24 S.D. 191 | S.D. | 1909
This is an action in claim and delivery, which was brought to recover the possession of a lot of merchandise held by defendant as sheriff under and by virtue of certain warrants of attachments issued in actions brought against the brother of the plaintiff. The plaintiff claimed in this complaint that he was entitled to the possession of the property by virtue of a purported bill of sale of same given to him by his brother, John Walklin, which said purported bill of sale plaintiff alleged was given solely as security. Plaintiff further alleged that these goods were wrongfully taken from his possession. The defendant in his answer alleged .that John Walklin was still the owner of said property, and that the purported bill of sale was executed for the purpose of hindering, delaying, and defrauding the creditors of said John Walklin, which wrongful purpose was known to the plaintiff at the time he received such bill of sale. The cause was tried to a jury, and, when the evidence was all in, 'upon motion of the defendant, the learned circuit court directed a verdict in favor of the defendant, and such a verdict was returned by the jury. A judgment having been entered thereon, and a motion for a new trial having been denied, the plaintiff brought this appeal from said judgment and order denying a new trial.
The only question before us is whether or not the -trial court was warranted in directing the verdict. In order to sustain such ruling of the court, it being not a determination of a question of fact, but purely a decision of a question of law, it must be found that, interpreting the evidence in this case as favorably to the appellant as possible, it still leaves facts established against the plaintiff and appellant, under which facts, as a matter of law, the defendant was entitled to recover. Bank v. Stebbins, 15 S. D. 280, 89 N. W. 674; Bohl v. Dell Rapids, 15 S. D. 619, 91 N. W. 315. The appellant strenuously urges that, under the evidence and issues in this case, there was a question of fraudulent intent in connection with the execution and delivery of the purported bill of sale, which question the trial court was bound
Keeping in mind the rule above stated, that the evidence herein must be construed as favorably as possible to the plaintiff, we find the following facts to be established: John Walklin, brother of plaintiff, was engaged in the mercantile and also in the real estate business. Prior to October 21, 1905, he had become indebted to the plaintiff for money loaned to him evidenced by two certain prommissory notes, and on said date there remained up-paid about $4,000, which sum was long past due, and plaintiff had been endeavoring to collect same. At that time John Walklin was also indebted to one Prank J. Reed in the 'sum of $2,000, which indebtedness was known to the plaintiff herein. On said date John Walklin was also indebted to one Geo. W. Parliament in the sum of some $700, which sum was past due. Just prior to October 21, 1905, John Walklin was closing a trade of some land for a stock of goods in another state, which goods were en route to the home of the Walklins on said October 21st. • John Walklin returned from closing said trade for goods prior to October 19, 1905, and upon his return the plaintiff demanded that he be given a bill of sale of the personal property owned by John Walklin. A bill of sale absolute in its terms was given by John Walklin to the plaintiff, -which was delivered October 21, 1905; the consideration therein named being $4,000 in hand paid, and the property covered thereby being the stock of general merchandise then in the possession of John Walklin at Castlewood, also the stock just traded for, which was at that time en route billed to the said John Walklin, as well as a certain dwelling house located on some farm land, all the hay belonging to said John Walklin on two quarter sections of land, all the grain belonging to John Walklin raised on a certain quarter of land, a lot of silver watches, and some other items of personal property. It appears, from oral testimony of the plaintiff, that the property named in said bill of sale comprised all the personal property of the said John Walklin. The bill of sale was filed in the office of the register of deeds on October 25, 1905. Plaintiff swears: That
The appellant contends: That the evidence shows that the possession of this property was surrendered to him as security; that the whole arrangement created a pledge of this property; that if, under the evidence, it should appear that possession was not given him of the property, but that it remained in the possession of his brother, then the transaction would amount to a mortgage; and further that, even admitting that the transaction was a bill of sale conveying title to him, yet it was not the province of the court to pass upon the question of fraudulent intent in executing the same; but'that the intent should have been left to be determined by the jury, under -the provision of section 2371 of the Civil Code, reading as follows: “In all cases arising under section 991, or under the provisions of this title, except as otherwise provided in sections 2369, the question of fraudulent intent is one of fact and not of law; nor can any transfer or charge be adjudged fraudulent solely on the ground that it was not made for a valuable consideration.” Respondent, meeting these several contentions of the appellant, says: That, considering this transaction as either a pledge or mortgage, the evidence of the appellant himself shows such a conversion of these goods as to destroy the lien of such pledge or mortgage and leave the goods free therefrom; .that, considering this transaction as a mortgage, it is an absolute nullity, for the reason that there was no recitation therein showing that the mortgagor received a copy; that if this transaction is neither a. mortgage nor pledge, but an absolute transfer of the title, then that it is void as against creditors, owing to a secret trust under which the grantor reserved an in
