MORTGAGE
USCA
12 USC 3754 Authority to foreclose on mortgages.
00:50:44
59 Corpus Juris Secundum, MORTGAGES 2, Definitions
“The literal meaning of the word ‘mortgage’ is ‘dead pledge’. A mortuum vadium. The term mortgage may be employed as meaning the debt secured by the mortgage, but in its true sense an ordinary mortgage is not a debt as the debt is the principle obligation, and the mortgage is generally regarded as merely an incident or accessory to the debt.
A mortgage is an interest in land created by a written instrument providing security for the performance of a duty or payment of debt, and is usually evidenced by a note.”
A mortgage does not define where a debt truly is. It is an accessory to a debt, not the debt itself.
Supporting cases which worked because brought in were the statute and confirming court case:
Caddy vs. Cortite, New York
Tusty vs. Collins
Baker vs. Citizen State Bank of Louis Park
U.S. vs. Stanley
00:55:34
Intent of Congress re Banks and Banking
13 Stat 99, aka 62 Stat
Cornell Law, on the right in the note section, then go into the source, and it will tell you the statute.
In 12 USC, there are 33 references to 62 revised statutes which is 13 Stat 99 [13th Congress, page 99]. Consists of 20 pages of Banks & Banking which are expanded into 4 volumes with hundreds/thousands of sections in 12 USC.
“13 Stat. 102 (1864), Sec. 9. And be it further amended, That the affairs of every association shall be managed by not less than five directors, one of whom shall be the president. Every director shall, during his whole term of service, be a citizen of the United States; and at least three fourths of the directors shall have resided in the state, territory, or district in which each association is located one year next preceding their election as directors, and be residents of the same during their continuance in office. Each director shall own, in his own right, at least ten shares of the capital stock of the association of which he is a director. Each director, when appointed or elected, shall take an oath that he will, so far as the duty devolves on him, diligently and honestly administer the affairs of such association, and will not knowingly violate, or willingly permit to be violated, any of the provisions of this act, and that he is the bona fide owner, in his own right, of the number of shares of stock required by this act, subscribed by him, or standing in his name on the books of the association, and that the name is not hypothecated, or in any way pledged, as security for any loan or debt; which oath, subscribed by himself, and certified by the officer before whom it is taken, shall be immediately transmitted to the comptroller of the currency, and by him filed and preserved in his office.”
01:00:05
12 USC has about 64 sections which are positive law, and the rest are assumptions, beliefs, and opinions of the Law Revision Council.
01:02:00
[updated 05-04-2009]
Sec. 83. Loans by bank on its own stock
(a) General prohibition
No national bank shall make any loan or discount on the security of
the shares of its own capital stock.
(b) Exclusion
For purposes of this section, a national bank shall not be deemed to
be making a loan or discount on the security of the shares of its own
capital stock if it acquires the stock to prevent loss upon a debt
previously contracted for in good faith.
Capital stock is the money the directors put into the “pool” which thus creates the stock of the company. That money cannot be pulled out or touched because the stock would then deflate instantly. They cannot loan it out, or pledge it because it has already been pledged here as capital stock.
01:03:19
13 Stat. 35. And be it
further enacted, ‘That no association shall make any loan or discount on the
security of the shares of its own capital stock, nor be the purchaser or
holder of any such shares, unless such security or purchase shall be
necessary to prevent loss upon a debt previously contracted in good faith;
and stock so purchased or acquired shall, within six months from the time of
its purchase, be sold or disposed of at public or private sale, in default
of which a receiver may be appointed to close up the business of the
association, according to the provisions of this act.
[The above underlined wording is left out of the code. Perhaps also the next section 36.]
Sec. 36. And be it further enacted, That no association shall at any time be indebted, or in any way liable, to an amount exceeding the amount of its capital stock at such time actually paid in and remaining undiminished by losses or otherwise, except on the following accounts, that is to say:--
First. On account of its notes of circulation.
Second. On account of moneys deposited with, or collected by, such association.
Third. On account of bills of exchange or drafts drawn against money actually on deposit to the credit of such association, or due thereto.
Fourth. On account of liabilities to its stockholders for dividends and reserved profits.
Sec. 37. And be it further amended, That no association shall, either directly or indirectly, pledge or hypothecate any of its note of circulation, for the purpose of procuring money to be paid in on its capital stock, or to be used in its banking operations, or otherwise; nor shall any association use its circulating notes, or any part thereof, in any manner or form, to create or increase its capital stock.
Sec. 38. And be it further enacted, That no association, or any member thereof, shall, during the time it shall continue its banking operations, withdraw, or permit to be withdrawn, either in form of dividends or otherwise, any portion of its capital. And if losses shall at any time have been sustained by any such association equal to or exceeding its undivided profits then on hand, no dividend shall be made; and no dividend shall ever be made by any association, while it shall continue its banking operations, to an amount greater than its net profits then on hand, deducting therefrom its losses and bad debts. And all debts due to any...
The bank cannot use its
own capital stock, depositors’ money, and cannot lend credit. When an
account is opened, there is no negotiation in which the bank says it is
going to lend the depositors money. That violates the requirement that each
contracting party must be fully informed of what’s going on relating to the
contract. That lack of knowledge makes the contract void (not voidable).
A void contract means it never existed. A voidable contract is one that
exists but is not valid due to bad faith, breach of contract, etc.
01:06:33
Re Sec. 37: The bank may
not pledge or hypothecate any of
its notes for any reason
whatsoever, because of the word “otherwise”.
01:07:00
Since the bank cannot use
its notes, that brings up the question, “Whose issued the note?” The bank
could not have issued it because, if it did, that would violate the federal
law.
The note only has one
place for a signature. There is no place for the bank to sign. The
signature is that of the “borrower”. That note belongs to you. But, it
cannot be a debt according to the case law. And, if it is not a debt,
according to the FRB publications, then it cannot be an asset. In other
words, the note is an accessory to the debt, not the debt. In law, the
mortgage is also just an accessory to the debt; it is neither debt nor
asset.
01:09:00
The original note:
without it being brought forth in an action, the alleged “holder” of the
note has no rights, for 2 reasons:
1. The original note is used to prove the note was duly negotiated.
Duly negotiated = a transfer, sale, exchange, or delivery; according to the Securities and Exchange Act.
When you sign the note and give it to the bank, it has been transferred, regardless of any other factors.
2. To assure, if I’m accused by a bank under the note, if a judge honors in favor of the bank, the original note may resurface later and I might could be charged twice for the same thing.
01:11:20
Supporting cases:
A promise to pay cannot, by argument, however ingenious, be made the equivalent of actual payment. Christensen v. Beebe, 91 P.129, 32 Utah 406
- jk