Virginian Joint Stock Land Bank v. Hudson

July 3, 1925, defendant, then a single man, made, executed and delivered a promissory note in the sum of $7,000 to the Columbus Joint Stock Land Bank of Columbus, Ohio, payable with interest at 6 per cent. per annum, on an amortization plan, in 65 semi-annual instalments of $245 each, and one additional instalment of $204.61. It was provided that if default was made in the payment of any instalment payment, the legal holder of the note might declare the whole debt immediately due and payable. To secure the Columbus Joint Stock Land Bank the payment of the sum of money mentioned in the promissory note, *Page 656 together with the interest thereon, defendant made, executed and delivered to the Columbus Joint Stock Land Bank a real estate mortgage of even date therewith in the sum of $7,000 covering real estate consisting of a farm of 120 acres in Kalamazoo county. This mortgage was properly acknowledged and recorded. It subsequently became the property of the Virginian Joint Stock Land Bank of Charleston, West Virginia, now the owner thereof. Default was made in the payment both of interest and of principal instalments due upon the mortgage, whereupon plaintiff, February 24, 1932, instituted foreclosure proceedings in the circuit court for Kalamazoo county, claiming the whole amount due upon said note and mortgage as of January 16, 1932, to be $7,316.77. August 8, 1932, a decree of foreclosure was entered and a sale of the premises directed to be made. October 15, 1932, defendant petitioned for a modification of the decree of foreclosure and October 27, 1932, an order was entered modifying the final decree of foreclosure by reducing the attorney fee therein upon conditions mentioned in the decree. December 17, 1932, the mortgaged premises were sold at circuit court commissioner's sale for $3,500, which sale was subsequently confirmed and a deficiency judgment ordered against defendant for $4,451.72. June 7, 1933, defendant filed a petition based upon Act No. 98, Pub. Acts 1933, and an order was made by the trial court that defendant pay to plaintiff within 60 days from and after July 8, 1933, costs in the sum of $21.10; that defendant pay to the clerk of the court $606.90 which represented interest from the date of the order, August 3, 1933, to October 1, 1934, at 6 per cent. on $7,904.02, the amount of principal and interest due as of December 17, 1932, the date of sale, the sum of *Page 657 $606.90 to be paid to the clerk in equal monthly instalments beginning forthwith and ending October 1, 1934, payments to be made on the first day of each month; that defendant pay to the clerk of the court additional sums of money equal to all taxes assessed against the property between December 17, 1932, and October 1, 1934, as and when such taxes become due and payable; that defendant have the right to retain possession of the property during the extended period of redemption; that the order of December 28, 1932, confirming the sale held December 17, 1932, be revoked and set aside and the period of redemption extended to October 1, 1934.

We are not concerned with the wisdom or policy of the statute nor the motives which led to its adoption. The only question which this court may consider is whether Act No. 98, Pub. Acts 1933, is constitutional or not. Article 1, § 10, Constitution of the United States, provides:

"No State shall enter into any treaty, alliance, or confederation; grant letters of marque and reprisal; coin money; emit bills of credit; make anything but gold and silver coin a tender in payment of debts; pass any bill of attainder,ex post facto law, or law impairing the obligation of contracts, or grant any title of nobility."

Act No. 98, Pub. Acts 1933, § 4, provides:

"In any case of mortgage foreclosure now pending in a court of chancery in which the equity of redemption has not expired, the court, upon application of the owner or owners of such real estate or any person or persons liable on said mortgage and note, may set aside or amend its order confirming sale and thereupon may grant such order or orders or continuance as provided in section two of this act." *Page 658

Act No. 98, Pub. Acts 1933, § 2, provides among other things:

"Upon such order of continuance the court shall make order or orders for possession of said real estate, giving preference to the owner or owners in possession, determine fair rental terms to be paid by the party or parties to be in possession and the application and/or distribution of the rents, income and profits of said real estate, and make such order or orders for the preservation of said property and the payment of taxes and insurance as will be just and equitable during the continuance of said cause. Such order or orders shall provide that such rents, income or profits shall be paid to and distributed by the clerk of the court of the county in which said suit is pending, or such other person or persons as the court shall name, and further provide that in such distribution taxable costs of the proceeding, taxes, insurance, cost of maintenance and upkeep of said real estate shall be paid in such priority as shall be determined by the court, and any balance distributed as the court may further direct. The court may, upon a substantial violation of its said order or orders, or for other good and sufficient cause, set aside or modify said order or continuance and the cause shall forthwith proceed to trial as by law now provided, the provisions of this act to the contrary notwithstanding."

The trial court made no order determining the fair rental terms to be paid by defendant nor for the preservation of the property, nor for insurance upon the buildings thereon, if any, nor for the cost, maintenance and upkeep of the real estate.

The record indicates the finding by the trial court of interest to be paid was made in place of a finding of fair rental terms by consent of the parties, and they should now be bound by such finding. The *Page 659 statute authorizes the court to extend the time of redemption within the terms thereof upon the application of the owner or owners of the land "unless upon the hearing of said application good cause is shown to the contrary," and no good cause was so shown.

The decree entered July 8, 1933, provides that within 60 days from the date of this order defendant pay plaintiff all costs taxed; that defendant pay the clerk of the court $606.90 which represents the interest from December 17, 1932, to October 1, 1934, at 6 per cent. on $7,904.02, the amount of principal and interest due December 17, 1932, in equal monthly instalments beginning forthwith and ending October 1, 1934, such payments to be made on the first day of each month, and pay to the clerk of the court such additional sums as may equal all taxes levied and assessed against the property between December 17, 1932, and October 1, 1934, such amounts to be so paid as and when such taxes shall become due and payable. If defendant does not comply with this decree the statute provides:

"The court may, upon a substantial violation of its said order or orders, or for other good and sufficient cause, set aside or modify said order or continuance * * * the provisions of this act to the contrary notwithstanding."

It has been suggested the practice under this statute be more clearly defined. The statute governs, — it is clear, and this court by rule may not modify, alter or overrule the statute.Young v. Peters, 118 Mich. 45.

In Home Building Loan Ass'n v. Blaisdell, 290 U.S. 398 (54 Sup. Ct. 231, 88 A.L.R. 1481), decided January 8, 1934, the supreme court of the United *Page 660 States upheld the constitutionality of a similar law. The rule in that case should govern this. Decree affirmed, with costs.

NELSON SHARPE, C.J., concurred with POTTER, J.