Rider v. Regan

Vanclief, C. Action to foreclose a mortgage executed by defendant Began to secure payment of his promissory note, made payable to plaintiff or order, for the sum of fifteen hundred dollars, with interest thereon at the rate of eight per cent per annum. The defendants, Edward and Mary Kelly, are husband and wife, and were made parties defendant, on the ground that they claimed some interest in or lien upon the mortgaged premises, which consist of a lot of land thirty-five by eighty feet, with appurtenances, situated in the city of San Francisco. Edward Kelly alone, by his guardian ad litem (he being insane), answered plaintiff's complaint, denying that defendant Began ever owned or had any authority to mortgage the lot, and alleging that, at the time the mortgage was executed, he (Kelly) was, and ever since had been, sole owner of the mortgaged premises. He also filed a cross-complaint, the substance of which is: That in October, 1887, while he and defendant Mary C. Kelly were husband and wife, he purchased the mortgaged lot with money earned by him during the marriage, and that it thereby became community property of himself and wife; that in June, 1880, while he with his wife and family were residing on said lot, she, in due form, made and recorded a declaration of homestead thereon which was never abandoned; that in August, 1884, he, after due examination before the superior court, was found to be insane, and by order of said court was committed to the insane asylum at Napa, California, and is now and ever since has been confined in said asylum, and during all that time has been and is now hopelessly insane, and incompetent to transact any business. These facts alleged in the cross-corn670 plaint were found by the court to be true, and are not questioned. The following additional facts appear by the record, and are undisputed: In October, 1883, while defendant Edward Kelly was sane, he and his wife executed a mortgage on said homestead lot to secure their promissory note for six hundred dollars, payable to the German Savings and Loan Society one year after date. In October, 1888, suit was commenced to foreclose this mortgage, and while it was pending, to wit, in December, 1888, the defendant, Mary 0. Kelly, filed in the superior court her petition praying for an order authorizing her to sell said homestead premises pursuant to an act of the legislature, entitled, “An act to enable certain parties therein named to alienate or encumber homesteads,” approved March 23, 1874. (Stats. 1873-74, p. 582.) It is admitted that her petition stated all the requisite facts, according to said act, and among them that neither said Edward nor Mary C. Kelly had any means, property, or estate, except said homestead premises and a few articles of household, furniture, and wearing apparel; that said Mary was dependent for the support of herself and three minor female children, offspring of the marriage, upon the assistance of her relatives; and that her husband had no relatives in this state, except said female children. Notice of the application was published, and also personally served on the public administrator as required by the second section of the act; and the public administrator appeared by counsel for Edward Kelly. After hearing, the court made an order authorizing the petitioner to sell the homestead premises. Thereafter, on April 11, 1889, Mary 0. Kelly, by deed of grant, bargain, and sale, conveyed said homestead to the defendant, Janies 0. Eegan, who, on May 4,1889, executed to plaintiff the mortgage to foreclose which this action was brought. The court below found that on May 4,1889, when the mortgage in suit was executed, the defendant, Edward Kelly, “had no right, title, or interest in, or claim to,” — 671 — the mortgaged premises; and decreed a foreclosure of the mortgage as prayed for in plaintiff’s complaint. The defendant, Edward Kelly, by his guardian ad litem, appeals from the judgment and from an order denying his motion for a new trial. 1. It is admitted by counsel for appellant that all the proceedings by which the order purporting to authorize Mary 0. Kelly to sell the homestead were regular and in strict accordance with said act of March 25, 1874. But he contends that said act is unconstitutional and void, for the reason that a sale of a homestead in accordance therewith deprives the insane spouse of a vested right to property without his consent and without due process of law. And whether it does so or not is the principal question for decision. The legislature has not, by the act in question, encroached upon the judicial department. It has adjudged nothing. The act itself does not directly deprive the insane spouse of any right. It merely declares that, upon a specified state of facts to be found by a court, such court may authorize the sane spouse to sell the homestead property. The first section of the act is as follows: “ Section 1. In case of a