27 F.2d 254 | 4th Cir. | 1928
(after stating the facts as above). The assignments of error relied upon on this appeal are that the District Court erred in holding that the plaintiffs had been guilty of laches; that the court erred in holding in effect that the defendant’s judgment was a prior lien on the furniture because defendant was at the time of the making of the mortgage an officer of the corporation, and had then represented that the furniture was covered under the terms of the mortgage as security for the debt therein secured; that the court erred in holding that the matters in dispute were res adjudieata because the plaintiffs were not parties to any of the suits set up in the answer of defendant, and that the court erred in not holding that the plaintiff Mrs. Hutchinson was entitled to an equitable lien upon the hotel furniture. We will now dispose of these assignments.
Plaintiff’s mortgage was executed in 1909. In 1921 a decree of sale in a foreclosure suit was entered, and the property covered by the mortgage was purchased by her. Neither in the foreclosure suit nor in the mortgage itself does it anywhere appear that the hotel furniture was conveyed as security for the debt. The judgment which was rendered at the February term, 1921, fixed the amount of the debt and appointed a commissioner “to sell the lands described in the complaint and in the deed of trust.” In the following September, Kenney brought his suit against the hotel company and attached the furniture, and, by consent of the parties, Mrs. Hutchinson, who, having purchased the hotel, was in possession of the furniture, was allowed to use it in connection with the hotel business, but in subordination to the rights of the sheriff under the attachment. The situation thus continued until, at the February term, 1927, Kenney got his judgment together with the right to have the furniture sold by the sheriff to satisfy his lien. It will thus be seen that'for a period of nearly six years, plaintiff recognized that she had neither right nor title to the furniture by virtue of the bonds secured by the mortgage, and neither at the time of the foreclosure of her security, nor at the time of the institution of the suit by Kenney, did she make sueh claim. It is true she continued to hold the furniture, and to use it, but expressly subject to the ultimate determination of Kenney’s claim of lien on it, and it was only after this claim was sustained by a decree of the state court that she asserted the claim she now makes here that the exclusion of the furniture in the granting provisions of the mortgage was an inadvertent omission. It is true that mere delay in itself does not constitute laches, and that ordinarily delay, not amounting to a bar of the statute, will not preelude relief; and this is especially true if the delay does not work injury to the rights of the other party. In sueh circumstances, a court of equity will rarely regard it sufficient to defeat an acknowledged right.
In this case, while the lapse of six years is not in itself fatal, when considered in connection with the fact that during this entire period, plaintiff not only failed to assert the rights she now claims, but, in holding the furniture as the agent of the sheriff, and in assenting to a title wholly antagonistic to that she now sets up, she created an estoppel by laehes, which is nothing more or less than the failure to do something which should be done, or to claim or enforce a right at a proper time.
We do not, however, place our decision
In these circumstances, we feel that the decree of the lower court discharging the injunction and dismissing plaintiff’s hill was clearly right, and should be, and is, affirmed.
Affirmed.