Elmer v. Welch

47 Conn. 56 | Conn. | 1879

Pardee, J.

On July 22d, 1876, the defendant bought of William B. Smith, who was insolvent, a piece of land in West Hartford upon which stood a house and two barns, together with hay, harnesses, wagons, and other personal property therein; also his half interest in a stallion, the other half being in himself. Toward payment he assumed a note for $5,400 which Smith had made and secured by a mortgage of the land, arid made a note for $1,000 payable two years from date at bank to his own order and delivered it to Smith.

On July 29tlr, 1876, the plaintiff factorized the defendant as being a debtor, and as having in his possession property belonging to Smith. The court found him a debtor to the amount of $1,000; execution issued and was returned unsatisfied ; and the plaintiff brings this action of scire facias to the Superior Court, and the advice of this court is asked as to the judgment to be rendered.

When the factorizing process was served upon the defendant Smith held his note for $1,000 above described, and the plaintiff insists that he is entitled to a judgment for that amount at least. The statute (Revision of- 1875, page 409, section 40,) provides that “when a debt evidenced by a negotiable promissory note shall have been attached by process of foreign attachment and the defendant shall have had actual notice thereof, he shall not negotiate or transfer such note during the continuance of the attachment lien; and, if he do so, shall be deemed guilty of fraud upon the attachiñg creditor, who, if he shall recover judgment in his original suit, may, within one year after its rendition, institute an action on the case against the defendant for such fraud; but the title of any bond fide purchaser of such note for valuable consideration, without notice and before maturity, shall not be affected by this section.” Smith having transferred the note before maturity to the American National Bank, the defendant ceased thereafter to be indebted to him, and the plaintiff’s lien was dissolved, if the bank was a bond fide purchaser.

Again, the plaintiff insists that the defendant has in his hands property belonging to Smith, for the reason that the sale thereof was not followed by the open, visible and continued change of possession which is requisite to its validity as against creditors.

The finding upon that point is, that the sale and purchase were made in good faith; that the property immediately passed under the control and supervision and into the possession of the defendant, who used it publicly for his own benefit, receiving rent from a tenant in the house. He took into his service one or two men who had been in the service of Smith, and employed the latter to take charge of the horse.

Here then was a recorded transfer of real estate, with immediate and exclusive possession and occupation thereof by the purchaser. This is notice to all the world of a change of ownership; and the publicity of this change as to the principal thing is to be imputed in full measure to the change as to the personalty, the mere incident remaining in visible connection therewith; the law did not demand either a permanent or temporary removal of the latter; whoever saw it thereafter in the defendant’s possession and use upon the realty known to be his, became chargeable with knowledge that he held and used both by the same right; and, as all persons had knowledge that Smith neither owned nor occupied the realty, whoever saw him thereon in. charge of any part of the personalty was bound to presume him to be the servant of the defendant rather than the owner of the property. The publicity of the change is quite up to the standard established by this court.

Again, the statute (Revision of 1875, page 843, sec. 2,) provides that “any negotiable promissory note payable on demand which remains unpaid four months from its date shall be considered overdue and dishonored after that time.”-

The plaintiff claims that as at the service of the factorizing-process the 15,400 note was in that condition, Smith had the right to recover damages to the amount thereof from the defendant for a breach of his contract to pay it. .

But the date of the note precedes that of the contract of assumption by nearly two years; the defendant has paid interest upon it semi-annually, and there is no finding that the payee demanded payment of the principal. Obviously it was held as an investment, and the contract imports' that when the payee demanded the defendant should make payment. Before such demand and a refusal Smith could claim neither actual nor constructive breach of the contract; it is certain that he did not intend to claim anything from the statutory maturity, for that had occurred long before; and it is not to be presumed in the absence of testimony that he intentionally entered into a contract having an element of impossibility.

And the contract of assumption is to be interpreted in the light of the fact that the note was an incumbrance of record upon land purchased by the defendant; he had the right to pay it at any time before payment by Smith, and have a discharge of the mortgage, and after such payment Smith, if entitled to any, would be to only nominal damages.

Therefore the finding fails to show that when the defendant was factorized he was indebted to Smith upon the contract of assumption; and we advise the Superior Court to render judgment in his favor, if, upon further hearing for that purpose had, it shall appear that the American National Bank was a bond fide purchaser of the note for $1,000 before maturity.

In this opinion the other judges concurred.