Court Opinion

ID: 8504738
Source: CourtListenerOpinion
Date Created: 2022-11-23 01:26:00.836765+00
Date Added: 2024-06-11T16:50:50.232922
License: Public Domain

Gilchrist, J.
The case finds that on the 14th day of April, 1836, the demandant’s father conveyed to him the premises, and that he entered and took possession. On the same day the demandant mortgaged the premises to his father, to secure a debt, and on the 18th day of April, 1840, the father conveyed the premises to N. G. Smith, but did not deliver or transfer to him the notes.
The first question then is, whether N. G. Smith took any interest by virtue of this conveyance. In the case of Bell vs. Morse, 6 N. H. Rep. 210, it is said by the court that “ under certain circumstances a conveyance of the land by the mortgagee will pass the debt secured by the mortgage. But, there are certain cases in which a deed of the land by the mortgagee will pass nothing. Thus where a note is secured by a mortgage, if the mortgagee has transferred the note he cannot afterwards convey the land. And we are of opinion that it is not enough to show a deed from a mortgagee, in order to prove that the land passed, but it must be made to appear that the debt passed to the grantee. At least it must appear that the mortgagee had a right to transfer the debt to the grantee.” From this last sentence it may perhaps be inferred that a mere conveyance of the land will pass the debt, provided the mortgagee has a right to transfer it. The remark of the late learned Chief Justice Richardson, who delivered the judgment of the court in Bell vs. Morse, was elicited by the fact that in that case no account whatever was given of the debt secured by the mortgage, and perhaps should hardly be considered even as an intimation of his opinion. That he had such a right in this instance appears from the case. It was in the month of April, 1840, that the mortgagee made his deed to N. G. Smith, and it was not until the month of July, 1841, that' he delivered the notes to the demandant. If, then, the position cited from the opinion in the case of Bell vs. Morse be correct, the deed to N. G. Smith transferred the debt secured by the-*65mortgage. But that the deed did not have that effect appears from those decisions which determine that the interest of the mortgagee before foreclosure is a mere personal chattel, incident to the debt, and having no existence except in connection with it. If the mortgagee can convey an interest by deed, and still retain the ownership of the debt, then the interest in the land is not an incident to the debt, but is something which can be distinguished from, and which has an existence independent of, the debt. In such a state of things, the interest in the land can be conveyed to one person, while the property in the debt may belong to another. This result would be entirely inconsistent with the pxinciples recognized by this court in'various cases, the last of which is Ellison vs. Daniels, 11 N. H. Rep. 274. In that case the intimation in the case of Bell vs. Morse, on which we have been commenting, is adverted to, but it was not necessary to settle the point whether a deed of the land would convey the debt. It would rather seem to have boon the impression of the court, however, that it would not, and the case of Aymar vs. Bill, 5 Johns. Ch. 570, is cited as holding that a deed of the land would not have that effect. This is certainly the doctrine of Aymar vs. Bill, and the reason given for it is, because “ that would separate the debt and the pledge, the latter to reside in one person while the debt resided in another.” But even without this authority, our opinion is that a conveyance of the land does not transfer the debt, because, so long as the mortgage is considered as an incident to the debt, it cannot pass without a transfer of the principal. Consequently in this case the mortgagee’s deed of the 18th of April, 1840, conveyed no interest to N. G. Smith.
The entry by N. G. Smith upon the premises was of no effect whatever. He had not the rights of the mortgagee, as has been stated; and even if he had had the interest in the debt, there was no foreclosure. He did not retain that actual peaceable possession which the statute contemplates, for the space of one year after his entry. Rev. St., ch. 131, § 14. The demandant never attorned to him, nor recognized his title, nor assented to retain the possession as his tenant. N. G. Smith had no possession whatever. He did nothing but make an entry. His deed then *66to Henry Smith, of the 7th of November, 1840, conveyed to the mortgagee no farther title than he had before. There having been no foreclosure, the position of the mortgagee was not and could not be changed by any conveyance that N. Gr. Smith could make.
