Barnet v. Fergus

• Decision Date: 30 September 1869
• Parties: ALEXANDER BARNETv.ROBERT FERGUS et al.
• Court: Illinois Supreme Court

51 Ill. 352

1869 WL 5342 (Ill.)

99 Am.Dec. 547

ALEXANDER BARNET

v.ROBERT FERGUS et al.

Supreme Court of Illinois.

September Term, 1869.

OPINION TEXT STARTS HERE

APPEAL from the Circuit Court of Cook county; the Hon. ERASTUS S. WILLIAMS, Judge, presiding.

This was an action of replevin, brought by Alexander Barnet, against Robert Fergus, and John L. Beveridge, sheriff of Cook county, to recover of them the possession of certain printing materials, printing presses, and “stock in trade,” of James Barnet, which had been levied upon by the sheriff, as the property of James Barnet, under, and by virtue of, an execution issued upon a judgment in favor of Fergus, for $1,861, and costs, which he, Fergus, had obtained in the Superior Court of Chicago, against James Barnet, on the 3d day of October, 1867, and that the execution so issued bore date Nov. 7, 1867, and was returned executed Nov. 13, 1867. It appears, from the record, that James Barnet executed a mortgage in due form to Alexander Barnet, bearing date Aug. 6, 1867, to secure the sum of $1,980, with interest thereon, upon the printing materials, presses, and “stock in trade,” then belonging to James Barnet, the same that was levied upon under this execution. It also appears, that Alexander Barnet permitted James to sell, in the ordinary course of trade, from his “stock in trade” so mortgaged, and this is claimed as a waiver of his lien upon the entire property. The “stock in trade” referred to seems to have been certain books and blanks, which James Barnet had then on hand, and which he printed from time to time.

The court below rendered judgment for the defendants, and the plaintiff appeals, and the assignment of errors presents the single question, whether the mortgagee, by permitting the mortgagor to sell, in the due course of trade, a certain portion of the mortgaged property, lost his lien upon the residue.

Mr. W. T. BURGESS, for the appellant.

Messrs. HERVEY, ANTHONY & GALT, for the appellees.

Mr. JUSTICE LAWRENCE delivered the opinion of the Court:

It was held by this court, in Davis v. Ransom, 18 Ill. 402, and in Read v. Wilson, 22 ib. 380, that a mortgage of a stock of goods, containing a provision authorizing the mortgagor to retain possession for the purpose of selling in the usual course of trade, was fraudulent and void as to creditors. This was held to be fraud in law. It is a necessary consequence of these decisions, that where the mortgage contains no such provision, but the mortgagee nevertheless knowingly permits the mortgagor to make sale of the property in the ordinary course of trade, and in the same way as before the mortgage was made, this would be such a perversion of the mortgage from its legitimate purposes as to withdraw from its protection, and place within the reach of other creditors, all of the property which the mortgagee had permitted the mortgagor to hold for sale in the ordinary course of his business. This principle has been recognized in Griswold v. Sheldon, 4 Comst. 580, and Delavan v. Ensign, 21 Barb. 88. The case of Ogden v. Stewart, 29 Ill. 124, quoted by counsel for appellee, is...