Pool v. Young ( 1828 )

Judge Mills

delivered the Opinion of the Court.

Young filed his bill in equity against Pool, to foreclose a mortgage, and force a sale of the estate mortgaged to discharge certain debts secured by the mortgage.

Pool answered.

The account was settled, and the estate directed to be sold, and was sold in pursuance of the decree; and to reverse that decree, Pool has prosecuted this writ of error.

Proceedings and decree, settling the snn»*duo”approved. Where it was stipulated, in a mortgage made before the enactment of the relief laws, that on de- ' fault of payment, the mortgagee might sell the estate for ready money, the chancel- ' lor, oíTbeing appealed to, saft<o of those" acts, was °S6 bound to specifioally enoroet coontracl, by a sale for cash in hand, whether those statutes were regarded as constitutional in other cases or not

There is no question worth noticing arising in the progress of the case, or in settling the account. In all this, the court beiow seems to have decided correctly.

But the notes, which the mortgage was given to vsecure, were executed in 1819, and before the passage of the act of assembly which directed the sales estates to he on a credit of two years, unless the complainant would accept notes on the Bank of the Commonwealth, in payment, and also required such estate to be valued before it was sold, and to bring; "at least three fourths of that valuation, if such indorsement was not made; and in this the court below refused to give such credit, and also refused to set aside the report of the commissioner, because suclt. credit was not given, and such valuation made, and this is assigned as error. If this case was not one peculiary circumstanced (as it really is) it would be sufficient for us to refer to the cases of Lapsley vs. Brashear, and Blair vs. Williams, 4 Litt. Rep. 34-47, to prove that, according to the settled course of dec^on this court, the plaintiff in error would not be entitled to the credit of two years, secured by the act of assembly, because that the act in this respect, is in coiitrovention of the constitution of the United States. But it is not necessary to rest on these decisions. They shew that the hare understanding, that the contract, when made under an existing law, includes that law in its composition, precludes the operation of such an act; but here, there is no necessity of implying such an understanding, kfov their is an express agreement between the parties regulating and fixing the remedy between them on the mortgage, if the estate should be sold for the purpose of raising the money due. Nor is it necessary to enquire whether the act requiring estates to be valued, and if they should not bring three fourths of that value, directing them not to be sold at all, comes within the principles recognised in the cases of Blair &c. vs. Williams, and Lapsley vs. Brashear, and is therefore unconstitutional so far as it operates upon contracts made before its passage. For the stipulation of the parties in this instance meets that case, and excludes the application of the valuation act. In the condition to this mortgage is the following express stipulation.

Such stipnlaCons o> the fhor^i’d^ for a breach of their oon]0, asrte law of the case,

“If the said Pool shall neglect or refuse to any or all of the sums aforesaid, as they become due to said Young, then said Young may, by giving twenty days notice at the public houses in the town of Winchester, in writing, proceed to sell to the highest bidder, for ready money, from tune to time, so much of said land as will meet all deficiency of consideration money with interst and all costs, and the balance, after all is paid, shall be paid over to said Pool.” ^

Now it will he seen that applying the act of indulgence by a sale for two years, unless hank paper was taken, or the valuation act either, will expressly and essentially alter and change these stipulations between the parties. Either of these acts incorporated with, and bearing upon their contract, would make it read, that instead of selling for ready money, Young should sell tor hank paper, at a credit of three months, and for money" at the end of two years, and if the property would not sell for three fourths of its appraised value in the opinion of commissioners appointed for that purpose, he should not sell at all. To admit a subsequent act of the legislature thus to 'modify and essentially vary the written stipulations of the parties, would concede to the legislature a power to make a new contract and destroy the old altogether; a power not assumed by the letter of the act itself; for it only professes to operate on general remedies.

The stipulation of the parties applies to the remedy and regulates it; fixes its terms and its credit, and what is to be taken in payment and provides for an unconditional sale, without any fixed value, except so much ready money as the estate would bring. It was competent for the parties to tnake such a contract. There was no law forbidding it, when it was made. It'was then both fair and legal How then can a legislature change the words, sense and substance of the agreement? It is true that Young did not himself attempt to execute this stipulation without the aid of a court of equity; but this, was to the benefit of his adversary, who now complains, The application to the chancellor was made, not 0nly to subject the estate mortgaged, but to do it as agreed, and to specifically enforce the agreement by applying the conventional remedy for a breach. In such a case, it was proper for the chanceller to decree the contract specifically as the parties made it tat its date, and not as the legislature made it after-wards, as the plaintiff in error now contends.

Where the ohanoelh.r has no jurisdiction of the original demand, he can only order a sale of the mortgaged estate, and the creditor must go to law for any balance that may remain. In cases to enforce alien for the purchase money, this chancellor has original jurisdiction.

Another question is made by the assignment of error, which is of more weight. The court not only subjected the estate tofHae satisfaction of the-mortgage, but decreed the full and positive amount of the notes to be paid absolutely, and afterwards, as the property when sold did not amount to enough to satisfy the debts, directed by a decretal order, that execution should issue for the balance, as on a judgment at common law. According to the settled law of this court, the chancellor has no jurisdiction of legal demands secured by mortgage, further than to. subject the estate to the demand, and the party must resort to his legal remedy for the balance. Cases where the chancellor has exclusive jurisdiction of the demand secured by the mortgage., or where he has concurrent jurisdiction with a court of law, are exceptions to this rule, within which the case of the complainant here cannot be brought. The notes secured by the mortgage were executed by Pool to Silas W. Robbins, and by him assigned to Young, and then Pool executed to Young this mortgage to secure these notes.

It is true, that the mortgage recites that the land mortgaged was purchased by Pool of Robbins, and that the notes in question were given for the same land. But that Robbins retained any lien upon this land which was secured or confirmed by the mortgage to Young, is not suggested in the bill or claimed by it; so that this bill is not to enforce either an equitabtelien, or to enforce specifically a contract for land, which are circumstances conducing to give a court of equity jurisdiction. For any thing that appears, the case is circumstanced as it would be, if Pool had mortgaged any other tract of- land to secure the debt, and there is nothing to exempt it from the general rule.

Decree reversed as to the sum due in personam. Monroe for plaintiff; Taul for defendant.

All that part of the decree therefore directing the sale of the land, and confirming it, is affirmed; but all that part which decrees the balance, and directs an execution for it, must be reversed with cost, and the cause remanded, with directions to the court below, to direct by a decretal order, credits on the notes for the sum raised by the sale of the estate, after deducting therefrom the cost of the suit in that court.