Cuello v. Fuster

Rodey, Judge, delivered the following opinion: The issue before us at this time in this cause is that raised by the demurrer and exceptions to the answer and cross bill. The respondent Bernardo Aguilo Fuster, it seems, is the real, party in interest, the other respondent, Juan Rosell y Maymi,, being practically a nominal party only. A statement of the facts is necessary to an understanding of the situation. In the year 1899, the respondent Bernardo Aguilo Fuster executed a mortgage on a tract of land near Yauco, in this-island, in favor of the complainant, Francisco Marques Cuello,, to secure the payment of $5,960, Porto Rican currency. Payment of this sum was to be made in instalments each year up to and including 1904. Fuster defaulted in these payments,, and thereupon, in the early part of 1905, the complainant, Francisco Marques Cuello, brought proceedings in the local — 195 — insular courts to foreclose tbe mortgage or collect tbe debt,- costs, and interest, and it also appears that in some manner be coupled therewith an attachment proceeding by which he took immediate possession of all of the property mentioned in his said mortgage, and, as it is alleged, also attached another plantation belonging to respondent which was not mentioned in the mortgage at all, but which was, at that time, mortgaged to another person, and which attachment, as it is alleged, caused such other person to immediately foreclose such other mortgage, and thus cause the property mentioned in it to be lost to the respondent. Respondent further claims that at the time these former proceedings were brought against him, he had a bargain pending to sell the other property for enough to pay both mortgages, hut that said attachment caused a foreclosure of the other mortgage and prevented such sale, thus greatly damaging him. It transpired that the complainant wholly mistook his remedy in the insular courts in these other proceedings, and, after the matter was litigated through the local district court, and appealed to the supreme court of the island, the latter tribunal set aside the whole proceeding as null and void, — the complainant, of course, having had possession of this respondent’s property ever since he took it under the attachment, as stated, and, having, pending the appeal from the local district court to the supreme court of the island, caused the premises described in the mortgage to be sold, bidding the same in at the sale himself, and causing the same to be registered in his own name. This action of the local supreme court of course rendered it necessary for the complainant to begin anew his efforts to foreclose his said mortgage, and to that end he filed the present suit. All his trouble, time, costs, and expense in and about said former foreclosure proceedings went, of course, for naught. — 196 — Immediately after the dismissal of the proceedings by the supreme court of the island, the respondent Bernardo Aguilo Buster brought a suit in this court (No. 370, law docket) against the complainant, Francisco Marquez Cuello [2 Porto Rico Fed. Rep. 183], to recover damages in the amount of some $10,000 for this alleged wrongful proceeding and attachment. That suit was dismissed on demurrer, and, in the opinion rendered in the premises, which is on file, we took occasion to point out that, under the ruling of the Supreme Court of the United States in the case of Perez v. Fernandez, 202 U. S. 80, 50 L. ed. 942, 26 Sup. Ct. Rep. 561, such an action could not be maintained, but that all of the damages to which the plaintiff in that suit was properly and legally entitled, could, in our opinion, be set up as a defense to the present bill which was then pending. . In that opinion we also pointed out that eases are extremely rare where a plaintiff who files a suit for damages, with probable cause and without malice, is held liable to the defendant for the inconvenience he puts such defendant to or the damage he causes him by the suit; it being held in law that the failure of the proceedings and the consequent cost and expense to the plaintiff are sufficient punishment, and usually a sufficient deterrent against frivolous litigation. See Cooley, Torts, § 180; Drake, Attachm. §§114, 726; King v. Montgomery, 50 Cal. 115; Day v. Bach, 14 Jones & S. 460; Palmer v. Foley, 71 N. Y. 106; Stewart v. Sonneborn, 98 U. S. 187, 25 L. ed. 116. After the dismissal of his suit at law, as aforesaid, and the expression of the views of the court as to the right of the respondent to set up all proper matters as a defense to this suit, which he could, if at all, recover in the former suit, he filed his answer and cross bill in the case at bar, and set out — 197 — every one of tbe grounds of recovery in tbe former suit as a defense here in this equity