Curtis v. Renneker

The opinion of the court was delivered by Mr. Justice McIver. .The full and clear statement of the "facts in this case by Mr. Miles, the master, in his two reports, which should be embraced in the report of the case, relieves us of the necessity of going into any detailed statement of the facts, and we will therefore confine ourselves to a consideration of the questions raised by this appeal, calling attention to such facts only as are necessary to a proper understanding of the points now involved. The general question involved is as to the priority of the liens or claims of the several parties upon a certain lot in the city of — 490 — Charleston, or rather the proceeds of the sale thereof in the hands of the master. The plaintiff claims the first lion under a mortgage executed on the 27th of March, 1867, given to secure the payment of a bond of like date, payable in three instalments, at six, nine, and twelve months from the date thereof, upon which a payment was endorsed on the 7th of April, 1868. This mortgage was duly recorded, and is now held by the plaintiff under successive assignments from the original mortgagees and their assignee, the first bearing date 6th January, 1882, and the second 9th of January, 1882. The defendant. William E. Butler, as executor of Hannah Enston, denying the lien of the said mortgage, claims the first lion under two judgments recovered by said Hannah against the mortgagor, one entered 16th of May, 1872, and the other 15th of July, 1881. The defendant, T. W. Bacot, as assignee as aforesaid, recognizing the priority of the plaintiff's mortgage, claims under a tax title derived, as he alleges, through regular proceedings to sell the property for the non-payment of taxes assesséd thereon for the fiscal year 1877, which being subsequent to the lien of the mortgage, its precedence must be acquiesced in, but being prior to the entry of the second judgment recovered by Mrs. Enston (it being conceded that the first judgment never had a lien), the tax title takes precedence of the judgment. 1 The validity of the lien of the mortgage is assailed upon the ground that more than twenty years having elapsed after its date before this action was commenced (15th of March, 1888) to foreclose this mortgage, and neither the original mortgagees nor the assignees having caused “to be recorded upon the record of such mortgage * * * a note of some payment on account, or some written acknowledgment of the debt secured thereby,” the lien - had expired under the provisions of the act of 1879. now incorporated in the General Statutes as section 1831. It is claimed, however, on behalf of the plaintiff, that the requirement of this statute, that some note of payment on account or written acknowledgment of the debt, should be recorded upon the record of the mortgage, was substantially complied with, by the recording of the assignment from the original mortgagees to Renneker, the intermediate holder, upon the record of the — 491 — mortgage before the expiration of the twenty years from the date of the mortgage. But we cannot accept that view. That assignment was certainly neither a note of payment nor a written acknowledgment of the debt. It was the act of the assignee merely, and, so for as appears, the mortgagor knew nothing about it, while the statute manifestly contemplates that the record of the mortgage should show some act of the mortgagor recognizing the continual validity of the mortgage. 2 Assuming, then, as we must assume, that this provision of the statute was not complied with, the real question is, whether this statute w7as intended to apply to mortgages executed prior to the enactment of that law ; and if so, whether it was competent for the legislature to pass such an act. This is a very important question, and far reaching in its effects ; for, as was suggested in the argument for plaintiff, if the view-taken by the Circuit Court should prevail, then it would be possible, and perhaps not improbable, that a mortgage might lose its lien before any right of action to enforce it could arise. If a mortgage debt should be made payable more than twenty years after the date of the mortgage, as is known to be the caso with mortgages on railroads, then the lien would be lost before any right of action could arise, unless, perhaps, there had been default in the payment of interest in the meantime. 