120 Mo. 208 | Mo. | 1894
The plaintiff and the defendant, W. J. Ross, were partners in the retail liquor business as saloon keepers under the firm name of Ross & Boland. Their business enterprise did not prove successful and they became largely involved in debt. Among others of their creditors was Michael Ross, brother to W. J. Ross to whom they were indebted and to whom they gave a mortgage on their partnership stock to secure the payment of his debt and placed him in the actual possession thereof. This mortgage also included some real estate owned by Ross & Boland individually. They were also indebted, or claimed to
On June 3, J. T. Boland, one of the partners, began a suit against his copartner for an accounting and dissolution of the firm, and made the mortgagee, Michael Ross, and attachment creditors parties defendant. In this petition he set up the necessary facts to authorize his suit against his copartner, and also alleged the mortgages and attachments as demands due from the firm, and prayed a distribution of its assets among all the creditors. He also asked the appointment of a receiver, which the court granted. To the attachment suits the defendant Ross filed pleas in abatement, which have never been tried and are now pending.
To the petition for an accounting the defendant Michael Ross made -answer, being a general denial and setting up his mortgages and deeds of trust, alleging the lien thereof as prior and superior to all other claims. These instruments on their face show a consideration of $7,000, but Michael Ross claims but $4,500, alleging the mistake in the amount and explaining that it occurred through the scrivener who drew the instruments.
On the twenty-sixth of January, 1891, the attachment creditors filed amended answers and what they called cross bills against the holder of the mortgage and deed of trust, setting up their attachments and assailing the mortgage and deeds of trust as fraudulent and as made for the purpose of hindering and delaying creditors. To these cross bills the mortgagee filed a general denial.
On the same day the cross bills were filed the cause was tried before the court. At the trial the defendant Michael Ross objected to the introduction of any evidence under the cross bills on the ground that the matters stated in them were not germane to the matter in the original bill, and showed no grounds of equitable jurisdiction. The objection was overruled and defendant saved his exceptions. The plaintiff offered no evidence in support of his petition.
After the evidence had all been introduced in behalf of the attaching creditors, defendant Michael Ross asked the court to find for him against the plaintiff Boland. This the court did and dismissed the petition in so far as Michael Ross was concerned. He then asked the court to declare that under the pleadings and evidence the plaintiffs in the cross bills could not recover, which the court refused to do, but compelled him to proceed with his defense to the cross bills. After a hearing on the merits the court declared the chattel mortgage and deeds of trust made by Boland and wife fraudulent and set them aside.
When the attachments were levied the sheriff took possession of several articles of personal property which had been put in the saloon by the mortgagee, and which belonged to him personally and were in no way connected with the saloon or the mortgage upon it. Prior to the levy the mortgagee had paid the rent of the building for half a month, at the rate of $200 per month. ' When the receiver came in on June 3, he
In due time the defendant Michael Ross filed his motions for a new trial and in arrest of judgment, which were overruled, and he perfected his appeal to this court.
