Miller v. Coxe.

Oonnob, J. The plaintiff insists that the defendant Ooxe has not filed exceptions, assigning error in the judgment of the Court below, as required by section 550 of The Code. Exceptions were filed to the report of the referee, and from his Honor’s judgment overruling-them the defendant appealed. It would seem from the remarks of Smith, C. J., in Bank v. Manufacturing Co., 96 N. C., 298, and Rhyne v. Love, 98 N. C., 486, that the appellant should have filed exceptions to the action of the Court, pointing out in what respects error was assigned. “It is to be observed that no specific objection is taken to the rulings of the Court, as should have been done, limiting the examination to them, many of which objections to the referee’s report, if this had been done, might not have been pressed in this Court, and so relieved it of unnecessary labor. The proper course is to take the exceptions to the ruling of the Court which the appellant wishes to be reviewed, after the rulings have been made, and to let them come up as a part of the record.” Treating, however, the appeal as an exception to the judgment based upon the referee’s conclusion of fact, as a case agreed or special findings of fact by the Court adopting as its own the findings of the referee, we proceed to dispose of the appeal upon the sole question presented and argued in this Oo-urt. The feme defendant, S. C. Miller, as principal, together with her husband, J. A. Miller, as surety, executed to the defendant Coxe, on October 27, 1880, her bond under seal, *580 promising to pay, November 1, 1881, tbe sum of $500’. On tbe same day they executed to said Ooxe, for tbe purpose of procuring tbe payment of said note, a mortgage on several tracts of land. It does not appear very clearly from tbe record whether tbe first tract named in tbe mortgage belonged to tbe defendant J. A. Miller or not, tbe only language throwing any light upon this question being “where the said J. A. Miller now lives.” The undivided interest in tbe other tracts is described as belonging to both of said parties. Tbe referee finds that a part of tbe land belonged to J. A. Miller. Tbe mortgage contains tbe usual power of sale. The only payment upon tbe bond was made by J. A. Miller, the surety, on March Y, 1896. It does not appear who has been in possession of tbe land since the execution of the mortgage or the date of the payment. On the 21st June, 1889, the defendant J. A. Miller executed to N. W. Miller bis note, under seal, for the sum of $1,018.81, due one day after date, upon which several payments were made, tbe last being April 24, 1900. To secure said note the defendants J. A. Miller and wife executed to said N. W. Miller a mortgage upon a portion of tbe land described in the complaint and in the mortgage to Ooxe. On September 28, 1898, the defendant Coxe, pursuant to tbe power of sale contained in bis mortgage, advertised for sale the several tracts of land conveyed therein. This action was brought by N. W. Miller against tbe defendants Ooxe and Miller and wife for tbe purpose of restraining and enjoining the sale of tbe land and cancelling tbe mortgage from Miller to Ooxe, alleging that tbe same was barred by tbe statute of limitations and was a cloud upon tbe title of said J. A. Miller and tbe plaintiff. Tbe defendant Coxe answered tbe complaint, admitting tbe material facts, denying that bis power of sale was barred by the statute of limitations, and demanded judgment that the Court vacate tbe restraining order granted and that the action be dismissed. *581 He asked for no affirmative relief. Tbe defendants Miller and wife answered, admitting the material facts and saying: “These defendants aver and allege that it has been more than three years since the last payment on the Ooxe note and mortgage and the bringing of this action, and the same are barred as to the surety J. A. Miller, and the defendant J. A. Miller hereby pleads the statute against said note and mortgage of the defendant Ooxe.” They further say that: “The allegation in the sixteenth paragraph of the complaint is admitted to be true and is adopted as a plea of the statute of limitations against the defendant Frank Ooxe.” The cause was referred, and the referee’s findings of fact material to the decision of the exceptions argued in this Court are as above set forth. The referee found as a conclusion of law that the right of the defendant Ooxe to execute the power of sale contained in his mortgage was barred by the statute of limitations. His Honor overruled the exception to said finding, and rendered judgment accordingly, from which the defendant Coxe appealed. The plaintiff insists that a second mortgagee may plead the statute of limitations as against a prior mortgagee, and for that position relies upon the decision of this Court in Hill v. Hilliard, 103 N. C., 34. That ease came before the Court upon an agreed state of facts in which the simple question submitted was whether a subsequent