Britton & Mayson v. Criswell

63 Miss. 394 | Miss. | 1885

Cooper, C. J.,

delivered the opinion of the court.

The mortgage executed by Nalty to secure the debt due to Brit-ton & Mayson was not fraudulent on its face, for though it is strongly suggested that it was contemplated by all parties to it that Nalty should continue to dispose of the goods mortgaged in the usual course of trade, there is no express reservation of that right. Cargill v. Ewing, 13 S. & M. 79. We cannot say that the power is so clearly reserved to sell the goods that no evidence negativing that right could be introduced. It is only where the conveyance so unmistakably reserves the right to the mortgagor to deal with the property mortgaged as his own that all evidence to the contrary should be excluded as contradicting the writing, that a court can declare the deed fraudulent in law. But that the mortgage was fraudulent in fact, or fraudulently used by the beneficiaries, is, we think, manifest. The debtor’s property was withdrawn from liability to seizure by other creditors, not for the purpose only of giving security to the creditors in whose favor it was given, but that at the end of the business which might be conducted by the debtor the mortgage should bind whatever of goods there might be then on hand, for whatever debt might be then due, within the amount of the note described in the deed. The mortgagor could, in conformity with the contract or understanding between himself and the beneficiaries, sell any part or all of the mortgaged goods, and thus he could determine on what the mortgage should exist at its forfeiture; the beneficiaries, on the other hand, could apply any payments made, whether realized from sale of the mortgaged goods or otherwise, to any debt they might hold, and thus other creditors could be prevented from securing the payment of their debts, at the will of the parties to this deed. As we have said, this agreement is not shown from the face of the deed, but it manifestly and indisputably is shown by evidence aliunde.

Whether Hardy is chargeable with notice of this fraudulent agreement existing dehors the deed, it is unnecessary to decide, since we think the evidence preponderates in favor of the fact that all the deeds securing Mrs. Criswell’s debt were recorded. Nalty, the mortgagor, testifies that they were, and though others who examined the records failed to discover on the index of deeds evidence that they were recorded, it may be that the reason was that the clerk failed to index the deeds, or that the examinations were not thorough. That such was the character of the examinations made by McNair is evident from the fact that he failed to find the prior deed in favor of Britton & Mayson, and that this was recorded and placed on the index is shown by the evidence of Mr. Williams.

On the facts shown it appears that, though the mortgages executed from time to time were surrendered as the renewals were given, there was no intention on the part of the mortgagee to surrender her lien on the property, but that these were mere changes in the form of the security. Under such circumstances the lien is to be treated as continuous, under whatever form it existed.

The judgment in favor of Cummings, county superintendent of education, is valid and a prior lien upon the property, except that described in the mortgages to Mrs. Criswell. It is not competent for either Mrs. Criswell or Britton & Mayson to deny that the plaintiff in that judgment was the owner of the claim sued on at the time of the rendition of the judgment. The debt was a valid debt, and if the debtor did not avail of any supposed defect of power on the part of the county superintendent to sue, these creditors cannot. Jones v. Moody, 59 Miss. 327.

It is true that the board of supervisors of the county is now the proper party to receive payment of the money due on the judgment. Code of 1880, § 739 ; but this only shows that it might have been made a party defendant to the bill instead of Spencer.

’On the facts shown the complainant is entitled to subject the property to the payment of her debt, but as to all of it not included in her mortgages, the judgment is a prior lien and entitled to priority of satisfaction, and a sale, if made, must be in subordination of the rights of those beneficially interested therein. Since Mrs. Criswell has improperly made Spencer a party to the bill, the decree dismissing him from the suit should be so modified as to clearly protect the rights of the board of supervisors in any suit it may see proper to institute.

For this purpose the decree will he reversed and a proper decree made here.