Court Opinion

ID: 6238342
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:38:03.966715+00
Date Added: 2024-06-11T08:58:07.106753
License: Public Domain

Mr. Justice Gordon
delivered the opinion of the court, May 24th, 1886.
We agree with the Master and the court below that the attempt to change the prima facie character of the deed of Pettibone to Bonnell, and by oral testimony convert it into a mortgage, has not been successful. It may be admitted that there are many things apparent on a critical examination of the evidence which would seem to favor the contention of the appellant, but when the whole body thereof is considered together, such a conclusion is seen to be illusory. To convert a deed, absolute on its face, into a mortgage by parol testimony, such testimony must be clear and specific, of a character such as will leave in the mind of a chancellor no hesitation or doubt, and failing this, the effort to impeach the legal character of the deed must be regarded as abortive. A mortgage is essentially a pledge or security, and it is distinguishable from a trust in this only, that the property described in it is to revert to the mortgagor on the discharge of the obligation for the performance of which it was pledged: Allegheny Railroad & Coal Co. v. Casey, 29 P. F. S., 84. So we have it said in Danzeizen’s Appeal, 23 Id., 65, that where the intent is.merely *468pass the property as a pledge for the payment of a debt, the transaction may be regarded as a mortgage, but not so when the grantee has the power to sell the premises, though the proceeds are to be applied on the indebtedness of the grantor. In this, of course, we say nothing as to the various methods which may be adopted for the purpose of foreclosure or extinguishment of the mortgagor’s equity of redemption. This may be accomplished by a bill in equity, by a scire facias, or by agreement of the parties, as that the mortgagee shall have the power to sell on default of payment, or performance of the obligation, whatever that may be, which the mortgage was given to secure.
This, however, affects not the character of the instrument itself, for if it be not a vadium or pledge, whether living or dead, it is not a mortgage. It must be accompanied with a defeasance, otherwise it is a deed absolute or in trust. If, therefore, the alleged oral defeasance has not been proved, if it appears that Bonnell was not' merely to hold the land conveyed as a pledge, but was to have the power to sell it for the purpose of paying the indebtedness of Lance to him, and the liens against the property, it is clear that the prima facie character of the. deed is unaffected, and the trust, if any, attaches to the proceeds. It would also follow, that if Bonnell had thus, in himself, the power to sell, his vendee, the Lehigh and Wilkesbarre Coal Company, must be regarded as vested with an absolute estate, and cannot be obliged to account. But that he had such power the evidence clearly demonstrates. The letter from Bonnell to Lance, previous to the conveyance from Pettebone, setting forth his, Pettibone's proposition, and inquiring whether, in case of his purchase of the property, he could sell it for a sum not less than $300,000, of itself shows what Bonnell’s intention was in the acquisition of the land in controversy, and this same intention is also expressed in his letter to Mr. McClintock. But that the design of all the parties was that Bonnell should carry the property on his own credit until he could dispose of it by an advantageous sale, is clear from their subsequent conduct. The proposition to the president of the Wilkesbarre Coal and Iron Company, -as contained in the letter of Bonnell and Lance, dated June 23d, 1871, and the consummation of that proposition by the conveyance to the said company of the breaker, houses, improvements, and personal property, together with a lease of the coal, executed by Bonnell and witnessed by W. W. and W. L. Lance, can be explained on no other hypothesis than that above stated. Beside this, we have from the testimony of W. W. Lance the fact that the deeds for the surface lots, sold by him, were sent to Bonnell *469for execution, so that, without reference to the disposition of the money derived from such sales, it is obvious that he was regarded as the owner of the fee, and as the only one who had power to convey it. Moreover, his power to mortgage the property to Pettibone for the purchase money has not been questioned; on the other hand it seems to have been recognized by all the parties as the exercise of a legitimate power on part of Bonnell, and if so, he must have been regarded as something more than a mere mortgagee. If, then, this man had the power to sell the improvements, lease the coal, the equivalent of a sale, to execute deeds for the surface land, and to mortgage the estate, we cannot understand by what process of reasoning he could be deprived of the power to sell the reversion. Under such circumstances as these the question of notice is of no importance, for if the power to convey was vested in Bonnell, notice to his vendee would not reyoke that power; and if, indeed, it be admitted that this vendee had notice, prior to its purchase, of every act in the transaction between its vendor and the Lances, it would nevertheless have no other knowledge than that upon which it acted, that is, that he had the right to sell and convey the property which it was about to buy. It may be, and we are inclined to that opinion, that after - payment of his own claims, and the debts which were a charge against the property, Bonnell held the balance of the money raised from the sale, if any such balance there was, as trustee for the Lances. But for this he ought to account, and not his vendee. We also agree with the Master, that the bill before us is fatally defective for the want of proper parties. The evidence clearly reveals the fact that William L. Lance, Sr., and Walter W. Lance, were interested in the property with the appellant, hence the defendants, if liable to account at all, were so liable to the three jointly, and not to either severally: Gloninger v. Hazard, 6 Wr., 389.
The decree of the Court of Common Pleas is 4 affirmed at the costs of the appellant.