Rosa v. Díaz

31 P.R. 647

Opinions

Mb. Justice Aldbey

delivered the opinion of the court.

In a private instrument dated May 8, 1921, the brothers José and Ramón Díaz Agueda acknowledged a debt of $2,395.22 to Lucas Rosa Ruiz and agreed to pay it, without interest, in ten annual instalments, or within a shorter time if they found it possible. The third clause of the instrument contains the following stipulation:

“For the performance of this obligation we hind ourselves and all property that we now have or may have, and we renounce all rights that the law gives us, agreeing not to dispose of our property until the said debt has been paid.”

On October 18, 1921, the Díaz Agueda brothers mortgaged a property of from 41 to 45 acres of land belonging to them to a third person to secure a loan of $400 and interest at twelve percent payable in two years on the condition that if they failed to pay two consecutive quarterly instalments of the interest the whole debt should be considered due, and on January 4, 1922, Lucas Eosa Ruiz brought suit against the Díaz Águeda brothers to recover his credit of $2,395.22. on the ground that the creation of the mortgage without his consent was a violation of their contract with him. The defendants defended and after trial judgment was rendered dismissing the complaint, whereupon the plaintiff took the present appeal.

The whole issue in this case depends upon the meaning and scope of the words “dispose of” used in the third clause of the contract between the parties, the appellant contending that in mortgaging their property without his consent the defendants disposed of it in violation of the contract and that for this reason they are now obliged to pay the whole debt.

According to the Dictionary of the Spanish Academy the words “to dispose of” mean: “To act freely in the destination or alienation of one’s property by gift, sale, relinquishment, etc.” Webster’s Dictionary defines the phrase “to dispose of” as follows: “To transfer to the control of some one else, as by selling; to alienate; to part with; to relinquish; to bargain away.” The Century Dictionary and Cyclopedia gives the same definition.

These definitions show that the general, usual and grammatical meaning of the words involve the idea of transfer - ing to another person the ownership and control of some thing by parting with it by any of the means which definitely take it out of one’s possession, as by gift, sale, relinquishment, or alienation; and this was undoubtedly the meaning that the contracting parties had in mind, because it is a matter of general knowledge.

But if the parties were contemplating the legal meaning of those words, we must also conclude that it is the same, for Falcon, professor of civil law in the University of Barcelona, Spain, in his commentaries on the Civil Code, volume 2, 4th ed., p. 123, says:

“The right of ownership, as we have seen, is based on two fundamental attributes: The power- to possess and the power to dispose of. The Romans expressed the two ideas with the words e liter e et abutere’. Our codes translate these two words as to possess and to dispose of: To possess or use when one rises the thing himself; to dispose of when one grants to another the ownership in whole or in part. The two powers together constitute ownership proper.”

In Bouvier’s Law Dictionary, Yol. I, p. 888, the definition is as follows: “Dispose. To alienate or direct the ownership of property, as, disposition by will.” In "Wbuds &" Phrases Judicially Defined, Yol. 3, p. 21-14, dispose of is said to mean “to alienate; to effectually transfer.” A similar definition is given in 18 C. J. 1279. In 2 C. J. 1036, it is said that ordinarily a mortgage or other lien upon land is not, technically speaking, an alienation, for the reason that, while it may finally result in an alienation, it is not in itself a complete and absolute transfer of title. And in the ease of Bryan v. Traders’ Insurance Co. of Chicago, 145 Mass. 389-392, where an insurance policy on a house stipulated that the policy should be void if the property were sold, and the house was mortgaged, it was held that the mortgage did not' void the policy because a mortgage is not a sale.

It is true that according to section 354 of the Civil Code ownership confers the right to enjoy and dispose of a thing and that one way of disposing of a property is by mortgaging or leasing it, bnt this does not mean that, by the mortgage or the lease the owner has disposed of his property within the meaning of the words “to dispose of,” for he continues to be its owner.

For the foregoing reason we conclude that in mortgaging their property the defendants did not breach the contract in which they agreed not to dispose of it until their debt to the plaintiff had been paid; therefore, the judgment dismissing the complaint must be

Affirmed.

Justices Wolf and Plutchison concurred. Chief justice Del Toro and Justice Franco Soto dissented.