Dearman v. Trimmier

CourtUnited States State Supreme Court of South Carolina
Writing for the CourtMcIVER, J
Citation26 S.C. 506,2 S.E. 501
Decision Date20 April 1887
PartiesDEARMAN v. TRIMMIER.

2 S.E. 501
(26 S.C. 506)

DEARMAN
v.
TRIMMIER.

Supreme Court of South Carolina

April 20, 1887


.

.

1. Mortgage—Bona Fipe Purchaser—Collateral Security—Foreclosure.

Plaintiffs husband purchased a horse of A., and gave therefor a note signed by himself and plaintiff, secured by mortgage upon certain real estate. Before maturity, A. transferred the note and mortgage to defendant as collateral security for an existing debt. Subsequently, the horse not answering to the warranty, it was returned to A. After the note had become barred by the statute of limitations, defendant foreclosed the mortgage, and sold the land. In an action to cancel the note and mortgage, and for an account of the proceeds of the sale, held, that as the note, at the time of foreclosure, was barred, defendant could not rely upon the pro tection afforded by the law-merchant to innocent purchasers of negotiable paper before maturity, but could only rely upon the equitable protection extended to a

[2 S.E. 502]

purchaser of the mortgage without notice of existing equities, and that, as defendant gave no present consideration for the purchase, the equitable rule was not applicable; hence he took subject to the defense of failure of consideration, and, that being established, was bound to account for the proceeds of the sale.

2. Appeal—Question of Fact.

In South Carolina the findings of the trial court upon questions of fact, the evidence being conflicting, will not be disturbed on appeal.

Appeal from Spartanburg county.

John W. Carlisle and Ralph K. Karlson, for F. M. Trimmier, appellant.

J. S. R. Thomson and D. E. Hydrick, for respondent.

McIVER, J. The facts of this case, so far as they are necessary to be stated for the purpose of determining the questions raised by this appeal, are as follows: One Thomas M. Joplin, being engaged in the business of buying and selling horses, borrowed money, for the purpose of enabling him to carry on his business, from the defendant, F. M. Trimmier. On the twenty-fourth of April, 1876, he executed a note to the defendant for the sum of $1,027, securing the payment thereof by a mortgage on a lot of horses, among which were the two bay mares hereinafter referred to. One of the stipulations contained in this mortgage was that Joplin had agreed to sell the mortgaged animals, and apply the proceeds of such sale to the payment of the said note as soon as the money is paid. On the fourth of May, 1876, Joplin, sold the two bay mares above mentioned, as included in the said mortgage, to S. D. Dearman, the husband of the plaintiff, for the sum of $90 each, on a credit of 30 and 90 days. Joplin being unwilling to extend this credit to S. D. Dearman without security, two promissory notes were drawn up, one at 30 and the other at 90 days, signed by the plaintiff and the said S.D. Dearman, whereby they promised to pay to the order of Thomas M. Joplin the sums mentioned in each of said notes, —one at 30 and the other at 90 days from date, with interest at 1 1/2 per cent, per month; and, if not paid at maturity, interest thereafter to be at the rate of 5 per cent, per month. To secure the payment of these notes the plaintiff and her husband executed a mortgage to said Joplin of certain real estate, viz., two lots in or near the city of Spartanburg, one containing fifteen acres, more or less, which was the separate property of the plaintiff, and the other containing two acres, more or less. All the papers necessary to effect these transactions were drawn up by the defendant, Trimmier, who then was and still is clerk of the court for Spartanburg county; but the notes and mortgage of the plaintiff and her husband were not executed in his presence, having been taken to the house of the plaintiff for that purpose. After they were executed, Joplin delivered them to the defendant, who retained possession of them. When the first note fell due, S. D. Dearman went to Joplin to pay it, and was by him carried to the clerk's office, when the defendant produced the notes, and the amount of the first one was paid to Trimmier, or rather counted out on his table, when Joplin took $10 of it, and left the balance with Trimmier. Soon after this, and before the second note fell due, S. D. Dearman returned to Joplin one of the mares because she would not work as she was warranted to do. Joplin received her back, and asked Dearman to try another animal in her place. To this Dearman acceded, but soon returned that animal also as a failure, and Joplin received it. After this Joplin, on the demand of Dearman, refused to surrender the note given for the mare which had been returned. When the second note became payable, Trimmier demanded payment from S. D. Dear-man, who refused upon the ground of failure of consideration, and that the contract had been rescinded. Several times this demand was repeated, Trimmier calling Dearman's attention to the extravagant rate of interest which the note was bearing, but Dearman persistently refused payment, denying his liability on the ground stated. It does not appear, however, that any demand was ever made upon the plaintiff, or that Trimmier ever had any

[2 S.E. 503]

interview or communication with her upon the subject. Matters were allowed to rest in this condition, without any further attempt, to collect the note, until November, 1884, after any action on the note would have been barred by the statute of limitations, when the defendant, as assignee, by virtue of the power contained in the mortgage, advertised and sold the land, during the absence of the plaintiff and her husband in the state of Georgia, without any notice to them further than by the advertisement published in a newspaper in Spartanburg. At this sale, L. A. Mills became the purchaser at the sum of $550, the note, at that time, by the accumulation of interest, amounting to about $600. On the twenty-second of May, 1886, this action was commenced by the plaintiff for the purpose of requiring the defendant to cancel the note and mortgage and account to her for the proceeds of the sale of her property.

