Ottumwa National Bank v. Totten

114 Mo. App. 97 | Mo. Ct. App. | 1905

NORTONI, J.

(after stating the facts). — The respondent argues that inasmuch as the hank attached the identical property in suit, and by said attachment affirmed the right of property therein to be in the attachment defendant, Totten, that it is thereby estopped from saying and maintaining on the trial of the interplea that it was holding said property at the time of the execution of the mortgage to the interpleader as a pledge from Totten. We do not think the fact that appellent was holding the property as pledgee of Totten would preclude appellant from attaching the property so held by it as pledgee. The two acts are in nowise inconsistent, but on the contrary, both affirm or recognize the right of property in Totten. By the attachment against Totten, appellant affirmed the right of the property levied upon to be in him, and by holding the property levied upon as a pledge from Totten, prior to and at the time of the attachment, appellant admits and is estopped from denying the superior right in Totten, the pledgor, subject, of course, to the lien of the pledge.

The law is universal that the pledgor of personal property still retains ownership of the goods, qualified, of course, by the rights of the pawnee. The pledgee, by taking the goods into his possession, becomes a lienor to the extent of the debt for which he holds the goods as security. The interest of the owner or pledgor is a vendible property interest, subject to the pledge, and is as much a proper subject of attachment and levy of execution against the owner as any other property rights of the proprietor. [Southworth & Co. v. Lamb, 82 Mo. 243; Richardson v. Ashby, 132 Mo. 238, 33 S. W. 806; Jordan v. Harrison, 46 Mo. App. 172.]

Drake on Attachments (7 Ed.), sec. 35, states the rule on the subject thus: “The right of a creditor to sue his debtor by attachment is not impaired by his holding collateral security for the debt. The Supreme Court of Massachusetts once held that a creditor who had received personal property in pledge for the payment of a debt could not attach other property for that debt, without first returning the pledge; but this position was afterwards repeatedly overruled by that court. And a mortgagee of personal property may waive his rights under the mortgage, and attach the mortgaged property to satisfy the mortgage debt, even after he has taken possession of it under the mortgage.”

The question of liability of the property rights of the pledgor in the property pledged to levy of execution and attachment is not identical with the like question arising by virtue of a chattel mortgage when the mortgagee is in possession of the goods under the mortgage, as under a chattel mortgage the law is well settled that after condition broken the mortgagor is no longer the proprietor, as. the proprietary rights of the property involved pass by virtue of the breach of the condition of the mortgage from the mortgagor and vest in the mortgagee ; therefore, there is no property right of which the mortgagor is proprietor on which a writ may be successfully levied, and for the mortgagee to assert title in himself because of condition broken, would be inconsistent with the assertion of title in the attachment defendant by attaching the goods as the property of such defendant. The law regards the mortgagee in possession of the goods under the mortgage as the owner thereof and will not permit him to hold the goods in one hand under the mortgage as the owner, and with the other, point to the attachment defendant as the proprietor; and it was upon this principle that the cases of Boettger v. Roehling, 74 Mo. App. 257, and Ottumwa National Bank v. Totten, 94 Mo. App. 596, were decided. Those casfes are distinguishable, as above indicated, from the phase of the case at bar now presented.

The case of the pledge is different, however, in that the pledgor retains the right of proprietorship in the property pledged, subject only to tbe lien of tbe pledgee; and whatever rights he may have, subject to the lien, are liable to levy and sale under execution or attachment under the same rules as other property rights. The law does not treat'the pledgee as the owner of the property from the mere fact that he is inpossession of the pledge because to make the pledge valid in law, the pledgee must be in possession thereof as security for his debt. That there must be a placing of the pledgee in possession of the property pledged in order to make the pledge valid and binding in law, is too well settled to require the citation of authorities. It is a primary fact that possession of the pledged property must be transferred to the pledgee, for this is the very essence of the transaction. [Storts v. Mills, 93 Mo. App. 201; Chitwood v. Zinc Co., 93 Mo. App. 225; Staples v. Simpson, Admr., 60 Mo. App. 73; Vanstone v. Goodwin, 42 Mo. App. 39.] The pledgee may bring attachment against the pledgor and attach whatever remaining rights the pledgor has in the property, and by continuing to hold the pledge and attaching, he does not assert title in himself and the pledgor both, but he does assert title in the pledgor and a lien thereon in himself, where as the mortgagee in possession is the owner; and for him to attach the mortgaged property as the effects of the mortgagor, when he himself was in possession as owner, would be inconsistent and in so doing he renounces and waives his right under the mortgage.

