Bacon v. Brown

19 Conn. 29

• Court: Supreme Court of Connecticut
• Decided: June 15, 1848
• Status: Published

Opinions

Waite, J.

That the deed from II. W. Bacon to the plaintiff is good, as between the original parties, is admitted. But it is insisted, that it is not so, as against the defendant, Brown, a subsequent incumbrancer, because it does not sufficiently shew, either the amount of the indebtedness, its nature, or even the fact of its existence.

Cases involving the validity of mortgage deeds have been so frequently before this court, that the rules applicable to them, have become as well settled, as the nature of the subject will admit of. But little more remains to be done, than to apply those rules to the individual cases as they arise.

The rule applicable to the present case, is, that the deed must be so drawn that the record of it will give notice, with reasonable certainty, of the nature and amount of the in-cumbrance upon the property. Is the condition of this deed in accordance with the requirements of that rule?

And first, with respect to the existence and amount of that indebtedness. It is true, it is not stated, in so many words, that the mortgagor actually owed the plaintiff the sum of - 1600 dollars. But that fact is sufficiently implied. Suppose the condition had been, that the deed should be void, upon payment of a specified note, executed by the mortgagor; would any one doubt that there was an indebtedness on account of that note, although that assertion was not made in the deed, in express terms? The deed in question must operate, either as a sale, with a right to repurchase upon the payment of the specified sum, or as a mortgage for the security of that sum. It was competent for the parties to make either contract, at their pleasure ; and the only inquiry now is, which have they made ? As creditors sometimes take undue advantages of the necessities of their debtors, the leaning of courts has been against such sales, and doubtful cases have generally been treated as mortgages. Conway’s exrs. v. Alexander, 7 Crunch, 218. This deed, upon its face, clearly indicates an intent to create a mortgage, and nothing more. It has all the formalities usual in such cases, except that it shows no covenant or agreement, creating a personal obligation for the payment of the sum specified in the condition. Although that circumstance favours the construction that it was to operate as a sale, yet it is by no means conclusive upon that subject. Hughes v. Edwards, 9 Wheat. 489.

To constitute a mortgage, the conveyance must be made to secure the payment of a debt. But it is not necessary that, in all cases, there should be a personal liability for the payment of that debt, in addition to the security created by the mortgage. It is competent for the parties to make such bargain upon this subject as they please. They may agree that the mortgagee shall advance the loan, and rely solely, for his security, upon the pledge of the real estate. He can then obtain satisfaction, only by appropriating the pledge in payment of his debt. South Sea Company v. Duncomb, 2 Stra. 919. On the other hand, if the mortgage is given as security for an existing debt, which is not secured by any bond, note or covenant, the mortgage will not operate to exonerate the debtor from his personal liability, unless it is expressly so stipulated. And in a very recent case, the court of Queen’s Bench, in England, held, that where money was advanced at the request of another, who mortgaged real estate to secure the payment, the contract raised by parol for the repayment of the debt, was not merged, in the security, created by the mortgage deed ; and that the creditor might maintain an action of assumpsit. Yates v. Aston, 4 Ad. & El. N. S. 182. (45 E. C. L. 182.)

(a)

Whether in the present case, the deed, upon its face, furnishes sufficient evidence to support an action for the recovery of the debt specified in the condition, is immaterial, as in either view, it will operate as a mortgage, and not as a sale. Indeed, it is not seriously claimed, on the part of the defendant, that the deed operated as a sale, as such a construction would be fatal to his interest in the property. It is only by treating it as a mortgage, that the subsequent mortgage can be sustained.

It is further insisted, that the condition of the deed, does not sufficiently show the nature of the indebtedness; and upon this question only have we had any doubts. It is usual, in modern times, for the mortgagor to give a note or other obligation for the payment of the debt, and then to execute a mortgage deed, as collateral security. But the practice upon this subject has by no means been uniform. Formerly, mortgages were frequently given in the form of the one now under consideration ; and the records of our towns and of our courts, will furnish numerous cases of mortgage deeds like the present. No question, until the present case, has, to our knowledge, ever been made, as to their validity, not only as against the mortgagor, but all others claiming title! subsequently. This general practice and acquiescence are not conclusive as to the law, but furnish strong evidence of the general understanding upon the subject.

We think the deed, upon its face, sufficiently shows, that at the time of its execution, there was a liquidated debt, due from the mortgagor to the plaintiff, of the amount specified in the condition ; and from the circumstance that no mention is made of any note or other written security for the same, the fair presumption is, that there was none. If such was the fact, why does not the condition of the deed give reasonable notice of the nature of the debt — a liquidated debt — of the specified amount — and bearing interest from the date of - the deed ? A majority of the court are of opinion that it does.

Thus far, we have considered the deed, as it appears upon its face, irrespective of any extrinsic evidence. But another question is presented upon the record ; and that is, whether the parol evidence was admissible 1 It is difficult to see upon what ground it can be considered as objectionable. It was not offered for the purpose of proving any matter inconsistent with the deed, but to show the truth of the facts therein stated. The object of the plaintiff was, to prove that the mortgagor, at the time of the execution of the deed, actually and truly owed him the sum for which the deed was given as security ; and that the debt was of the character and description implied from the deed itself. There is no weight in this objection ; and indeed, it has been but faintly urged on the part of the defendants.

Our advice, therefore, is, that the parol evidence was properly received; and that the plaintiff, upon the facts found by the court below, is entitled to a decree of foreclosure against the defendants.

In this opinion Church, Ch. J., and Hinmaw and Ells-worth, Js. concurred.

A decision to the same effect, by Judge Daggett, in the case of House v. Keeney, Hartford, county, September term 1829, was cited in argument, by the counsel for the plaintiff.