Hargadine v. Henderson

Decision Date04 March 1889
Citation97 Mo. 375,11 S.W. 218
CourtMissouri Supreme Court
PartiesHARGADINE et al. v. HENDERSON et al.

A debtor executed an instrument by which, after reciting the claims which certain creditors had against him, and that he was "desirous of securing said debts," and certain sureties, on an obligation entered into by him, he conveyed all of his property, except his homestead and household goods, to one H., who was one of the said sureties; H. being directed, as trustee, to sell the property conveyed, whenever he should deem such a proceeding to be to the advantage of the creditors named. The principal part of the property conveyed was already incumbered by liens in favor of the said creditors, and the object of the conveyance to H. appeared to be to save such property from being sold under execution to satisfy such liens and enable it to be sold in the ordinary course of business, so that it might bring its real value. Held, that though there was no clause of defeasance in such instrument, and the possession of the property was delivered to the trustee, such instrument must be deemed a mortgage for the security of the creditors named in it, and not an assignment for the benefit of creditors, inuring to the benefit of all the creditors of the grantor.1

Appeal from circuit court, Howard county; G. H. BURCKHARTT, Judge.

Action by William A. Hargadine and others against John F. Henderson and others. Judgment was rendered dismissing the complaint, and plaintiffs appeal.

Walker & Johnson and R. P. Caples, for appellants. Thos. Shackleford and Droffen & Williams, for respondents.

BRACE, J.

On the 17th day of September, 1885, the plaintiffs (on behalf of themselves and the other creditors of the defendant John F. Henderson) filed in the Howard county circuit court a petition, stating that on the 22d day of June, 1885, the defendant John F. Henderson had duly executed and acknowledged the following conveyance, to-wit:

"Know all men by these presents, that whereas, I, John F. Henderson, of Howard county, in the state of Mo., am justly indebted to the Glasgow Savings Bank, a corporation, incorporated by the laws of the state of Missouri, in the following sums, and evidenced by the following notes: First note, dated October 13th, 1883, due four months after date, for three thousand dollars, with interest from maturity at the rate of ten per cent. per annum, credited July 23d, 1884, with one hundred and thirty 83-100 dollars; second note, dated August 1st, 1883 due four months after date, for four thousand dollars, with interest from maturity at rate of ten per cent. per annum, credited December 4th, 1883, with interest paid to April 7th, 1884, May 18th, 1885, thirty dollars, June 9th, 1885, four hundred dollars; third note, dated December 4th, 1883, due three months after date, for five hundred dollars, with interest from maturity at eight per cent. per annum, credited December 9th, 1884, twenty-five dollars, February 3d, 1885, forty-five dollars, May 26th, 1885, one hundred and forty dollars; fourth note, dated October 3d, 1884, due one day after date, for three hundred and forty-eight 85-100 dollars, with interest from date at the rate of ten per cent. per annum, credited February 12th, 1885, by one hundred and sixty and 40-100 dollars; fifth note, dated October 4th, 1884, due one day after date, for fifteen hundred dollars, with interest from date at the rate of ten per cent. per annum, which note is also executed by William White and Joseph S. Henderson as security. And whereas, also, A. Frank & Sons obtained a judgment against said Henderson, at June term, 1885, of Howard county circuit court, for five hundred and seventy-two 80-100 dollars, being debt and costs, interest at six per cent., and also Walter H. Teumy & Co. obtained judgment at the same term, for debt and costs, seven hundred and fourteen 86-100 dollars; and also John B. Farwell & Co. obtained judgment at the same term, for one hundred and sixty-eight 55-100 dollars, debt and costs; and Thomas E. Birch and George B. Harrison executed a delivery bond to the sheriff of Howard county as surety for said Henderson to secure the payment of said judgment on which execution had been issued. Now, therefore, the said John F. Henderson is desirous of securing said debts, and of protecting and saving harmless his sureties as aforesaid, therefore, I, the said John F. Henderson, do by these presents bargain, sell, transfer, and deliver, into the immediate possession of George B. Harrison, of Howard county, in the state of Missouri, all the stock of goods, merchandise, consisting of dry goods, clothing, hats and caps, boots and shoes, notions, gents' furnishing goods, stoves, mirrors, show-cases, writing-desks, chandeliers and lamps, being all the personal property of every kind, not attached to house, in the store-room situated on lot one, block five, city of Glasgow, known as `Pythian Building,' in said city of Glasgow; also two shares of Howard County Bank stock, No. 139, and 10 shares Wabash, St. Louis and Pacific, No. 27 and 66. The said Harrison, as trustee, takes immediate possession of said stock, and takes a complete inventory of said stock of goods, after which he shall, as such trustee, proceed to sell the said stock of goods at private sale, at the best price that can be obtained, and at his discretion shall proceed to sell said stock of goods at public sale whenever he shall deem it of advantage to said creditors. After selling said stock of goods the said George B. Harrison shall, after deducting the expenses of insuring, taking care of, and selling said goods, proceed to divide the proceeds between the creditors above named, and, in case said securities shall pay said debts referred to, then the said securities shall be refunded the amount so paid. The said trustee may out of the proceeds pay a balance due to Teft, Weller & Co., for about $300, to secure which they hold a chattel mortgage on part of all of said goods. And whereas, the said John F. Henderson was the owner of 152 shares of stock in a corporation known as the `Pythian Hall Association,' in the city of Glasgow, and said notes, described as `first' and `second,' were secured by deposit of said stock as collateral, the said Henderson being the owner of the largest number of shares of said stock, therefore the said John F. Henderson transfers said stock to said trustee to be sold at public sale, giving twenty days' notice in a newspaper printed in Howard county. The said Henderson and other stockholders will be compelled to borrow about $2,500 to repair the building, partially destroyed by the tornado on the night of the 20th of June, 1885, and the Glasgow Savings Bank will be compelled to loan said corporation sufficient to make repairs and protect the property. Therefore said advances shall be paid first out of the sale of said stock of the Pythian Hall Association, and the balance appropriated to payment of the two notes for which said stock is held as collateral; also pay Howard county and Wabash stock, on notes for which it was collateral. It being the object and intention of this deed to convey to said trustee all his interest in said Pythian building, situated on lot one, block five, in the city of Glasgow. The said Henderson also conveys to said trustee all notes and accounts due him for goods sold, which said trustee shall inventory when he takes account of stock. The said Geo. B. Harrison, having accounted for all the above property, and discharging all of said debts, if any sum shall remain over, shall pay over the excess to the said John F. Henderson, or his legal representatives; and the said Harrison accepted said trust, agreeing to administer the same to the best of his ability.

"In witness whereof the said parties have hereto set their hands and seals, this 22d day of June, A. D. 1885.

                                   "J. F. HENDERSON.  [Seal.]
                                   "GEO. B. HARRISON. [Seal.]"
                

That said conveyance was duly acknowledged, and was on the 23d day of June, 1885, filed for record in the office of the recorder of Howard county, Mo. That the legal effect of said conveyance was an immediate and absolute appropriation of said property and effects of the said Henderson to the payment of said debts therein recited, and was and is a voluntary deed of assignment for the benefit of creditors, and, although made for the sole benefit of the creditors therein named, inures, under and by virtue of the provisions of the statutes of the state of Missouri, to the benefit of all the creditors of the...

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