FIRST STATE BANK OF HAMLIN et al. v. JONES & NIXON
Court of Civil Appeals of Texas. Ft. Worth.
March 19, 1910
On Motion for Rehearing, April 30, 1910.
139 S.W. 671
[8] It is well settled that the lex situs governs when a chattel mortgage is executed in a state other than that in which the property is situated. Jones on Chattel Mortgages, § 305; Wharton on Conflict of Laws, § 317. As shown by the findings of fact in this case the mortgage held by appellee was duly recorded in Hemphill county, Tex., where the cattle were located when the mortgage was executed.
[9] Under the laws of this state the registration of that mortgage was constructive notice to appellant of appellee’s rights under that mortgage. The first note was never in fact paid, and if it was never paid the first deed of trust was never actually discharged. Independent of its registry, that mortgage was superior to the second mortgage while the latter was in the hands of Ladd, Penney & Swazey. To hold that the equities in favor of appellant are superior to those in favor of appellee, and give to appellant a right superior to that possessed by its assignor and entitle appellant a decree in equity subordinating the first mortgage to the second, would be to set at naught the force of registration laws of this state, which we do not think can be done; aside from the further question for us to decide, whether or not independent of the fact of such registration, the second mortgage in the hands of appellant without notice before maturity and for value was subject to the equities existing against it in appellee’s favor while it was held by Ladd, Penney & Swazey, the affirmative of which latter question has support in many respectable authorities. See 2 Pomeroy’s Eq. Jur. §§ 688, 708, 714, 730, 733 and 734.
[10] Furthermore, if the law be as suggested in Bartlett v. Eddy, supra, that, in order to protect the maker, a subsequent purchaser or mortgagee can urge any defense to a prior incumbrance, the rejection of which would result in ultimate loss to the maker, yet we fail to see how that rule can be invoked by appellant in this case. As announced, the rule is for the protection of the maker of the note. The findings of fact show that in consideration for the services performed by Kenney in replevying the cattle from the sequestration levy and then delivering them to appellant, the second note was canceled and returned to the makers. It is thus shown that no possible loss could be sustained by the makers of the second note as a result of the rejection of the defense of payment urged by appellant to appellee’s suit to foreclose the mortgage given to secure the first note; and, as the reason for the application of such rule does not exist in this case we do not think the rule should be given effect. If this conclusion be correct, then the decisions in Rice v. McFarland and Bartlett v. Eddy support the judgment in this case at all events.
For the reasons noted, the judgment is affirmed.
1. ATTACHMENT (§ 375*)—VACATION—SURRENDER OF PROPERTY—RECEIPT BY DEBTOR.
[Ed. Note.—For other cases, see Attachment, Cent. Dig. §§ 1378-1385; Dec. Dig. § 375.*]
2. TROVER AND CONVERSION (§ 5*)—WRONGFUL LEVY.
An attachment was levied on certain wood that belonged to a firm for a debt of one of the members of the firm, but only a small portion was ever removed; this being sold to provide for the expense of removing part of the wood from a pasture to a railroad right of way. The attachment having been quashed on the sustaining of a plea in abatement by one of the members of the firm, a tender of the wood remaining was made and refused. Held, that the levy having been made by notice only to one of the members of the firm and by an indorsement on the writ, and actual possession not having been disturbed, there was no conversion of the wood by the officer or attaching creditor, except as to the part sold.
[Ed. Note.—For other cases, see Trover and Conversion, Cent. Dig. §§ 38-50; Dec. Dig. § 5.*]
3. ATTACHMENT (§ 278*)—PARTNERSHIP PROPERTY—SURRENDER—POSSESSION.
Where, after the attachment of partnership property, one of the members of the firm by proceedings in a suit procured the quashing of the attachment and the dismissal of the suit, and had acknowledged that the levy had abated, there being no evidence that the officer or attaching creditor asserted any right or control over the property thereafter, it would be held, as a matter of law, that the possession was restored to the partnership without the actual entry of an order therefor authorized by
[Ed. Note.—For other cases, see Attachment, Cent. Dig. §§ 980-982; Dec. Dig. § 278.*]
Where an attachment was levied on partnership property, a return of possession of the property to one of the partners on the quashing of the writ was a return to the firm.
[Ed. Note.—For other cases, see Attachment, Dec. Dig. § 278.*]
5. ATTACHMENT (§ 359*)—PARTNERSHIP PROPERTY—MODE.
Though an attachment for debt of one of the partners of a firm was voidable only and regular on its face, its levy on partnership property, in a manner other than that prescribed by
[Ed. Note.—For other cases, see Attachment, Dec. Dig. § 359.*]
On Motion for Rehearing.
6. APPEAL AND ERROR (§ 724*)—ASSIGNMENTS OF ERROR—SUFFICIENCY.
Assignments of error to the refusal to set aside a verdict and judgment and granting a new trial, because the judgment and verdict are unauthorized by the court’s charge, the pleadings and evidence, and because the verdict and judgment are not responsive to or decisive of the issue made by the pleadings, evidence, and the charge of the court, are too general to be considered on appeal.