We are of the opinion that the respondent is correct in each of these positions. The plaintiff apparently did not know what position to take upon trial; but, under the pleadings, he could only recover upon the theory that the transaction was either a mortgage or pledge, yet - the question of fraudulent intent was raised by respondent on motion to direct verdict. Appellant admits the fact that the indebtedness was long past due when this transaction took place, and that he proceeded to sell the goods and apply the proceeds to the indebtedness. Under our statute relating to chattle mortgages, there is provided a method for foreclosing such mortgages m-her than that by action. This statute provides for a notice of sale and a sale at public auction. Section 2038 of our Civil Code provides that the wrongful conversion of personal propery upon which there is a lien, by the person holding the lien, extinguishes such lien. Our statutes, furthermore, by section 2123 of the Civil Code, provide that, in case of sale of pledged property for the payment of the indebtedness secured, such sale must be made upon public notice. In the case of Everett v. Buchanan, 2 Dak. 249, 6 N. W. 439, 8 N. W. 31, the territorial court, in a decision which has been followed since the date thereof, held that a sale of property by the pledgee or mortgagee, after default. in obligation secured, which sale was not made in accordance with the provisions of the statute, was a conversion of the property pledged such as, under the statute, destroyed the lien of such mortgage or pledge. We see no reason to depart from this holding.
Treating this transaction as a mortgage- — and a reading of appellant's brief indicates that they rely mainly upon such theory- — -we are confronted with certain other statutory provisions. While it -is true that at common law a chattel mortgage need not be in writing, either in whole or in part, yet under the provisions of our statute it is clear that it must be in writing; that is, all of the contract containing the covenants and agreements on the
This court held, in the case of Park et al. v. Robinson et al., 15 S. D. 551, 91 N. W. 344, that the omission of the receipt, showing that mortgagor had received a copy of the mortgage, renders such mortgage void as against attachment creditors. It might, however, be claimed that this instrument, being in form a bill of sale, is not subject to the provisions of these statutes; that they are intended to apply only to those instruments showing, upon their face, that they are chattel mortgages. We think, however, such contention would be without merit. The authorities ail • agree that no particular wording is necessary to create a mortgage.
We know of no other state having sections like sections 2091 and 2092, supra, and it is therefore impossible to find any case in the books .exactly parallel with'the case at bar; but numerous decisions are to be found wherein similar propositions are involved, showing" clearly by analogy that, regardless of the form of the instrument, the receipt must be contained therein or attached thereto. In the case of Dowdell et al. v. Empire Furniture & Dumber Co., 84 Ala. 316, 4 South. 31, a party delivered to another goods, taking in return promissory note with an oral agreement that title of the goods should remain in the first party until the notes were paid. The vendee' was empowered to sell the goods, and, if sold, to turn over any notes received as security.
If this transfer was not intended as a pledge or mortgage, but was intended as, and- was therefore, an absolute transfer of the title, then there is no escape from the fact that the grantor in such instrument had with the grantee a secret agreement, by which the grantor reserved an interest in the said goods; it being admitted by the grantee that, after enough goods had been sold to
In McCulloch v. Hutchinson, 7 Watts 434, 32 Am. Dec. 776, and which case is a leading authority on the question before us, the court said: “A preference may be given by a debtor, though insolvent, to an honest creditor. A sale may be made by such debtor at a specified price; but honesty and fair dealing require that the truth of the transaction should concur with its appearances, that the whole truth should be developed, and that the transaction should not wear the aspect of a simple sale or preference, and yet in fact be merely a disguise or color, by means of which the debtor is enabled to enjoy a secret interest in and
It will be seen that the above authorities held that, where it
It will therefore be seen that, whether we view this transaction as a pledge, mortgage, or an absolute conveyance, yet, in either case, under the facts undisputed or admitted by the appellant, the transaction was void as a matter of law, or else that the lien of plain-tiff had been destroyed by his own act, and that therefore there was no question to'submit to the jury, and the court rightly directed a verdict in favor of the defendant.
The judgment of the trial -court and the order denying a new trial are affirmed.