mortgagee has the right to avail himself of the statute of limitations as a defense to the first mortgage. This proposition was held in the affirmative, and we think correctly so. In this case the first mortgagee, Coxe, has not instituted any action to foreclose his mortgage, nor does he in his answer ask for any affirmative relief. It is difficult to perceive how the subsequent mortgagee can bring the defendant into court for the purpose of having his mortgage cancelled because, as he avers, an action upon it would be barred if the statute was set up in an answer. He *582 is a proper but not a necessary party to an action brought by the subsequent mortgagee for tbe foreclosure of bis mortgage. Tbis Court beld at tbe last term', in Menzel v. Hinton, 132 N. C., 660, tbat tbe execution of a power of sale is not witbin tbe language of section 152 (3) of Tbe Code, saying: “It is not necessary for tbe mortgagee to institute an action for the foreclosure of tbe mortgage or tbe execution of tbe power of sale; bence no time is fixed by tbe statute witbin which be must execute tbe power. Tbe word 'action’ in tbe paragraph evidently has reference to tbe action for foreclosure, and not to tbe execution of tbe power of sale, which requires no action.” To construe the action otherwise would be to write into it language which we do not find there. See also Cone v. Hyatt, 132 N. C., 810, in which Walicer, J., says: “Tbe statute was intended to apply only to actions or suits, and tbis is apparent from tbe very language of tbe law. In a case where it became necessary to decide whether a sale under a power was a suit or an action witbin tbe meaning of a statute it was beld tbat a proceeding to foreclose a mortgage by advertisement is not a suit. Such a proceeding is merely an action of tbe mortgagee exercising tbe power of sale given him by tbe mortgagor. In no sense is it a suit in any court, and all tbe definitions of tbat word require it to be a proceeding in some court.” We have carefully considered tbe principle 'upon which these cases were decided, and see no reason to change tbe conclusion then reached. Tbis case would come clearly witbin tbe principle decided in Hutaff v. Adrian, 112 N. C., 259, where it was beld tbat a mortgagor in possession is not entitled to an injunction to restrain a sale upon tbe suggestion tbat tbe execution of tbe power was barred. Tbis conclusion was in no degree affected by tbe decision in Menzel v. Hinton, supra. Tbe plaintiff, recognizing, tbis difficulty, says that be may maintain tbis action for the purpose of removing a cloud upon *583 bis title under the act of 1893, chapter 64. Whether this act changes the well-settled rule that the statute of limitations can be used only “as a shield and not as a sword,” as a defense and not as a cause of action, is an interesting question which it is not necessary for ns to decide in this case, as in no pointof view is the plaintiff entitled to the relief asked. There is, however, another point fatal to the plaintiff’s action. It will be observed that the defendant J. A. Miller, as surety for his wife, executed the mortgage on his own land to secure the debt An action on the note against him m per-sonam was barred after three years, but in respect to an action to foreclose the mortgage executed by him it was barred only after ten years. He made a payment on the note March Y, 1896. In this action the creditor, Coxe, asks for no judgment against Miller, either in personam or upon his mortgage. What effect the payment of March Y, 1896, would have upon the statutory bar in respect to an action for the foreclosure of a mortgage executed by J. A. Miller presents an interesting question. It is well settled that the three-years bar of the statute available to the surety in an action against him would not affect the right of the mortgagee to an action for the foreclosure of a mortgage if brought within ten years. If the defendant Coxe had instituted an action to foreclose the mortgage executed by Miller it would seemi that he could not avail himself of the ten-years bar, because in respect to that cause of action there was a payment within the statutory period. However this may be, as we have seen, the ease falls clearly within the principle of Menzel v. Hinton and Cone v. Hyatt, supra, and we must reverse his Honor’s ruling in holding that the defendant’s right to execute the power of sale is barred. It may not be out of place to say, as intimated in Menzel v. Hinton, that an amendment of section 152 (3) of The Code by inserting after the words “real property” the words “or the execution of a power of sale in a mortgage on real prop *584 erty” would bring tbe law, in respect to tbe time within wbicb an action must be brought or tbe execution of tbe power be enforced, in harmony. Tbe judgment of tbe Court below must be reversed and the cause remanded, that sucb other and further orders may be made as are in accordance with the rights of tbe parties. Error.