[Ed. Note.—For other cases, see Appeal and Error, Dec. Dig. § 724.*]
7. SHERIFFS AND CONSTABLES (§ 130*)—CONVERSION—RIGHT OF ACTION—WAIVER—RECLAIMING PROPERTY.
Where, after a sheriff has made a wrongful levy on partnership property for the debt of an individual partner, the acting partner voluntarily institutes proceedings to reclaim the property, in which he is successful, except as to a small part, which the sheriff sold, the firm thereby waived its right to sue for conversion of the property, except as to the part sold.
[Ed. Note.—For other cases, see Sheriffs and Constables, Dec. Dig. § 130.*]
Appeal from District Court, Jones County.
Action by Jones & Nixon against the First National Bank of Hamlin and others. Judgment for plaintiffs, and defendants appeal. Reversed and remanded.
Woodruff & Woodruff, C. H. Steele, G. M. Shelton, and Spence, Knight, Baker & Harris, for appellants. W. T. Shannon, J. W. Boynton, and J. B. McMahon, for appellees.
CONNER, C. J. Appellees, as partners, instituted this suit on the 14th of March, 1908, against appellant First State Bank of Hamlin, a private corporation, and against W. H. Hollis, as sheriff of Jones county, and against B. S. Davidson, Ed Kennedy, and C. H. Steele, sureties upon the officer’s bond, to recover damages for the alleged wrongful seizure and conversion of 1,042 cords of wood, alleged to belong to the plaintiffs and to have been wrongfully converted to the use of the defendants, under a writ of attachment, issued at the suit of the First State Bank of Hamlin, against the said F. L. Nixon. Among other things not necessary to notice, the defendants pleaded the general denial, and the sheriff specially that the attachment proceedings against Nixon had been dismissed “and the property levied upon returned to him; that Nixon disclaimed any ownership to the property so attached, and refused to receive the same.” A trial before a jury resulted in a verdict and judgment for appellees against all of the appellants in the sum of $2,510, as actual damages, with 6 per cent. interest thereon from March 21, 1908, with verdict and judgment in like amount against the appellant bank in favor of the defendant sheriff and his bondsmen.
One of the appellants’ propositions to an assignment of error complaining of the judgment presents the question of whether appellees were entitled to the value, as for a conversion, of all of the wood upon which the writ of attachment was levied, and we have concluded that the evidence fails to show that they were.
The evidence, in substance, shows without dispute that the writ of attachment mentioned was issued at the instance of the appellant bank, in a suit by it against appellee F. L. Nixon; that at the time the writ was received by the officer all of the wood in controversy, except about 150 or 200 cords, was corded upon a railroad right of way, in the town of Hamlin, presumably preparatory to sale and shipment, the remainder being situated in scattered cords in a nearby pasture, where woodcutters had left it. The levy was made by the officer notifying appellee Nixon that he “had papers for him, and would have right to take possession of the wood,” and by making return upon the writ that he had levied the same by taking the wood “into his possession.” It also seems to be undisputed that upon inquiry made one of the officers of the appellant bank stated to the other partner, Jones, that it was not intended to levy upon his interest in the wood, and that he could get his part at any time. Some time thereafter the defendant Nixon in the attachment suit presented a plea in abatement of the action, and also a motion to quash the writ of attachment, because of an alleged insufficiency in the attachment bond. The plea in abatement was sustained, the writ of attachment quashed, and the suit dismissed. It seems further undisputed that during the pendency of the attachment suit nothing was done by the officer in relation to the property attached, save that, at the instance of some of the parties, he removed some 50 or 60 cords out of the pasture, where it had been corded, to the right of way, where the larger part was situated, and that to provide for the expense of so doing he disposed of some 10 or 12 cords of the wood.
[1]
[2] But is this true? We think not. There was an undoubted conversion of the wood sold, for the value of which, with legal interest thereon from the date of the conversion, all appellants are liable; but by far the greater quantity of the wood was at the time of the dissolution of the attachment in the precise condition and situation, so far as the evidence shows, it was when levied upon, and the evidence, to which we have adverted, at least tends to show, if it does not establish, such return to appellees as the circumstances required. The wood, to which we are now referring, while technically taken into the possession of the officer by virtue of the writ, was not actually so done. It was in substance but a levy by a notice to Nixon and by an indorsement on the writ. The actual possession of appellees was not otherwise disturbed. Nevertheless, appellees might doubtless have then, had they seen proper, elected to treat the levy as a conversion; but they did not do so. One of the members of the firm invoked the aid of the court to remove the legal obstacle to the firm’s possession by pressing to a successful termination a plea in abatement of the suit, which necessarily vacated the ancillary writ of attachment and its levy. The necessary legal consequence, which the partner so acting must be held to have had in contemplation, was to restore, free of obstruction, possession of all the wood levied upon that had not been actually seized and converted by the officer, or lost in some way during the pendency of the attachment proceedings. In Drake on Attachment (7th Ed.) § 228, the law is thus stated: “As the whole office of an attachment is to seize and hold property until it can be subjected to execution, its lien is barren of any beneficial results to the plaintiff, unless he obtain judgment against the defendant, and proceed to subject the property to execution. A judgment for the defendant, therefore, destroys the lien, and remits the parties to their respective positions before the attachment was levied.” It is also said, in Smith & Co. v. Whitfield, 67 Tex. 124, 2 S. W. 822, that (quoting from the headnote): “After the dissolution of an attachment, the suit remains as if the writ had never issued. All proceedings under the attachment are dissolved, and all liens acquired by it fall with it, and can impart no validity to a lien acquired by a subsequent attachment.” Hence it would seem to be immaterial in the case under consideration that the court failed to make formal order for the return of the property, as required by the statute we have cited; for it is clear that Nixon knew of the quashal of the writ, and that he had but to ask in order to receive such direction, if deemed necessary.
