90 Va. 737 | Va. | 1894
delivered the opinion of the court.
It appéaring that the decree of October 18, 1889, appealed from, was iuterloeutory only and did not settle any question in dispute in tbe cause, beiilg a decree of reference only to a commissioner to make inquiry and report.
Upon the return of the cause to the circuit court this order was executed, report made and excepted to, exceptions overruled, and report confirmed by the court, and appeal taken to this court from said decree which was rendered on the 3d day of February, 1892; which overruled all exceptions to the commissioner’s report, confirmed the said report, decreed the payment of the debts of the appellant company, and upon default for thirty days decreed the sale of its property, and appointed a special commissioner to execute the decree for a sale.
The object of the bill filed in the case by the appellant company was to annul the deeds under which the sale is decreed. 1st, Because the trust deed was executed by a company to prefer certain creditors, which is alleged to have been made by a joint stock compauy to pay a loan which should enure ratably to all the creditors. 2d, Because the deed to Miles’ trustee on the 18th day of February, 1888, was void for uncertainties in the sum secured. 3d, To declare the deed to J. H. 'Wood void because not properly executed and recorded. 4th, To enjoin the collections under the deed, and to obtain priority for the the complainants’by reason of priority in time by attacking the deeds first. The commissioner, whose report is the subject of controversy, to which the exceptions above mentioned were filed, makes a statement of the matters before him in substance as follows:
On December 20, 1886, W. W. James and M. J. James, his wife, undertook by deed to convey two parcels of land situated in Goodson, “Washington county, Va., containing about six and one-half acres, adjoining each other, to F. W. and W. F.
The money, thus loaned was to be paid by the parties loaning, to J. H. Wood, trustee, for the buildings and improvements to be made on her said land, as they might progress and be completed. On written orders from F. W. Aldrich to said trustee, the money loaned to be paid said trustee as the money was needed for constructing said buildings and making said improvements, and upon the completion of said buildings and improvements, and upon the arrival of said machinery upon said land, the balance of said loan should be paid through said trustee to the said F. W. Aldrich.
On the same day, December 20, 1886, said F. W. Aldrich and L. G. Aldrich and yf. F. Aldrich executed a deed of trust to J. H. Wood, trustee, purporting to convey the property agreed to be conveyed, and for the purpose agreed on; that the deed from W. W. James and wife to F. W. and W. F. Aldrich
On July 23, 1887, P. W., L. G. & "W. P. Aldrich executed a mortgage deed to said land, and all the machinery and improvements on the same, to John Keys, to secure him in the payment of $1,000 due in twelve months from date received, August 11, 1888.
On May 19, 1887, Judge Kelly, judge of the circuit court, on motion of Aldrich and others, granted them a charter of incorporation by the name of the Clinch River Veneer Company.
On July 30, 1887, the said Aldriches, in consideration of $20,000, conveyed said land with the buildings, &c., to the said company, which deed was admitted to record August 3, 1888.
On February 18, 1888, the said company conveyed to A. F. Miles, trustee, the same property to secure A. B. Echols as endorser of its notes, not to exceed $3,000, acknowledged before the trustee therein, and therefore the acknowledgment was ineffective.
On October 24,1888, the said company executed a trust deed to J. H. Wood, trustee, purporting to convey the said land and buildings and the machinery, except the veneering machinery belonging to W. A. Rader & Co., to Drake & Son, and that belonging to E. Godsey, subject to the deed to Miles, trustee, and the mortgages to Keys, both above mentioned, to secure stated debts; to secure first W. A. Rader as indorser to the National Bank of Bristol for $2,000, and other named creditors.
On October 24, 1888, another trust deed to M. J. Drake to secure debts, which have been discharged.
The plaintiffs brought their suit April, 1889. In their bill they claim that the money secured in the deed of trust of December 20, 1886, by the Aldriehes to J. H. Wood, trustee, except the $2,500 due M. J. James, are not preferred debts, because not loaned said company until the spring of 1887.
That the deed to Miles’ trustee is void for uncertainty, that the said company is a joint stock company and could not prefer one of its creditors to the prejudice of other creditors, except it be to secure a debt contracted or money lent at the time of the creation of the lien. Code of 1873, ch. 57, sec. 63.
