Juan Monagas v. Juliana Maria Albertucci Alvarez

• Decision Date: 30 November 1914
• Docket Number: No. 44,44
• Citation: 59 L.Ed. 139,35 S.Ct. 95,235 U.S. 81
• Parties: JUAN A. MONAGAS, Jse e Arturo Monagas, et al., Appts., v. JULIANA MARIA ALBERTUCCI Y ALVAREZ, Widow of Dominguez
• Court: U.S. Supreme Court

235 U.S. 81

35 S.Ct. 95

59 L.Ed. 139

JUAN A. MONAGAS, Jse e Arturo Monagas, et al., Appts.,

v JULIANA MARIA ALBERTUCCI Y ALVAREZ, Widow of Dominguez.

No. 44.

Submitted October 29, 1914.

Decided November 30, 1914.

Mr. N. B. K. Pettingill for appellants.

No appearance for appellee.

Mr. Chief Justice White delivered the opinion of the court:

Only that which is deemed necessary for the decision of the case is stated, bearing in mind that our power is con- fined to determining whether error of law was committed in admitting or rejecting evidence, and whether the findings of fact are adequate to sustain the conclusions based on them. Rosaly v. Graham y Frazer, 227 U. S. 584, 590, 57 L. ed. 655, 657, 33 Sup. Ct. Rep. 333.

The appellants sued in August, 1909, to recover immovable property upon the ground that a contract of sale made by them of the property in September, 1906, subject to a right to redeem, was not a sale subject to condition, but a mortgage, and, therefore, although the period for redemption had long expired without the exercise of that right, they were entitled to a decree for cancelation of the recorded sale on payment of the mortgage debt. Moreover, a right to recover rents and revenues was sought for the purpose of imputing the amount to the extinction of the mortgage debt. At the trial Juan A. Monagas, one of the plaintiffs, was tendered in their behalf as a witness, and he was permitted to testify over objection made and exception reserved by the defendant. The court substantially awarded the relief prayed. The prayer, however, for an accounting, was denied upon the ground that, although there was no agreement as to rate of interest, nevertheless it was contemplated that the lender should go into possession of the property, collect the rents and revenues, and appropriate them in lieu of collecting interest on the debt. Both sides appealed.

On the appeal it developed in the argument that neither side had complied with the rules as to assigning errors. The case was heard and taken under advisement with leave to file assignments of errors within a time fixed. In its opinion the court came first to the appeal of the defendant below. Directing attention to the fact that the permission to file assignments had not been complied with, the court then considered what was open, and after referring to the exception concerning the testimony of the witness, offered for the purpose of showing that the deed was not a sale, but was a mortgage, treated the exception as covering two considerations: first, Was parol evidence admissible, 'under our Civil Code, to vary the terms of the sale?' and second, whether 'An improper construction was put on the written contract entered into between the parties,' evidently considering, therefore, that even if parol evidence was admissible, it was yet necessary, as a result of the exception, to determine whether the contract had been improperly construed by a wrongful effect given to the evidence admitted over objection.

The contention as to mere inadmissibility was at once disposed of by stating that the real question to be decided was not whether any testimony could have been received, but the character and probative force of that which was admissible. The court said:

'The whole case really turns on the question of whether the written instrument in controversy was a mortgage or a conditional sale. If it is the latter, it must be complied with according to its terms; if the former, the plaintiff must be allowed to repay the money received and take a reconveyance of the land. The real intention of the parties at the time the written instrument was made must govern in the interpretation given to it by the courts. This must be ascertained from the circumstances surrounding the transaction and from the language of the document itself. The correct test, where it can be applied, is the continued existence of a debt or liability between the parties. If such exists, the conveyance may be held to be merely a security for the debt or an indemnity against the liability. On the contrary, if no debt or liability is found to exist, then the transaction is not a mortgage, but merely a sale with a contract of repurchase within a fixed time. While every case depends on its own special facts, certain circumstances are considered as important, and the courts regard them as throwing much light upon the real intent of the parties and upon the nature of such transactions: such are the existence of a collateral agreement made by the grantor for the payment of money to the grantee, his liability to pay interest, inadequacy of price paid for the conveyance, the grantor still remaining in possession of the land conveyed, and any negotiation or application for a loan made preceding or during the transaction resulting in the conveyance. The American doctrine on this subject does not differ materially...