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act of Congress* as a part of the duties of the U. S. census enumerators in June, 1890. It is safe to say that these returns if obtainable will furnish extremely interesting and valuable information. The act appropriates the sum of one million dollars for the purpose, and provides :
That it shall be the duty of the Superintendent of Census, in addition to the duties now required of him by law, to ascertain the number of persons who live on and cultivate their own farms, and who live in their own homes, and the number who hire their farms and homes, and the number of farms and homes which are under mortgage, the amount of mortgage debt, and the value of the property mortgaged. He shall also ascertain whether such farms and homes have been mortgaged for the whole or part of the purchase money for the same, or for other purposes, and the rates of interest paid upon mortgage loans.
But these facts, having reference only to the ownership of and indebtedness on real estate, will tell but half the story of the burden of private recorded indebtedness. Chattel mortgages, those on personal property, are equally evidence of debt, and probably indicate to a greater extent than incunibrances on land whether the mortgages are becoming embarrassed. So with foreclosure executions, sheriff's sales, which mean that the owner has succumbed to the burden of the mortgage debt.
The same may be said of docketed judgments, which are all a lien on real estate. A judgment is enforceable against both the personal property and real estate of the debtor, it becoming a lien on the latter as soon as docketed, that is recorded in the county clerk's or supreme court clerk's office. It may be either a general lien, as in the case of a supreme court judgment, which covers the whole State, or a local lien, coextensive only with the county wherein docketed. It remains a lien on the land acquired by the debtor at any time within twenty years thereafter. Except in case of a purchase money mortgage, it is a lien superior to a subsequent mortgage. It is to be enforced first against the goods and chattels, and then against the real estate, all of which may be sold under the statute, except such as is exempted under the Homestead Exemption Act, of March 17, 1852,† that is, the lot and residence of the debtor, being a householder and having a family, to the value of one thousand dollars.
*"• An act to require the superintendent of census to ascertain the number of people who own farms and homes, and the amount of mortgage indebtedness thereon."
| Revisod Statutes, Ed. 1877, p. 1055, 153.
Previous to the act of May 2, 1885,* a chattel mortgage was simply filed, and so far as creditors, or purchasers or mortgagees in good faith, were concerned, was valid only for one year thereafter, unless a copy was refiled within thirty days next preceding the expiration of the year. Since then, such instruments, duly executed and acknowledged, are required to be recorded in the office of the clerk, or of the register, where in existence, of the county wherein the mortgagor, if a resident of the State, resides; and if not a resident, then in the clerk's office of the county where the mortgaged property may be at the time of the execution of the mortgage. Such a mortgage is valid against the creditors of the mortgagor, and subsequent purchasers and mortgagees, “from the time of recording thereof until the same be cancelled of record in the manner now provided by law for cancelling mortgages of real estate.” A chattel mortgage vests in the mortgagee or owner " the right to the possession of the chattels therein described, so far as may be necessary for the purpose of preventing the removal thereof out of the county wherein they did lie at the time of execution or delivery of such mortgage, and of recovering such chattels in case the same shall have been removed out of such county.” On default in payment, the chattels are forfeited and the title is absolnte at law in the mortgagee, who may proceed to sell them on due notice to the mortgagor. There is no statutory regulations as to the notice to be given. It should be such notice as will be likely to secure the best price practicable for the goods. The sale must be public, after due advertisement, and conducted with fairness and good faith. Sometimes a chattel mortgage is foreclosed in the same way as a real estate, but rarely.
A real estate mortgage is in the form of a deed of land, with a condition that, if a certified sum of money be duly paid, the deed shall become void, or as it is expressed in legal phraseology, "that then these presents, and the estate hereby granted, shall cease, determine and be void." The land is not transferred, and the only effect of the mortgage is to give the mortgagee a lien on the land, the equity, or right of redemption, still remaining in the mortgagor.
* Revised Statutes, Supplement (1836), p. 191, 8.
The debt is the principal thing and the land merely an accessory; the payment of the debt extinguishing the mortgage, when it may be discharged on the records, a statement to that effect being entered on the margin of the recorded instrument. It is necessary to record the mortgage in the office of the county clerk, or register, when there is one*, or it will be postponed to the lien of an honest, subsequently recorded conveyence or mortgage. It need not be recorded in full, but only an abstract of it “registered.” Section 17, page 705, Revised Statutes (1877) requiring the county clerk “to provide fit books, well-bound and lettered, for registering [on payment of his legal fees) all mortgages, and defeasible deeds in the nature of mortgages, of lands, tenements, and hereditaments, lying and being within his county, in which shall be entered the names of the mortgagor and mortgagee, the date of the mortgage, the mortgage money and when payable, and the description and boundaries of the lands, tenements and hereditaments mortgaged.” The date of receipt of the instrument must be noted at the foot or in the margin of the record.