The case was heard by the circuit judge upon the testimony delivered in open court, who found the general history of the transaction to be substantially as above stated; that the plaintiff was a surety, and not the principal on the note, although she signed it first; that Trimmier was aware of the real nature of the transaction; that he took the notes of the Dearmans, together with the mortgage, as collateral security for the debt of Joplin to him, but that he had no notice of the failure of consideration, as to the last note, at the time the papers were transferred to him. Upon these facts he found, as matter of law, that while the transfer before maturity of a negotiable note such as this was, for a valuable consideration paid at the time, without notice of subsisting equities between the original parties, would carry with it the mortgage given to secure the payment of such note, and the holder would be entitled to both note and mortgage free and discharged from such equities, and that, while a negotiable note transferred before due, without notice of any equities between the original parties to it, "not for a valuable consideration given at the time, but in payment and extinguishment of an antecedent debt, * * * if it be so taken in the usual course of business, it is free from the equities between the original parties;" yet for the doctrine that "a mortgage transferred in payment of a pre-existing debt to a purchaser of a note it secures, before maturity and without notice, stands discharged of...

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20 practice notes
  • Fitzgerald v. Flanagan
    • United States
    • Iowa Supreme Court
    • April 10, 1912
    ...v. Clark, 128 N. Y. 295, 28 N. E. 638, 14 L. R. A. 59; Myer v. Beal, 5 Or. 130; Ballou v. Taylor, 14 R. I. 277; Dearman v. Trimmier, 26 S. C. 506, 2 S. E. 501;Irvine v. Shrum, 97 Tenn. 259, 36 S. W. 1089;Fievel v. Zuber, 67 Tex. 275, 3 S. W. 273; Criss v. Criss, 28 W. Va. 388; Cerney v. Paw......
  • Ed. Fitzgerald v. Flanagan
    • United States
    • United States State Supreme Court of Iowa
    • April 10, 1912
    ...v. Clark, 128 N.Y. 295 (28 N.E. 638, 14 L. R. A. 59); Myer v. Beal, 5 Ore. 130; Ballou v. Taylor, 14 R.I. 277; Dearman v. Trimmier, 26 S.C. 506 (2 S.E. 501); Irvine v. Shrum, 97 Tenn. 259 (36 S.W. 1089); Fievel v. Zuber, 67 Tex. 275 (3 S.W. 273); Criss v. Criss, 28 W.Va. 388; Cerney v. Pawl......
  • Kirton v. Howard, (No. 12059.)
    • United States
    • United States State Supreme Court of South Carolina
    • August 26, 1926
    ...incumbrances or equities; and (3) that he purchased bona fide without notice. Black v. Childs, 14 S. C. 312; Dearman v. Trimmier, 26 S. C. 506, 2 S. E. 501; Haynsworth v. Bischoff, 6 S. C. 159; Lynch v. Hancock, 14 S. C. 66; Bush v. Bush, 3 Strob. Eq. (22 S. C. Eq.) 131, 51 Am. Dec. 675; Zo......
  • Morgan v. Farmington Coal & Coke Co, (No. 4974.)
    • United States
    • Supreme Court of West Virginia
    • September 9, 1924
    ...paper can be set up against the lien. To sustain this statement Shanabarger v. Phares, 86 W. Va. 64, 103 S. E. 349; Dearman v. Trimmier, 26 S. C. 506, 2 S. E. 501; and cases from Illinois, Minnesota, Louisiana, Ohio, California, Pennsylvania, Oklahoma, and Kentucky are cited; also Wiltsie o......
  • Request a trial to view additional results
20 cases
  • Fitzgerald v. Flanagan
    • United States
    • Iowa Supreme Court
    • April 10, 1912
    ...v. Clark, 128 N. Y. 295, 28 N. E. 638, 14 L. R. A. 59; Myer v. Beal, 5 Or. 130; Ballou v. Taylor, 14 R. I. 277; Dearman v. Trimmier, 26 S. C. 506, 2 S. E. 501;Irvine v. Shrum, 97 Tenn. 259, 36 S. W. 1089;Fievel v. Zuber, 67 Tex. 275, 3 S. W. 273; Criss v. Criss, 28 W. Va. 388; Cerney v. Paw......
  • Ed. Fitzgerald v. Flanagan
    • United States
    • United States State Supreme Court of Iowa
    • April 10, 1912
    ...v. Clark, 128 N.Y. 295 (28 N.E. 638, 14 L. R. A. 59); Myer v. Beal, 5 Ore. 130; Ballou v. Taylor, 14 R.I. 277; Dearman v. Trimmier, 26 S.C. 506 (2 S.E. 501); Irvine v. Shrum, 97 Tenn. 259 (36 S.W. 1089); Fievel v. Zuber, 67 Tex. 275 (3 S.W. 273); Criss v. Criss, 28 W.Va. 388; Cerney v. Pawl......
  • Kirton v. Howard, (No. 12059.)
    • United States
    • United States State Supreme Court of South Carolina
    • August 26, 1926
    ...incumbrances or equities; and (3) that he purchased bona fide without notice. Black v. Childs, 14 S. C. 312; Dearman v. Trimmier, 26 S. C. 506, 2 S. E. 501; Haynsworth v. Bischoff, 6 S. C. 159; Lynch v. Hancock, 14 S. C. 66; Bush v. Bush, 3 Strob. Eq. (22 S. C. Eq.) 131, 51 Am. Dec. 675; Zo......
  • Morgan v. Farmington Coal & Coke Co, (No. 4974.)
    • United States
    • Supreme Court of West Virginia
    • September 9, 1924
    ...paper can be set up against the lien. To sustain this statement Shanabarger v. Phares, 86 W. Va. 64, 103 S. E. 349; Dearman v. Trimmier, 26 S. C. 506, 2 S. E. 501; and cases from Illinois, Minnesota, Louisiana, Ohio, California, Pennsylvania, Oklahoma, and Kentucky are cited; also Wiltsie o......
  • Request a trial to view additional results

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