3 Our first inquiry is, whether the legislature intended this statute to have a retroactive operation, so far as mortgages are concerned. The rule that a statute will never be given such a construction unless it is required by the express words of the statute, or must necessarily be implied from such words, is too well settled to need the citation of any authority to support it. Now, it is quite certain that there are no express words in the statute evidencing an intention that it should be retroactive, and w'e are unable to discover anything in the language used necessarily implying such an intention, so for as mortgages are concerned. It is true that in the case of Henry v. Henry (31 S. C., 1), it wras held that such an intention was necessarily implied, so far as judgments were concerned; but that w'as solely because it was absolutely necessary to give the act such a construction as to judgments, as otherwise the act wTould have — 492 — been entirely nugatory in that respect.. For the legislature manifestly intended to make some alteration in the previously existing law as to the lien of judgments by the statute in question, and as the second' proviso expressly forbids its application to the lien of judgments recovered since the adoption of the Code, by the express declaration “that nothing herein contained shall be construed to affect the duration of the liens of judgments as prescribed by section 310 of the Code of Procedure,” it was absolutely necessary, in order to give the statute, so far as judgments were concerned, any effect at all, to apply its provisions to antecedent judgments. But no such necessity arises in the case of mortgages, and therefore there is no warrant for giving the statute a retroactive operation as to them. At first view it may seem inconsistent to give a section* of a statute a retroactive operation as to one of the subjects mentioned therein, and deny a similar operation as to another subject mentioned in the same section. But the inconsistency is seeming rather than real. There can be no doubt that it is entirely competent for the court to declare one portion of a statute unconstitutional, and at the same time recognize the constitutionality of that portion of the same statute which does not conflict with any constitutional provision. Wardlaw v. Buzzard, 15 Rich., 158; State v. Carew, 13 Rich., 498. So also a statute which in general terms refers to all contracts, may be declared unconstitutional as to certain contracts, while its constitutionality as to other contracts may be recognized. Barry v. Iseman, 14 Rich., 129, heard by the Court of Errors in connection with State v. Carew, supra. In State v. Platt (2 S. C., 150), it was held that one portion of a section of an act might be declared unconstitutional, while another portion of the same section may be held free from all constitutional objection; and the same doctrine was recognized, though the point was not distinctly decided, in State v. Hagood, 13 S. C., at page 56. The test, according to these two cases last cited, seems to be whether the unconstitutional provision relates to an independent matter which can be separated from the rest of the section without impairing its efficiency or altering its terms, whether the portion declared unconstitutional was capable of being the subject of a separate, independent act. — 493 — In this connection, a remark made by Dawkins, J., in delivering the opinion of the court in Wardlaw v. Buzzard, supra, seems quite pertinent: “It was not contended seriously that if one part of an act was unconstitutional, it vitiated the whole, or that the same section might not, be unconstitutional as affecting any {? one) class of cases, and constitutional as to others” (italics ours). Upon the same principle we see no reason why one portion of a section of a statute dealing with one subject may not be declared retroactive, from the necessity of the case, while another portion of the same section dealing with a distinct and different subject, as to which no such necessity arises, may not be construed as prospective only, It is manifest that this section was dealing with two entirely distinct and different subjects, either one of which might have been omitted or obliterated without in any way affecting the efficiency of the provisions of the statute as to the other. Either might have been made the subject of a separate act. There was no such connection between them as required that the statute should be construed alike as to both. For example, there was nothing to prevent the statute from being construed constitutional as to judgments, and unconstitutional as to mortgages, or vice versa. And so we think there is nothing to prevent the statute from being construed retrospective as to judgments, especially when such a construction is demanded by the necessity of the case, and prospective as to mortgages, where no such necessity exists. It seems to us, therefore, that the act of 1879, now incorporated in the General Statutes as section 1831, cannot be construed as applying to a mortgage executed anterior to the date of that act, and that the Circuit Judge erred in holding otherwise. 