Ottumwa semi-weekly courier. [volume] (Ottumwa, Iowa) 1899-1903, 1899-11-30

1eTS Ol mortgages passing Dy operation
of law, given a decision exactly the re-
verse of that given by the judge. The
decision, which is published in the last
issue of Treasury Decisions" has been
received by Deputy United States Col
lector S. L. Vest, and is us follws:
Treasury Department, Office of Com
missioner of Internal Revenue,
Washington, d. c., Nov. II, 1899:
s Sir:-I have to acknowledge the re-
ceipt of your letter of the 11th instant,
inclosing letters of Messrs. Pratt, Dana
& Black, of your city, asking ruling
relative to the transfer or assignment
of mortgages under schedule A of the
act of June 13, 1898. Letters have also
been received on the same subject from
several other parties in Kansas City,
viz: j. D.. Robertson, president inter-
state national bank; Garland NJ. Jones,
attorney; Chicago Live Stock compa-
ny; J. G. Stream, cashier National
Bank of Cmmerce; R. f. Porter, at
torney, and HARDWOOD q Meredith, at
torneys. These letters have presuma-
bly, all been caused by recent ruling
of Judge Woolson, of the United
States district court at Keokuk, with
respect to the, transfers or assign
ments of mortgages, where the assign
ment or transfer is not express, but
only by implication or operation of
law. It appears that this ruling was
not written one, but made verbally
on question of the admissibilitu of
evidence.
This Office has received, through the
clerk of the court. what seems to be
an authentic statement of the position
of Judge Woolson in this matter. The
facts are not stated in much detail, but
sufficient appears to show that one Gill
lett, In Kansas, gave his promissory
(. note for sum of money secured by
chattel mortgage on some cattle. This
note passed by various Endorsements to
the Bank of Orion, an Illinois corpora
ton, and the plaintiff in this case, the
last Endorsement being in blank. Ac-
cording to the law in most, if not all,
the states, the assignment of a debt Sc
cured by mortgage carries with it
the security.
The mortgage and note in this case
were apparently duly stamped when
originally executed. but schedule A
provides that upon each and every as
signment or transfer Of mortgage a
stamp duty shall be required and paid
at, the same rate as that imposed on
the original instrument. 1t appears
that this mortgage had not been stamp
I ed as an implied transfer, and when
the said plaintiff, wishing to avail it
self of its security. offered the same
in evidence, it was objected to, and
ruled out by Judge Woolson as incom-
petent, because it had not been stamp
ed for the transfer.
The crucial part of the judges opin-
ion is contained in the following Ian
guage, which appears in the state
ment before alluded to;
Here are two contracts entirely sep
arate. One, the note, contracts to pay
asum or debt. Now, that is good
contract If no mortgage secures it..
The other contract is the mortgage,
contracting or pledging that certain
property shall stand good for the 9TH
er contract or note. l may transfer
the note and not the mortgage, if such
a. my express contract with my as
signee. If transfer merely the note
or debt contract, no re-stamping is
necessary, according to the law. MY
transfer, then, merely gives the owner
ship OF the debt and the right to en-
force it to my assignee.
The chattel mortgage in this case is
Kansas contract; it was executed
there, and it provides for being en-
forced there. The Kansas statute de-
clares that the owner of chattel
mortgage is the holder of the legal III
tie and right to possession of the prop
Z erty mortgaged. That means here
that before the assignment or transfer
OF the chattel mortgage to the Bank
OF Orion, which now holds it, the Kan
sas persons then owning were ..the
holders Of the legal title to the cattle
mortgaged." When these Kansas peo-
pie transferred to the Bank of Orion
the note, they transferred (altbough
by operation of law the chattel mort
gage. That transfer thus made the
Bank of Orion the holder of the legal
title to the cattle mortgaged. Instead
OF such legal title remaining with
these Kansas people or assignees, it
passed to the Bank of Orion; and ev-
evry time this chattel mortgage is as
Lgned or transferred there is thereby
passed to the assignee. the legal title,
which heretofore the assignor had
held, to the cattle mortgaged.
Under this statement it would APP
peear that such transfer of legal title
ought to bear revenue stamps accord
1ngly. If such is not the law, man
tfest oversight has occurred.