the subject of litigation in Koch v. Briggs (14 Cal. 262.) The provision respecting a sale by the mortgagee is not mandatory or exclusive in its character. It provides merely that if default be made it shall be lawful for the mortgagee to sell the mortgaged premises at public auction, according to law, the latter clause evidently copied from some form in use in a State having laws regulating such sales. In this State we have no such special statute, and it may be doubtful, perhaps, whether under this provision, any sale of the property could be made, “ according to law,” except a regular judicial sale, under a decree of foreclosure rendered by some competent Court. It is clear that there is nothing in the instrument forbidding a sale under a judicial decree; and the mortgagee has his election to foreclose in that way or under the power of sale vested in him by the mortgage. It is decidedly for the benefit of all parties that the mortgage should be foreclosed in the former mode rather than the latter. In that way there is no doubt of the right of the mortgagor, or parties holding under him, to redeem the property within six months after the sale, as provided by the statute. If the latter mode should be adopted, a doubt might arise whether such right of redemption *125existed. We have never heard it doubted before that Courts of Equity have the power to foreclose mortgages with powers of sale, nor has the able counsel for the appellant referred us to a case in which the right to foreclose such an instrument in a Court of competent jurisdiction has been denied. The power of sale contained in the mortgage is a mere cumulative remedy, and does not in the least affect the right to foreclose in chancery. (Washburn on Real Prop. 501, Sec. 8; Carradine v. O’ Connor, 21 Ala. 573; McGowan v. The Branch Bank of Mobile, 7 Id. 823; Cox v. Wheeler, 7 Paige, 248.)

It does not in the least change the character of the instrument as a mortgage, because the mortgagee is a trustee for himself and other parties. (Davis v. Hemmingway, 29 Vermont, 438; Lowe v. Morgan, 1 Brown’s Ch. 368; Wood v. Williams, 1 Madd. Ch. 185.)

The second point made by the appellant is, that the Court erred in rendering personal money judgments in favor of each of the parties holding the notes against the defendant, before the sale of the property. He insists that this cannot be done under Sec. 246 of the Practice Act as amended in 1861. (Stat. of 1861, 306.) Respondent, in his brief, refers to the case of Chapin v. Broder (16 Cal. 403, 422) as an exposition of this statute, but that was a decision upon a judgment rendered before this section was amended by the acts of 1860 and 1861, and therefore has no application to the present case. Counsel for appellant admits that the judgment in this case would be good under this section of the Practice Act, as it stood before the amendments of 1860 and 1861, but contends that the amendment of 1861 has taken away the power of the Court to render a personal money judgment until after the sale of the property, and the application of the proceeds of the sale to the debt. As this amendment relates to the remedy given to parties, it should be liberally construed to extend the remedy. (White v. The Mary Ann, 6 Cal. 470; Burnham v. Hays, 3 Id. 119.) The amendment first provides that “ there shall be but one action for the recovery of any debt, or the enforcement of any right, secured by mortgage or lien upon real or personal property, which action shall be in accordance *126with the provisions of this chapter.” This part relates entirely to the “ action,” and not to the form of judgment which the Court may render in the action. It then provides: In such action the Court shall have power, by its decree of judgment, to direct a sale of the incumbered property,” etc. This second clause of the amendment, it will be seen, is substantially the same as the original section before amendment, with the exception that it omits the clause in the original section providing for an “ execution for the balance,” which is provided for in the third clause of the amendment. Here, then, in this second clause of the amendment, there is no essential change of the law as it was before, relating to the power of the Court to render a personal judgment before sale. It does not limit or prohibit the exercise of any power previously employed by the Court in framing its decrees in foreclosure suits. The last clause of the amended section then provides that “ if it shall appear from the Sheriff’s return that there is a deficiency of such proceeds and a balance still due to the plaintiff, the judgment shall then be doclceted for such balance,, against the defendant or defendants personally liable for the debt, and shall, from the time of such docketing, be a lien upon the real estate of the judgment debtor, and an execution may thereupon be issued by the Clerk of the Court, in like manner and form as upon other judgments, to collect such balance or deficiency from the property of the judgment debtor.” Here, again, we find no restriction upon the power of the Court to render a personal judgment before the sale of the mortgaged property. In fact, it does not invoke the aid of the Court at all to carry out its provisions. The return of the Sheriff shows whether there is any deficiency or not, then the Clerk dockets the judgment for such deficiency, and issues execution as in other cases. If there should, arise any question as to the amount of the deficiency, or the application of the proceeds of the sale, the aid of the Court might be invoked to determine the matter. Again, this clause refers to “ the judgment,” evidently presupposing that a personal judgment might be, or had been, rendered before the sale, and simply providing that after the application of the proceeds of the sale to such judgment, it might then, if there was any deficiency, be docketed for the amount of such deficiency.

*127There are many good reasons why no change should be made in the practice of rendering personal judgments in the decree of foreclosure, unless imperatively required by the statute, which are evident to every practitioner. In the present case there is evidently no such requirement, but on the contrary a recognition of the previously existing practice. That practice was well known to the Legislature, and had been settled by numerous decisions of this Court. (Rowland v. Lieby, 14 Cal. 156; Rollins v. Forbes, 10 Id. 299; Rowe v. Table Mountain Water Company, 10 Id. 441.) If they had intended to change that practice, they could readily have done so, in framing the amendment, by using apt words for that purpose. Hot having done so, it is evident they did not intend to make any change in that respect. We do not mean to be understood, however, that a personal judgment rendered in a foreclosure suit could be docketed before a sale of the mortgaged property, or that it would become a lien upon other property of the debtor, or that an execution could issue thereon against the debtor’s property generally, before the sale and docketing of the judgment for the balance. The provisions of the amendment are all plain and explicit on these points. In the view we have thus taken of the statute, there is no error in the manner of entering the decree in this case.

Judgment affirmed.

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