
    Cayol v. Balseiro & Georgetti
    Appeal in cassation from a judgment rendered by the District Court of Arecibo.
    No. 60.
    Decided February 13, 1903.
    Foreclosure or Mortgages. — In the foreclosure of any mortgage, the provisions of Section 169 of the Regulations for the execution of the Mortgage Law must be strictly complied with.
    Appeals. — Evidence.—Only documents that have been before the lower court can be considered on appeal. A certificate of the Registrar dated after the institution of the proceedings filed with the appeal for the purpose of correcting a defect in the one originally presented cannot be considered by the appellate court.
    STATEMENT OF THE CASE.
    By deed executed in the. town of Manatí, before Notary Public Francisco Irene Nater, on the 7th of June, 1894, Josefa Cayol y Juliá, in her own right, and Jaime Anexy y Cayol as attorney in fact for Catalina Juliá y _ Fabregas, sold to the agricultural firm of Balseiro & Geor-getti the estate known as “Plazuela”, situated in the ward of Pueblo, township of Barceloneta, composed of 189.75 cuerdas of land, situated in the said ward, and a house which was the private property of Catalina Juliá, also situated in the town of Barceloneta, all for the sum of thirty-four thousand six hundred pesos, current coin, as is set out in the second clause of the aforesaid instrument, of which sum the vendor Catalina Juliá acknowledged to have received fourteen thousand six hundred pesos; the balance amounting to twenty thousand pesos, current coin, to be paid on maturity by the purchaser, in gold 'or silver excluding all paper money, to the vendors jointly or severally, or to their successors, within the term of fifteen years from the date of the execution of the aforesaid deed, namely on the 7th of June, 1909, the vendees during all this time to pay interest at the rate of 8 per cent per annum on the aforesaid sum of money, payable in monthly installments at the domicile of the creditors; the payment of this monthly interest being such an essential condition for the allowance of the term heretofore mentioned, that should the purchasers or their successors at any time fail to pay six installments of the aforesaid monthly interest, by such failure the term stipulated for the payment of twenty thousand pesos shall be considered as having expired, the vendors or their successors having then a right to institute an executory action for the recovery of the total amount of the principal, and interest accruing thereon, the same as in the case of the ordinary expiration of the term agreed upon, up to the time when the debt shall be paid in full; the purchasers Balseiro & Georgetti executed, as a guarantee for the payment of the balance of the purchase money remaining unpaid, and for the interest accruing thereon, and for an additional sum of one thousand pesos, to cover costs in case executory proceedings were resorted to for the recovery of the debt, a mortgage upon the 189.75 cuerdas which composed the original Plazuela Sugar Estate and the house in Barceloneta. On the 10th of January, 1901, Rafael Lopez Landron Esq., counsel for Josefa Cayol y Juliá, and Catalina Juliá y Fa-bregas, brought suit in the District Court of Arecibo against Balseiro & Georgetti, to compel them to pay the interest agreed upon in the deed of sale of June 7, 1894, without any discount by reason of the exchange of the provincial money, from August 1, 1900, with legal interest for the delay, and costs; and asking that the proceedings for the tender and deposit of interest accrued up' to November of the same year, instituted in the Municipal Court of Manatí by the defendants, be declared null and void. After all the proceedings in the case were had the District Court of Arecibo on August 30, 1901, rendered judgment dissmiss-ing the complaint, and at the same time imposing upon defendants the obligation of continuing to pay the stipulated interest on the twenty thousand pesos, the unpaid balance of the purchase price, in provincial money or in United States currency at the established rate of exchange, namely sixty cents United States coin for one dollar Porto Rican coin; and declared without effect the deposit made by Bal-seiro & Georgetti for the purposes of the suit, without making any imposition of costs. From this decision Josefa Cayol took an appeal in cassation for error of law to this Supreme Court, where the same was dismissed by judgment rendered April 22, 1902. Rafael López Lan-drón Esq., counsel for Josefa Cayol, on the 31st, of July of the same year, filed a complaint in the District Court of Arecibo, together with a certified copy of the aforesaid decision and of the mortgage deed of January 7, 1894, and a certificate issued by. the Registrar of Property of Arecibo, under date of July 11, 1902, attesting that said mortgage had not been cancelled and was not pending cancellation according to. the entries contained in the day-book; including a memorandum of the other encumbrances affecting the mortgaged property, and stating that the latter had not been transferred