homestead, if either the husband or wife shall become hopelessly insane, upon application of the husband or wife, not insane, to the probate court of the county in which said homestead is situated, and upon due proof of such insanity, the court may make an order permitting the husband or wife, not insane, to sell and convey or mortgage such homestead.” The second section provides that notice of the application shall be published for three weeks in a newspaper, and personally served on the nearest male relative of the insane spouse to be found in the state, or, if no male relative be known to reside in the state, then upon the public administrator, three weeks prior to the application, whose duty it shall be “to appear in court and see that such application is made in good faith, and that the proceedings thereon are fairly conducted.” — 672 — The third section indicates generally what the verified petition of the applicant shall contain, besides requiring that it specifically set forth the age of the insane, the number, age, and sex of the children of such insane husband or wife, a description of the homestead and the value of the same, and such other facts as relate “to the circumstances and necessities of the applicant and his or her family as he or she may rely upon in support of the petition.” The fourth section provides that, if the court make the order, any sale, conveyance, or mortgage made in pursuance thereof shall be as valid and effectual as if the property thereby affected was the absolute property of the person making such sale, conveyance, or mortgage. The fifth section provides that a fee not exceeding twenty dollars be paid the public administrator for his services in any.case under the áet. The sixth section expressly repeals all acts and parts of acts in conflict with this act. Conceding that the insane husband had a vested property right in the homestead premises, and even that it extended to absolute ownership thereof (which is not admitted), yet “all vested property rights are held subject to the laws for the enforcement of public duties and private contracts, and for the punishment of wrongs; and, if they become divested through the operation of those laws, it is only by way of enforcing the obligations of justice and good order.” (Cooley’s Constitutional Limitations, 6th ed., 438.) The statute in question is a general remedial law intended to enforce the legal obligation of a hopelessly insane husband or wife to apply his or her property, in case of necessity, to the support of the sane wife or husband and- their minor children; and, therefore, is no more objectionable on constitutional grounds than would be a statute to enforce the performance of any other private or public duty or obligation. After stating the rule that private property cannot, by either a general or special enactment, be taken from one person and transferred to another for the private use — 673 — and benefit of such other person, Judge Cooley says: “Nevertheless, in many cases, and many ways, remedial legislation may affect the control and disposition of property, and, in some cases, may change the nature of rights, give remedies where none existed before, and even divest legal titles in favor of substantial equities where the legal and equitable rights do not chance to concur in the same persons.” (Cooley’s Constitutional Limitations, 436.) Nor can it be truly said that the procedure prescribed by the act in question is not due process of law. The usual and only practical kind of notice of the wife’s petition was given the insane defendant by publication, during a reasonable period of time, and by personal service of like notice on a public officer who, pro hoc vice, was constituted guardian ad litem of the insane defendant, and upon whom was imposed the duty of appearing for and protecting the rights of his ward; and who, in this case, did appear for him by counsel. The cause was heard and the facts found by the court before judgment was pronounced, and it is not questioned that the facts proved and found justify the judgment as tested by the provisions of the act in question. If this was not due process of law in the constitutional sense, it would seem difficult, if not impossible, for the legislature to provide due process by which the property rights of an insane person could be affected in any case. The insane defendant is afforded all possible opportunity to be heard in defense of his rights. In addition to the guardian ad litem provided by the act, the court, at request of appellant’s wife, appointed the learned counsel for appellant to that office, who appears to have ably and zealously performed the duties thereof, both in the court below and in this court. 