Bloch & Co. v. Edwards

COLEMAN, J.

The appellants as mortgagees sued in detinue to recover a certain bay mare which was included in the mortgage. There was no controversy as to the due and proper execution of the mortgage, and the justness of the claim secured thereby. After the plaintiffs had introduced "the mortgage and evidence of the debt, and that the mare sued for was included in the mortgage, and in the possession of the defendant at the institution of the action, the defendant testified in his own behalf substantially that the plaintiffs, by their agent, one Gardner, agreed to receive and did accept and receive from the defendant another and different *92 horse, in the place of the horse conveyed by the mortgage. The agent Gardner, witness for the plaintiffs, contradicted this statement of the defendant, and testified substantially, that he requested payment of the defendant of the mortgage debt; that defendant told him that he had no money, but desired to make a partial payment on the debt with a horse ; that he and defendant valued the horse at fifty dollars, which amount was credited upon the debt, leaving a balance unpaid of one hundred dollars, and that there was no understanding or agreement that the horse turned over to him was substituted for the mare included in the mortgage and sued for. In the oral charge, the court instructed the jury, “that before the plaintiffs could recover in this case, they must have returned to the defendant the horse which Gardner had received from the defendant before the commencement of this suit.” The effect of this instruction was, that although the horse may have been received from the defendant by agreement with him as a partial payment upon the debt, and credited thereon, yet before the plaintiffs could maintain the action, it was necessary to first return the horse to defendant. This instruction was erroneous. It wholly ignored the evidence of the witness Gardner. The defendant had the right with the consent of the plaintiffs, to pay the debt either with money or property, and if made, the legal result was the same, whether made in money or property.

The plaintiffs requested the court to give the affirmative charge in their favor, which charge was refused. Section 1731 of the Code of 1886 is as follows : “ A mortgage of personal property is not valid, unless made in writing and subscribed by the mortgagor. ” We are of opinion, that parties cannot by parol substitute personal property, not embraced in a mortgage, for property included in a mortgage, so as to transfer the lien of the mortgage upon the substituted property, and release the mortgage property from the lien. To allow this would be a violation of the statute. This principle, however, would not relieve a mortgagee from the just and equitable doctrine of estoppel. If a mortgagee undertakes by an agreement to release certain mortgaged property in consideration of other property which he receives in lieu thereof, he would not be permitted to *93 hold on to the property thus received and also assert the mortgage claim and- lien against the property agreed to be released and delivered up. We would not be understood as intimating that the mortgagor and mortgagee might not make a valid parol agreement, upon valuable consideration, which would operate to divest the title of the mortgagee and invest it in the mortgagor, freed from the legal operation of the mortgage. — Powers v. Harris, 68 Ala. 409 . The evidence of the defendant tended to establish such an agreement. The court did not err in refusing the affimative charge for the plaintiff.

Reversed and remanded.