7 S.D. 122 | S.D. | 1895
Lead Opinion
This was as action brought by the plaintiff to .recover from the defendant $50 actual damages and $200 penalty for its refusal to give certificate of discharge of two mortgages, under the provisions of section 4365, Comp. Laws. A trial was had before a jury, resulting in a verdict and judgment for the plaintiff for $25 damages and $200 penalty, and the defendant appeals.
The facts in this case, briefly stated are as follows: On April 1, 1887, Leonard F. Davis and wife and the plaintiff, Jones, and wife executed a note and mortgage to the defendant for $1,500, payable in five years from date. At the same time Davis and wife executed a note, secured by a mortgage, to the defendant, on other real property, for $2,500, also payable in five years from date. In 1887, soon after the mortgages were given, the said Davis and wife conveyed their interest in the property included in the two mortgages to the plaintiff, Jones. In the deed from Davis and wife of the premises included in the $2,500 mortgage, were a warranty and an assumption clause as follows: “That the same [premises] are free from all incumbrances except one certain mortgage for $2,500, due April 1, 1892, given to the Fidelity Loan and Trust Comxoany, and bearing interest at the rate of 9 per cent, per annum, payable semi-annually, which mortgage and interest is to be paid by the said grantee, Josexoh-W. Jones.” On the 1st day of Axaril, 1892, the date of the maturity of said notes and mortgages, the plaintiff forwarded to the defendant, at Sioux City, Iowa, a
1. The first proposition of the learned counsel for appellant is stated by them in their brief as follows: “Respondent, not being the mortgagor in either of the mortgages set forth in the complaint, was not entitled to demand certificates of discharge thereof, and cannot demand the statutory penalty for a refusal or neglect to execute such discharges in accordance with-his demand.” This proposition assumes as a fact what is not strictly correct, namely, that the plaintiff was not a mortgagor. The record discloses the fact that the plaintiff was a co-mortgagor in the $1,500 mortgage. The section of the statute under which this action was brought reads as follows: “When any mortgage has been satisfied, the mortgagee or his assignee must, immediately on demand of the morgtagor, execute and deliver to him a certificate of the discharge thereof, and must, at the expenses of the mortgagor, acknowledge the execution thereof so as to entitle it to be recorded, or he must enter satisfaction, or cause satisfaction of such mortgage to be entered of record; and any mortgagee, or assignee of such mortgage, who refuses to execute and deliver to the mortgagor the certificate of discharge, and to acknowledge the execution thereof, or to enter satisfaction or cause satisfaction to be entered of the mortgage, as provided in this chapter, is liable to the mortgagor or his grantee or heirs for all damages which he or they may sustain by reason of such- refusal, and also forfeit to him or them the
Reading the two clauses of the section under consideration together, it seems clear to us that it was intended that the demand might be made by the mortgagor or his grantee or heir; or, in other words, by the party who is in fact the owner of the land at the time the demand is made. To hold that the mortgagor alone can make the demand, and yet the damages and penalty, after the demand is made, can be recovered by the grantee or heir, would require us to give an absurd construction to the section. In case of the death of the mortgagor, or his absence from the country, no demand could be made if the construction contended for should be given to the section. The object of‘the section evidently is, not only to protect the credit of the mortgagor, but to protect the title to the land, and enable the owner to remove all clouds from the title. There would be no propriety in giving the damages and penalty to the grantee if it was purely a personal right of the mortgagor, and was not a right running with the land. Reading all the clauses of the section together, we are satisfied that the term “mortgagor” in the first clause includes “grantee or heirs,” and that it was the intention of the legislature that the term “mortgagor” should be so understood, as is fully evidenced by the last clause of the section.
Counsel'for appellant relies upon Deeter v. Crossley, 26 Iowa, 180, but the court in that case was construing a'section entirely
2. Counsel for appellant state their second proposition as follows: “The allegations in the complaint are insufficient, in that it is nowhere alleged that appellant did not, within a reasonable time after demand being made therefor, execute certificates of discharge of the mortgages set forth in the complaint.” We are unable to agree with the counsel in this proposition, as the plaintiff seems to have stated his cause of action quite fully, and in the language of the statute. The complaint, in this respect, seems to be a clear and sufficient statement of the facts. The claim of appellant that the complaint should have stated that the certificate was not made within a reasonable time is not tenable. The complaint states when (he demand was made, and when the certificate was in fact delivered, thus placing in possession of the court and jury all the facts; and states that defendant did not immediately furnish the certificate. The answer sets up fully that the certificate was made within a reasonable time, and the court left that question to the jury, under proper instructions, to which no exceptions were taken. Evidence having been given upon this question, and the jury having been fully instructed upon it, their
3. The third proposition of appellant’s counsel is stated as follows; “The contract, being by its terms one to be performed in the state of Iowa, must be governed by the laws of Iowa, and not by the laws of South Dakota.” The notes and mortgages were made in Dakota, and the notes were made payable to “Fidelity Loan and Trust Company, at their office in Storm Lake, Iowa.” But in the same note is the following provision: “It is agreed that this note is executed under, and is to be construed by, the laws of Dakota.” Assuming that it was competent for the parties to make such an agreement, this stipulation seems to be an answer to the appellant’s proposition.
