Cahoon v. Miers

Miller, J., delivered the opinion of the Court. Authorities are to he found in other States to the effect that a mortgage of domestic animals which makes no mention of the increase, covers the increase, even as between the parties, so long only as it is necessary for the young to follow the mother for nurture ; or at all events that a purchaser of such increase from the mortgagor who is left in possession thereof, without actual notice of the mortgagee’s claim, will acquire a good title ; and in one case the same thing was held in regard to the title of an attaching creditor. Jones on Chattel Mortgages, secs. 149, 150; Winter vs. Landphere, 42 Iowa, 471 ; Darling vs. Wilson, 60 N. H., 59. But the law has long been settled differently in this State.

In the case of Evans & Iglehart vs. Merriken, 8 ⁵⁷⁷ G. & J., 39 , (decided, in 1836,) there was a mortgage of several female negro slaves in which nothing was said as to their issue or increase. One of them had a child born after default in payment of the mortgage debt, and while the mother was in possession of the mortgagor. When this child was about two years old the mortgagor sold it to his son for a valuable consideration, who thus became a bona fide purchaser for value, and immediately took possession of the child and raised it, with the knowledge of the mortgagees and without any claim of title on their part. Eleven years after the date of the mortgage the mortgagees filed their bill for the sale of the mortgaged property, and the trustee appointed to make the sale sold the child with its mother.

The question then arose whether the proceeds of sale of the child should go to the mortgagees towards payment of the mortgage debt, or to the purchaser from the mortgagor. The Chancellor's decision was in favor of the purchaser, but this was reversed by the Court of Appeals. The question was conceded to be a new one, was argued before a very full Court, all the Judges but one being present, and they gave it a very careful consideration. In behalf of the appellee, the argument was pressed that the mortgage having made no mention of the issue, the public had no means of knowing where the title was, and they should be secured in dealing with the possessor as the legal proprietor; that when the boy was conveyed to him by the mortgagor, the appellee who was an innocent third party and a purchaser for value, did not, and could not know that he was touched by the mortgage.

But the Court putting aside this argument, rested their decision upon the legal effect and operation of the mortgage, as between mortgagor and mortgagee. They said, and upon ample authority, that a mortgage does something more than merely create a lien for the debt; that upon its execution the legal estate, becomes immediately vested in the mortgagee, and the right of possession fol ⁵⁷⁸ lows as a consequence, subject only to the occupancy of the mortgagor, which is only tacitly -permitted, until the will of the mortgagee is determined; that this legal estate is defeasible at law upon the payment of the mortgage debt at the time stipulated, but if this is not done then it becomes indefeasible .at law and defeasible only in equity, where the mortgagor, nothwithstanding his default, is permitted to redeem. From this view of the nature and effect of a mortgage, they say, it results that the mortgagee must be considered as having an estate or interest in the subject-matter of the mortgage, not absolute, it is true, because such an estate is not imported by the terms of the instrument, but an interest commensurate with the object contemplated to be attained by it, as a security for the payment of the debt. They then applied the rule that the owner of the mother is the owner of her offspring, and held that the mortgage cover.ed the issue.

For authority they referred to