It is contended that the proceedings against the demandant by the mortgagee, under ch. 209 of the Revised Statutes, were entirely nugatory. The objection is, that the writ of summons authorized by the 8th section of this chapter was not signed by the magistrate. The 5th section of ch. 182 enacts that writs issued by a justice of the peace “ shall be signed by him.” The writ of summons in this case did not purport to be signed by the justice. The teste was in the form prescribed by the 10th section of ch. 182, “ Witness, David Thornton, esquire, the 6th day of May, 1843.” But this is not sufficient. The 2d section of this chapter provides that writs issuing from the clerk’s office of any court “ shall be signed by the clerk.” A writ not signed by the clerk would undoubtedly be a void process, for it would be defective in a matter specially required by the statute. And for the same reason this writ of summons was invalid. But the point is now immaterial. It is now entirely unimportant that there was a defect in the proceedings before the magistrate, which might have been taken advantage of in some proper mode, perhaps by a motion to quash, or by a plea in abatement. The writ, valid or invalid, has answered its purpose. It has served as the foundation of a writ of possession, issued by the magistrate, and executed by the delivery of the possession of the demanded premises by the sheriff to Henry Smith, the mortgagee, on the 17th day of May, 1843. He, then, being in possession on the 21st day of June, 1843, by deed of warranty in the ordinary form, conveyed the premises to the tenant. He was then, if the notes had not been paid, a mortgagee in possession by virtue of a process issued by a court of competent jurisdiction. He had a right to retain the possession as against the mortgagor, and this right might be conveyed, so that his grantee would stand in his place, and would hold whatever right of possession was owned by his grantor.
*67The question then arises whether the debt secured by the mortgage has been paid.
The production of the notes by the mortgagor was primé facie evidence that they were paid. The tenant, however, proposed to prove by the mortgagee that they had not been paid. But he had conveyed to the tenant with warranty. The tenant then released the witness, and the demandant then contended, in the first place, that, notwithstanding the release, the witness was incompetent to testify, from interest, because if the demandant should recover in this suit against the tenant, his judgment would estop the witness, on account of the privity of estate between him and the tenant.
A judgment binds parties and privies by estoppel, and there is a privity of estate between the witness and the tenant, as the latter is the grantee of the former. But that is of no consequence in this case. The witness is, notwithstanding, disinterested. He stands indifferent in this suit, because, whoever may recover, he is not responsible. Since the release, he must be considered as having conveyed his interest without warranty ; and as that was the only ground for holding him interested, upon the execution of the release he became competent to testify.
Can he testify to the facts to prove which he was introduced ? The demandant contends that the witness could not explain the reason why the notes were delivered to him, by proving that he acted under a mistake of the law.
It is settled that where money has been paid with a full knowledge of all the facts, or with the means of such knowledge, it cannot be recovered back on account of the payment having been made in ignorance of the law. Peterborough vs. Lancaster, [14 N. H. Rep. 382.]
But the object of the tenant in this case was only to explain how the notes came into the possession of the demandant, and to rebut the presumption that he had them because he had paid them, or because the mortgagee had voluntarily given them to him without requiring them to be paid. Now it may be shown that a person has acted under an erroneous impression of his legal duties for the purpose of explaining acts which, withoxit such *68proof, would bear a different construction. The possession of the notes, for instance, was primá fade evidence that they had been paid, but it is no violation of the principle that money paid under a mistake of the law cannot be recovered back, to prove by tho mortgagee the reason why he surrendered them. Such evidence is merely explanatory. It has no connection with the principle above stated, but its competency depends upon its tendency to rebut the presumption of payment. Our opinion is, that the witness was competent, and also that he should have been permitted to testify to the facts to prove which he was called. It would then have been a question for the jury, whether the notes had or had not been paid. For the purpose of inquiring into this fact, the verdict must be set aside and there must be a
New trial,