Appeal of the Bank of Commerce

The opinion of the court was delivered, by Read, J. The mortgage, which forms the foundation of the appellant’s claim, was dated March 9th 1855, recorded on the 12th of the same month, and was for $4000, payable one year from date; was executed by William H. Maurice to A. E. Borie, and was accompanied by a bond and warrant, upon which judgment was entered on the 30th July 1860. These papers did not represent the real transaction ; for, it appears that Mr. Borie, who was the president of the bank, took it for the benefit and protection of that institution, under a special contract with Mr. Maurice, all the terms of which are stated in a deed-poll executed by Mr. Borie, and bearing even date with the mortgage. This deed or paper recites, “ Whereas, William H. Maurice, of the said city, stationer, hath this day executed to me his bond and mortgage conditioned for the payment of the sum of $4000, in one year from the date thereof; now know ye that I, the said A. E. Borie, do by these presents confess, acknowledge, and declare that the said bond and mortgage were executed by the said William H. Maurice, only as a collateral security for the payment of notes discounted, or hereafter to be discounted, for [429] the use of the said William H. Maurice, and to and for no other use, intent, or purpose whatsoever; that I do not, on account of myself or my heirs, claim or demand any right, title, or interest in or to the said bond or mortgage, but do hereby confess, acknowledge, and declare, that the said bond and mortgage were made to and received by me only as a trustee, to the use of and for and on behalf of the said Bank of Commerce, of which I am the president.” This paper was not recorded, but it was clearly proved that it contained the whole contract between the bank and the mortgagor. It is not a contract for renewals, as in Gault v. McGrath, 8 Casey 392, but resembles that of the Bank of Montgomery County, in that Bank’s Appeal, 12 Id. 170, and is entirely unlike the mortgage of B. W. Richards, in the same case, where there was an absolute contract on the part of the person, secured by the mortgage, to make sales to the mortgagors, and to furnish endorsements of notes, given by the mortgagors for purchases from other persons. The agreement, by its positive terms, clearly included all notes of every description, discounted for the use of the mortgagors, covering, of course, the two notes, which the bank did not claim as against Mr. Forrest, as well as the eight notes which were claimed as renewals of eight notes held by the bank, at the .date of the entry of his judgment. The controversy in the present case arose upon the distribution of the proceeds of a sheriff’s sale, of the mortgaged premises, under a judgment entered up in the District Court on the 24th of April 1856, upon a bond and warrant for $10,000, given and executed by William H. Maurice in favour of Edwin Forrest, dated October 22d 1853, payable in one year from date, and the consideration was money loaned. It was referred to an auditor, who reported that the eight notes held by the bank were not renewals of the notes originally discounted by the bank, or of those held by it, at the time of the entry of Mr. Forrest’s judgment. The bank and Mr. Forrest each filed with the auditor a demand for an issue substantially upon the same question, “ whether the notes held by the bank at the time of the sale were renewals of notes held by them at the time of the entry of Forrest’s judgment, and if so, to what amount?” Upon the filing of the auditor’s report exceptions were filed by the bank, and the court granted their demand for an issue. The pleadings were in the usual form upon a wager, the bank being plaintiffs and Mr. Forrest defendant. Upon the trial of this feigned issue several questions were propounded to Mr. Maurice and Mr. Borie by the plaintiffs, which were objected to by the defendant, and overruled by the court, on the ground that they were asking the opinions of the witnesses, [430] when it was the proper course to state the facts. As these questions were substantially submitted to the court, in the first and second points of the plaintiffs, upon which the judge was requested to charge the jury, it will be more convenient to consider the admissibility of such evidence in reviewing the answers and the charge of the court. The court in their charge said, “ This is the simple question, whether these notes, or any of them, are renewals ? It is a question of fact. I understand a renewal to be a new security given for a debt due, or falling due, in fact substituting one security for another whether it is the same debt.” “If the securities now held are notes or securities given for the same debt, they are renewals.” Now, this seems to be a correct and comprehensive view of the law, and it is nowhere complained of by the appellants, and the court were clearly right in saying renewal or not was a question of fact, for only in that light could a jury be required to pass upon it. The court affirmed the third, fourth, and fifth points of the plaintiffs, as follows: “ That it is not necessary, in order to one note being a renewal of a former one, that it should be of the same amount, or time to run, or made or endorsed by the same parties; nor that the note given in renewal should be given, or bear date upon the day of the maturity of the fprmer note; and that it need not appear that the identical proceeds of the new note were actually applied to take up the note for which it was a renewal. That a now note may be a renewal of a former one, although the new note passes through the regular course of discount in a bank; in other words, that because a note is discounted, it does not necessarily follow that it is not a renewal of a former note; and that if the jury believe that the several series of notes testified to by William II. Maurice, formed one continuous transaction in the loan of money by the bank to Maurice, of which loan the notes in question are the evidence,,the verdict must be for the plaintiffs, notwithstanding any new note, in any one or more of the series, may have been discounted prior or subsequent to the maturity of the preceding note” — the court adding, “you are to determine whether the notes now held are securities for the same debt.” Now, these instructions are certainly as liberal as the plaintiffs could desire, and unless the debt for which these notes were given existed at the time of the Forrest judgment, it is clear that the mortgagee could not claim to be paid out of the proceeds of the sheriff’s sale in preference to that encumbrance. The first and second points of the plaintiffs were requests that the court should charge the jury that, if it was the intention of the parties that these several series of notes should be considered as renewals, and that whether the notes in question were the last of respective series of renewals, depends upon the intention of [431] the parties as to the successive notes which make up the respective series ; and if the jury believe, from the evidence, that it was the intention of the parties that those successive notes should be renewals of the preceding notes in the respective series, the verdict must be for the plaintiffs. This the court properly refused to do, saying, “I do not think it is a question what the parties intended or considered. But what is the fact ? Was it for the same debt ?” It will be recollected that there was not a word, either in the written or any other contract, between the bank and Mr. Maurice about renewals at all, and that the rejected questions on the trial and these points were attempts to substitute the opinions and the intentions of the parties for the actual facts; and the court were therefore clearly right in overruling the questions, and in declining so to charge the jury. The jury gave a verdict for the defendant, the court refused a new trial, dismissed the exceptions, and confirmed the auditor’s report absolutely. We have, therefore, tbe report of an auditor, the finding of a jury, and the deliberate judgment of the court below, that these notes were not renewals, nor given for the debts due, or falling due at the time of the entry of the Forrest judgment; and, upon a careful examination of the whole case, we see no good reason to dissent from this decision. Decree affirmed, at the costs of the appellants. Bank ok Commerce v. Edwin Forrest. Error to the 'District Court of Philadelphia. The above opinion decides this case. Judgment affirmed.