Barnett v. Wedgewood.

• Citation: 211 P. 601,28 N.M. 312
• Decision Date: 29 November 1922
• Docket Number: No. 2669.,2669.
• Parties: BARNETTv.WEDGEWOOD.
• Court: Supreme Court of New Mexico

28 N.M. 312

211 P. 601

BARNETT

v.WEDGEWOOD.

No. 2669.

Supreme Court of New Mexico.

Nov. 29, 1922.

Syllabus by the Court.

The equitable assignee of a chattel mortgage may maintain in his own name an action for the conversion of the property covered by the mortgage.

Section 589, Code 1915, requiring assignments of choses in action to be in writing, has no application, where the assignment is effectuated by means of an equitable doctrine to the effect that the assignment of the debt carries with it the security.

Section 591, Code 1915, requiring a demand before action, has no application, where the time for performance is fixed in the contract.

An assignment of a chattel mortgage need not be recorded.

In the absence of evidence to the contrary, property acquired during marriage is presumed to be community property, and the fact that cattle are branded in the recorded brand of the wife does not, standing alone, overcome this presumption.

The purchase of mortgaged cattle by a third party, and the claiming of them as his own, free from the mortgage, is a conversion thereof, and no demand prior to an action for conversion is required.

Appeal from District Court, Sierra County; Owen, Judge.

Action by J. Barnett against Tom Wedgewood. From a judgment for plaintiff, defendant appeals. Affirmed.

Under Code 1915, § 2764, in the absence of evidence to the contrary, property acquired during marriage is presumed to be community property, and under Code 1915, §§ 117, 122, and Laws 1915, c. 84, the fact that cattle were branded in the recorded brand of the wife does not, standing alone, overcome this presumption.

Edward D. Tittmann, of El Paso, Tex., for appellant.

M. C. Spicer, of Socorro, for appellee.

PARKER, C. J.

The appellee brought an action against the appellant for the conversion of a certain number of cattle upon which the appellee claimed to have a chattel mortgage; his rights being based upon the same and having been executed by H. D. Sibley to J. N. Kenny to secure the payment of a promissory note for $252.50, executed by the said Sibley to the said Kenny, and payable on or before September 3, 1919, with interest, and which note and mortgage were alleged to have been assigned to the plaintiff for value. The appellant answered, denying the special interest of the appellee under the chattel mortgage, and alleged that on the 28th day of March, 1919, he purchased the cattle in question from one Judith Sibley, and received a duly acknowledged bill of sale for the cattle.

It appears from the transcript that the said H. D. Sibley and Judith Sibley were husband and wife during all of the times material to the controversy; that Judith Sibley, in September, 1916, recorded the S I B brand with the State Cattle Sanitary Board, using her married name of Mrs. H. D. Sibley, and that the cattle in question were branded with this brand; that on September 28, 1919, the said H. D. Sibley entered into a partido contract with the said Kenny covering these S I B cattle and other cattle; that a controversy arose between the parties to that contract, which was compromised and settled by the giving of the note and chattel mortgage heretofore referred to; that thereafter a suit was brought by the said Sibley and wife against the said Kenny to set aside and cancel the said note and chattel mortgage on the ground of fraud and for the recovery of damages; that this suit was afterwards compromised and settled and the chattel mortgage released by the said Kenny, notwithstanding he had theretofore indorsed in blank the said note and delivered the same, together with the said chattel mortgage, for value to the appellee, and without his knowledge or consent; that on March 28, 1919, the said Judith Sibley executed a bill of sale to the appellant for the cattle in question for the sum of $534; that a sufficient sum to pay off the mortgage was placed in escrow in the Sierra County Bank to await the determination of the suit to cancel the note and mortgage, but for some reason the appellant afterwards released the money from the escrow, and it was paid over to the Sibleys. A trial was had before the court without a jury, which resulted in a judgment in favor of the appellee, for the sum of $282, the amount due on the note, together with interest and costs, from which judgment this appeal was prosecuted.

[1] 1. Counsel for appellant first argues that under the circumstances shown in this case the appellee had no cause of action for conversion. He relies upon the fact that there was no written assignment of the chattel mortgage to the appellee, the assignment being an equitable assignment and effectuated only by means of the fact that the note for which the chattel mortgage was given as security was indorsed and delivered to the appellee. He cites Jones on Chattel Mortgages (5th Ed.) § 503, which is as follows:

“The mortgagee's legal interest does not, however, pass by his assignment of the debt. Such assignee cannot maintain replevin in his own name for the mortgaged property; though he may, in the absence of any express or implied stipulation to the contrary, bring such an action in the name of the mortgagee, who holds, in such case, the legal title in trust for such assignee's benefit. In like manner such assignee cannot maintain trover for a conversion of the mortgaged property, but may maintain such action in the name of the mortgagee.”

This statement of the law is undoubtedly correct as announced in many of these states. See Ramsdell v. Tewksbury, 73 Me. 197; Perry County Bank v. Rankin, 73 Ark. 589, 84 S. W. 725, 86 S. W. 279. On the other hand, under statutes like ours (section 4069, Code 1915), which requires that every action shall be presented in the name of the real party in interest, it is held that an equitable assignee of a chose in action may bring an action in his own name to enforce his rights under the chose in action. Thus in 5 C. J. Assignments, § 198, it is said:

“It is well settled that an assignment which divests the assignor of both the legal and equitable title deprives him of the right to sue. Where the assignment operates to transfer only the equitable title, and the legal title remains in the assignor, it has been held by some authorities that he may maintain the suit, and that the assignee may not sue. But by the weight of authority, the assignee, as the beneficial owner, is regarded as the real party in interest, and therefore as possessing the sole right to sue, whether his title is legal or equitable.”

Mr. Pomeroy states the proposition as follows:

“The rule deduced from these authorities is plain and imperative: The assignee need not be the legal owner of the thing in action; if the legal owner, he must of course bring the action; but, if the assignee's right or ownership is for any reason or in any manner equitable, he is still the proper plaintiff, in most of the states the only plaintiff, although, in a few, the assignor should be joined as a plaintiff or as a defendant. The plain intent of the statute is to extend the equity doctrine and rule to all cases.” Pomeroy's Code Rem. § 65.

Special application of this principle is made in First National Bank of Mexico v. Ragsdale, 158 Mo. 668, 59 S. W. 987, 81 Am. St. Rep. 332. In that case the court quotes, with approval and adopts the language in an opinion by Philips, P. J., in Kingsland & Ferguson Mfg. Co. v. Chrisman, 28 Mo. App. 308, as follows:

“The spirit and object of the statute will be best expressed and executed by allowing this plaintiff to proceed in his own name immediately, to enforce his possessory right under the mortgage, rather than to compel him either to resort to the circumlocution of a bill in equity to compel an assignment of the legal title, or to bring replevin in the name of the mortgagee.”

See, also, Willison v. Smith, 52 Mo. App. 133.

We are aware that there is some diversity of opinion as to whether an assignee of a mortgage, under the circumstances in this case, can maintain an action for conversion in his own name. The objection to the right to so maintain the action is founded upon a distinction between the common law and equitable remedies and jurisdiction. It is said that the assignment of the debt does not transfer the legal title to the mortgage, and that therefore the action must be brought in the name of the original mortgagee. This is entirely logical and...