Carter v. Rewey

• Decision Date: 13 January 1885
• Parties: CARTER AND OTHERS v. REWEY.
• Court: Wisconsin Supreme Court

62 Wis. 552

22 N.W. 129

CARTER AND OTHERS

v.REWEY.

Supreme Court of Wisconsin.

Filed January 13, 1885.

Appeal from circuit court, Grant county.

Carter & Cleary, for respondents.

A. W. & W. E. Bell, for appellant.

COLE, C. J.

The learned counsel for the defendant insists that the instrument under which the plaintiffs claim the goods in controversy is really an assignment for the benefit of creditors, and is void for several reasons. If his view of the nature of that instrument is correct, its invalidity would follow as a natural consequence. The plaintiffs gave no bond, and did not attempt to comply with the statute regulating voluntary assignments for the benefit of creditors. But an inspection of the instrument will show that it is a chattel mortgage and not an assignment. It is in the usual form of a chattel mortgage. For the purpose of securing the payment of $1,000, Charles H. McLean bargained, sold, and transferred to the plaintiffs all of his stock in trade--consisting of a quantity of jewelry--and other personal property named, upon the condition that if McLean should forthwith pay the three debts specified, amounting to the sum of $385, also to secure such other claims against him as might come into the hands of the plaintiffs for collection, and a claim of Aiken, Lambert & Co. of $127, then the sale to be void. It is a conditional sale to secure the payment of certain debts. In case of default in the payment of the moneys mentioned as specified, the plaintiffs were authorized to take possession of the mortgaged property and sell the same at public or private sale for the best price which could be obtained therefor, and out of the proceeds pay the debts named and expenses, and return the surplus to the mortgagor. It will be seen that the instrument is a formal chattel mortgage, and must be so regarded. In many important respects it differs from the instrument considered in Page v. Smith, 24 Wis. 368, which was held to be an assignment for the benefit of creditors.

Now, treating this as a legal mortgage of personal property, given to secure the payment of certain debts, the question arises, is it valid, and did it have the effect to vest in the plaintiffs the title to the property embraced in it? The instrument was not only filed in the town clerk's office, but the plaintiffs took possession of the property under it, and had possession when the defendant seized a portion of the property on the attachments. There is no pretense that the debts which the chattel mortgage was given to secure were not bona fide debts of the mortgagor. But it is said that McLean was largely indebted to other creditors when he gave this mortgage upon his entire stock of goods, and that the plaintiffs knew the fact. But still it is competent for a debtor in failingcircumstances to pay or secure one creditor or a number of creditors, where there is no statute forbidding such...