Peterson v. Hornblower

By the Court, Rhodes, J. : Henry Miller, and Catharine, his wife, on the 5th of April, 1865, executed to the plaintiff a mortgage of certain real estate, to secure the payment of a promissory note given by Miller to the plaintiff for a sum of money loaned by the plaintiff to Miller. In 1861 Miller made a declaration of homestead upon the premises that were subsequently mortgaged to the plaintiff. The only question is whether, under the provisions of the Homestead Act of this State, the mortgage is void. The first section of the Homestead Act of 1851 provided that “ the homestead * * * shall not be subject to forced sale on execution, or on any other final process from a Court,” etc.; and the third section, providing that “ such exemption shall not extend to any mechanic’s, laborer’s, or vendor’s lien, or to any mortgage lawfully obtained,” is not limited to mortgages for the purchase money, but comprehends all that the parties may execute for any purpose. The section proceeds to declare how such mortgages (as well as sales and other alienations) shall be executed—that is to say, if the owner is a married man, and his wife is a resident of this State, she also must execute and acknowledge the mortgage, unless it be a mortgage to secure the purchase money, in which case her signature is unnecessary. Ho provision is made in this Act for a written declaration of abandonment of homestead. Several changes in the system were wrought by the Act of 1860. (Stats. 1860, p. 311.) Section one provides that the homestead to be selected by the husband and wife, or either of them, or other head of a family, shall not be subject to — 273 — forced sale on execution or other final process ; and provides for the selection of the homestead by a declaration in writing, and then declares that the husband and wife shall hold the same as tenants in common. It is provided by section two that “ such exemption shall not extend to any mechanic’s, laborer’s or vendor’s lien, lawfully obtained, hut no mortgage or alienation of any kind, made for the purpose of securing a loan or indebtedness upon the homestead property, shall be valid for any purpose whatever, provided that a mortgage or alienation to secure the purchase money shall he valid if the signature of the wife be obtained to the same and acknowledged by her separately and apart from her husband.” Following this is a provision for the abandonment of the homestead by a declaration in writing, and the further provision that the signature of the wife, who is a non-resident of the State, is not essential to the validity of a mortgage or alienation of the homestead before it has become the homestead. It thus appears that under the Act of 1860 the homestead must be acquired and abandoned by the written declarations of the parties; that no mortgage to secure a loan or indebtedness was valid except a mortgage to secure the purchase money, and the latter must be signed and acknowledged by the wife. Under the Act of 1851 a mortgage of the homestead to secure a loan was valid if executed and acknowledged by the wife, hut under the Act of 1860 it was declared invalid. The Act of 1862 (Stats. 1862, p. 519) amended the second section of the Act of 1860 in several particulars. It is provided that “ such exemption [from forced sale on execution or other final process] shall not extend to any mechanic’s, laborer’s or vendor’s lien lawfully obtained, nor to any mortgage or other lien lawfully taken or acquired to secure the purchase money for said homestead.” The term “ mortgage or other lien ” was intended to embrace every possible form or character of security for the purchase money that might — 274 — become a charge upon the premises, except, perhaps, the vendor’s lien. The next clause of the section is that “ no alienation, sale, conveyance, mortgage or other lien of or upon the homestead property shall be valid or effectual for any purpose whatever, unless the same be executed by the owner thereof, and be executed and acknowledged by the wife, if the owner be married and the wife be a resident of this State, in the same manner as provided by law in ease of the conveyance of her separate real property.” The words “ mortgage or other lien ” mentioned in this clause are intended as descriptive of all other mortgages and liens than those enumerated in the first clause. If it is held to include a mortgage for the purchase money, and to declare that it must be executed by the • husband and wife, then, by the same reasoning, it is necessary for them to execute a mechanic’s, a laborer’s and a vendor’s lien. That involves an absurdity, if not an impossibility. The phrase “ mortgage or other lien ” most clearly is not limited to those made or given for the purchase money. There is no such qualification expressly annexed to it, and such a limitation is not indicated, even remotely, by the context. The terms “ alienation, sale, conveyance, mortgage or other lien,” are comprehensive enough to include most, if not all of the modes in which parties may by their own act convey, create a lien upon, or otherwise affect real estate; and seem to have been inserted to confirm and conserve the right of voluntarily alienating or incumbering of the homestead, but requiring the sale, lien, etc., to be made in writing, and in order to protect the wife of the owner, if the owner be a married man and his wife a resident of this State, to be signed and acknowledged by her. It will not be presumed that the Legislature intended to take away the right of the husband and wife to deal with the homestead in any of the accredited modes by which real estate is conveyed or may be affected; and nothing short of the clearest and most unmistakable terms will justify us in holding that so unnecessary and unusual a restraint upon alienation was intended. — 275 — The Act of I860- went much further in this respect than that of 1851 or that of 1862, it being provided in section two, as already mentioned, that no mortgage or alienation of any kind, except for the purchase money, should be valid. That provision was under trial for two years, and was found to work badly. Parties continued, as they had formerly done, to borrow money and give mortgages on the homestead as security, and to sell portions of the homestead premises; and, to accomplish either of these purposes, the husband and wife were burdened with the useless expense of filing a declaration of abandonment, and then, immediately after the execution of the mortgage or conveyance, of filing a new declaration of homestead. The Legislature of 1862, in order to save parties this inconvenience and useless expense, repealed the prohibitory clause just mentioned, and in its place enacted the second clause of the second section of the Act of 1862, which we have cited at length. And to make assurance doubly sure, a