12 N.Y.S. 824 | N.Y. Sup. Ct. | 1891
We concur in the conclusion of the special term that, if there were assets in the hands of the receivers sufficient to pay the proper dividend upon the claim of the Lee Arms Company, it should be paid, although the time to prove debts against the estate had expired; and therefore are of the opinion that that part of the order which was appealed from by the receivers should be affirmed. This leaves for consideration that portion of the order which denied the petition of the Lee Arms Company for a direction to the receivers to pay to the petitioner its royalties in full.
The question presented at the outset is whether the royalties which were due the Lee Arms Company constituted a debt against the estate in the hands of the receivers to be paid by them as other debts against the estate were paid, or whether its claim for such royalties could properly be made against the receivers, and should be paid by them in full. By an examination of the contract under which these royalties were claimed, it becomes quite obvious
It appears by the papers read on this motion that 165 arms were on hand at the armory of E. Remington & Sons when the receivers in this action were appointed. Upon 30 of these royalties have been paid or allowed by the receivers. On the remaining 135 no royalties have been paid. The royalties on that number amounted to the sum of $199.25. As it is not claimed that there was any sale of these arms until after the receivers were appointed, it follows, we think, that this sum should be paid by the receivers in full, if they have sufficient funds in their hands.
The appeal book also discloses that, when this action was brought, all the other arms in question had been transferred by bills of sale given by E. Remington & Sons as security for money borrowed by it at the time of the several persons, firms, or corporations to which they were given. There had been a default in each case in the payment of the debt thus secured, or some portion thereof. It is perhaps proper, before proceeding further with the examination of this question, to determine the nature and character of the transactions between E. Remington & Sons and the several creditors to whom such transfers were made, and whether they were mere pledges of the arms in question, so that the title remained in E. Remington & Sons, or whether they were in the nature of chattel mortgages by which the title passed to the several creditors, subject to be defeated only by a payment of the debts which they were given to secure. “A • pledge ’ differs from a ‘ chattel mortgage ’ in three essential characteristics: (1) It may be constituted, without any contract in writing, merely by delivery of the thing pledged. (2) It is constituted by a delivery of the thing pledged, and is continued only so long as the possession remains with the creditor. (3) It does not generally pass the title to the thing pledged, but gives only a lien to the creditor while the debtor retains the general property.” Jones, Pledges, § 4. “ Whenever there is a conveyance of the legal title to personal property upon an expressed condition subsequent, whether contained in the conveyance or in a separate instrument, the transaction is a mortgage. ” Id. § 8. A delivery must always accompany a pledge, while a mortgage may be valid without a delivery. Jones, Chat. Mortg. § 7. “A decis
“Ilion, N. Y., 9th April, 1885.
“H. D. Alexander, Cashier Rational Mohawk Valley Bank, Mohawk, N. Y. Bought of El Remington & Sons, 1,000 Lee rifles, 433 Cal. A. B., 4 boxes, $15,500. Above goods are sold to H. D. Alexander, cashier, and are held by him as collateral security to and for the payment of our note C, Ro. 10,151, dated April 9th, 1885, at three months from date, to order of and indorsed by P. Remington, for $10,000, and all renewals of the same. Said rifles are stored in the warehouse at the N. Y. C. R. R. freight depot. Ilion, N. Y., contained in fifty cases, each case marked ' A,’ and covered by receipt No. 163, signed by C. R. Mentz. E. Remington & Sons.
“By E. Remington, Tr.”
The transfers by E. Remington & Sons to their several creditors were all substantially alike except as to the name of the creditor, the amount of the debt, and the number of arms transferred. We think it is quite obvious that these transfers were in the nature of chattel mortgages, and were not mere pledges of the property. It will be observed that, by the express provisions of each of these transfers, E. Remington & Sons sold to the creditor the arms mentioned therein, to be held as collateral security for the payment of its debt. The property was in no case delivered to the creditors, but it remained in the possession of the New York Central Railroad Company. Such a transaction did not constitute a pledge, as there was no delivery of the property pledged, and there was a sale by which the title passed. We are of the opinion that, within the doctrine of the authorities cited, the transactions between E. Rem
Merwin, J., concurred. Kennedy, J., dissented.