46 Kan. 400 | Kan. | 1891
The opinion of the court was delivered by
This was an action in the court below, brought by C. A. Bliss, E. S. Bliss, and B. F. Wood, partners
It is contended that there is no evidence to sustain the general finding of the court in favor of I. P. Couch, the sheriff. We have carefully examined the record, and do not find that there is any evidence tending to show that the chattel mortgage executed by Millspaugh, Highman & Co. to Bliss & Wood was fraudulent or void. It appears from all the evidence that the mortgage was given to secure the payment of a bona fide indebtedness for flour.
In Frankhouser v. Ellett, 22 Kas. 147, a majority of the court decided that—
“The statute authorizes a stipulation in a chattel mortgage for a retention of the possession by the mortgagor, and that a possession retained in accordance with the terms of such mortgage, is not, when duly filed, per se fraudulent, or even prima facie evidence of fraud as against creditors and subsequent purchasers.”
A majority of the court further decided in that case that—
“The mortgagor, if he may keep the possession, may as well make the sales as a stranger. He acts in that respect as a quasi agent, at least, of the mortgagee, and as such agent and salesman is entitled to compensation for his services.”
We know that—
“Fraud is rarely susceptible of positive proof, for the obvious reason that it does not cry aloud in the streets, nor proclaim its iniquitous purposes from the housetops. Its vermiculations are chiefly traceable by covered tracks and studious concealments.”
Notwithstanding this general doctrine, fraud is never presumed, but must be established by some evidence. If a creditor of a mortgagor assails the mortgage or transfer for fraud,, the burden of proof rests upon him. (Baughman v. Penn, 33 Kas. 504.) In Long v. West, 31 Kas. 293, it was decided that —
“ In the absence of evidence to the contrary, honesty and fair dealing in all transactions are always presumed, and if any person claims that there was fraud in any transaction, it devolves upon such person to prove the fraud, and it does not devolve upon the party charged with committing the fraud to prove that the transaction was honest and bona fide.”
Although Millspaugh, Highman & Co. were insolvent at the time of the execution of the chattel mortgage to Bliss & Wood, they had the right to prefer Bliss & Wood as creditors, if the same was done in good faith. (Arn v. Hoerseman, 26 Kas. 413; Randall v. Shaw, 28 id. 419; Avery v. Eastes, 18 id. 505; Bishop v. Jones, 28 id. 680; McPike v. Atwell, 34 id. 142; Cuendet v. Lahmer, 16 id. 527.) It was decided in Randall v. Shaw, 28 Kas. 419, that “the vigilant creditor is entitled to the advantage secured by his watchfulness and attention to his own interest.”
There was some evidence introduced upon the trial on the part of the defendant below showing that the members of the firm of Millspaugh, Highman & Co. were brothers-in-law of E. S. Bliss; that other mortgages were also executed by Millspaugh, Highman & Co. to Bliss & Wood, to secure the same indebtedness embraced in the chattel mortgage; that a mortgage by Millspaugh, Highman & Co., to secure E. S. Bliss, as
We think it was proper for the trial court to admit evidence of everything connected with .the possession of the property under the chattel mortgage, and the sale and transfer of the goods by Bliss & Wood, as throwing light on the transactions between the parties to the chattel mortgage. But all of the mortgages given to secure the indebtedness existing from Millspaugh, Highman & Co. to Bliss & Wood were not excessive in value, and the amount of the indebtedness in the mortgages was not exaggerated or over-valued. It is possible that, upon a new trial, something may develop the mala fides of the transactions between Millspaugh, Highman & Co. and Bliss & Wood, but, upon the evidence presented in this record, we cannot see how the chattel mortgage can be defeated or set aside. If Bliss & Wood have received under their mortgage more than sufficient proceeds to pay their indebtedness, they may be held to account to the creditors for any overplus.
It is claimed upon the part of plaintiff below, that I. P. Couch, as sheriff, did not have in his possession the goods and merchandise in dispute at the time that the last order of delivery was issued and served. He did have, however, the actual possession of the goods' when the petition was filed, and when the first summons and the first order of delivery were issued. These were set aside on account of the irregularities and alias orders issued.
On January 27, 1887, the court directed the goods and merchandise to be turned over to the defendant below. He did not file any disclaimer, but attempted to show title in himself, and the right of possession incident thereto, under an execution properly issued and placed in his hands. There
The judgment of the district court will be reversed, and the cause remanded for a new trial.