to a third possessor, instituting the present summary proceedings, and in which complaint the above particulars were enumerated, special reference being made to clause two of the mortgage deed, whereby a default in the payment of the interest agreed upon, for a period of six months, would be considered tantamount to a termination of the time allowed for the payment of the balance of the purchase price of twenty thousand pesos, and the vendors would have a right to bring an executory action for the recovery of the total amount of principal and interest, inasmuch as the firm of Balseiro- & Georgetti had failed to satisfy the interest agreed upon in the mortgage deed, from July 30, 1900, when the exchange of the provincial currency for that of the United States took place, to June 30, 1902; and although they had attempted to avail themselves of the privilege of making the deposit, for that purpose in the Municipal Court of Manatí, said deposit had been de-dared null and void by the District Court of Arecibo, in its decision rendered in the previous action prosecuted by plaintffs against Balseiro & Georgetti; for this reason the twenty thousand pesos of the purchase money left unpaid should be considered as due according to the terms of clause two of the aforesaid mortgage deed, plaintiff being entitled to recover said amount with the stipulated interest, by means of a summary proceeding. Plaintiff therefore prayed that, pursuant to article 169 of the regulations for the execution of the Mortgage Law, Balseiro & Georgetti be ordered to pay within 20 days the said sum of twenty thousand pesos, the said sum, after the proper discounts are made, being equivalent to twelve thousand dollars United'States currency, besides the interest due up to the 30th of June last, amounting to one thousand seven hundred and fifty-nine dollars and seventy-eight cents and also the interest at the rate of eight per cent per annum up to the date of payment, and costs. On August 2, 1902, this complaint was dismissed, the Court holding that the debt was not due, because in the documents accompanying the complaint, the formalities prescribed by article 169 of the regulations for the execution of the Mortgage Law had not been complied with. A’ motion for reconsideration of this decision having been made, the . same was overruled by an order of the 9th of the said month for the "reasons before stated; but with the explanation that the defect in the documents presented consisted in the fact that the Registrar’s certificate dated back twenty days before the instutition of the suit, while according to article 169 of the regulations, it should not have exceeded fifteen days. From this order an appeal in cassation for violation of law was taken by Josefa Cayol, the appeal being accompanied by a new certificate from the Registrar of Arecibo dated after the institution of the suit, for the purpose of correcting the defect contained in the previous one, and the appeal having been allowed and the record sent up to this Court, the appellant being cited to appear and she having entered her appearance, the record was delivered to her in order that she might perfect the appeal, which she did, basing the same on paragraphs 1 and 7 of article .1690 of the Law of Civil Procedure, alleging the following grounds to wit:
    I. — Violation of clause two of the mortgage contract of June 9, 1894, after it having been expressly ageed in said clause two that upon a failure to pay the interest during six successive months the whole debt would be considered due, for the purposes of the executory proceeding, and inasmuch as Balseiro & Georgetti had failed to pay no less than twenty-two monthly installments of interest from July 30, 1900, to June 30, 1902, for which they had presented no receipts at the Registry of Property, it is evident that pursuant to the aforesaid clause two, the executory action should have been sustained and the writ of execution issued, for said agreement having been perfectly legitimate it was binding in every respect according to Articles 1255, 1256, 1258 an,d 1278 of the Civil Code, which had been violated.
    II. — Violation of Article 122 of the Mortgage Law; for if it is manifest that the mortgage shall continue in force so long as the same remains uncan-celled, as prescribed by said Article, the same is violated when the collection of uncancelled interest is refused, as if satisfied or extinguished.
    III. — -Violation of Articles 168, 169 and 170 of the regulations for the execution of the Mortgage Law, because having in view the spirit and the correct interpretation of the said articles, a decree of execution and summons to pay the principal and interest cannot be refused, except when from a recent certificate issued by the Registrar of Property, they should appear to have been extinguished. In conformity with the intent of Article 122 of the special law governing mortgages, they continue in force in all respects so long as they remain unextinguished by cancellation. Hence a misconception of the fundamental idea contained in these rules.
