Court Opinion

ID: 7895560
Source: CourtListenerOpinion
Date Created: 2022-09-08 21:52:16.977482+00
Date Added: 2024-06-11T16:32:04.267135
License: Public Domain

Miller, J.,
delived the opinion of the Court.
This appeal is from an order refusing an injunction upon a bill filed on the 27th of March, 1880, by the appellant as trustee in insolvency of Charles H. Mann. The bill avers that Mann applied for the benefit of the insolvent laws on the 18th of Eebruary, 1880, and that the complainant was thereupon on the same day duly appointed trustee for the benefit of his creditors, and gave bond as such, which has been duly approved, and that the insolvent at the same time duly executed a deed, conveying to the trustee all his property, except such as is exempted by law; that among other property of which the insolvent at the time of his application was seized and possessed, *397there is a hotel and premises situated in Towsontown, known as the “Smedley House,” on which Joseph J. Lewis, a citizen and resident of Pennsylvania, holds a mortgage which was executed to him hy Mann and wife, on the 3rd of April, 1869 ; that this mortgage which was duly recorded in Baltimore County, contains a clause authorizing Enos Smedley to sell the premises upon default made by the mortgagor; and that Smedley has advertised the property for sale at public auction, on the 10th day of April next. The hill then charges that by virtue of his appointment and qualification as trustee, it became the right and duty of the complainant to sell this property, as well as all other property belonging to the insolvent, and that Lewis and Smedley have no right or authority to make sale thereof, or to interfere with the complainant in the administration of his trust, and prays for an injunction restraining them from so doing.
The mortgage referred to is a mortgage to secure the sum of $16,000, with interest, and it contains a clause, as provided in sec. 5, Art. 64 of the Code, authorizing the mortgagee “ or Enos Smedley” to sell the property in case of default. It is admitted that Lewis, the mortgagee, was at the time the mortgage was executed, and is. now a citizen and resident of the State of Pennsylvania, that Smedley is also a citizen of the same State, and that before the property was advertised by him default had been made by the mortgagor in the payment of the money secured by the mortgage.
The present case differs from that of Mackubin vs. Boarman, supra, p. 384, in that here the mortgagee, at the time the mortgage contract was made, was, and ever since has been, a non-resident of this State, and we are all clearly of opinion that this of itself is fatal to the pretensions of the appellant. It is too well settled to be now a matter of controversy, that upon such a contract as this the insolvent laws of this State can have no effect whatever. The decisions *398of this Court which are binding upon us have placed this question beyond dispute. In Evans & Co. vs. Sprigg, et al., 2 Md., 457, where the subject was elaborately considered, the Court say, “ when the present contract” (which was a contract with a non-resident) “was entered into, the Constitution of .the United States protected it from being in any degree affected by insolvent proceedings in this State, and this protection followed it into and formed part of the judgment,” subsequently recovered upon it. And again, “in regard to such claimants,” (non-residents) “our insolvent laws are considered as nullities, and as the insolvent’s trustee acquires all his rights under those laws, he can have no rights in opposition to those of the appellants.”; So again in the case of Poe vs. Duck, 5 Md., 1, it was decided that State insolvent laws apply to all contracts made within the State between citizens of the State, but they do not apply to those made within a State between a citizen of that State and one of another, nor to those not made within the State. In view of these decisions we think it quite impossible to hold that the power of sale thus stipulated for and embodied in the mortgage and given to, or for the benefit of, a non-resident mortgagee, can be stricken down by the application of the mortgagor for the benefit of our insolvent laws, or in any way interfered with by the trustee in insolvency. Such a power we have decided is not a naked power collateral to the grant, but is a power coupled with an interest in the premises, conveyed by the mortgage deed, intended for the benefit of the mortgagee, appendant to the estate and forming part of the security itself. Berry vs. Skinner, 30 Md., 567. It follows that the order refusing the' injunction must be affirmed.
(Decided 1st July, 1880.)
Order affirmed.