Dighton v. First Exchange National Bank

192 P. 832, 33 Idaho 273, 1920 Ida. LEXIS 43
CourtIdaho Supreme Court
DecidedOctober 5, 1920
StatusPublished
Cited by9 cases

This text of 192 P. 832 (Dighton v. First Exchange National Bank) is published on Counsel Stack Legal Research, covering Idaho Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dighton v. First Exchange National Bank, 192 P. 832, 33 Idaho 273, 1920 Ida. LEXIS 43 (Idaho 1920).

Opinions

MORGAN, O. J.

On May 13, 1910, T. G. Kaesemeyer and Emma Kaesemeyer, his wife, executed their note in favor of respondent for the sum of $2,000, due one year after date, together with a mortgage, which was recorded on May 18, 1910, conveying to respondent certain real estate by way of security for the payment of the note. On April 12, 1912, the mortgagors deeded the premises in question to appellant, by way of security, and in November of that year they departed from the state and had not returned at the time of the trial in the district court. On March 7, 1916, the Kaesemeyers executed a deed conveying the mortgaged premises to appellant and therein recited that it was “not intended as security but as a Complete and absolute conveyance of said property.” On April 30, 1917, they signed the following indorsement on the note due to respondent: “that there is now due upon the foregoing note the sum of $2,000, with interest at 8% per annum, less payments which have ibeen made on the interest.” Suit to foreclose respondent’s mortgage was instituted on the last-named date and the mortgagors answered admitting the execution of the note and' mortgage and that there was due thereon the sum of $2,000 with interest at the rate of 8% per annum from May 13, 1910, less $1,010 paid on the interest on the dates specified in the complaint, and they consented that decree of foreclosure be entered for the amount due on the note. Appellant alleged in its answer that the cause of action was barred by the statute of limitations. The trial court found adversely to this Contention and entered its decree accordingly.

[276]*276The principal question involved in this case is: Can the grantee of a mortgagor, who acquired his interest in the premises before the right to foreclose was barred, and who is not obligated to pay the debt secured by the mortgage, plead the statute of limitations against a suit to foreclose, when the cause of action is not barred as against the debtor because of his continued absence from the state?

Many courts have held an action to foreclose a mortgage to be a remedy distinct from that by which the creditor may enforce the personal obligation for the debt secured by it, and that one of these remedies may be barred when the other is not. The cases so holding seem to proceed on the theory that the owner of a note and mortgage has two distinct remedies which may be pursued independently of each other: 1. A suit in equity to foreclose the mortgage and for a deficiency judgment, if deficiency should remain; 2. An action at law to recover the amount of the debt.

Decisions based on such a theory cannot aid us, for C. S., see. 6949, provides: “There can be but one action for the recovery of any debt, or the enforcement of any right secured by mortgage upon real estate or personal property, which action must be in accordance with the provisions of this chapter.” Then follows Our statutory authority for foreclosure and sale.

That section was construed by this court in Clark v. Paddock, 24 Ida. 142, 132 Pac. 795, 46 L. R. A., N. S., 475, wherein it was held that a note and mortgage given to secure its payment must be construed together as one contract, and that the remedy for the enforcement of the conditions thereof is the one referred to in C. S., see. 6949. The court said: “In other words, under the statute of this state, no action can be maintained for the recovery on a promissory note secured by mortgage, unless the action be coupled with an action to foreclose the mortgage, except where it is shown that the security has become valueless.”

In Kelly v. Leachman, 3 Ida. 629, 33 Pac. 44, it was held that the subject matter of a suit for mortgage foreclosure is the debt due the plaintiff from the defendant, and that [277]*277the mortgage is a mere incident to the debt and given to secure its payment.

In Law v. Spence, 5 Ida. 244, 48 Pac. 282, it is said in the syllabus, which was written by the court: “But one action can lie for recovery of any debt secured by a lien upon real or personal property in this state, and where such action is barred by the statute of limitations as to the debt, the lien is carried with it and is likewise barred, and whatever will prevent the running of the statute upon one will prevent it upon both.”

In Moulton v. Williams, 6 Ida. 424, 55 Pac. 1019, this language appears: “So long as the creditor is entitled to a judgment for the debt evidenced by his note, so long he may, generally, be entitled to enforce the security given to secure its payment.....If, by- our statutes, the security was extinguished by the lapse of a time certain, its life limited by statute, regardless of whether the remedy on the principal object [the debt] was lost by reason of the bar of the statute or not, as is the case in California, the rule would be otherwise.”

It is a well-established principle that one who conveys or encumbers property cannot thereafter by any act of his defeat, or add burdens to, the title he has granted or the encumbrance he has created, and, it is argued, one who sells or re-encumbers his mortgaged premises cannot, by absenting himself from the state, continue in force, beyond what would otherwise be the period of limitation, the lien of the first mortgage to the detriment of his subsequent grantee or mortgagee.

The rule of law is sound, but incapable of the application sought to be made of it. It cannot be said that the Kaesemeyers, by leaving the state, placed a burden on the title which was not there when appellant took its deed. The effect of their going was to continue in force, for a longer period than it would otherwise have existed, a prior encumbrance, but appellant took its deed with notice of that encumbrance and with knowledge of the law which made possible its continuance in force in the manner in which it was [278]*278done. That law became a part of the contract and was and is as binding on appellant as if it had been expressly agreed that the grantors named in the deed might remove from the state and thus beep respondent’s mortgage in force.

The- original agreement between the mortgagors and respondent, in the light of our law governing mortgages and the enforcement of obligations secured by them, was that the former would pay the debt, but in the event of their failure to do so, the latter would foreclose the mortgage, sell the land, and apply the proceeds toward the payment of the debt and take a deficiency judgment for the balance found to be due, if any, and no more. Thereafter, and prior to the expiration of the period of limitation within which suit might be commenced on the note and mortgage, the mortgagors conveyed the premises to appellant subject, as a matter of law, to respondent’s lien; they then left the state and the statute of limitations was thereby suspended with respect to their personal obligation, for C. S., sec.

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Cite This Page — Counsel Stack

Bluebook (online)
192 P. 832, 33 Idaho 273, 1920 Ida. LEXIS 43, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dighton-v-first-exchange-national-bank-idaho-1920.