25 Neb. 66 | Neb. | 1888
This action was brought in the district court of Custer •county, to foreclose a chattel mortgage on certain mill machinery, which constituted the motive power of the mill operated by the Broken Bow Roller Milling Company.
The facts as shown by the evidence are, in substance, as follows: John G. Schaupp and Son were, during the year 1885, the owners of and operating an extensive flouring mill at Grand Island, known as Planet Roller Mills; the plaintiff was their banker, to whom they then owed abouf $13,000. To secure this indebtedness and future advances they made a mortgage on the mill property for $10,000. Afterwards a doubt arose as to whether the machinery in the mill was covered by the real estate mortgage, and a chattel mortgage was taken to secure two notes of $5,000 each, being a part of the actual indebtedness. The real estate mortgage was recorded in Hall countyj and the chattel mortgage filed therein according to law. About June 4, 1886, the mill was destroyed by fire, which damaged the engines and machinery. At the time of the fire the actual indebtedness of Schaupp & Son to the plaintiff was about $17,000. The real estate mortgage was foreclosed, property sold, and the proceeds credited on the indebted
Mr. Frey testifies that he knew this boiler and engine were to come from the ruins of Schaupp & Son’s burned mill. Soon after this Mr. Schaupp caused some of the mortgaged property to be shipped direct to Broken Bow, and some to be sent to Allis & Co., at Milwaukee, for repairs, and to be shipped after this to Broken Bpw, where it arrived about Christmas, 1886, and was placed in position in the mill before the 29th of December, 1886, on which day a copy of plaintiff’s mortgage was filed in the office of the county clerk of Custer county. Mr. Frey paid the freight on the machinery to Broken Bow, and became liable personally for the repairs on the engine, and Mr. Schaupp failed to keep his engagements with him, and Frey assumed entire control. Mr. Frey afterwards sold the mill and machinery to Mr. Coliman. The Broken Bow Roller Milling Company was then organized, with Mr. Inman, Frey, Coliman, and Lorengan as its stockholders and officers. The property was conveyed by Coliman to the Broken Bow Milling Co., on or about March 29, 1887. Mr. Frey and Mr. John G. Schaupp had a settlement, and Mr. Schaupp signed a release of all
“Broken Bow, Neb., Apr. 15, 1887.
“Received of George W. Frey, Esq., fifty dollars, the receipt of which is hereby acknowledged, in full for all work done, material furnished of whatever description and character,' and also in full for all claims John G. Schaupp may have or had against the said George W. Frey or against the mill property, both personal and real estate, located on lots 4 and 5, block 102 of railroad addition to Broken Bow, Nebraska. In witness whereof, said John G. Schaupp has hereby signed his name this 13th day of April, 1887.
“ John G. Schaupp.
“ In presence of O. J. Coliman.”
Mr. Schaupp testifies that he only sold his own interest in the machinery, and that he never represented the bank; that its claim was not mentioned at the time.
Frey and the milling company defend against the action on the ground,
1st. That they are innocent purchasers, without notice of the bank’s claim under the mortgage.
2d. That Schaupp had a right to sell the property and release the bank’s claim, and that the receipt above set out has that effect.
3d. That the property has become affixed to the land, and is now real estate, and the plaintiff’s claim is lost thereby.
The defendants have paid nothing for the machinery in question except the above sum of $50. Mr. Schaupp, Sr., in his testimony, estimates the value of the machinery in controversy at $1,400, while Mr. Frey places it at not to ■exceed $500. The claim of the plaintiff is shown to be bona fide, and Mr. Schaupp is actually indebted to it on the chattel mortgage in question for considerably more than the value of the mortgaged property in controversy.
The judgment of the district court is reversed, and the cause remanded for the purposes herein indicated.
Reversed and remanded.