A mortgage will be presumed to have been paid, if the mortgagee never entered on the land, and there has been no foreclosure nor payment of interest within twenty years. On the other hand, when there has been no default, it remains in force notwithstanding the expiration of the term as stated in the instrument. It has become the practice in cities to make this nominal term one year; the actual life of a mortgage, as a general rule, being considerably longer. This is done to protect the mortgagee, especially in the matter of the payment of taxes on the mortgage, on account of which a deduction in the assessment value of his land may be claimed by the mortgagor from the assessor. The mortgagee is bound in such case to pay the tax on his mortgage and cannot recover it of the mortgagor. Under the so called “five-county act," I applying to the counties of Hudson, Essex, Union, Bergen and Passaic, and the cities of Trenton, New Brunswick and Camden, the owners of mortgaged lands may agree not to apply for any deduction, and in case the deduction is claimed in violation of the agreement, the mortgage becomes immediately due. It is also the general custom throughout the state to insert "insurance" and "interest” clauses in the mortgage, under which the mortgagor is required to keep the premises insured and pay the interest due on the mortgage within a specified time, for example, six months. In the one case, if default is inade, the mortgagee may take out a policy of insurance and add the premium to the mortgage; in the other, the mortgage becomes due and may be foreclosed immediately.
* In only Camden, Essex and Hudson counties. + 8 C. E. Green, 181. † April 17, 1876.
It is usual for some instrument, generally a bond, to accompany the mortgage, indicating the existence of the debt. The statute of limitation runs against the bond in sixteen years. Under the law of 1881,* all proceedings to collect the debt “shall be, first, to fore close the mortgage, and if at the sale of the mortgaged premises under said foreclosure proceedings the said premises should not sell for a sum sufficient to satisfy said debt, interest and costs, then and in such case it shall be lawful to proceed on the hond for the deficiency, and that all suits on the bond shall be commenced within six months from the date of the sale of said mortgaged premises.” With rare exceptions, a foreclosure proceeding is the course followed to obtain a sale of the mortgaged real estate. A power to sell the premises for payment of the debt may be inserted in the mortgage. That is valid, and will do away with the necessity of a foreclosure, but it is not favored by the courts and will be jealously watched. Under the statute, also, when default is made in payment of the mortgage money, the priperty being subject only to one mortgage and no other persons but the mortgagor and mortgagee being necessarily interested thereto, it is lawful for the mortgagee at any time after the payment of the debt ought to have been made to sue out a writ of scire facias, requiring the mortgagor to show cause before the court of common pleas or Supreme Court, why the mortgaged premises should not be seized and sold for the debt; if there is no appearance on the return day of the writ, judgment is entered, execution issued and the property sold as under other executions for the sale of real estate.
*March 23, 1881. 13 C. E. Green, 358.
But the almost invariable practice is to proceed by a suit of foreclosure. Where all the real estate is situate in the same county, the circuit court, under the act of 1851, has the same jurisdiction as the Court of Chancery, where with but few exceptions these proceedings are had.* They are begun by issuing a subpæna and filing a bill of foreclosure, all incumbrancers subsequent to the foreclosing mortgagee being made parties defendant with the mortgagor. The object of a bill of foreclosure is to enable the mortgagee to have the mortgaged premises sold in order to get his mortgage money and interest, or that the mortgagor may redeem it without delay, and in default thereof, that the mortgagor and all persons claiming under him, or to claim from or under him, be forever barred of and from all equity of redemption in the mortgaged premises. From the service of the subpæna up to the time of the final decree, authorizing the issuing of the execution (fi. fa.) to the sheriff or master in chancery, if there be no defence, generally four to five months are consumed; or about six months to the sale of the premises—a period, however, which varies with the circumstances of the case, causing delay.
Not all the suits begun proceed to execution, and the issuing of the execution is sometimes delayed; but such cases are the exception, although the sheriff's fees add a very appreciable amount to the sum total of the debt, as do also the various items of so-called
costs,” which go to the solictor, clerk of the court, etc. These fees and costs are regulated by statute, but the totals vary in different suits. Combined with accumulated interest and the sacrifice of the property incident to forced sheriffs' sales, they seldom fail to more than wipe out any remaining equity of redemption of the mortgagor, who thus not only loses his property, but has an unsatisfied execution hanging over him. The following “sheriff's statement in foreclosure " will illustrate this. It is the return made by the sheriff of Burlington county of an execution in February, 1884. The final decree had been made in February, 1868, requiring the sheriff to satisfy out of the proceeds of the sale of the land of the defendant mortgagor, in the first place, the sum of $2,408, the prin
*In 1887 and 1888, for example, only 33 and 17 foreclosures proceedings, respectively, took place in the circuit courts, and 900 and 859, respectively, in chancery. More than half of the circuit foreclosures were in Cumberland and Passaic.
Dickinson's Chancery Precedents, p. 383.