Mariano Martinez v. International Banking Corporation No 79 Mariano Martinez v. International Banking Corporation No 80
| Decision Date | 03 April 1911 |
| Docket Number | Nos. 79 and 80,s. 79 and 80 |
| Citation | 220 U.S. 214,31 S.Ct. 408,55 L.Ed. 438 |
| Parties | MARIANO MARTINEZ, Administrator of Francisco Martinez, Deceased, Appt., v. INTERNATIONAL BANKING CORPORATION. NO 79. MARIANO MARTINEZ, Administrator of Francisco Martinez, Deceased, Appt., v. INTERNATIONAL BANKING CORPORATION. NO 80 |
| Court | U.S. Supreme Court |
Messrs. Frederic R. Coudert, Howard Thayer Kingsbury, and Paul Fuller for appellant.
[Argument of Counsel from page 215 intentionally omitted] Mr. Henry E. Davis for appellee.
These are two suits commenced in the court of first instance of the city of Manila on the same day, February 25, 1905, and numbered in that court as cases Nos. 3363 and 3365, respectively. In each suit the International Banking Company was plaintiff and Francisco Martinez and another person as the guardian of Martinez were defendants. After the present appeals were taken Martinez died and his administrator has been substituted in his stead.
We shall separately summarize the proceedings below in the two cases to the extent it is necessary to do so to understand the proper disposition to be made of the appeals.
Case No. 79 was a suit of an equitable nature brought by the bank against Martinez to foreclose a mortgage upon the steamer Germana, sell the steamer, and collect an alleged debt of 30,000 pesos, claimed to be secured thereby. By the answer and cross bill it was asserted that, at the time of executing the mortgage, Martinez was mentally incapacitated, and hence legally incompetent; that the whole transaction was void for fraud, duress, and conspiracy; that the alleged indebtedness was a part of the subject-matter of the instrument sued on in the other case, the effect of which instrument was to supersede the mortgage sued on in this, and that plaintiff had wrongfully taken and held possession of the steamer and refused to account for its profits. As affirmative relief the setting aside of the whole transaction was demanded, as also the return of the steamer and an accounting of its profits.
The court of first instance in substance sustained these defenses, dismissed the plaintiff's suit, and directed a return of the steamer.
It was decided in the judgment: 'This case was tried together with case No. 3365, it being agreed that the evidence taken on the trial pertinent to either or both cases should be considered by the court in the respective cases.' On appeal, the supreme court of the Philippine Islands reversed this judgment, held that the transaction was valid, and entered the following judgment:
Case No. 80.—This case was brought to recover a judgment for 159,607.81 pesos, with interest, and, in default of payment, for the foreclosure of an instrument alleged to be a mortgage, the sale of certain real estate described in the mortgage, execution in the event of a deficiency, and for general relief. By answer and cross bill the same general defenses were set up as in the other suit. It was further averred that the alleged consideration for the instrument sued on was 'padded and fictitious,' contained duplications of the same item, and included the item of 30,000 pesos which was the subject of the other case; also that the instrument sued on was not in law a mortgage, but was an agreement for the transfer of property with right of repurchase (pacto de retro), and that the defendant had never refused to perform such contract, but that the plaintiff had failed to perform its own obligations there- under; also that the plaintiff had wrongfully taken possession of the property in question and received its rents and profits. The defendant demanded that the entire transaction be set aside, that plaintiff's suit be dismissed, and that plaintiff account for the rents and profits it had received.
The court of first instance found against the plaintiff, and rendered judgment in favor of the defendant guardian for the gross amount of the rents adjudged to have been unlawfully collected by the plaintiff. The case was appealed to the supreme court of the Philippine Islands, and was there docketed as case No. 3,472. The appellate court held 'that the evidence is not sufficient to establish any of the defenses or counterclaims,' and 'that the defendant Martinez, at the time the action was commenced, was indebted to the plaintiff in at least the sum of P. 159,807.81, was fully established by the evidence.' The court, however, decided that the instrument claimed to be a mortgage was not such, but was 'a promise to sell real estate upon certain terms, and contemplates a subsequent contract of sale which should contain the terms stated in this document,' and that sufficient facts were stated in the complaint 'to constitute a good cause of action for the specific performance of the contract.' After referring to the fact that plaintiff had been in possession of certain of the real property described in the complaint, and collected rentals therefrom, the court concluded its opinion as follows:
'The net amount collected should be applied in reduction of the sum of 159,607.81 pesos, which, according to the evidence, the defendants owe to the plaintiff. When the case is remanded, the defendant should have an opportunity to question the expenses claimed to have been met by the plaintiff in connection with its possession of these buildings, which it has deducted from the gross amount received.
After a consideration of the whole case, we hold that the plaintiff is entitled to a judgment in the court below, with costs, declaring that Francisco Martinez is justly indebted to it in the sum of 159,607.81 pesos, less such sum as that court may decide should be credited to Martinez for the net receipts from the real estate in question in this case, with interest on the balance from February 25th, 1905, at 8 per cent per annum; and ordering that Francisco Martinez and Vicente Ilustre, as guardian of Francisco Martinez, execute and deliver to the plaintiff, within a time to be fixed by the court, such a contract as is contemplated by the contract of June 15th, 1903, which should be substantially in the form of the instrument above referred to of date February 12th, 1904, omitting therefrom, however, the steamer Germana. The judgment should contain a provision that whatever may be realized from the sale of the Germana under the judgment in case No. 3471 shall be considered as a partial payment when realized upon the amount found due in this action.
[10 Philippine, 257.]
The following judgment was subsequently entered:
'It is hereby ordered that the judgment of the court of first instance of the city of Manila, appealed from and dated March 29, 1906, be reversed and the case remanded to the court from which it came, with directions to the judge to enter judgment in favor of the plaintiff in accordance with the decision of this court, without special provision as to the costs of this appeal.'
The present separate appeals from the afore mentioned judgments of the supreme coutr of the Philippine Islands were then taken. The petition for the allowance of the...
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