5. Appellant’s fifth proposition is as follows: “It appears from the evidence that the mortgage in controversy had been assigned by appellant before the date of the alleged demands for certificates of satisfaction thereof, and the demand should consequently have been made of the assignee of the mortgage, and not of appellant.” In answer to this proposition it is proper to state that 'no assignment had been recorded, and therefore, so far as disclosed by the record, the defendant was the proper party to make the certificate; and it appeared from the evidence of the plaintiff that he had never been informed of such assignment, and had paid all interest and principal due on the notes to the defendant, without any knowledge of such assignment. The mortgagee, upon receiving a mortgage, assumes the statutory and implied liability of discharging the same upon full payment of the debt secured thereby; and he can only relieve himself from this liability by assigning such mortgage to an assignee who is not only vested with power to discharge such mortgage, but whose assignment is legally recorded, in order that he may properly discharge the same of record, and who thereby becomes legally liable to the mortgagor in case he neglects or refuses to so discharge the same upon full paypient. This the mortgagee can only do by delivering to the assignee a properly acknowledged assignment, which shall be (July recorded, for until such assignment is. recorded the mortgagee is
6. The appellant’s sixth proposition is stated by counsel as follows: “The purported demand having been made by a letter written by respondent at Sioux Falls, South Dakota, and mailed to appellant and received by it at Sioux City, Iowa, is not a sufficient demand under the statute, for the reason that no extra territorial force can be given to the penal laws of the state of South Dakota.” There is great force in this proposition. It seems to be well settled that the penal laws of a state have no force beyond the boundaries of the state in which they exist. Scoville v. Canfield, 14 Johns. 338; Story, Const. Law, § 621; Flash v. Conn. 109 U. S. 376, 3 Sup. Ct. 263; Coal Co. v. Kilderhouse, 87 N. Y. 430; Henry v. Sargent, 13 N. H. 321; Wisconsin v. Pelican Ins. Co., 127 U. S. 290, 8 Sup. Ct. 1370; Attrill v. Huntington, 70 Md. 198, 16 Atl. 651. That no action under the statute can be maintained until there has been a demand and refusal, seems to be settled by
It is oontended by counsel for respondent that the mortgage contract was made in this state, upon property within the state. This is true, but it in no manner aids the respondent. What he is seeking to recover is a penalty imposed by the statute as a punishment for the refusal to give a certificate of discharge of the mortgage. The place where the contract of mortgage was made iis not material. If the demand had been made in this state upon the defendant, and it had refused to make the certificate, it would have been liable, without regard to where the mortgage was executed, as it would have subjected itself to the penalty by the terms of the statute in this state. But the statute is purely local, and limited to the sovereignty and domain of the state.
Our conclusions are that the demand made in Sioux City, without the limits of this state, cannot be made the foundation of an action under the statutes in this state for the penalty imposed by the statute. A failure, therefore, on the part of the defendant, a citizen of Iowa, to comply with the demand, did not render it liable to the penalty prescribed by the statute of this state. The damages recovered, however, do not come within the rule. They are not imposed as a penalty, but to remunerate the party for the loss actually sustained by reason of the defendant’s neglect to perform the duty imposed. So far, therefore, as damages are given by this judgment, we are of the opinion that the judgment is proper, and the plaintiff was entitled to recover the same. As to
Dissenting Opinion
While not actively dissenting from the conclusion of the court, I am not sufficiently persuaded that it is right to be willing to concur, and particularly as to appellant’s fifth proposition. A mortgagee who has parted with all his interest in the debt and the mortgage securing it has no moral or legal right by virtue of his former connection with it to discharge the same, even though he may be satisfied that it has been paid. He may have no relation whatever with, or knowledge of, the present owner and holder; and it does not seem right to me to so construe the law, if there is reasonable escape from it, as to require him, under a severe penalty, to do a thing which he has no right to do. It appears from the language quoted in the foregoing'Opinion, the Kansas court suggests that the mortgagee may protect himself from liability for such penalty by insisting upon making and recording a written assignment when he sells the mortgage. This would often be impracticable. The assignment does not become operative until delivered, and after delivery the assigning mortgagee would have no control over it. It would seem to be more logical to put the duty of releasing the mortgage upon him who owns it, and receives the payment of it. Such a ruling would accomplish the desirable end of a recorded assignment in every case of a transfer, for thus only could the assignee put himself in position to properly discharge a mortgage when he has received full payment for it. He would take and record an assignment so that he might disharge when paid, knowing that not to do so would leave him without power to make a good discharge of record, and thus expose himself to the penalty. I think this would put the duty of discharging the mortgage where it properly belongs.