Box v. Goodbar

• Decision Date: 29 November 1890
• Citation: 14 S.W. 925,54 Ark. 6
• Parties: BOX v. GOODBAR
• Court: Arkansas Supreme Court

14 S.W. 925

54 Ark. 6

BOX v. GOODBAR

Supreme Court of Arkansas

November 29, 1890

APPEAL from Monroe Circuit Court, M. T. SANDERS, Judge.

Attachment by Goodbar & Co. against John T. Box. White interpleaded for and retained the property, claiming under a deed of trust, in the nature of a mortgage, from Box. The court trying the case found that the parties intended to make an absolute appropriation of the property for the benefit of creditors and held the conveyance void. The attachment was sustained and judgment rendered against the interpleader on his bond for the amount due plaintiff. Interpleader and defendant appealed. The facts are stated in the opinion.

Judgment reversed and cause remanded.

Dan W Jones and T. B. Martin for appellants.

1. The instrument was a mortgage, and the fact that a trustee was named cannot change the real nature of the instrument. It was not executed for the purpose of making an irrevocable and indefeasible appropriation of property to the payment of debts, and was therefore a deed of trust in its technical sense. But it was given to secure the debts named, and certain preferences among creditors. It was acknowledged and recorded. 31 Ark. 429; Mansf. Dig., sec. 4712; 33 Ark. 203; Mansf. Dig., sec. 4759; 39 Ark. 68, citing 1 McCrary; 1 F. 768. A deed of assignment is absolute--a mortgage conditional. 15 Ark. 60; 31 Ark. 437; see the distinction in 16 Oh., 216; 5 id., 130; 21 N.Y. 131; 14 F. 160; 67 Tex. 315; 19 Iowa 479; 58 Iowa 589; 47 Ind. 372; 49 Wis. 486; 62 id., 554.

The deed in this case differs from that in 52 Ark. 31, in form, and there is a marked difference in the intention of the parties. See also the test as laid down in 53 Ark. 101; 13 S.W. 423. By the terms of the deed, no other creditor "can call the grantee to account for the proceeds of the property." Ib.

2. The judgment is erroneous on its face, as it was against the interpleader and his sureties, for the amount of appellee's debt. Mansf. Dig., secs. 390, 391, 394; 37 Ark. 531.

N. W. Norton for appellee.

1. The conveyance was an assignment: (1) there was a a trustee; (2) the purpose was to pay debts; (3) it embraced all his creditors; (4) the debts were partly due and partly not due. Defeasance clauses are no longer the test. 31 N.W. 386; 4 Oh. St., 602. This case is settled by 52 Ark. 42.

2. The court's finding of fraud was sustained by the evidence.

OPINION

HEMINGWAY, J.

In this class of proceedings an inspection of a deed furnishes prima facie evidence of its character, but not conclusive; for proof may be made aliunde that a deed absolute in form was intended as a mortgage, or that a deed conditional in form was intended to be absolute, and that the condition was inserted to disguise its real character. Richmond v. Miss. Mills, 52 Ark. 30, 11 S.W. 960.

The conveyance from Box to White, as trustee, contained a formal clause of defeasance by the terms of which the deed was to be void if Box should pay the debts therein provided for as they matured. The deed provided that, upon default in paying said debts as they matured, White should take possession of the property conveyed and sell the same for cash in due course of business for thirty days, and if at the expiration of that time any of said debts should remain unpaid, he should sell the property at auction for the payment thereof. As a part of the debts were past due when the deed was executed, the condition was, by its terms, broken at the time of execution and the trustee immediately took possession under the power to sell the property in course of trade. Although...