Boley v. Lake Street Elevated Railroad ( 1896 )

Mr. Justice Waterman

delivebed the opinion of the Coubt.

The question presented is as to the right of the particular bondholder to recover, under the circumstances, on the single coupon sued on, and involves, the right of all the holders of the $7,474,000 to recover under similar circumstances on any of the coupons which may come due during the life of the mortgage. With what the rights of the holders of coupons, only, would be, we are not now concerned.

A bond and the mortgage made to secure the same, when they are made at the same time, are to be construed together as if they were parts of one instrument, and in relation to the same subject, as parts of the same transaction, together constituting one contract.

The mortgage may, as well as the bond, describe the debt, and may thus qualify the terms of the bond. Jones on Mortgages, Vol. 1, Sec. 71, 2d Ed.; Muzzy v. Knight, 8 Kans. 456; Meyer v. Graeber, 19 Kans. 165; Bassett v. Bassett, 10 N. H. 64; Kennion v. Kelsey, 10 Iowa 443; Crafts v. Crafts, 13 Gray 360.

In the present case, taking bond and mortgage together, it appears that the holder of the bond has by express stipulation deprived himself of any right of action at law thereon, except in a certain contingency.

Up to the happening of certain events he has vested in the trustees his right to sue upon default in the payment of his bond.

This is not an attempt to oust the courts of jurisdiction, but is merely the vesting in trustees the right to sue. Our attention has not been called to any case in which such transfer of a right to sue has been held void, although such stipulations have been in other cases considered. Kennion v. Kelsey, 10 Iowa 443; Rothschild v. Ry. Co., 91 Supreme Court of New York 103; McClelland v. Ry. Co., 110 N. Y. 469; Manning v. Norfolk South. Ry. Co., 29 Fed. R. 838; Teller v. E. T., V. & G. R. R. Co., 67 Fed. Rep. 168; Guilford v. Minn., S. S. M. & A. Ry. Co., 48 Minn. 560.

Nor are we in this case called upon to say directly whether the coupon under consideration is by itself a negotiable instrument. Suit is brought upon it by the holder of the bond to which it was attached; the question here involved is as to the rights of a holder Of bonds and coupons thereto belonging.

It is manifest that the party who purchased this bond, if he read the same, together with the trust deed, must have known that he acquired with it no right of action upon default in the terms of it, or of any of the coupons belonging thereto; that such right was vested in the trustees named in the mortgage, and could not be exercised by the holder of the bond until the happening of other things.

Provisions of this kind are to be strictly construed. Guaranty Trust & Safe Deposit Co. v. Green Cove Springs & M. R. Co., 139 U. S. 137; Railroad Co. v. Fosdick, 106 U. S. 47; Morgan’s L. & T. Railroad & Steamship Co. v. Texas Cent. Ry. Co., 137 U. S. 171; Alexander v. Central R. R. Co., 3 Dill. 487; Fed Cas. No. 166; Credit Co. v. Arkansas S. W. R. Co., 59 Fed. 957; Farmers Loan & Trust Co. v. Winona & S. W. R. Co., 59 Fed. 957; Mercantile Trust Co. v. Missouri, K. & T. Ry. Co., 36 Fed. Rep. 221.

Yet like other compacts strictly construed, they are not to be set aside by such reading as is opposed to the plain meaning of the language employed..

Such is the subtlety of the human mind, that with a determined will so to do, there can always be read out of expressions what is clearly therein.

It is not the province of courts, with reference to the interpretation of constitutions, statutes or contracts, to do otherwise than to diligently search for, and honestly apply, the true meaning.

Counsel ask, and we answer, that we do not hold that either the bonds or coupons are not negotiable.

An instrument is called negotiable when the legal title to the instrument itself, and to the whole of the money expressed upon its face, may be transferred from one to another by indorsement and delivery by the holder, or by delivery only. Daniel on Heg. Instr., Yol. 1, Sec. 1.

The coupon under consideration is an absolute, unconditional promise to pay a definite sum of money at a fixed time. It thereby, as counsel for appellant says, contains all the wi&icia of negotiable paper. If there is attached thereto a condition that suit shall not be brought thereon until one month after the same becomes due, or until after demand and protest, or that for six months after the coupon becomes due the right to sue thereon is vested solely in A. B., trustee, is the negotiability of the instrument thereby destroyed ? If such provisions are in the mortgage securing the note, is there any inconsistency between the two instruments ?

In other words, is a right by the holder to bring suit as soon as the same is due, a necessary part of a negotiable instrument % If the legislature of this State should provide that no suit should be brought on any instrument providing for the payment of money until ten days after the same became due, would there be, here, no more negotiable instruments % We regard the mortgage, bonds and coupons as constituting one consistent contract.

The terms of the trust deed, and thus of the contract under consideration, are so plain that the judgment of the Circuit Court must be affirmed.