Adams v. Bateman & Bro.

GAINES, Chief Justice.

—We have for a long time inclined to the opinion, that in the earlier decisions in which instruments of the character of that in question in this suit were passed upon, this court failed properly to distinguish an assignment from a mortgage. A conveyance which passes the legal title of property to a trustee to be im mediately sold, and directs that the proceeds shall be applied to the payment of a debt, is generally held by other courts to be an assignment. An instrument which is intended merely to secure a debt is, on the other hand, usually held to be a mortgage. Whether this distinction has been properly recognized in this court may be doubted. But however that may be, in the eases which first came before the court involving the question of the distinctive character of such instruments, those in which the right to any surplus that might remain after the payment of the debt was expressly reserved to the debtors have been treated as mortgages, while such as contained no such express condition have been held to be assignments. The distinction so recognized has become a long established rule, under which many transactions have been entered into which involve property of great value. Such being the case, we are not at liberty to overrule the-former decisions of the court upon the question. It is far more important that a line of decisions under which valuable rights have accrued should be deemed settled, than that the court should conform to what may be thought a more correct technical rule. If, however, the express reservation of the surplus, if any, to the debtors, be the true test between an instrument to secure a debt and one to pay a debt, then our former decisions are correct. We have deemed it proper to say this much in passing upon this question, because we desire that there shall be no misunderstanding as to the rule which is to apply in similar cases.

Delivered April 4, 1895.

The ruling of the Court of Civil Appeals is in accord with the previous decisions of the court upon the main question involved in the case, and the application for the writ of error is accordingly refused.

Application refused.