Court Opinion

ID: 7192495
Source: CourtListenerOpinion
Date Created: 2022-07-24 16:58:43.141807+00
Date Added: 2024-06-11T16:16:13.790666
License: Public Domain

Dissenting Opinion.
Todd, J.
The following facts appear from the record to my satisfaction:
That Perrault gave a mortgage on the plantation named to secure the payment of two negotiable promissory notes executed by him for the sums mentioned'.
That this plantation was subsequently sold, by Perrault to Heneke, who, as p'art of the price, assumed the payment of these mortgage notes.
That the notes were taken lip by Heneke and came into his possession either subsequent or prior to his assumption of them.
That without his knowledge or consent, the one sued on was taken from his possession and delivered to the plain tiff as collateral security for a loan made to the party thus delivering it, who professed to be acting-as the agent of Heneke, and was treated as such agent by the plaintiff with whom he negotiated.
That this pretended agent acted without any authority from Heneke, and his acts were never ratified- by Heneke.
That Heneke subsequently sold the plantation to the defendant, the act of sale containing the statement, substantially, that the notes had been settled and the mortgage extinguished.
*8I hold, under these facts, that Hencke having assumed the payment of these notes and having taken them into his possession, the presumption is, they were both paid by him in accordance with his obligation, and the notes and mortgage securing them thereby were extinguished. And also, that Hencke being the owner of this plantation, under his purchase, as soon ns he became the holder of the note and mortgage, the mortgage being on his own property became extinguished by confusion.
It is true that the note, although reissued without Hencke’s authority or knowledge, being delivered to the plaintiff for value, and without notice, revived or kept in force the liabilities of the parties to the note, and that the holder was not affected by any equities between these parties. This results, however, exclusively from the rules of the commercial law, only adopted in furtherance of the negotiability of commercial paper and for the protection of the bona fide holders of such papers.
Mortgages, even mortgages accessory to and securing negotiable instruments, are, however, not subject to such rules and are not governed by the commercial law. The law governing mortgages and the liabilities of mortgagors and mortgaged property, whether the mortgages are the accessories of negotiable paper or not, is to be found in the Civil Code. The first and elementary principle of which is, that a conventional mortgage cannot he created, re-created or revived without the consent of the mortgagor. As to its transfer or assignment, a mortgage stands on-the same footing of a.ll other property j that it cannot be validly sold or conveyed without the consent or authority of the owner.
This, in my opinion, is settled by frequent adjudications. Thus, in the case of Hill vs. Hill, 4 Rob. 416, I find the following language of this Court:
“ This act shows that these uotes were delivered to the payee, and the notes, themselves, exhibit the endorsement of the payee toWm. Henderson, and of the latter to some other person. The evidence shows that they came hack into the hands of the maker some time after their date and before maturity. From, the moment Jno. S. Walton became the owner of these notes drawn by himself, the debt evidenced by them was extinguished by coufusiou. C. C. 2214. But it is argued by the appellant’s counsel, that the extinction of the debt between the maker and the payee did not incapacitate the former from contracting a new debt to Hill and handing over to him, as evidence of it, the same notes secured by mortgage on his property ¡ that Hill could have recovered on these notes from John S. Walton, and can, therefore, pursue his property, since sold, subject to tbe debt* *9To this argument the answer is obvious : that the notes thus reissued by the drawer undoubtedly bind him, but by replacing them in circulation be cannot revive the obligations of the other parties to the notes or the mortgage on the defendant’s property, which, being only an accessory to tbe debt between the maker and payee, became null and void as soon as the debt itself was extinguished.”
And again, in tbe case of Doll vs. Rizolli, 20 An. 264, we quote as follows:
“ But the question of the mortgage rests upon a different principle. When, as is shown, the note was paid and came into the possession of the maker and mortgagor, confusion took place, and the subsequent reissue of the note could not revive the mortgage. A mortgage is but accessory to the principal obligation, the extinction of which releases the mortgage. Mortgages not being negotiable, are not subject to tbe rules of commercial law, by wliicli the rights and obligations of the parties to commercial paper are fixed.”
My conclusion is, that the mortgage which is sought to be enforced in this case was extinguished in the manner stated, and that it was never revived.
Nor can I concede, that, from the fact that the mortgage note was stolen from Hencke, or taken from his possession without his knowledge and negotiated without his authority or consent, either he or his vendee, the defendant, was estopped from urging the extinguishment of the mortgage $ or that the failure of Hencke to have the. inscription of the mortgage cancelled had the effect of continuing the mortgage in force after its extinguishment, against or in favor of auy one.
For these reasons, I dissent from the opinion of the majority of the Court.
Rehearing refused.