Court Opinion

ID: 3672866
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:20:40.650001+00
Date Added: 2024-06-11T15:16:13.229814
License: Public Domain

McCannon in his 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 resell at any time within a year, at the same price. He averred that the plaintiff wished to give a mortgage, but that he 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 purchase; and that, finally, the plaintiff agreed to make a sale if he (McCannon) would consent to resell to him as above mentioned. He denied that he made any loan to the plaintiff, and averred that the plaintiff owed him about $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 $86.50, 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 defendant, did not make good the order for $86.50, he would *Page 212 
sue for the negro. He denied the tender of the money, and averred that although he did not then feel bound for the order, yet as the 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 (375) would abandon all claim, which was accordingly soon after done. He further stated that, wanting money himself, before September, 1811, to discharge an execution against him, he applied to the plaintiff to rescind the contract and take the negro back; and received for answer that he might sell the negro, for that he, the plaintiff, could not repurchase him; that upon this, he made the sale to the other defendant, for the same price of $400; but that the plaintiff might have still further time, he annexed to the bill of sale to 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 considered his contract with Hauser as a sale.
The answer of Hauser did not vary the case, but corresponded with McCannon's as to those parts of the transaction in which he had a personal agency.
Replications were filed to the answers, and testimony taken which will be found stated in the opinion of the Court.
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 price paid, or to be paid, to become absolute on a particular event, or a purchase, accompanied by an agreement to resell upon particular terms. It is the latter kind that runs so nearly into a (376) mortgage; for, as needy and distressed men are those who are commonly drawn into such contracts, and the very anxiety to get their estates again, which produces a stipulation to that effect, denotes either that it was favorite property, which the party did not intend to part from conclusively, or that the price was so inadequate as to make it material, in point of interest, 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 the character of the transaction. When it is once determined to be a mortgage, all the consequences of account, redemption, and the like, follow, notwithstanding any stipulation to the contrary; for the power of redemption is not lost by any *Page 213 
hard conditions, nor shall it be fettered to any point of time not according 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 circumstances attending 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, 10 N.C. 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 on the other; of great inadequacy of price, if it was a price, and of the possession of the land by the bargainor after he made the (377) deed. As Sir James Mansfield says (Iggulden v. May, 2 New Rep., 449), the conduct of the parties can never be looked to, to fix a construction at law upon their deeds, as had been done in Cooke v. Booth, Cowp., 819. But in equity their conduct is often regarded as evidence of the intent of making a contract. Now, what are the usual badges of a mortgage? They are, that there is a previous debt, or a present advance of money upon loan, for which some evidence is taken, obliging the borrower personally to the absolute payment. There is a bond for the debt, 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 should 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 a mortgagee in possession. He is subjected to an account, generally the most rigorous and under great disadvantages, for he is liable not only for profits made, but that might be made; and profits are always greater to standers-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 more willing to go out of possession, and give up the management and present use of his property. The one does not surrender nor the other take possession, but as the last alternative. And we may almost venture to assert that no mortgagee or mortgagor ever *Page 214 
yet made a contract upon which the possession was to change immediately, unless it were the veriest grinding bargain that could be driven with a distressed man, who had no way to turn. When to this is superadded that a fair and full price, $400, was paid, it seems (378) impossible to believe that it could be on loan. That this price was paid is fully proved by the plaintiff's own brother, who was present at the treaty and wrote the deed. I do not refer to his deposition, for the 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 parties. He proves that they came to a settlement, not to ascertain the debt due to the defendant, that it might be secured, but to ascertain its amount, that it might be known how much would remain to be paid in money. Upon that settlement all the old bonds were given up and no new one taken. Part of the debt was for the price of land. Would the defendant 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 appears that instead of a security for a debt, the slave was partly a satisfaction of a preexisting one; and the balance was then paid. If the plaintiff had been borrowing, and pledging his negro as a security, would he have received so large a part of the loan 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 others in his statement of the value of the negro and of the defendant's possession. The sum advanced was the full value. 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 (379) land for the purpose of getting a mortgage on a negro, which, as mortgaged property, he could not sell. Without citing particular cases, I will only refer to the general principles collected from them by Mr. Butler in his note to Co. Litt., 205a. The circumstances here repel every idea of a mortgage, or of a security redeemable at an indefinite period. The old securities were given up, and no new one taken; the price paid was a full one; the purchaser himself was necessitous, and obliged to part from property to pay his own debts; he took immediate possession, and actually made sale of the negro the day after that limited for the plaintiff's repurchase, and upon such sale only got his own money back, and this was twelve years before this suit was brought. If *Page 215 
this cannot be considered a purchase, then there can be none, unless it be absolute at the making up of it and forever. The plaintiff has no case, and his bill must be dismissed with costs.
PER CURIAM.                                 Bill dismissed, with costs.
Cited: Gillis v. Martin, 17 N.C. 474; Munnerlin v. Birmingham,22 N.C. 359; Newsom v. Roles, 23 N.C. 182; McLaurin v. Wright,37 N.C. 97; Watkins v. Williams, 123 N.C. 175; Wilson v. Fisher,148 N.C. 540.