Continental Gin Company v. Clement

• Decision Date: 02 April 1928
• Docket Number: 335
• Citation: 4 S.W.2d 901,176 Ark. 864
• Parties: CONTINENTAL GIN COMPANY v. CLEMENT
• Court: Arkansas Supreme Court

4 S.W.2d 901

176 Ark. 864

CONTINENTAL GIN COMPANY v. CLEMENT

No. 335

Supreme Court of Arkansas

April 2, 1928

Appeal from Jefferson Circuit Court; T. G. Parham, Judge; reversed.

Case reversed and remanded.

Joe S Harris and George A. McConnell, for appellant.

Rowell & Alexander, for appellee.

OPINION

MEHAFFY, J.

The appellant, who was plaintiff below, filed its complaint in the Jefferson Circuit Court in replevin, alleging that it had sold to J. M. Gracie one 50-inch class C elevator for 4-70 saw gins (except fan and telescope), also a pulley and some belting. It was alleged that Gracie purchased this property and agreed to pay the sum of $ 750 and the freight, amounting to $ 63.05. Plaintiff alleged that it retained title to the property until the purchase price should be paid, and that nothing had been paid on purchase price or freight, the plaintiff having prepaid the freight. The plaintiff alleged demand for the property and $ 150 damages for wrongful detention of same, and prayed for the possession of the property, and damages.

An affidavit and bond were filed, and a writ of replevin issued. The New Gascony Investment Company filed a cross bond in the sum of $ 1,200, and retained possession of the property. Defendants filed an answer, denying the material allegations of the plaintiff's complaint, and stating that Clement had no interest in the litigation, but that the New Gascony Investment Company claimed to be the owner by purchase.

A jury was waived and the case was tried before the court sitting as a jury, and the court rendered judgment for the defendant. Plaintiff filed motion for new trial, which was overruled exceptions saved, and plaintiff prosecutes this appeal to reverse the judgment of the circuit court.

The undisputed evidence showed that the Continental Gin Company on the 16th day of July, 1925, sold and delivered to J. M. Gracie the property described, and that the sale was evidenced by a sales contract, wherein the title to said property was retained by the plaintiff until the full purchase price should be paid; that no part of the purchase price had been paid, and the freight had not been paid. The contract contained the following clause:

"It is understood that the title to said machinery shall remain in you and the same shall be your property until payment in full for same is made, and until all other sums herein agreed to be paid are paid, and if default is made in the payment of either of said notes when due, or in payment of any other sum herein agreed to be paid, then you, at your option, may enter upon the premises where said machinery is, take possession of and remove the same, without being liable to account for any sum or sums paid thereon, the sum or sums to be paid to be in payment for the use of said machinery. Said machinery shall not become or be considered a fixture to the real property whereon the same is situated."

The undisputed proof also was that plaintiff demanded possession of machinery before suit, and that defendants retained possession of the property. The testimony showed a fair rental value to be $ 150 for the season.

The elevator purchased by Gracie is a complete outfit, but he did not purchase the fan or the telescope, which is a part of the elevator, and the elevator cannot run without the distributor being connected with the line shaft, or without a fan. The elevator is used to elevate cotton from the wagon to the feeder, driving cotton to the feeder and feeding same to the gin.

The property sued for was not actually attached to the gin stands, but was placed directly over them, and held in position by joists resting upon the floor and nailed and screwed to the building housing the gin. The property sued for could be removed without physical damage to the gin stands and without material damage to the building.

J. M. Gracie, who purchased the machinery, had owned the land, but he had by warranty deed conveyed to his daughter, Sallie E. Gracie, on December 10, 1924, the land on which this gin was situated, for the consideration of $ 1. The land conveyed contained 960 acres, in Jefferson County, Arkansas. On December 13, 1924, three days after the land was conveyed to Sallie E. Gracie by her father, she executed a note and mortgage to secure the payment of $ 32,000. Then on June 3, 1925, Sallie E. Rose, who was before her marriage Sallie E. Gracie, executed a deed of trust to secure $ 5,000 indebtedness to W. C. Hudson and R. Carnahan. On January 6, 1926, Sallie E. Gracie, by special warranty deed, conveyed to W. C. Hudson and R. Carnahan the said 960 acres for the consideration of $ 5,000 and the assumption by the purchasers of the $ 32,000 debt above mentioned. At the time Miss Gracie executed the deed of trust above mentioned, her father, J. M. Gracie, was managing the property. This was in January, 1925.

The testimony tended to show that the gin could not be operated without the elevator, but that the elevator could be removed without material damage to the gin stands or the building. The testimony shows that the defendant purchased the property without any knowledge that said property was placed in the building by the plaintiff, and without knowledge that plaintiff retained title to property. After Hudson and Carnahan purchased the property, they conveyed the same to the New Gascony Investment Company, a corporation, whose stockholders are Carnahan, Hudson, Clement and McGeorge.

The court found the value of the property at the time of the trial was $ 600, and the usable value for the season was $ 150. But the court held that the property sold by plaintiff to J. M. Gracie became a fixture, and passed with the conveyance of the realty.

The only question for our consideration is whether the appellee, the New Gascony Investment Company, is an innocent purchaser. As between the vendor of the property involved and the purchaser of said property it was not a fixture, and the vendor, having retained title, had the right, as against the original purchaser, to retake the property upon Gracie's failure to pay the purchase price.

The term "fixture," as generally understood, is property, originally a personal chattel, which has been affixed to the soil or to some structure legally a part of the soil, and which, being physically attached or affixed to the realty, has become a part of the realty. It is annexed to the freehold for use in connection therewith and so arranged that it cannot be removed without injury to the freehold.

It is sometimes said also that the intention of the party making the annexation is the chief test, and that in case of doubt the intention has a controlling influence. But in the instant case there is no dispute as to the character of the property as between the original vendor and original purchaser. They agreed that they should not be fixtures, but it is contended by the appellee that, while title was retained to the property until paid for, it was sold to J. M. Gracie, who was a tenant, and it is urged that the court has decided many times that if a landlord was ignorant of such reservation of title and the machinery was of such character that, when attached, it could not be removed without injury to the freehold, then it would become a fixture, and the vendor was not entitled to recover.

Attention is called to a number of decisions of this court which, it is claimed, support the contention of appellee.

The first case cited and relied on is the case of Peck-Hammond Co. v. Walnut Ridge School District, 93 Ark. 77, 123 S.W. 771.

The facts in that case were that a school board entered into a contract with one J. S. Park for the construction of a schoolhouse. The plans and specifications, which were a part of the contract, provided for the installing of a heating plant. Peck-Hammond Company furnished the...