Opinion
No. 27533
Decided December 13, 1939.
Appeal — Law — Akron Municipal Court to Common Pleas Court — Appellate Procedure Act applies — Sections 1579.527 and 12223-1 et seq., General Code — Execution — Mortgaged household chattels not exempt — Section 11729, General Code.
1. Under the provisions of Section 1579-527, General Code, of the Akron Municipal Court Act, an appeal from that court to the Court of Common Pleas on questions of law may be instituted by filing a notice of appeal as provided by Section 12223-1 et seq., General Code.
2. Household chattels duly mortgaged are not subject to exemption by reason of Section 11729, General Code, providing that every promise, agreement or contract seeking to waive the provisions of the exemption laws of this state shall to that extent be void.
APPEAL from the Court of Appeals of Summit county.
In the Municipal Court of Akron the plaintiff, The City Loan Savings Company, instituted this action for the foreclosure of a chattel mortgage executed September 13, 1935, by the defendants, Van H. and Margaret Keenan, husband and wife, to secure their note in the amount of a loan made to them by the plaintiff.
By stipulation the only issue submitted to the trial court was the claim of the Keenans that their mortgaged household chattels were subject to the exemption provisions of Sections 11725 and 11738, General Code. That court held that these defendants were entitled to exemptions under the former section but not under the latter.
Upon appeal to the Court of Common Pleas on questions of law alone, the judgment of the trial court allowing exemptions under Section 11725, General Code, was reversed, and the denial of exemptions under Section 11738, General Code, was affirmed.
Upon appeal to the Court of Appeals on questions of law, the judgment of the Court of Common Pleas denying exemptions under Section 11725, General Code, was reversed, and the denial of exemptions under Section 11738, General Code, was affirmed.
By reason of the allowance of a motion to certify the case is in this court for review.
Messrs. Meredith Meredith and Mr. S.M. Sokol, for appellant.
Mr. E.H. Hauenstein and Mr. S.D. Johnson, for appellees.
In addition to the stipulated substantive question presented at the trial of this case, the Court of Common Pleas and the Court of Appeals were confronted with the preliminary contention of the defendants that the plaintiff failed to follow the proper procedure in perfecting its appeal from the Municipal Court to the Court of Common Pleas on questions of law alone. Specifically, it is urged that the plaintiff should have filed a petition in error under the older provisions of Sections 1579-527 to 1579-529, General Code, of the Akron Municipal Court Act, instead of filing merely a notice of appeal as provided by the more recent Section 12223-1 et seq., General Code, relating to appeals in general. The defendants rely upon the pronouncement of this court in the case of Saslaw v. Weiss, 133 Ohio St. 496, 14 N.E.2d.), 930. However, as indicated by the Court of Appeals, that decision related to an appeal on questions of both law and fact. It did not involve an appeal on questions of law alone, as in the instant case. Section 12223-3, General Code, provides that the new procedure there mentioned shall be followed "unless otherwise provided by law." In the Saslaw case, supra, this court simply pointed out that in the Akron Municipal Court Act there is a procedure "otherwise provided by law" as to appeals on questions of law and fact. No problem as to appeals on questions of law alone was involved. This difficulty in the instant case is solved by Section 1579-527, General Code, of the Akron Municipal Court Act. It relates to "proceedings in error" which of course are now designated by the general appellate Section 12223-1 et seq., General. Code, as appeals on questions of law. Section 1579-527, General Code, specifically provides that "proceedings in error may be prosecuted to the Court of Common Pleas of Summit county from a judgment or final order of the Municipal Court in the same manner and under the same conditions * * * as provided by law for proceedings in error from the Court of Common Pleas to the Court of Appeals, except as otherwise provided herein." If effect is to be given to this section, it is apparent that appeals on questions of law from the Akron Municipal Court to the Court of Common Pleas must be perfected in substantially the same manner and under the same conditions as from the Court of Common Pleas to the Court of Appeals. The chief feature of an appeal from the Court of Common Pleas to the Court of Appeals is the jurisdictional act of filing a notice of appeal. Such a notice was filed by the plaintiff in appealing from the Akron Municipal Court to the Court of Common Pleas. This was proper, and the Court of Common Pleas was not in error in refusing to dismiss the appeal for want of jurisdiction.
The substantive question requiring the consideration of this court is whether the mortgaged household chattels of the Keenans were subject to the exemption provisions of Sections 11725 and 11738. The former section relates to household furnishings, books, tools, etc., and the latter provides for an additional exemption of property of a valuation of not to exceed five hundred dollars in lieu of a homestead. However, the present dispute is occasioned not by the language of these sections but by that of Section 11729, General Code, which reads as follows:
"The following sections of this subdivision of this chapter shall not extend to a judgment rendered on a mortgage executed by a debtor and his wife, nor to a claim for manual work or labor, less than one hundred dollars, nor to impair the lien by mortgage or otherwise, of the vendor for the purchase money of the premises in question, nor the lien of a mechanic, or other person, under a statute of this state, for materials furnished or labor performed in the erection of the dwelling-house thereon, nor for the payment of taxes due thereon. No promise, agreement or contract shall be made or entered into whereby the provisions of the exemption laws of this state are sought to be waived and every such promise, agreement or contract made after this act shall have gone into effect, insofar as it seeks to waive the provisions of the exemption laws of this state shall be void."
Inasmuch as this section unambiguously provides that the following sections of this subdivision of the chapter shall not extend to a judgment rendered on a mortgage executed by a debtor and his wife, it is obvious that these defendants have no basis for their claim for an exemption under favor of Section 11738, General Code, which, of course, is one of the sections following Section 11729 in the same chapter and subdivision. All three of the lower courts so held, and this manifestly was correct.
But what is the effect of the language of Section 11729 upon the preceding provisions of Section 11725? In 1933 the Legislature supplemented the language of Section 11729 by adding the last sentence which, as above quoted, provides that every "promise, agreement or contract" seeking "to waive the provisions of the exemption laws of this state shall be void." The defendants contend that the addition of this sentence had the effect of preserving exemptions in chattels even when duly mortgaged. However, the plaintiff urges that this new language invalidates only executory contracts to waive exemptions but does not affect executed waivers. The well-settled distinction between an executed waiver and a contract to waive an exemption is one long recognized in this state. In the first paragraph of the syllabus in the case of Frost, Jr., v. Shaw, 3 Ohio St. 270, this court said:
"The owner of the chattel property, which is exempted by law from execution and sale for the payment of debts, is not divested of the right of disposing of it by pledge in security for the payment of his debts; and in case of a pledge or chattel mortgage, the owner clearly waives the benefit of exemption, so far as the incumbrance extends or is operative."
Seventy years later in the opinion in the case of Dean v. McMullen, 109 Ohio St. 309, 142 N.E. 683, it was observed that "The case of Frost, Jr., v. Shaw, 3 Ohio St. 270, is sometimes quoted as opposing the doctrine that an executory contract of waiver of exemptions is void. That, however, was a case not of mere written contract, but of chattel mortgage, and therefore has no controlling influence here."
This court is of the view that if this statute is to include executed waivers as well as contracts to waive exemptions, this change in the law should be accomplished through unambiguous legislative enactment. This has not been done.
The judgment of the Court of Appeals is affirmed as to the denial of exemptions under Section 11738, General Code, and is reversed as to the allowance of exemptions under Section 11725, General Code.
Judgment affirmed in part and reversed in part.
DAY, ZIMMERMAN, WILLIAMS, MATTHIAS and HART, JJ., concur.
MYERS, J., not participating.