40 Kan. 5 | Kan. | 1888
Opinion by
In 1884, J. A. Cooper opened a grocery store in Washington, Kansas, with a capital of $800, money which he had borrowed from his wife, the plaintiff in this action. None of that money came to her from her husband; she got $769 of it from her mother, and the other $31
We think the testimony clearly establishes a cause of action in favor of plaintiff against defendant. This property was turned over under the mortgage and an agreement that the bank should be paid first, and afterward the residue should be paid to Mrs. Cooper. We see nothing wrong in such an agreement. Cooper and Knapp had a right to prefer their creditors, even if they both had remained in partnership; but this transaction was not of the ordinary partnership, and the creditors of Cooper & Knapp, whatever they might be under other circumstances, certainly in this case could have no greater rights or equities than Mrs. Cooper. The business was carried on solely upon money advanced by her to her husband; Knapp did not place a single dollar in the business; when he turned the matter over to his partner, Cooper had the right to prefer any one of his creditors. Cooper had the right to prefer Mrs. Cooper, his bona fide creditor, even though she was his wife, and even though the fact of her preference prevented the other creditors from receiving their pay out of his property. (Bailey v. Kansas Mfg. Co., 32 Kas. 73; Cuendet v. Lahmer, 16 id. 527; Kelsey v. Harrison, 29 id. 143; Tootle v. Coldwell, 30 id. 125; Wilcox v. Kellogg, 11 Ohio, 394; Waples, Attachm. & Garn., 59.)
The defendant claims that it was preferred as a creditor by Mr. Cooper, and not by plaintiff, and that whatever she did was a part of the consideration for her husband turning the property over to her. This is not supported by the evidence. The goods were transferred to plaintiff, and by her were turned over to the bank; to be sure, her husband wished to have the indebtedness of Cooper & Knapp to the bank paid. However, the goods were the property of Mrs. Cooper when she transferred them to the bank, subject to its mortgage upon them. The defendant further says, that it simply assigned its
It is claimed that because the defendant is a national bank it had no right to take this property and agree to turn back the proceeds to plaintiff, and that the cashier, in making this agreement, exceeded his authority. The bank took the property to secure its own claim; it was all personal property, and was not of more than twice the value of the claim to be secured; it received,the property, secured its own claim, and then refused to account for the balance. We think if it had the power to take the property and secure its own claim, it ought to have power to pay back the balance to plaintiff. It would be a very strange proposition of law for the bank to receive property upon a chattel mortgage or an agreement to secure its own claim, and not be compelled to account for any balance remaining after its own claim was satisfied.
We recommend that this case be reversed, and that the tria
By the Court: It is so ordered.