Unless the proceedings in this ease were authorized by some legislative enactment they can not be upheld and the objection to the introduction of any evidence under the answers and cross bills of the attaching creditors should have been sustained, as it would not have been permissible at common law or in equity. Martin v. Michael, 23 Mo. 50; Crim v. Walker, 79 Mo. 335; Fisher v. Tallman, 74Mo. 39; Turner v. Adams, 46 Mo. 95. Section 571, Revised Statutes, 1889 is as follows: “Any attaching creditor may maintain an action for the purpose of setting aside any fraudulent conveyance, assignment, charge, lien or incumbrance of or upon any property attached in any action instituted by him; and where several attachments in favor of different
By making the attaching creditors parties to the original suit for the settlement of the partnership between Ross and Boland, although not necessary parties, yet as no objection was made thereto by the mortgagee or attaching creditors, the court acquired jurisdiction over them. When once in court the attaching creditors had the right to avail themselves of the provisions of the section of the statute quoted, and to file their answers and cross bills attacking the mortgage and deeds of trust of Michael Ross as being fraudulent and as having been executed by Ross and Boland for the purpose of defrauding their creditors. “A cross bill is brought by a defendant in a suit against the plaintiff in the same suit, or against other defendants in the same suit, or against both, touching the matters in question in the original bill. It is brought either to obtain a discovery of -facts in aid of the defense to the original bill, or to obtain full and complete relief to all parties, as to the matters charged in the original bill.” 4 Am. and Eng. Encyclopedia of Law, 905; 2 Daniell’s Ch. PI. and Pr. [5 Ed.], 1548. It may be brought, as in the case at bar, against other defendants in the bill. It could not, however, be done under the circumstances in this case, but for the statute, as the attaching creditors had no such interest in the property as would authorize them to attack the mortgage for fraud. In the case of Brinkerhoff v. Franklin, 21 N. J. Eq. 334, it is held that one defendant can not impeach the mortgage of a codefendant for fraud or upon any other ground by answer, but that he may do so by cross bill.
The petition, it is true, stated no grounds for equitable relief against the defendant Michael Ross or
We do not intend to be understood as holding that the attaching creditors could have voluntarily and of their own motion been made parties to the suit to settle the partnership, nor that their cross bills were germane to the suit brought for that purpose, but after they had been brought into court, with the mortgagee, and after he had filed his answer setting up his prior liens under the mortgage and deed of trust, that then they were authorized under section 571, Revised Statutes, to file
As a general rule the cross bill must be within the scope of the original bill, and germane. to its subject-matter; but all questions of this character were waived by the mortgagee in pleading to the original bill and asking that his prior lien as mortgagee be enforced. As was said by this court in the case of Savings Inst. v. Collonious, 63 Mo. 290, Shebwood, J., speaking for the court: “The court had the subject-matter of the suit within its grasp; had jurisdiction of that and likewise of the parties; and the doctrine is too well settled to admit of either discussion or dispute, that when a court of equity once acquires jurisdiction of a cause it will not relax its grasp upon the res until it shall have avoided a multiplicity of suits by doing full, adequate and complete justice between the parties. It will not content itself in this regard by any half way measures; it will not declare that a party has been defrauded of his rights and then dismiss him with a bland permission to assert, at new cost and further delay, those rights in another forum. Corby v. Bean, 44 Mo. 379; Rozier v. Griffith, 31 Mo. 171; Keeton v. Spradling, 13 Mo. 321; Primm v. Raboteau, 56 Mo. 407; McDaniel v. Lee, 37 Mo. 204; 1 Story’s Eq. Jur., secs. 64, 71; Russell v. Clark’s Ex’rs, 7 Or. 69; Armstrong v. Gilchrist, 2 Johns. Cas. 424; Lerdy v. Verder, 2 Cain. Cas. in Err. 175; Smith v. Sutton, 24 Gratt. 191.”
The trial court found that the chattel mortgage executed by Ross & Boland to Michael Ross was void,
If it had been shown that the amount inserted in the mortgage was done by mistake, as was attempted in this case, the mortgage would not be invalid but upon that point the evidence was by no means satisfactory..
When it appears from the mortgage or deed of trust that the mortgagor is permitted to remain in possession of the mortgaged property, and to continue in the ordinary course of business, which renders the instrument void as against the creditors of the mortgagor, taking possession of the property by the mortgagee by
The motion of defendant Boss for an order on the receiver requiring him to pay out of the trust fund in his hands the sum of $90.78 for cigars, ice, beer, and other articles placed by him in the saloon after he took possession thereof, as well as the items for rent, gas, etc., should have been sustained; there is no conflict in the evidence as to their correctness. And, inasmuch as the pleas in abatement in the main action are still undetermined, so far at least as this record discloses, the cause is reversed and remanded to await the further action of the court in the attachment cases, as a distribution of the fund would be premature and irregular before final judgment on the main case has been had.