Case Name: Thomas W. Poindexter v. Isaac McCannon & Henry Hauser
Court: Supreme Court of North Carolina
Jurisdiction: North Carolina
Decision Date: 1830-06
Citations: 1 Dev. Eq. 373
Docket Number: 
Parties: Thomas W. Poindexter v. Isaac McCannon & Henry Hauser,
Judges: 
Reporter: North Carolina Reports
Volume: 16
Pages: 373–379

Head Matter:
Thomas W. Poindexter v. Isaac McCannon & Henry Hauser,
From Surry.
Jflf liste, «non the. face of a transaction, it d<w.T.Uni vüether the partios intfimed to make a mortgage or a comlitiminl sale, Courts of Equity incline to consider it a mortgage 5 because; by means of conditional .. ties, oppression is frequently exercised oy>-r the needy,-3j1. there in no rule of Equity, which forbids the making of conditional enJo-i. And where the subsequent sets or the parties are consistent with the idea of a saie, a redemption i; not decreed, 'for although the acts of the, parties are never regarded al lew as a rule of construction, yet in Equity they are oonsicJeml as evidence of the intent.
Where, upon the purchase of a slave, a full price was paid, and no bond or coTcnsni taken for the repayment of the purch ise money,, hi case of the death of the slave, and possession ’«•as given im-fitediately, held, that these circumstances, added to the (act that the buyer was necessitous, and that twelve years had i lapsed be ■ fore redemption was claimed, proved that a clause, whereby the seller rcs-’nred to himself the power cf annulling the bargain, did not reader the transaction a mortgige, but a c uditiona! sal —-to claim the benefit of which, there must be a strict performance by the seller.
This bill was filed its October, 1823, to redeem a negro man slave, which the Plaintiff alleged he mortgaged io the Defendant, Me,Cannon, on the 15th Sep-ember,» 1.810, and which MeCaimon sold to the other Defendant on I4(h September, 1811. The bill alleged that the Plaintiff was indebted to Mcfí. it» the sum of $ 150, and wanting money, be borrowed S ¡53 more from him, and to secure the payment of the whole, agreed to mortgage to him the negro in question, then a likely hoy about sixteen years old, and worth 3 500. That accordingly he made him a bill of sale, expressed to be in consideration of §400, and, put the negr© immediately into Me Cannon*!} possession, upon an agreement which was charged to he usurious, that his hire, should extinguish the interest, It averred expressly, that the agreemssF was fi>? a mortgage to secure the debt of $ 303. The deed was exbibited by the Defendant, and was absolute upon the face of it. But there was an endorsement on u, in these words: “N. B. If the above bound T. W. Poindexter pay up to the above named J. McCannon, the sum of four hundred dollars, within twelve months from the date •hereof, the above bill of sale to be void, and the negro boy returned.” The Plaintiff further alleged, that in 1814, he tendcrei! to both of the Defendants, the money due on the mortgage — which they refused to take.
McCannon, in bis answer, admitted the bill of sale,, and the nota bene, But he denied positively, that it was a mortgage, and affirmed that, it, was a purchase by him for full value, with an agreement to re-sell atany time niihh: a year, at the same price. He averred that the Plaintiff wished to give a mortgage, but that, lie refused to treat on such footing; and after they had contracted, upon redemption at an indefinite period being mentioned by the Plaintiff, he, McCannon, refused to complete the pur* Chase. And that finally, the Plaintiff agreed to make a sale, if he, McCannon, would consent to re-sell to him, as above mentioned. He denied that he made any loan to the-Plaintiff; and averred that the Plaintiff owed him about S 225, for land sold to him. That he then paid the Plaintiff a sum of money, and gave him an order on his father’s executor for § 86 SO, being the full balance of the price of $400. He likewise averred, that he then surrendered all the evidences of his previous debts, as they were satisfied in the price of the slave. He admitted, that in 1814, Plaintiff pretending that the conveyance was a mortgage, said, that if he, the Defend ant, did not make good the order for $ 86 50, he would sue for the negro. He denied the tender of the money, and aver - red that although he did not then feel bound for the order, yet as ffie Plaintiff was his brother-in-law, and he wished for peace, he authorized a mutual friend to pay him the principal and interest on it, if the Plaintiff would ul . ii-t.!!1 all claim ; which was accordingly soon after dose. ¡le further siatrd, that wauMf\g sr-oney himself. * J befow» SíUítCüibci*, 1811, lo míHurge m cxrcutiu» ugainst; him, he applied to til» Plaintiff to rescind the contract, and tek*» '¡he negro back ; and received for answer, that In-might sel! he negro, for that lie, the Pb'lr.isiF, could not r;-" parch,,>,0 him. That upon >ha, 1«* untie the sale to rhe other Defendant, for the samo price of ¡¿400$ but that ihc Plaintiff might have still ftsHliui- time, lie an • re-it'd to the bill of sak- «o Hauser, a similar condition to that which was annexed to the one to himself. And he averred, that neither he nor Hauser imagined, that either deed constituted a mortgage, and admitted, that he con-•Jdered his contract with Hauser as a sale.
