Dixie Grocery Co. v. Hoyle

ClaRksoN, J. Tbe questions involved: Does tbe act of tbe General Assembly, Public Laws of 1923, chap. 192, sec. 1; N. O. Code, 1931 (Micbie), sec. 2594(5), conclusively presume tbe payment of tbe two notes in question of date 6 September, 1911, maturity date 8 September, 1911; and tbe note dated 16 October, 1911, maturity date 20 October, 1911, when tbe bolder of tbe said notes did not comply witb tbe provisions of tbe aforesaid act prior to 25 January, 1932, being tbe date *112 agreed upon as the time when the marginal records in the office of the register of deeds, Lincoln County, North Carolina, showing the interest payment, etc., as set out in the agreed statement of facts in this case? We think not from the facts and circumstances of this case. The pertinent part of the statute to be considered is sec. 2594(5) supra, which in part is as follows: “The conditions of every mortgage, deed of trust, or other instrument securing the payment of money shall be conclusively presumed to have been complied with or the debts secured thereby paid as against creditors or purchasers for a valuable consideration from the trustor, mortgagor, or grantor, from and after the expiration of fifteen years from the date when the conditions of such instrument by the terms thereof are due to have been complied with, or the maturity of the last installment of debt or interest secured thereby, unless the holder of the indebtedness secured by such instrument or party secured by any provision thereof shall file an affidavit with the register of deeds of the county where such instrument is registered, in which shall be specifically stated the amount of debt unpaid, which is secured by said instrument, or in what respect any other condition thereof shall not have been complied with,” etc. “The conclusive presumption of the payment of a debt secured by mortgage, etc., after fifteen years, as against creditors, or purchasers (Public Laws, 1923, chap. 192), is prospective in its effect. Constitution of U. S., Art. I, sec. 10.” Hicks v. Kearney, 189 N. C., 316. Corporation Commission v. R. R., 185 N. C., 435; Andrews v. Masons, 189 N. C., at p. 702; Commissioners v. Blue, 190 N. C., at p. 643; Humphrey v. Stephens, 191 N. C., at p. 105; Overman v. Casualty Co., 193 N. C., at pp. 92-93. The plaintiffs contend that the ten-year statute of limitations is applicable. We cannot so hold. C. S., 437, within 10 years an action “(3) For the foreclosure of a mortgage, or deed in trust for creditors with a power of sale, of real property, where the mortgagor or grantor has been in possession of the property, within ten years after the forfeiture of the mortgage, or after the power of sale became absolute, or within ten years after the last payment on the same." (Italics ours.) In Humphrey v. Stephens, supra, citing numerous authorities, at pp. 104-5, we find: “If a mortgage is a mere incident to the debt which it is given to secure, it necessarily follows that it lives as long as the debt, and that it may be foreclosed so long as an action upon the debt is not barred by the statute of limitations. Menzel v. Hinton, 132 N. C., 660. . . . In Hicks v. Kearney, 189 N. C., 316, it is held: The conclusive presumption of the payment of a debt secured by mortgage, etc., after *113 fifteen years, as against creditors or purchasers (Public Laws, 1923, chap. 192) is prospective in its effect. Const, of U. S., Art. I, sec. 10; Const, of N. 0., Art. I, sec. 17. It would seem that the Legislature, in passing the above statute, construed the decisions of this State as we do in this case, and have provided a method to quiet mortgages and liens of long standing. The mortgage follows the debt. The debt here is not barred nor is the mortgage.” C. S., 2589, is discussed in the Humphrey case, supra. In Roberson, v. Matthews, 200 N. C., at p. 245, speaking to the subject, we find.' “Indeed, the trial judge instructed the jury that C. S., 2594, did not 'apply. This ruling was correct. Hicks v. Kearney, 189 N. C., 316, 127 S. E., 205. That decision declares the law to be that C. S., 2594, subsection 5, has no application to a mortgage given prior to the passage of that statute nor does it wipe out a valid debt existing at the time the statute took effect.” C. S., 416, is as follows: “No acknowledgment or promise is evidence of a new or continuing contract, from which the statute of limitations run, unless it is contained in some writing signed by the party to be charged thereby; bid this section, does not alter the effect of any payment of principal or interest.” (Italics ours.) “It is true that it is well settled in this State that a payment by the principal on a note before the bar of the statute operates as a renewal of the debt as to himself and also as to the surety on the note.” Houser v. Fayssoux, 168 N. C., at p. 3-4; Dillard v. Mercantile Co., 190 N. C., 228. In Green v. Greensboro College, 83 N. C., at p. 454, we find: “Upon a full and careful review, we are of opinion and so declare that the payments of interest on the note, before it was barred by lapse of time, arrested the operation of the statute as to all the makers, sureties as well as principal, and it commenced again to run only from the day when the last payment was made.” McDonald v. Dickson, 87 N. C., at p. 406; Wood v. Barber, 90 N. C., at p. 80; Moore v. Goodwin, 109 N. C., 218; LeDuc v. Butler, 112 N. C., 461. The record discloses that the annual interest has been paid on each of the two notes up to 20 October, 1929, and 7 October, 1929. N. 0. Code, 1931 (Michie), sec. 2594(5), is not applicable to the, facts and circumstances of this case. For the reasons given the judgment is Affirmed.