Tonnar v. Washington & Issaquena Bank, 105 So. 750

105 So. 750 | Miss. | 1925

^* Headnote 1. Chattel Mortgages, 11 C.J., Section 339. Consent to sale of property by mortgagor after mortgage is given as waiver of lien of chattel mortgage, see note in 43 L.R.A. (N.S.) 302; 5 R.C.L., p. 445. The appellee sued the appellant for and recovered the value of cotton on which the appellee had a mortgage lien. The cotton was produced by T.W. Thames, who had given the appellee a mortgage thereon. Thames, pursuant to an agreement with the appellant, but without the knowledge of the appellee, shipped the cotton to H. C. Newman, New Orleans, La., for the appellant's account, and the appellant paid him therefor. Thames used the money received by him for the cotton in paying debts due by him to others than the appellee. The appellant had no actual knowledge of the appellee's deed of trust, but he did have constructive notice thereof because of the fact that it had been duly recorded in the office of the chancery clerk. One of the questions presented by the record, and the one on which the case must turn, is: Was Thames authorized by the bank to sell the cotton for the value of which the appellant is sued? If he was authorized so to do, the appellant cannot recover. The appellee's cashier, Sharkey, on whose evidence the authority vel non of Thames to sell the cotton must be determined, testifies in substance as follows: That Thames shipped ten bales of cotton covered by the bank's deed of trust to O.B. Crittenden Co., cotton brokers at Greenville, Miss. The bill of lading for the cotton was forwarded by Thames to the bank, and when the cotton was sold by Crittenden Co. the proceeds thereof were paid by it direct to the bank. Thames died between the shipment of the cotton and the sale thereof by Crittenden Co. Shortly after the cotton here in question was shipped by Thames to New Orleans, Thames told Sharkey that he had shipped the cotton to New Orleans, but did not tell him to whom it was shipped, nor that it had been shipped for the appellant's account. Sharkey made no objection to the shipment, stating that he supposed Thames intended for the cotton to be sold in New Orleans and would, when it was sold, account to the bank for the proceeds thereof. Thames some time thereafter told Sharkey to whom and for whose account the cotton was shipped. Quoting now from Sharkey's testimonyverbatim:

"Q. You did not give him permission to dispose of that cotton? A. We never object to any one disposing of the cotton and turning over the proceeds to us.

"Q. It is only when the proceeds are not paid over to you that there is any reason or cause of complaint? A. Yes, sir.

"Q. But he had permission to do as he had done, to sell the cotton and turn the proceeds over to you? A. There would have been no objection to that.

"Q. And both of you and he understood that? A. I guess he did. . . .

"Q. Mr. Brunini asked you yesterday whether or not you agreed with Mr. Thames that he might sell the cotton, and, as I remember it, you answered that you did not, but that you made no objection to any of your customers who mortgaged cotton to you selling their cotton if you got the money — what do I understand you to mean by that answer? A. I meant that we never expect a customer to whom we advance money on property to actually turn the cotton over to the bank for the bank to sell. We expect them to sell the cotton in such a way as suits them, and turn over the proceeds to us until the indebtedness to us is satisfied."

It is manifest from this evidence that not only would the appellee have ratified the sale of the cotton by Thames had he accounted to it for the proceeds thereof, but that it expected and therefore authorized Thames to sell the cotton and to account to it for the proceeds. The appellee's complaint, therefore, is not that Thames sold the cotton, but that he failed to account to it for the proceeds thereof, and with this complaint the purchaser of the cotton has no concern. He received the cotton because of the bank's consent to its sale, free from the lien of the bank's deed of trust. Phillips v. Thomas, 128 Miss. 729, 91 So. 420; Judd v. Delta Grocery Cotton Co., 133 Miss. 866, 98 So. 243.

The judgment of the court below will be reversed and the bill dismissed.

Reversed and dismissed.