84 Wis. 601 | Wis. | 1893
1. There can be no doubt but that the deed and agreement, -which were clearly given to secure the debt of Robinson to Lovejoy, constituted a mortgage. It is settled that whenever property is transferred, no matter in what form or by what conveyance, as a mere security for a debt, the-person to whom the transfer is made takes merely as a mortgagee, and has no other rights or reme
2. Bobinson could not grant or mortgage that which he did not actually or potentially own, either absolutely or by way of security. The crop raised on the farm by him in 1890 was not in existence when the agreement was made, either actually or potentially; and Bobinson could .not, therefore, grant it by way of security. The seed had not been planted and had not germinated so as to constitute a possibility coupled with an interest which might be the subject of sale or transfer. Conceding that, within some of the authorities cited by respondent, the agreement would be operative when the crop should come into existence (McCaffrey v. Woodin, 65 N. Y. 459), or would amount to a revocable license .to Lovejoy to enter on the premises and take the after-acquired crops according to the terms of the license, or that it might be made operative by a delivery or other equivalent of the crops after they were raised, still it is plain that in this view of the case the agreement, as a title or charge on the crops, was inoperative in law and invalid as to creditors. That the provision in question would be invalid as to crops thereafter to be planted was settled in Comstock v. Scales, 7 Wis. 159, and reaffirmed in Lamson v. Moffat, 61 Wis. 153. The subject matter not being in existence, there was nothing for the agreement to operate on until the crops were raised and delivered. The case of a lien reserved in like manner by a landlord in a lease, upon crops to be raised by a ten
It is plain, therefore, that such a mortgage, even though filed in the proper town clerk’s office, would be wholly inoperative as to creditors or subsequent purchasers, unless, before their rights attached, the property was delivered to the mortgagee, or the subsequent act necessary to make it valid was performed; and this would seem to render actual possession necessary by the mortgagee of such property, in order to be able to maintain his rights in respect to it. For want of such actual and continued possession of the property claimed to be affected by it, the agreement was absolutely void as to the creditors of Robinson, whether prior or subsequent to its date or to the time when- the crop was raised. R. S. sec. 2313.. It is sufficient
3. In addition to the objections already noticed, as against Robinson’s creditors the stipulation in the agreement in respect to the crops was fraudulent and void in law, for the reason that there was reserved in it to Robinson, as mortgagor, the right to such portion of the crops raised from year to year as might be necessary to feed the stock on the farm, belonging to him, and such as he might use for food in his family, to be apportioned and set apart by the parties when the crop should be in readiness; thus reserving to him, as against his creditors, a substantial trust for his benefit in every crop that might be raised under this arrangement, and which it was at the time contemplated should continue at least ten years. The case, in principle, is not distinguishable from that of Blakeslee v. Rossman, 43 Wis. 116. The validity of such a security is not an open question in this state. It is not a question of intent, for the arrangement necessarily tends to hinder,
It is impossible to overlook or ignore the manifest fraudulent character of this agreement, as against creditors. If sustained, it would furnish an apt and ready device to cheat and defraud the creditors of every person engaged in similar pursuits, and in embarrassed circumstances, so that he might take to his own use a large portion of the annual profits of his lands, and hold them in defiance o.f creditors, if he happened to have a friendly mortgagee at hand, willing to enter into such an arrangement with him as the one disclosed by this record. Mr. Lovejoy had no right to use his debt and mortgage security for any such improper purpose, and his testimony shows that it was intended, in point of fact, that this instrument should have precisely the effect that we ascribe to it in law, namely, “ so that no one else could take hold of them [the crops] if he had any other debts. I allowed him to take out of the crops he raised a sufficient amount to feed his stock he had on the premises, and a sufficient amount, each year, to tahe eare of his family and to pay his expenses. We have never had any particular settlement. He has used all the crops that I did not get. I have no account whatever of what he used. ... I have allowed him to sell out of the crops, and buy other things with it.” It being incontestable that this provision was given by way of security, and has the effect of a mortgage on the crops to be thereafter raised, it is impossible to sustain it, as against the claims of the creditors of Robinson, either prior or subsequent, for manifestly it was aimed against both, and was .to be operative, as already observed, for the period of at least ten years. It is not only fraudulent in law, but the
By the Oourt.— The judgment of the circuit court is reversed, and the cause is remanded with directions to give judgment in favor of the plaintiff for the fund paid into court, or against the party to whom it has been paid, for the amount of his judgment and costs.
I have no doubt a valid stipulation may be inserted in a real-estate mortgage, whereby the mortgagee may be deemed to be in possession, and the mortgagor, as his agent, continue to occupy, cultivate, and dispose of the crops, and, after paying the expenses for doing so, apply the net proceeds in payment of the mortgage debt. Especially may this be done where, as here, the old mortgage is overdue and inadequate security, and a hew equitable mortgage containing such stipulation is taken in lieu thereof. The difficulty with 'the stipulation in question is that Robinson thereby reserved to himself such portion of the crops raised on the premises as might be nec-cessary to feed his stock and support his family, without any regard to the expense of raising such crops. This seems to be a conveyance or transfer in writing, therefore, of goods, chattels, or things in action, made in trust for the use of the person making the same, and hence, under the statute, is void against the creditors, existing or subsequent, of said Robinson. Sec. 2306, R. S. It also appears to be in conflict with the statute which declares, in effect, that every conveyance or assignment, in writing, of any