4 Under this view, the question whether it was competent for the general assembly to pass such an act giving to it a retroactive operation, cannot arise and will not be considered; for it is a delicate matter for the court to declare an act of the legislature void for unconstitutionality, and it should not be done unless necessary to the decision of a case. We therefore must decline to express or even intimate any opinion upon this grave question. Having reached this conclusion, the other questions raised are practically of no importance, for it is marri — 494 — fest that the fund in controversy will not be sufficient to satisfy the mortgage debt, which we hold is the first lien thereon. .But as these questions have been made and may be regarded as important, we will proceed to dispose of them. 5 First, as to the Enston judgment. It seems that the debt upon which this judgment was recovered, was evidenced by a bond secured by a mortgage on property other than that now in question, and that an ordinary action at law on the bond was brought, which culminated in a judgment entered 16th of May, 1872, which, under the provisions of the Code, had no lien, and no steps appear to have been taken to give it a lien. Subsequently, however, Mrs. Enston commenced proceedings to foreclose the mortgage, which resulted in a judgment of foreclosure, under which the mortgaged premises were sold, and after applying the proceeds of sale to the mortgage debt, there remained a balance due thereon, and a judgment for the deficiene}'’ was entered 15th of July, 1881. It being conceded that the judgment on the bond, obtained in the action at law and entered 16th of May, 1872, never had a lien, the only question is as to the validity of the judgment obtained in the proceedings to foreclose the mortgage, for the balance left unpaid by the proceeds of the sale of the mortgaged premises, which was entered 15th of July, 1881, after the lien for the unpaid taxes of 1877 had been fixed upon the property, as claimed by the holder of the tax title. It is contended that the judgment of 15th of July, 1881, was void, because Mrs. Enston, the plaintiff in that judgment, had previously obtained a judgment for the same debt in the action at law on the bond, and the case of Anderson v. Pilgram (30 S. C., 499), is relied on to sustain this proposition. All that case holds is that a mortgagee cannot maintain an action at law on his debt, while at the same time he is prosecuting an action in chancery, for the foreclosure of his mortgage and claiming judgment for any deficiency that may arise from the insufficiency of the proceeds of the sale of the mortgaged premises to pay the mortgage debt. But the pendency of another action, or the previous recovery of judgment, for the same debt, is a defence which must be pleaded and proved like any other defence; and if it is not so — 495 — pleaded and proved, there is nothing to prevent the court from rendering judgment in the second action. If one issued upon a note to which his name has been forged, or which has been paid, and he fails to set up and prove the forgery or payment, whereby judgment is recovered against him, neither he nor any one else can afterwards assail such judgment upon the ground that the note was forged or had been paid. Fraser & Dill v. City Council of Charleston, 19 S. C., 384. It is not, as seems to be supposed, a matter of jurisdiction, and there is nothing in the case of Anderson v. Pilgram, supra, to warrant such an idea. It is a mere matter of defence, and if not pleaded and proved at the proper time, it cannot be-urged afterwards, either by the defendant in the case or any one else, for the judgment is conclusive. Even, therefore, if it should be conceded (as to which, however, we express no opinion) that the mortgagor could have successfully defended himself in the action for foreclosure, from a judgment for the deficiency, yet not having done so when he had the opportunity, he cannot do so now, as he is concluded by the judgment, which became a valid lien from the date of its entry as to him as well as all others. 6 It only-remains to consider the question as to the tax title. It being conceded that no execution or distress warrant had ever been issued to enforce payment of the taxes in arrear out of the personal property of the tax payer, we think the question is concluded by our decision in Ebaugh v. Mullinax, ante 361, and we refer to that case for the reasons upon which we rest our conclusion. It is true that in that case the question arose out of the failure to pay the taxes for the year 1880, while here the taxes in arrear were those for the year 1877 ; but as it is conceded that the terms of the two acts under which the taxes for those two years were levied are identical, so far as this matter is concerned, the reasoning in that case is applicable here. Without considering any of the other alleged defects in the tax title, we think the failure to issue the execution against personal property was fatal. The judgment of this court is, that the judgment of the Circuit-Court, in so far as it adjudges that the lien of the plaintiff’s mortgage has been destroyed by the act of 1879, be reversed, — 496 — but that in all other respects it be affirmed, and that the case be remanded to the Circuit Court for such further proceedings as may be necessary.