The answer of Hauser did not vary (he case, but corresponded with McCannon’s, as to those parts of the transaction in which he had si personal agency.
Replications were filed to the answers, and testimony taken, which will be found stated in the opinion of the Court.
Winston, for the Plaintiff.
Gaston & Devereux, for the Defendants,
cited Coke L. 905 a. — Bonham v. Jfewmnb, (1 Vernon 7, 214, 232) Mellar v. Lees (2 Mk. 494) Verner \. Winstanly (2 ficho* & Lef. 393) Goodman v. Grierson (2 Ball & I sea, 274) Conway v. Alexander (7 Crunch 218).

Opinion:
Ruffin, Judge,
after stating the case as above, pro» ccedcd : A mortgage and a conditional sale are nearly allied to each other, and it is frequently difficult to say, whether a particular transaction is the one or the other,, The difference between them is, that the former is a security for a debt $ and the latter is a purchase for a pries paid, or to be paid, to become absolute on a particular event $ or a purchase, accompanied by an agreement ta re-sell upon particular terms. It is tine latter Mud, that runs so nearly into a mortgage. For, as needy aim»1 " tressed men are those who are commonly drawn »:n - such contracts, and the very anxiety to get their estates aSa*nJ which produces a stipulation to that effect, denotes either that it was favorite property, which the party did mot intend to part from conclusively, or that the price was so inadequate, as to make it material, in point of inte» rest, that they should have the power to reclaim, Courts lean towards considering them mortgages. But there is no rule of law, that a sale shall not be made conditionally. In each case, the only difficulty is, to ascertain ihe character of the transaction. When it is once determined to be a mortgage, all the consequences of account, re» demption, and the like, follow, notwithstanding any stipulation to the contrary. For the power of redemption is not lost by any hard conditions | nor shall it be fettered to any point of time, not accor ding to the course of the Court. This is well expressed in the familiar maxim, " once a mortgage, always a mortgage." In the present case, the clause Inserted in the deed may well consist with a contract of either description. It is Equivocal in itself. But it is sufficient to induce the Court to decree a redemption, if nothing else appeared, because the Court inclines to that side, to prevent oppression and hard dealing. It is however susceptible of variation by the acts of the parties, and the circumstan» <ces artending the transaction, which show it to be the one or the other. I do not mean, that it can be contradicted by the testimony of witnesses, to show either that the bargain was different from that expressed, or that it was meant to be, unless there be fraud. But I mean, that the parties' acts and their dealings are material to show the intent. Streator v. Jones (3 Hawks 423) for instance, is a case where an absolute deed was held a security, upon evidence of lending and borrowing between a needy man on one side, and an habitual and hard lender »n the other % of great inadequacy of price, ?f It? s*smr pvb'e i and of flic possession of the I^sid by the .!"' 'nor, after he made the deed. Ar- Sir James Mans-sys (Iggulden v. May, 2 New Rep. 449) the con-«.b -' <'f >b parties ean never be looked to,, to íis a eons*> uc-i'J law upon tlieir deeds, *b bad been, doit'» in CooLt " fík (Cowp. 819) But in Equity. iLcdr conduct is ií*'1'1, ' regarded as evidence of the i¿¡'r, v ct making u -, utrstri. Nov/ what are the usual badges of a j gag.