49 Neb. 766 | Neb. | 1896
This action was instituted by Charles W..Sanford to recover the value of a span of mules, which it is claimed the defendant converted. The answer is a general denial. At the close of plaintiff’s testimony, the jury, in obedience to a peremptory instruction of the court, returned a verdict for the defendant, upon which judgment was subsequently rendered. Plaintiff prosecutes error.
The question involved is whether, under uncontradicted testimony, the court erred in not submitting the cause to the jury, and in directing a verdict for the defendant. On the 14th day of November, 1887, one J. R. Eddy, a resident of Saunders county, and being the owner of the mules in question, executed and delivered his negotiable promissory note to George A. Crafts for the sum of $680, payable ninety days after date, with interest at ten per cent, and at the same time secured-the payment of said note by a chattel mortgage upon said mules, together with other property. The mortgaged chattels were left in the possession of Eddy, and the mortgage was duly filed in the office of the county clerk of said county, the county in which the mortgagor then resided, on December 31, 1887. Plaintiff purchased the note and mortgage before maturity, in the usual course of business, for an adequate consideration, and he has ever since been
Section 11, chapter 32, Compiled Statutes, declares: “Every sale made by a vendor of goods and chattels in his possession or under his control, and every assignment of goods and chattels, by way of mortgage or security, or upon any condition whatever, unless the same be accompanied by an immediate delivery, and be followed by an actual and continued change of possession, of the things sold, mortgaged, or assigned, shall be presumed to be fraudulent and void, as against the creditors of the vendor, or the creditors of the person making such assignment, or subsequent purchasers in good faith; and shall be conclusive evidence of fraud unless it shall be made to appear on the part of the persons claiming under such sale or assignment that the same was made in good faith, and without any intent to defraud such creditors or purchasers.” The foregoing provisions have been frequently before the court for consideration, and it has been decided repeatedly that the retention of possession of mortgaged chattels by the mortgagor renders the mortgage, although duly filed, prima fade fraudulent as to creditors of the mortgagor and subsequent good-faith purchasers, but that this presumption may be rebutted by evi
In the first case Lake, J., in construing the statute which we have just quoted, uses this language: “In the case at bar, it is undoubtedly true that the property described in the mortgage, and which is the subject of the action, was left in the possession of the mortgagor; and that, under the section of the statute just quoted, as to certain persons, the transaction would be declared fraudulent. But who is entitled to invoke the aid of this provision? Not every person, most certainly. It is expressly limited by unequivocal language to creditors of the persons making the sale or assignment, and subsequent purchasers in good faith. Before a purchaser can invoke the aid of this statute, he must establish his own bona fides. If, at the time of his purchase, he knew of the existence of the mortgage, he will take the property charged with the just claims of the mortgagee, or in case of an assignment of the assignee of the mortgagee under the mortgage.” If the defendant was aware of the mortgage when he acquired the property, he has not been defrauded by reason of the possession of the property being retained by the mortgagor, since it constituted no inducement to his purchasing. If he knew of the outstanding mortgage, he cannot invoke the statutory presumption of
Counsel for defendant rely upon Norton v. Pilger, 30 Neb., 860, to sustain their contention that it was essential to a recovery by plaintiff that he should prove the Iona fides of the mortgage and the mala fides of the defendant’s possession. The views we have expressed do not conflict with that case. The first clause of the syllabus of the opinion reads thus: “A chattel mortgage or bill of sale of personal property, not accompanied by an immediate delivery and followed by an actual and continued change of possession of the property sold, mortgaged, or assigned, is presumed to be fraudulent and void as against subsequent purchasers in good faith; and when offered in evidence in an action between the person claiming under it and a subsequent purchaser in good faith, and for value, to be effective it must be accompanied by evidence on the part of the person claiming under such chattel mortgage, or bill of sale, that the same was made in good faith and without intent to defraud creditors or purchasers. A prior recording of the instrument will not supersede the necessity of such proof.” The principle enunciated in the foregoing is in entire harmony with not only the prior decisions of this court, but in accord with the rule which we have announced as controlling this case. Had Jensen shown that he-was a good-faith purchaser, the case of Norton v. Pilger, supra, would have been in point, and it would have been necessary for this plaintiff to prove the good faith of the mortgage.
It is urged that the petition fails to show a cause of action, because it does not allege that there was any consideration for the execution of the note and mortgage, or that the defendant’s possession or purchase was mala fides. This argument has already been met by the foregoing discussion. Moreover, there is no averment in the petition that the defendant was a purchaser of the prop
Reversed and remanded.
