[Syllabus from page 323 intentionally omitted] [Statement of Case from pages 323-324 intentionally omitted]
The opinion of the court was delivered by: Waite, C. J.
A. Chester, for appellants.
Henry Beard and C. H. Armes, for appellee.
There is but a single question presented by this appeal, to-wit, whether, if a promissory note, negotiable by the law-merchant, is made by a citizen of one state to a citizen of the same state, and secured by a mortgage from the maker to the payee, an indorsee of the note can, since the act of March 3, 1875, c. 137, (1 Supp. Rev. St. 173,) sue in the courts of the United States to foreclose the mortgage, and obtain a sale of the mortgaged property.
It was held in Sheldon v. Sill, 8 How. 441, that such a suit could not be maintained under the eleventh section of the judiciary act of 1789, because in equity the mortgage was but an incident of the debt, and as the indorsee could not sue on the note, he could not sue to enforce the mortgage. The language of Mr. Justice GRIER, speaking for the court in that case, is this, (p. 450:) 'The complainant in this case is the purchaser and assignee of a sum of money, a debt, a chose in action, not of a tract of land. He seeks to recover by this action a debt assigned to him. He is, therefore, the 'assignee of a chose in action,' within the letter and spirit of the act of congress under consideration, and cannot support this action in the circuit court of the United States, where his assignor could not.' This clearly implies that if a suit could be brought on the note, it could for the foreclosure of the mortgage, should there be no other objection to the jurisdiction than the citizenship of the payee and maker.
In the judiciary act of 1789 it was expressly provided that the circuit courts could not take cognizance of a suit to recover the contents of any promissory note or other chose in action in favor of an assignee, unless a suit might have been prosecuted in such court to recover the contents, if no assignment had been made, except in cases of foreign bills of exchange. The act of 1875, however, removes this restriction in suits on 'promissory notes negotiable by the law-merchant;' and now the jurisdiction in such suits is made to depend on the citizenship of the parties as in other cases.
Since, therefore, the indorsee could have sued in the circuit court on the note now in question, it follows that, as there is no objection to the jurisdiction other than the citizenship of the original payee, the suit to foreclose the mortgage was properly brought. The decree is affirmed.
© 1992-2012 VersusLaw ...