[3, 4] Had it been made, its execution could have consisted in, nothing other than so notifying one of the partners, and in a cessation on the part of the officer in the assertion of control. In substance, it appears that this is what was actually done. Nixon knew that the levy had been abated, and there is no evidence whatever that thereafter the officer or the appellant bank asserted any kind of right or control. We think, therefore, that it should be held, as matter of law, under the circumstances of this case, that the possession of the partnership was restored, and that the acts of Nixon must be construed as a waiver of the right to treat the levy as a conversion, and as an election on his part to pursue the remedy of recovering possession of his property, of which he availed himself, together with such special damages as may have been caused thereby; it being considered in this connection that the acts of Nixon in relation to the partnership property were binding on the firm, and that a return of possession to him was sufficient. See Gassett v. Sargeant, 26 Vt. 424.
[5-7] The appellants Hollis and sureties prosecute a separate appeal, and insist that they are not liable because of the fact that the writ of attachment was regular on its face, and that hence it could not have been wrongful on the part of the sheriff to make the levy. We think it sufficient to say as to this, however, that if it be conceded that the writ was voidable only, and not void, and that it was regular on its face, its direction
We conclude that the judgment should be reversed, and the cause remanded for a new trial in accordance with the conclusions we have announced.
On Motion for Rehearing.
Appellees present a very forceful motion for rehearing that merits some notice. Among other things, it is insisted that the assignments of error do not support the proposition upon which the judgment was reversed, and that, in considering the same, we were in conflict with many decisions of this state relating to the sufficiency of assignments. The assignments that appellees in their motion assumed that we sustained are appellants’ first and second, which are as follows:
“The court erred in not setting aside the verdict and judgment rendered against the First State Bank of Hamlin, and granting it a new trial in this cause, for the reason that said verdict and judgment are not authorized by law as given in the court’s charge to the jury, the pleadings of the case, and the evidence admitted under the ruling of the court upon the trial of the case.
“The court erred in refusing to set aside the verdict and judgment because same are not responsive to nor decisive of the issue made by the pleadings and the evidence of the plaintiffs Jones and Nixon and this defendant, and the charge of the court applying the law thereto.”
These assignments were objected to upon the original hearing, and we agree with appellees that they point out no specific error and are too general to require consideration. We thought, however, that, if the error discussed was not apparent of record, it was necessarily involved in the determination of appellants’ third assignment of error to the charge of the court, and to which we referred in our original opinion. This assignment was that the court erred in charging the jury “that the writ of attachment offered in evidence in this case was unauthorized by law,” and that “by the term ‘conversion’ it means where an officer seizes property under a void writ.” Under this charge and the undisputed facts, there seemed to be no other alternative than a verdict in appellees’ favor, the very material issue of waiver, which we discussed in the original opinion, being thereby in effect determined against appellants, which we thought was erroneous. We therefore merely adopted appellants’ fourth proposition under its first and second assignments of error as presenting in its most concrete form the real question presented by the assignments and the record.
Nor did we hold, as appellees insist, that the acts of the sheriff in making the levy were insufficient to constitute a conversion, but, treating them so, that appellees through the acting partner voluntarily pursued the remedy of reclaiming the property, and thereby waived the conversion. In this respect the case is wholly unlike the case of Crawford v. Thomason, 53 Tex. Civ. App. 561, 117 S. W. 181, so urgently pressed upon us. That one so electing who actually receives the property in return cannot thereafter also recover the value of the property would seem manifest, and in this case the record shows no obstacle, as in the case of Terry v. Webb, 96 S. W. 70, that prevented appellees from reaping the benefit of the remedy of which they elected to avail themselves. In that case Terry sought and finally obtained a judgment for the return of attached property, but, before such final judgment, the property had been sold and the proceeds otherwise disposed of, and it was held that the form of his suit did not preclude him from thereafter suing the sheriff and his sureties for the value of the converted property, and we do not think our original opinion subject to the construction that it is in conflict with the Webb Case. We did not hold that, because of the action of Nixon, the partners were thereby precluded from thereafter suing for the trespass. On the contrary, we distinctly held that this suit might be maintained at least for all of appellees’ wood actually converted, for the deterioration thereof, if any, and for such special damages, if any, as they may have suffered by reason of the attachment or deterioration of the property while in the hands of the officer.
We conclude that the motion for rehearing should be overruled, and it is so ordered.