    IV. — Violation of Article 1157 of the Civil Code, in its relation with Articles 1176 et seq. The first of said articles establishes a legal presumption juris et de jure, in the absence of evidence to the contrary, by virtue of which a debt shall not be considered as satisfied until the full amount owing shall have been paid. The lower court, in contravention of this law, presumes that certain installments of interest were satisfied, from the mere fact of an attempt having been made to effect a deposit of a part thereof, thereby committing the error of law of considering as valid, for the purposes of extinguishing a mortgage debt, a deposit that had been declared null and void, — which necessarily involves a manifest disregard of Article 1180 of the Civil Code, and especially the last -paragraph thereof, for according to the said Article, until a judicial decision has been rendered, declaring the deposit ' to have been properly made, the whole debt continues to exist, and as the total amount due for interest remains unpaid, it follows as already stated, that the full amount of the mortgage deed has fallen due.
    V, and last. — For error of fact in taking into consideration that portion of the judgment rendered in the executory action which disposes of the case. The judgment of the Arecibo Court rendered under date of August 30, 1901, a certified copy of which appears among the principal papers contained in the record, referred to by the Supreme Court in a former appeal, in that portion thereof disposing of the case, reads as follows: “The deposits of interest money made by Balseiro & Georgetti are declared null and void for -the purposes of the ordinary suit”; but it does not declare, as is tacitly implied, that such deposits are effectual for the purposes of the executory proceeding.
    
      Mr. Rafael Lopez Landrón for appellants.
   Mr. Chief Justice José S. 'Quiñones,

after making the above statement of facts, rendered the opinion of the Court;

According to article 169 of the Regulations for the execution of the Mortgage Law in this Island, with the first pleading filed in the summary proceeding established by Article 128 of the aforesaid law, for the foreslosure of mortgages, there must be presented in addition to proof as to the capacity of the plaintiff or his representative to sue, the instrument or instruments of the credit, with a memorandum of their record, and the other formalities required by the law of Civil Procedure for the issuance of a decree of execution; a certificate of the registrar of property bearing a date subsequent to that on which the obligation falls-due, declaring that the mortgage does not appear to have been cancelled and that it is not pending cancellation, according to the day-book, together with the other matters set out in paragraph 3 of Article 169; which certificate, as expressly provided by said Article, cannot date back more than fifteen days prior to the institution of the proceedings; and according to the following article, the judge shall examine the complaint and the documents upon which it is based, and should he consider that the legal requirements have been complied with, he shall issue a decree without further proceedings requiring payment to be demanded of the persons who, according to the certificate of the registrar, are in possession of the mortgaged property; but should he consider that said requirements have not been complied with he should refuse, also by means of a decree, the demand made. Inasmuch as Josefa Cayol did not comply with all the requirements prescribed by said article of the regulations, since the certificate of the Registrar filed by her with the complaint, was dated twenty days prior to the date on which the proceedings were instituted, while, according to the provisions of said Article, the proceedings should have been instituted within fifteen days after the date of such certificate, the order requiring payment to be made, which was applied for by the plaintiff, could not properly be issued; that in so deciding the trial court, instead of controveiling, correctly applied Articles 168, 169 and 170 of the Regulations for the execution of the Mortgage Law. Although for the purpose of correcting this defect counsel for Josefa Cayol filed with the appeal a certificate of the Registrar, dated after the institution of the proceeding, this document cannot be taken into account by this Court, which can only consider such documents as had been before the lower court while rendering the decision appealed from, such not having been the case with the certificate in question, which was presented at the wrong time- and had not been considered by the trial court, and which does not appear to have been ordered to be included in the record. Inasmuch as a failure to comply with the requirements of Article 169 of the Regulations for the Execution of the Mortgage Law, should be considered sufficient cause for refusing to issue a decree requiring the debtor to pay, pursuant to Article 170 of the said Regulations it is needless to discuss the other grounds on which the appeal is based.

It is hereby declared that the appeal in cassation for error of law, taken by Josefa Cayol y Juliá, does not lie, and the same is dismissed with costs.  