TREDWAY
v.
SANGER
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An indorsee of a negotiable promissory note made between citizens of the same State sought to foreclose a mortgage securing the note in federal court. The Supreme Court held that following the Act of March 3, 1875, which removed restrictions on federal jurisdiction over suits on negotiable promissory notes by assignees, the indorsee could maintain the foreclosure action in federal court because the indorsee could sue on the underlying note, and the mortgage as an incident to the debt followed the note's jurisdictional status.
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Mr. Chief Justice Waite delivered the opinion of the court.
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, 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: “ 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 1 . the Circuit Court of the United States, where his assignor could not.” p.
450. 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.
Decree affirmed.
Cases With Similar Vibessemantic neighbors from the corpus
Citator
Cited By
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New Orleans v. Benjamin, 153 U.S. 411 (U.S. 1894)…egotiable promissory note, secured to the payee by a mortgage, could not sue in the courts of the United States to foreclose the mortgage, unless the mortgagee could; but this was necessarily ruled otherwise under the act of 1875. Tredway v. Sanger, 107 U. S. 323. As remarked by Mr. Justice Blatchford in Corbin v. County of Black Hawk, 105 U. S. 659, 665, “the contents of a contract, as a chose in action, in the sense of section 629, are the rights created by it in favor of a party in whose behalf stipulati…
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New Orleans v. Quinlan, 173 U.S. 191 (U.S. 1899)…the law merchant and bills of exchange.” The restriction was thus removed as to “ promissory notes negotiable by the law merchant,” and jurisdiction in such suits made to depend on the citizenship of the parties as in other cases. Tredway v. Sanger, 107 U. S. 323. By the first. section of the act of March 8, 1887, c. 373, 24 Stat. 552, as corrected by the act of August 13, 1888, c. 866, 25 Stat. 433, the provision was made to read as follows: “Nor shall any Circuit or District, Court have, cognizance of any…
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Mersman v. Werges & Another, 112 U.S. 139 (U.S. 1884)…was within the jurisdiction of the Circuit Court, under the act of March 3, 1875, ch. 137, although Krueger, the payee and mortgagee, could not have maintained a suit in that court. 18 Stat. 470; Sheldon v. Sill, 8 How. 441, 450; Treadway v. Sanger, 107 U. S. 323. Decree reversed.…
Authorities Cited
- Sheldon v. Sill, 8 How. 441 (U.S. 1850)