Schmidt v. Klipfel

WARD, J. This is an appeal by defendants from a judgment of foreclosure of two chattel mortgages given by them to secure the payment of a promissory note.

On November 6, 1931, the defendants, Robert Klipfel and Christine Klipfel, his wife, executed and delivered to Arno Schmidt their promissory note in the sum of $1,500, secured by a mortgage of the same date upon certain personal property consisting of printers’ tools, machinery and equipment. Thereafter on November 6, 1933, when by its terms the note fell due, Robert Klipfel and Arno Schmidt entered into an agreement extending the time for payment of the note until November 6, 1936. On January 31, 1936, as further security for its payment, Robert Klipfel executed a second chattel mortgage to Arno Schmidt covering additional printers’ equipment. On May 23, 1937, Arno Schmidt died and his wife, plaintiff herein, was duly appointed executrix of his estate. Robert Klipfel made his last payment on the note on September 25, 1940. Thereafter, plaintiff filed this action for judgment upon the note for $1,453.75 principal, interest of $151.83, and foreclosure of the mortgages. Defendants demurred upon the ground that the complaint failed to state facts sufficient to constitute a cause of action in that the alleged cause of action appeared to be barred by the provisions of section 337 of the Code of Civil Procedure. The [199]demurrer was overruled. The defendants answered, pleading as a bar to the action subdivisions 1 and 2 of the same section of the Code of Civil Procedure set up in their demurrer, and in addition sections 338 and 344 of said code. Upon the trial it was stipulated that none of the property covered by the mortgages was attached to real property, nor does the record disclose that the chattel mortgages were given as additional security for obligations also secured by mortgage or deed of trust on real property. No estoppel to plead the bar of the statute was set up or claimed, the whole issue being whether or not the principal obligation was barred thereby, The sole question is whether the obligation herein has been barred by the statute of limitations (Code Civ. Proc., sec. 337, subd. 1), or whether the Moratorium Act of 1939 .(Stats. 1939, ch. 86, p. 1045; Deering’s Gen. Laws, 1939 Supp., Act 5100) provides an extension of time within which the action may be brought. Section 20 of this act provides: "Whenever the time within which an action may be commenced upon any obligation founded upon a written instrument secured by chattel mortgage, mortgage, deed of trust or contract of purchase, or founded upon any guarantee of such obligation or any contract of suretyship therefor or any indorsement of such instrument, would expire by virtue of section 337 of the Code of Civil Procedure, or by virtue of the provisions of Chapter 1, Statutes of Extra Session of 1934, or by virtue of the provisions of Chapter 7 or Chapter 348, Statutes of 1935, or by virtue of the provisions of Chapter 5, Statutes of 1937, or Chapter 167, Statutes of 1937, or any other provision of law, during the period commencing with the effective date of this act and ending on July 1, 1941, such time is hereby extended so as not to expire until the first day of October, 1941.” Unless the broad term "chattel mortgage” used in the above section is modified or limited by other provisions of the act, it includes all chattel mortgages, and a creditor may delay bringing an action and not be barred by the statute of limitations.