third clause was added, declaring that “ for the purpose of making or creating such alienation, sale, conveyance, mortgage or lien as aforesaid, it shall not be necessary that the declaration of abandonment of the homestead be executed, as herein provided for, nor that the homestead be actually abandoned.” Whether the term “ mortgage or other lien ” in the second clause includes the “ mortgage or other lien ” mentioned in the first clause, or not, the declaration of abandonment could not by any possibility be deemed necessary by any one in order to give effect to a mortgage for the purchase money, executed cotemporaneously with conveyance of the premises to the mortgagor, for the mortgage must .of necessity have priority over the homestead claim, for that could not be made until after the purchase was effected; and, if executed subsequently to the declaration of homestead, it would be held by any Court in which it might be foreclosed, upon the plainest principles of equity, to have priority over the homestead claim, unless the Court was prepared to hold that the Act was a legislative device to enable purchasers to swindle vendors. The provi — 276 — sion must be considered as having relation to other mortgages than those given for the purchase money. Whether the phrase “ mortgage or other lien” in the second clause includes the mortgage or other lien mentioned in the first clause, or not, it is clear that it comprises all mortgages other than those executed to secure the purchase money. The husband and wife, therefore, are not restrained by the Act from mortgaging the homestead to secure the payment of a loan. It is urged, however, that the first clause of section two enumerates certain liens which may be enforced against the homestead by forced sale on execution or other final process; that, therefore, the enumeration is exclusive, and consequently non-enumerated liens are void. The point is more plausible than real. The error arises from a misinterpretation of the phrase “ forced sale on execution or other final process.” The effect of the qualifying word “ forced” seems to be overlooked. The Constitution (Article XI, Section 15) provides that: “ The Legislature shall protect bylaw, from forced sale, a certain portion of the homestead and other property of all heads of families.” The several Homestead Acts were enacted to give effect to this provision. A “ forced sale” is not synonymous with a “sale on execution,” etc. The latter may be and often is voluntary in every respect. When the owner consents to a sale under the execution or other legal process, the sale is not forced, but it is as voluntary, within the full import of the term, as it is when he directly effects the sale and executes the conveyance. Its quality, as being voluntary or forced, depends not upon the mode of its execution, but upon the presence or absence of the consent of the owner. If those terms were synonymous or were so understood by the Legislature, the provision would have been that the homestead shall not be subject to sale under execution or other legal process. As the clause now stands, and with the interpretation contended for, no meaning or effect can be given to the word “ forced.” The meaning of a sale on execution or other final process is plain — 277 — and needs no interpretation, and the word “forced,” unless it is to be rejected as insensible, must qualify the phrase with which it is connected. If it is rejected from the statute, it must have the same fate in the clause of the Constitution directing the enactment of the statute. But we think there can be no question that enforced sale means a sale against the will of the ownér. It is apparent, upon reading the whole Act in connection with the constitutional provision, that it was not the intent either of the framers of the Constitution or of the Legislature to prevent the owner or owners of the homestead property from voluntarily alienating, changing or otherwise affecting it. The homestead was not forced upon him, but he was at liberty to avail himself of its protection or not, at his election, and if accepted to waive it at his election—the consent of his wife, if he was a married man, being required in order to secure to her, also, the protection of the homestead exemption. We remarked that where the owner of the homestead consents to a sale under execution or other legal process, it is not a forced sale. It makes no difference in respect to its being forced or voluntary, whether he consents directly to the sale or does the same indirectly by consenting to or doing those acts or things that necessarily or usually eventuate in a sale. A foreclosure sale, whether under the power of sale contained in the mortgage or in pursuance of a decree, is not a forced sale within the meaning of the Constitution or the statute. There are other views which we think decisive of this question. The statute of 1860 declared a mortgage of the homestead to secure a loan void. The clause containing this ’prohibition was repealed by the Act of 1862. This is tantamount to a declaration that such mortgage thereafter executed in conformity to law should be valid. The statute of 1862, as we have already said, affirmed the power of the owner to mortgage the homestead for other purposes than to secure the purchase money. It would be doing violence to the plainest rules of statutory construction — 278 — to hold that the Legislature, while conserving to the owner the power to execute the mortgage, intended to deprive the mortgagee of the right of foreclosure and sale. It would be a misnomer to call such an instrument a mortgage, and a strange perversion of terms to say that it was valid. Concede to the owner of the homestead the power to give the morfc gage, and the remedy for its enforcement by foreclosure and sale necessarily follow. In conclusion, we do not think the Act, which might well have been improved by the omission of certain words and phrases—inserted apparently through excess of caution—is rendered so obscure as to leave in doubt the intent of the Legislature. The unnecessary mention of cases in which the property may be subjected to a forced sale—a vendor’s lien, which necessarily attaches before the homestead claim is passable, and a mortgage or other lien to secure the purchase money, which is valid, in spite of the homestead—does not make a sale under legal process a forced sale, without regard to the presence or absence of consent of the homestead claimant. The point that the complaint is defective because it is not alleged that the claim was presented to the administrator for allowance, must be disposed of on the authority of Coleman v. Woodwoorth, 28 Cal. 567. The objection should have been taken in the Court below. Judgment reversed and cause remanded for further proceedings. Mr. Justice Sawyer delivered a dissenting opinion.