109 U.S. 211 | SCOTUS | 1883
NEW ORLEANS NATIONAL BANKING ASSOCIATION
v.
ADAMS.
Supreme Court of United States.
*214 Mr. J.D. Rouse, Mr. William Grant, and Mr. Thomas L. Bayne for appellants.
Mr. Joseph P. Hornor, and Mr. W.S. Benedict for appellees.
MR. JUSTICE WOODS delivered the opinion of the court.
It is conceded by counsel for complainant that the original mortgage made by Tucker Brothers, dated February 24th, 1860, and the decree rendered thereon in favor of the Bank of New Orleans by the District Court of the Parish of La Fourche, in June, 1867, were both extinguished by the sale of the mortgaged premises to Cummings on September 7th, 1867.
But complainant insists that the agreement made by Cummings on the day last named, with the Bank of New Orleans and other parties entitled to the proceeds of the sale, constituted a mortgage, and that the same having, on September 12th, 1867, been recorded in the office of the recorder of mortgages for the parish in which the lands were situate, secured them a lien and privilege on the premises from the date of said record.
We are of the opinion that this contention is not well founded. While it may be conceded that no precise form of words is necessary to constitute a mortgage, yet there must be a present purpose of the mortgagor to pledge his land for the payment of a sum of money, or the performance of some other act, or it cannot be construed to be a mortgage. Wilcox v. Morris, 1 Murphy, 116 (S.C. 3 Am. Dec. 678).
The agreement of September 7th, 1867, does not, on its face or by its terms, profess to create a lien in favor of the Bank of New Orleans on the premises in question, but it recites that the parties thereto do not thereby impair, affect, or novate their existing *215 claims; that the original mortgages and privileges remain in full force and are recognized as operating on said property "to secure the debts stated as aforesaid with the rank above stated." The agreemen is not of doubtful meaning. Its purpose is to recognize the old mortgage made by Tucker Brothers in 1860 and to preserve its lien on the mortgaged premises from the date of its inscription.
The contention of complainant is not that the agreement is a mortgage to secure the notes made by Tucker Brothers, but to secure from Cummings the price which he bid for the premises at the sale made to satisfy the mortgage executed by Tucker Brothers. The bill of complainant is framed upon this theory. But the fault of this theory is, that the agreement does not profess, of its own force, to secure the money due from Cummings, but excludes the idea that such is its purpose by declaring that the original mortgages are recognized as operating on said property to secure the sums due from Cummings.
It is perfectly clear, therefore that the agreement of September 7th, 1867, was not intended by the parties as a new mortgage to take effect at that date, but as a recognition of the old mortgage, and that its purpose was to keep it alive and to preserve its lien as of the date of its inscription.
In other words, Cumming, by this agreement undertakes to keep alive and in full force a mortgage made by another party after it had been foreclosed, the mortgaged property sold, and the mortgage and the decree rendered thereon extinguished. It was not in his power to do this. It follows that the effect of the agreement of Cummings of September 7th, 1867, is simply as a contract to pay the parties entitled to it the purchase money of the premises bought by him, and creates no lien or privilege on the premises sold. In other words, it is not a mortgage.
This view is supported by the decision of the Supreme Court of Louisiana in the case of Adams v. Daunis, 29 La. Ann. 315. This was the proceeding by Adams to cause to be erased the mortgages anterior to his purchase of the premises in question. The agreement of Cummings of September 7th, 1867, was put in evidence in that case, and this court held it to be no mortgage.
The decree of the circuit court must be affirmed.