57 Kan. 352 | Kan. | 1896
I. We do not feel called upon to decide whether the judgment creditors stand in a position to question the validity of the several chattel mortgages, each of which was given to secure a bona fide, although a preexisting, debt. If they secured liens upon the fund in the hands of the receiver, certainly they were subsequent in time to the recording of the chattel mortgages. It cannot be held as a matter of law that the entire failure of the Bank to file its mortgage of June 6, 1890, and the delay in filing that of December 6 until December 22, 1890, operated as a fraud upon creditors who relied on the false representation of Champion that his stock was not mortgaged. The mortgage of June 6 was never
II.’ Mary E. Champion and Hattie C. Crozier, as well as the commercial creditors, attack the validity of the mortgage to the Bank on the ground that Charles T. Champion was permitted to conduct the store and dispose of the proceeds of sales in his own way, and that the recording of their mortgages and taking possession thereunder -were prior in point of time to the recording of the mortgage of the Bank and the possession of the Bank under the same. This claim is not tenable. They had actual knowledge of the prior mortgage, and as to them it was immaterial
The conclusions of fact are favorable to the Bank, and we think that they are sufficiently supported by the evidence. The record does not show the amount realized by the receiver ; but we feel satisfied that the funds in his hands will be insufficient to pay the three mortgage claims and that nothing will be left for the commercial''.creditors. If any balance should remain, however, they ought to have the benefit of it.
The judgment of the District Court will be affirmed.