51 Neb. 620 | Neb. | 1897
On the 15th day of February, 1893, D. R. Cole, of Lexington, Dawson county, executed and delivered to D. E. Cole and G. W. Cole a chattel mortgage on his stock of merchandise and fixtures to secure a Iona fide debt which he then owed them. The mortgage was filed, and possession of the property was immediately taken thereunder by the mortgagees, who sold the same, receiving $214 in excess of the amount of their debt. On the same day said D. R. Cole executed and delivered to G. W. Miller & Co. a second chattel mortgage on the same property, by its terms subject to the one aforesaid, to secure a note of $300, but which last mentioned mortgage was not filed for record until February 17, 1893, and at no time had the firm of G. W. Miller & Co. taken possession of the property under its mortgage. On the 16th day of February, 1893, Meyer & Raapke, Atwood & Steel, Allen Bros., and George W. Chase & Son each instituted an action in the county court of Dawson county against said D. R. Cole to recover a debt due fox; merchandise sold and delivered to him. A writ of attachment and garnishee summons were issued in each cause, and the latter was directed to and served upon the said D. E. Cole and G. W. Cole the day prior to the filing of the chattel mortgage to G. W. Miller & Co. Subsequently, each plaintiff recovered a judgment in its said action against the defendant therein for the amount of his indebtedness. The garnishees appeared in said causes and answered that they had in their hands the sum of $214 belonging to D. R. Cole as the proceeds of the sale of the mortgaged' property over the amount of their debt, interest, and costs. G. W. Miller & Co. intervened in the garnishxnent proceedings and claimed under and by virtue of their mortgage the said sum remaining in the hands of the garnishees. From a decision rendered adversely to such claim in the county court, an appeal was prosecuted to the district court, where a judgxnent was entered to the
It is not a mooted question in this state that where a mortgagee of chattels is in possession of mortgaged property, the interest of the mortgagor therein, after the debt due the mortgagee is paid, may be reached by the process of garnishment by a creditor of the mortgagor. That doctrine was first stated by this court by Lake, C. J., in Burnham v. Doolittle, 14 Neb., 217, in this language: “But in view of our attachment law and the ruling of the supreme court of Ohio on a statute from which ours was copied, and upon more mature reflection, we are now satisfied that whatever interests a mortgagor of chattels may have in them, in this state may be reached by seizure under a writ of attachment at any time while in his possession, and by means of the process of garnishment if they have passed into the hands of the mortgagee.” (See Chicago Lumber Co. v. Fisher, 18 Neb., 334; Grand Island Banking Co. v. Costello, 45 Neb., 119.) That proceedings in garnishment are binding from the time of the service of summons upon the garnishee, and the property of the debtor in his' hands is thereby placed in custodia legis, there can be no doubt. (Reed v. Fletcher, 24 Neb., 435;, Northfield Knife Co. v. Shapleigh, 24 Neb., 635; Grand Island Banking Co. v. Costello, 45 Neb., 119.) It follows that the judgment creditors of D. R. Cole acquired liens upon his interest or equity of redemption in the mortgaged chattels from the time of the service of the garnishment process. Upon the fact that the mortgage to Gr. W. Miller & Co. was given before the garnishment proceedings were instituted, the claim of said mortgagees to a prior lien is predicated. If section 14, chapter 32, Compiled Statutes, means what it says, this contention is wholly untenable. Said section has been before this court for consideration more than once, and it has been
Reversed.