-1 ' They are, that there is a ¡previous debí, or a present advance of money apon lo.rn? for «kick some evidence is taken, obliging tbs borrower person ally to she abr-olute payment. There is a bond for ihe.deblj or a covenant in the mortgage deed for-the payment. This is usual, where the security by mortgage is taken on landed property. Much more shoo'd we expect to find it. where the security is on a slave, who may die the next day. It is always a question, in mortgage or no mortgage — whose loss will it be, if the thing is destroyed. If that of the maker of the deed, then it is a mortgage. Again, one of the most difficult situations, that can be, is that of u mortgagee in possession. He is subjected to an account, generally the most rigorous and under great disadvantages ; for lie is liable not only for profits made, but that might be made$ and profits are always greater to slanders by, who have a high opinion of their own management, than they are in reality to those who work. Hence a mortgagee never takes possession, until he is obliged. Nor is a mortgagor mora willing to go out of possession, and give up the management and present use of hi- property, The- one doer, not surrender, nor the other take possession, but an the last alternative. And we may almost ventare to assert, that no mortgagee or mortgagor ever yet wado a contract* upon which the possession was to change immediately, unless it were the veriest grinding bargain, tSi?t could be driven with a distressed man, who had no way to «un?. 'When to this is superadded, that a fair and full price.- §400 was paid, it seems impossible to believe- tliat could be, on loan. That this price was paid, is proved by the Plaintiff's own brother, who was prese at the treaty, and wrote the deed. I do not refer to his deposition, for tSie sake of what he says was the understanding of the parties ; though in that respect he supports the answer ; but to get at the acts of the partic s. Ho proves, that they came to a settlement, not to ascertain the debt due to the Defendant, that it ¡night he secured ; but to ascertain its amount, that it might be known how much would remain to be paid in money. Upon that settlement, ail the, old bonds were given up, and no new one taken. Part of the debt was for the price of land. Would the Defendant have relinquished his equitable lien on that, for the precarious security of a mortgage on a slave, for that and other advances to the full value ? The Defendant likewise took immediate possession.
Here then it appeal's, that instead of u, security for a debt, the slave was partly a satisfaction of a pr< -existing one; and the balance was then paid, if the Plaintiff had been borrowing, and pledging hi;: negro as a security, would he have received so large, apart ofiheloan in an order ? Such a payment might be expected to be received. But such a loan is out of the way of business. The subscribing witness is supported by several oil ers, in his statement of the value of the negro and of the Defendant's possession. The sum advanced was thefullvalue. These circumstances satisfy me, that a redemption was never intended. And the sale by McCannon to Hauser at the same price removes every appearance of it. He might have taken the negro in payment and advanced the difference; because he could then sell himself again after a reasonable time. But the idea is preposterous, that a man, who was himself obliged to raise money, would surrender a good security on land, for the fín cf goUhtg a Mortgage «•; a ¡icf-'ro, v.bicb, gg v-i. ia«jt>d property, ho coaid not ce!!. Without citing "íls.r (',«!v.'h, 2 wi¡! oalv iM'ftí»* t« the genera! priste!- , >0íTt>''.! froiti Sm*!» by Mr. Butler, hi bis noto fo ' , r.L ííüD a. Thfi cii'cuisfii«:¡''oa hr-ra repel every ! . oía tuorigtigr, oroía security mií*e;tiLi¡>?» r»l an »n« 4- ik'thyL The old «v.Hriüec were «p, and no eü-'4 o-ie tstS.'pn; Hit' price paúl a a" a MI oí;»; tñ¡; '¿hí:,.',ííR! rr himself '.vea iit'cesqhotis, ami ob" ;•"('«! ío parí; «Vo*u prowEáy :ú ¡p..yJ>i-¡ ©ws df*!»íM 5 ¡k> U',c¡k ininimlbvti [ji'VJí'Pi'ííoj? iv:/í pxíiusiy- «mb? sale «í íf.s stegro Ü¡e dr.y afhc- üsííT limited íbr &? PLihsüsPs rr-pwrírñr; ;i;kI ¡jaapa rr:di <Me na'/ rpí his owts money back : am! ibis wap fv>< Uí yfj(¿';> before this suit was brcvgiii. if tpig i;d 5»**. 'o'iic.jdered a parchase, then t.ii.-ro ran Ire none, niik'CS ii be aiisoisitc afc the Kinking of is aii.i forever, — .
Tim ITuwnil Imc m aissj cm! IT; -JIÍ maet be dismiss c,c v.í.Ie eo-M,
Tm. C >:;??? tv.:.
—Let Me kill k», ílLcak-M vs';!; f'ft.Tv,