Buck v. Ingersoll

Hubbard, J. The Rev. Sts. c. 90, §§ 78, 79, make no distinction between personal property mortgaged and personal property pledged. In either case, it is subject to attachment by a creditor of the mortgagor or pawnor, which attachment shall be dissolved by the mortgagee or pawnee demanding the amount for which the property is liable on the mortgage or pledge, if the same is not paid or tendered within twenty four hours after such demand. So far, therefore, as the question of notice and demand arises in this case, it is unimportant to determine whether the first instrument of June 13th 1842 is to be taken as a mortgage or pledge ; because the same provision respecting the dissolving of the attachment is applicable to it, whether construed as a mortgage or a pledge; and the paper subsequently made on the same day is virtually a part of the same transaction. No demand was made by the plaintiffs upon the officer or attaching creditor; and the question is, whether the circumstances of the respective parties were such as to render such demand unnecessary in order to preserve their lien. It is argued that Billings was a mortgagee as well as the plaintiffs, as he was a party named in the instrument, and that a demand upon him was unnecessary, as he acted with knowledge of the incumbrance. But admitting, for the sake of the argument, that he was a mortgagee,.still, as a creditor, he had a right to attach and hold the property, after providing for and removing the liens upon it, and thus bring the mortgage to a close, which otherwise might be as enduring as the company itself, if held to be a valid instrument. It is contended, however, that a mortgagee cannot attach the property, to obtain payment of the debt secured by the mortgage ; and Atkins v. Sawyer, 1 Pick. 351, is relied upon in support of the position. That was the case of a mortgagee of real estate, who sued the note secured by the mortgage, and attached the defendant’s right in equity to redeem [232] ttie mortgaged estate; and the court held that such attachment was an evasion of the debtor’s right to redeem the property at any time within three years after the right of foreclosure had commenced, and that a sale of the equity, therefore, under such an attachment, did not defeat or affect the mortgagor’s right secured by statute, although the mortgagee might attach it for any other debt. But the principle of that case has never been extended to mortgages of personal property; and we are of opinion that a mortgagee of personal property, whose debt is payable, may waive his claim under the mortgage, and attach the property to secure his debt, if he see fit, without violating any of the mortgagor’s rights, or exposing him to any greater loss in consequence of such attachment. It is alleged, however, that the pledge must be returned, before .property can be attached to secure the debt; and Cleverly v. Brackett, 8 Mass. 150, is cited to sustain the point. The authority of that case, it may be observed, has been denied.* But we are not called upon here to consider it, because Billings, the attaching creditor, was not in the actual possession of the property pledged. He could make no such personal restoration of the goods; for they were either in the possession of the plaintiffs, as mortgagees, pawnees, or trustees, or in possession of the company. It is also argued, that as the plaintiffs had paid the debt of Warren, the property, which was receipted for to secure that debt, became absolute in them, and was not liable to attachment on a suit against the company. But the instrument, under which the plaintiffs claim to hold the property as sureties, indorsers, or receiptors, made no distinction between the claim ‘ of the plaintiffs as receiptors or sureties; and it conveyed to the plaintiffs no absolute title to the property, but created a trust by which they were authorized to sell the goods and appropriate the money for the discharge of liabilities. [233] Till such sale took place, their title was that of mortgagees or pawnees, and the goods were therefore subject to attachment. Treating the instrument as a mortgage, there was no evidence that, at the time of the attachment, sixty days had expired after the condition was broken. New goods were continually substituted in the place of old ones, and new liabilities were incurred, as former ones were satisfied; so that a breach of the condition cannot be inferred from the facts before us. There is nothing to prove that Billings was a party to the second contract, if that is distinguishable from the first; and his conduct in demanding and obtaining security, from time to time, for his liabilities, tends to prove that he claimed no right under either of the instruments. But, treating the instruments as valid, (though their validity might be questioned,) the after received property rests on the same foundation with that first assigned. All is held by way of mortgage or pledge, and subject to the same legal provisions. Viewing the instrument, then, in the light most favorable for the plaintiffs, yet as they have shown no demand upon the creditor or officer, and no foreclosure sixty days prior to the attachment, they cannot support their claim, and there must be judgment on the verdict. Exceptions overruled Footnotes [*] See Chapman v. Clough, 6 Verm. 123. Morse v. Woods, 5 N. Hamp. 297 U. S. Digest, Attachment, 39. Story on Bailm. § 366