2. The act is further objected to on the ground that it does not require of the sane spouse any bond or other security for the proper application of the proceeds of the sale. But this objection does not touch the question as to due process of law. It goes only to the quality — 674 — or nature of the relief which necessarily follows the process, whether that process was or was not due process of law; and, conceding that the relief provided was defective or excessive, yet the legislature had indubitable power to authorize the courts to grant it by due .process of law. It follows that, from the mere nature ■of the relief granted, no inference can be drawn touching the nature of the procedure or process of law leading up to it. Whether such procedure was due process of law must be determined by other means. And it having been hereinabove determined that the procedure provided by the act is due process of law, and it appearing, and being admitted, that both the procedure and the relief granted were in strict accordance with the provisions of the act, it follows that the order granting such relief was valid. ' 3. It appears that the defendant, Regan, to whom the homestead premises were sold, was a brother of the «defendant, Mary 0. Kelly, who sold it; that her deed to Regan recited the consideration therefor to have been live dollars, which was not paid; that Regan mortgaged the property to plaintiff to secure a loan of fifteen hundred dollars which he borrowed from plaintiff; that of the fifteen hundred dollars- so borrowed six hundred dollars was applied by Mary 0. Kelly to the satisfaction of the aforesaid mortgage executed by her and her husband to the German Savings and Loan Society in October, 1883; that the remainder of the money loaned to Regan by plaintiff (nine hundred dollars) was given to Mrs. Kelly, and she loaned it to Regan; and that afterward Regan, for the consideration of love and affection, conveyed the homestead, subject to his mortgage to plaintiff, to his sister, Mary 0. Kelly. Counsel for appellant contends that the substance of these transactions was a mortgage of the homestead by Mrs. Kelly to the plaintiff through the agency of her brother, and not a sale to her brother according to the purport of her deed to him; and, therefore, was not authorized by the order of the court, which merely au — 675 — thorized her to sell and not to mortgage the homestead. Conceding all this, the rights of the plaintiff as mortgagee are not thereby affected, unless he had actual or constructive notice of the alleged character of the transactions by and between Regan and Mrs. Kelly. There is nothing tending to prove such constructive notice. The deed from Mrs. Kelly to Regan, as previously recorded, both literally and substantially conformed to the order of the court. It purported an absolute sale to Regan, and nothing of its contents indicated anything different. As to actual notice, it is stated in the bill of exceptions that it was proven that at the time of the execution of the mortgage by Regan, and at the time of the loan of fifteen hundred dollars, “ plaintiff had no knowledge of any agreement between the de. fendants, Regan and Mary C. Kelly, but at all of said times believed defendant Regan was the absolute owner of said property in accordance with the terms of the deed of Mary C. Kelly to him, said Regan.” Whether or not the appellant has suffered injury in consequence of the transactions herein above stated, for which he is entitled to any remedy against others'than the respondent, is a question not involved in this appeal. I think the judgment and order appealed from should be affirmed. Searls,.0, and Haynes 0., concurred. For the reasons given in the foregoing opinion the judgment and order appealed from are affirmed. It is to be observed, however, that the propriety ofv trying appellant’s alleged title in this action was not raised; and this decision must not be taken as authority for trying adverse and paramount titles in an action to foreclose a mortgage. McFarland, J., Van Fleet, J., Garoutte, J. Beatty, C. J., concurring.—I concur in the judgment of affirmance. — 676 — It is not necessary to decide, or to consider in this case, whether the act of 1874 is constitutional or not, as applied to homesteads created by the sole declaration of one spouse upon separate property of the other. The case here is of a homestead declared upon community property acquired subsequent to the passage of the act in pursuance of which it was sold. If the legislature has the power (as unquestionably it has) to provide generally for the alienation of community property by the husband alone, and his control of the proceeds of the sale, I can see no reason why it has not the power to provide, in case of the hopeless insanity of the husband, for the alienation by the wife alone of so much of the community property acquired subsequently to the passage of the act as may have been lawfully dedicated as a homestead. So far as the act of 1874 goes beyond this proposition it may be seriously doubted whether it, is operative, but I can see no reason to refuse to give it effect in a case not involving any question of vested rights.