proceeding. This, of course, caused complainant to demur to tbe answer and except to portions of tbe cross bill, as be bas done. After due consideration, we believe tbe respondent, in and by bis said answer and cross bill, bas gone too far, and bas attempted to set up as a defense to tbe action matter not properly provable as sucb. Tbe demurrer and exceptions ar.e not in very concise form, and bence tbe court will not attempt to sustain and overrule tbe same seriatim, paragraph by paragraph, but will here state that the respondent will not be permitted to prove as an offset or damage against tbe claim of tbe complainant anything save what could and ought to be considered in law as a payment upon said mortgage; and we bold that tbe value of tbe possession, use, and enjoyment of tbe land and premises mentioned in tbe mortgage, tbe cost of correcting tbe registration in tbe recorder’s office, and tbe value of tbe crops from said land, and loss to tbe cross complainant thereon by reason of tbe acts of tbe complainant, since tbe date tbe same was so wrongfully taken by tbe complainant, is a payment, or that which can be claimed as a payment, upon tbe mortgage itself, and that to this' can be added tbe value of any other property of tbe respondent which tbe complainant actually or constructively took and appropriated, as alleged in tbe bill, in connection with said improper so-called foreclosure proceedings, sucb as tbe wooden structure and tbe use of half an acre of land, described in paragraph 9 of the cross bill, and tbe crop items, pasture value, etc., set up in paragraph 11 of tbe cross bill. For the reasons above set out, we do not, however, think that tbe attorneys’ fees set out in paragraph — 198 — 13 of tbe cross bill are provable as damage or as payment in this case. We are clearly of the opinion that the matters set out in the cross bill about the damage alleged to have accrued to the respondent because of the attachment by complainant of a tract of land not mentioned in his mortgage, which caused the other mortgagee to at once foreclose, and thereby, as it is claimed, damage respondent, are not provable either as payment or an offset in the present suit, and we doubt if damage therefor could now be recovered in any court, under the circumstances, and under the ruling of the Supreme Court of the United States in Perez v. Fernandez, supra. It appears from paragraph 3 of the cross bill that respondent, at the time of these former attachment proceedings against him, had this other piece of property of his mortgaged to one Lucas Solivella, and that, under a contract or understanding he then had with the said Solivella for the sale of said premises, he expected or was to realize enough money to pay off both mortgages; but that, because of said attachment proceedings, and an anti-transfer entry made thereunder in the registry, Solivella at once foreclosed, and thus said other property was lost to respondent. We fail to see how this alleged loss was a necessary consequence of complainant’s act; but, in any event, it appears to us that the damage in that regard is too remote. We say this independent of the rule which appears to be laid down in Perez v. Fernandez, supra, that it must be recovered in the same suit, if at all, under the local law. See also Drake and other text writers and reports, supra. We are also free to confess that it would, to our mind, be a harsh rule which would hold that, because a man attempts to collect a just and undisputed debt, evidenced by a formal mort — 199 — gage in Ms favor, and simply mistakes bis remedy, tbe person wbo caused it all should then be permitted to plead as damages tbe cost of defending such proceedings, wbieb be, tbe debtor, •could easily have avoided by payment of bis debt in tbe first instance. Oooley, Torts, § 180; Drake, Attacbm. § 114, supra. It would look somewhat as though the one who defaulted was being permitted to take advantage of his own wrong. This cross complainant, in our opinion, always had a complete remedy against any damage in the premises by paying his debt. Having failed to do so, the other party ought not to be mulcted any more that is right and proper in the premises. The respondent and cross complainant, in his defense to the present suit, will therefore be confined within the limits here indicated, which, however, will be construed with reasonable liberality because of the peculiar circumstances. If necessary, at some future stage of the progress of the case, proper amendments will be permitted to correct the entries in the registry of property as may be necessary. The demurrer and exceptions will therefore be sustained and overruled to the extent indicated in these views, and the pleadings will be considered as amended in accordance therewith, and it is so ordered.