Bekkedal v. Johnson

Mabshaix, T.

Sec. 2316a, Stats. 1898, provides that property tahen under a chattel mortgage shall not be sold within five days after the taking without the mortgagor’s consent; that any person aggrieved by a violation thereof may recover of the violator actual damages and $25 in addition as liquidated damages, and that in case of any such property being sold at private sale without public notice, or sold within the five-day period without the mortgagor’s consent, the mortgage indebtedness shall be deemed paid and the mortgage canceled. It will thus be seen that the answer contained a good defense, in that it alleged a sale of mortgaged property without public notice. True, as counsel for respondent contends, the. statute does not prohibit such a sale: therefore, a sale of that character may be made without affecting the indebtedness not paid by the proceeds, if the mortgage provides, in terms, for a sale with or without notice. Vreeland v. Waddell, 93 Wis. 107 , 67 N. W. 51 . That is because it is competent for the mortgagor, in the mortgage, to waive the statutory privilege; which is regarded as done by including in the mortgage, expressly, power to sell with or without notice. The difficulty with respondent’s position is that the pleadings do not show any such waiver. None can be presumed in favor of the demurrer. As the answer stands it satisfies every essential of a defense to the plaintiffs cause of action under the statute, unless other points made by counsel for respondent are controlling.

It is said that the clause as to selling without notice only applies to sales within the five-day period. It plainly indicates otherwise. There was no reason for regulating sales absolutely prohibited. So it was said, in case of any sale “at *627 private sale without public notice” or sale “within the period herein limited,” etc., the mortgage indebtedness and the mortgage shall be deemed extinguished. The latter clause relates unmistakably to the prohibitive clause and the former .to occurrences after the five-day period.

The further point is made that since the property at the time of the sale was in custodia legis the court would not be bound by the statute as to the manner of mailing sale thereof, and therefore its receiver was not. The authorities to which counsel refers us on that do not support the proposition. On principle, a court, superseding a person as to his contract rights, takes the same with their incidents. The court, as well as individuals, in the mere administration of contract obligations in a representative capacity, is bound by the law in respect thereto the same as was the original possessor. That is well illustrated by the holding that the appointment of a receiver does not affect the running of the statute of limitations as to matters devolving upon him by the appointment. Fincke v. Funke, 25 Hun, 616 ; Whitley v. Lowe, 2 De G. & J. 704.

The defense under ch. 122, Laws of 1903, must fail because the law was not in force when the mortgage was given. It is not a mere remedial statute. It was designed that its features should be regarded as incorporated into mortgage contracts. If it was read as having a retroactive effect, applying to mortgages antedating its enactment, it would fall within the prohibition against legislation impairing the obligation of contracts. Eau Claive Nat. Bank v. Macauley, 101 Wis. 304 , 77 N. W. 176 ; Peninsular L. & C. Works v. Union O. & P. Co. 100 Wis. 488 , 76 N. W. 359 .

What has been said sustains the demurrer to the counterclaim, as regards the law of 1903. There is no clear indication whether the pleader had that in mind or sec. 2316a of the Statutes. Possibly either was regarded as sufficient. The clause as to liquidated damages in the statute relates to the *628 five-day period only, not to the clause as to sale after tbe expiration thereof.

The result is that the demurrer to the counterclaim was properly sustained, but the answer otherwise contained a good defense under sec. 2316a, and therefore the general demurrer to the answer should have been overruled.

By the Gowrt. — The order appealed from, so far as it sustains the general demurrer to the answer for insufficiency, is reversed, and the cause is remanded with directions to overrule such general demurrer and to proceed further .according to law.