It is the office and purpose of the interplea to try and determine the title and ownership to specific chattels and the right of the sheriff to seize and hold them under his writ as the property of the attachment defendant. The sole issue thereon is the question of ownership, and of course, as ownership is usually accompanied with the right of possession, the right of possession is incidentally tried and determined. This is true to such an extent that in the case of Burgert v. Borchert, 59 Mo. 80, it was spoken of as a statutory replevin engrafted upon a suit by attachment, and has been so treated by the courts of this State ever since. The proceeding is so much of a substitution for the action of replevin that after its judicial determination the interpleader cannot resort to the action of replevin for the same property. The’ question of ownership being the issue on trial in this proceeding, and the interpleader asserting ownership in himself, he must, of course, as in replevin, recover upon the strength of his own title and not upon the weakness of his adversary’s. [Beck v. Wisely, 36 Mo. App. 239; Reeves v. Barker, 26 Mo. App. 487; Brownwell, etc., Car Co. v. Barnard, 139 Mo. 142, 40 S. W. 762; Scharff v. Meyer, 133 Mo. 428, 34 S. W. 858; Nolan v. Deutsch, 23 Mo. App. 1; Cahill, etc., Co. v. Ely, 55 Mo. App. 102; Hellman & Co. v. Pollock & Co., 47 Mo. App. 205; First National Bank v. K. C. Lime Co., 43 Mo. App. 561.] As the sole issue on the interplea is the ownership and right of the interpleader to the property, it would be competent then for the plaintiff in attachment, in defending against the asserted right of the interpleader, to show anything which would tend to overthrow his right or title to the property. The interpleader in this case predicated his right wholly upon the mortgage from Totten to him and the resultant possession of the property which Totten turned over to him under said mortgage at a time, as claimed by the plaintiff in attachment, when Totten had no right to mortgage or turn over possession of the property because of the prior pledge thereof to the plaintiff bank, therefore, if the bank could show these facts to be true, they would certainly overcome the right of the interpleader to the property.

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The attempted showing on the alleged pledge to plaintiff bank in this case went to the very essence of the alleged title of the interpleader. The proffers of proof were to the effect that the cashier, as agent of the plaintiff bank, then and there had possession of the property involved under a prior arrangement with Totten whereby the property was pledged to the bank for a sufficient consideration. This prooí should have been admitted. It is, of course, needless to say that if the bank was holding the stock as a pledge at the time, the pledgor, Totten, could convey no title to the interpleader other than that which he himself had, and that was subject to the pledgee’s lien. The pledgee, then, having a superior right to the possession of the property, it was competent to prove this in order to show that the inter-pleader had none. It was competent to prove the pledge, not to show title in the plaintiff bank, but to show want' of title in the interpleader. The court erred in its ruling that the identity of the property was the only issue. What has been here said applies as well to the instructions on this theory of the case which were requested by appellant and refused by the court.

The further question in the case contended for by the appellant is that the description in the mortgage to the interpleader is insufficient as against the plaintiff in attachment. When this case was here before Judge Bland, in the opinion, said: “There is some question as to the sufficiency of the description in Madden’s mortgage. The description is somewhat vague and indefinite. Its sufficiency may depend somewhat upon extraneous facts.” We can say as much again; but upon a retrial of the cause, the proceedings of which are now under consideration, it seems that extraneous facts alluded to bv the learned judge in the prior opinion, have been supplied in the record sufficiently to eliminate the question of insufficient description from further consideration. Inasmuch as the evidence all shows, and about which there is no controversy, that the property mentioned in Madden’s mortgage was actually pointed out and delivered to Madden by his mortgagor, Totten, before the attachment in this case was levied, and that Madden was in possession thereof, in the public road, conveying the same to his farm, before and at the time of the levy, and therefore prior to the intervention of the rights of plaintiff bank as attaching creditor, the question is not open here. The actual delivery by the mortgagor of the chattels mortgaged to the mortgagee prior to the attachment cures the matter of insufficient description if it be insufficient, and it is not a question in this case.

On this question, the Kansas City Court of Appeals, in the course of the opinion in the case of Springfield Engine & Threshing Co. v. Glazier, 55 Mo. App. 100 said:

“It has been decided that, when a mortgage was fatally defective but possession was delivered to the mortgagee before the rights of third parties had attached, that such third party could take no advantage of the faulty description. [Bank v. Sargent, 20 Kan. 576.] Delivery cures defects in description. [Cobby on Chattel Mortgages, sec. 187; Morrow v. Reed, 30 Wis. 81.] So it often has been held in other jurisdictions that possession taken by the mortgagee with the mortgagor’s assent before the rights of third parties intervene, cures defects in description and is an identification of the property. [Frost v. Bank, 68 Wis. 234; Morrow v. Reed, 30 Wis. 84; Williamson v. Steel, 3 Lea 530; Stephenson v. Tucker, 14 N. J. 600; Cameron v. Marvin, 26 Kas. 624; Frank v. Miner, 50 Ill. 444.] And a similar rule has been repeatedly, recognized in this State. [Wood v. Hall, 23 Mo. App. 110; Moser v. Claes, 23 Mo. App. 420; Nash. v. Norment, 5 Mo. App. 545; Greeley v. Reading, 74 Mo. 309; Petring v. Chrisler, 90 Mo. 649; Dobyns v. Meyer, 95 Mo. 132.] And a delivery to a third person for the mortgagee’s use is a good delivery if accepted by the mortgagee. Delivery to an agent is as effective as a delivery to the mortgagee. [Cobby on Chattel Mortgage, sec. 508; Jones v. Swayze, 42 N. J. L. 279; McPartland v. Read, 11 Allen 231.]”

For the reasons above stated, the judgment is reversed and the cause remanded.

All concur.