Joe explains Carpenter v. Longan, an 1872 Supreme Court case that established the note and mortgage are separate instruments, with the note being essential and the mortgage incidental. Many lawyers cite the case without understanding what it actually says.
And to understand the world of instruments like, you have supplied me a lot of documents and I really try to read them. And I feel so much better now having had it come right out of your mouth this way. And we do it on the phone, but it just doesn't translate as well as looking at you. So it's been. I've. I've gotten the whole flow tonight. Does the Carpenter v. Longan, 1872 Supreme Court ruling, once the debt and the note are separated, play into anything that you do?
Of course. Oh my gosh. So thanks for bringing it up.
Sure.
It's again, it's having a proper understanding that most. They don't have an understanding. Everybody cites this willy nilly. Right. It's an 1871 was a case Carpenter B logging it was opined in 1872. Okay. But negotiables act did not come out until 1881. So that's, that's why the president here is so darn clear. And it says, okay, it talks about the note and morgue are real separable. All right? And the exact verbiage.
I love how it's at your fingertips, Joe.
Oh, yeah. So I actually. And I use this a lot. All right. So the exact. All right. Verbiage says this U.S. supreme Court stated, quote, the note morgue are separable. The former as essential, the latter as an incident. So former is a note, the latter is a mortgage. Right. So the mortgage is essential or the note is essential and the mortgage is just an incident. An assignment of the note carries the mortgage with it, while an assignment of the lateral loan is a nullity. The mortgage can have no separate existence. The mortgage, when the note is paid, expires. It cannot survive a moment for which the debt the note represents, this dependent and incidental relation is a controlling consideration. So if you understand that, go back 200 years. Right? So when they transferred the note, they did it through endorsement. Okay? That's how it was transferred. So you can transfer the note without an assignment. And that's why they say the mortgage follows it, because you would transfer it through endorsement. And by endorsement, you are naming a payee. So if the purpose of that mortgage is to attach itself to the payee, again, that is why the mortgage follows the note. They are inseparable.
