Libby v. Cushman

Tenney, J. A mortgage of personal property as well as of real estate, is collateral to the contract intended to be secured thereby, and until foreclosure will not of itself prevent a recovery of the full amount due upon the contract in a suit brought upon it. The right of possession, as in a mortgage of lands, is in the mortgagee, before as well as after the breach of the condition, unless controlled by an agreement between the parties ; and possession of the mortgagee prior to foreclosure, in no wise affects the right of redemption of chattels, by the mortgager. A mortgage of real estate becomes foreclosed in three years from the time possession is taken for condition broken. R. S. c. 125, <§> 6. The title of personal property mortgaged, becomes absolute in the mortgagee in sixty days after the breach of the condition. R. S. c. 125, <§> 30. And payment made within that time, will restore to the mortgager the property, if the mortgage still subsists, notwithstanding the possession may be in the mortgagee. Ibid. It has been held in Massachusetts, that a mortgagee of personal property may waive his claim under the mortgage, and attach the property to secure his debt, if he see fit, without violating any of the mortgager’s rights, or exposing him to any greater loss in consequence of such attachment. Buck & al. v. Ingersoll, 11 Metc. 226; and the attachment of mortgaged" personal property on a writ, brought to recover the sum due upon the claim secured, extinguishes the lien. Sweet v. Brown, 5 Pick. 178, Consequently such property, so attached, is the property of the debtor, subject only to the attachment, [433] and the creditor has no title thereto, as an owner. After the attachment, the legal possession is in the officer who made it and the goods are in the custody of the law, and cannot be appropriated by the creditor to his own use, without the consent of the debtor, and he is not obliged to account for their value. If the mortgagee of personal property, cannot legally waive his lien, so that an attachment upon the claim secured by the mortgage can be valid, the right of redemption will remain in the debtor, till foreclosure, and the mortgager cannot claim its value of the creditor, till that takes place. The defendant does not resist the right of the plaintiff to maintain the action upon the note secured by the mortgage, for any balance due, after deducting the value of the property mortgaged, but insists that he is entitled to such deduction. The mortgage was recorded on August 3, 1848. The defendant retained possession of the property till Sept. "28, 1848, when the plaintiffs took it into their own hands for their better security ; and on the 30th of October, 1848, the mortgage still subsisting and not foreclosed, he caused the same goods to be attached in this suit, upon the note secured by the mortgage, they claiming the right to waive the security. Prior to the attachment, the goods were not absolutely the property of the plaintiffs, being subject to the right of redemption in the defendant, and the plaintiffs were not bound to account for their value in money. If the attachment was valid, it was because the previous lien upon the goods was extinguished ; and it follows that the plaintiffs had no right to the property, excepting such as is acquired ordinarily by an attachment. If it was invalid, the plaintiffs had no greater right to the property, than ho had before, and the relations of the parties and their several interests remained unchanged. The defendant is to be defaulted, and judgment for the amount of the note declared on.