The plaintiffs in their bill make no objection to the said deed of trust to J. H. Wood, trustee, of October 24, 1888, except to certain persons, to-wit: F. W. Aldrich, W. F. Aldrich, J. C. Tyler and M. J. Tyler, stockholders, and Taylor & King, and no objection to the mortgage to John Keys by said company of July 23, 1887.
At the time of the deed to J. H. Wood, trustee, of December 20, 1886, to secure the debts due W. W. James, Jos. R. Anderson, W. D. Jones and Mrs. James, the company had not been chartered, being incorporated May 10, 1887, and hence, if for no other, their objection for the reason stated could not prevail.
The deed to Miles, trustee, 18th of February, 1888, for the same reason, being subsequent to the date of incorporation, will inure ratably to all of the creditors existing at the time of the creation of the lien. The deed of trust not being executed to secure a debt contracted or money borrowed at the time of the creation of the lien.
And for the same reason the deed of trust to J. H. Wood,
Plaintiffs’ counsel objected to the validity of the deed of trust executed by the Aldriches to J. H. Wood, trustee, of December 20, 1886, because the acknowledgment thereof was not taken in accordance with the form prescribed by the Code. This is a good objection as to Mrs. L. Gf. Aldrich, wife of P. W. Aldrich, but is not good as to W. P. and L. G. Aldrich. As to them there is a substantial compliance with the statute. That the title to the land in the suit has therefore never passed out of Mrs. M. J. James, she being a married woman and seized of the land in fee simple as her separate property. Her certificate of acknowledgment is defective, as has been said, because it does not state that she acknowledged the same to be her act, and that she has willingly executed the same as provided by the said Code of 1878. Rorer’s heirs v. Roanoke Nat. Bank, 88 Va., 589, and cases cited.
But while the deed from M. J. James to P. W. and T. W. Aldrich, of date December 20,1886, is defectively acknowledged and .insufficient to pass the legal title to the land, the deed is good as an executory contract, and one a'court of equity will enforce, and will uphold the deeds of trust executed on the faith of said deed, especially so inasmuch as Mrs. James, in her answer, is' making no objection on that account, and is only anxious to carry out her part of the contract, and recover the money which the deed iu trust of December 20, 1886, to J. H. Wood, trustee, was intended to secure her and the others therein named. 2 Minor, 344. The debts to said Drake have been paid and discharged in full by said trustee, as appears in evidence.
The said commissioner returned with his report an accouut showing the assets and the debts and their priorities in'five classes. This report was exceptéd to by Echols, Rader, Reynolds, and Barker, because too much interest was allowed on
Mrs. James filed an amended answer, seeking to take advantage as far as may of the defective acknowledgment by her in deed referred to above.
W. W. James and W. D. Jones except because the acknowledgment to the deed of December 20, 1886, is reported to be defective.
The court sustained the exceptions, showing error in calculations of interest as stated, and recommitted the report, and reserved the question as to the priority of W. F. Rader, rejected the debt of Tavenier altogether, and in all other respects confirmed the report. The commissioner reformed his report according to the decree of the court, stated some new debts, and reported with new depositions to sustain the same. Which report was excepted to because not reported in accordance with the decree, because the commissioner would not report the J. D. Mitchell & Co. debt, and because he did report the Morey debt to be $14,950, and because without authority he reported contrary to evidence a debt in favor of the National Bank of Bristol at $198 03 instead of $334 91, and renewed their old exceptions overruled by the court in former decree.
The court thereupon decreed as has been already stated, overruling all exceptions, confirmed the report, and decreed the payment of the debts therein reported, in their stated priorities, and decreed a sale upon default of payment in thirty days. Whereupon the appeal is taken to this court.
The decree appears to be without error, for reasons already stated by the commissioner and the trial court, and stated by this court herein, and must be affirmed. Amer. & Eng. Encyl. of Law, vol. 5, 439; Carpenter v. Dexter, 75 U. S., 8 Wall.,
Decree aeeirmed.