Donahoo Horse & Mule Co. v. Durick

• Decision Date: 13 May 1915
• Docket Number: 18
• Citation: 193 Ala. 456,69 So. 545
• Parties: DONAHOO HORSE & MULE CO. v. DURICK.
• Court: Alabama Supreme Court

69 So. 545

193 Ala. 456

DONAHOO HORSE & MULE CO. v. DURICK.

No. 18

Supreme Court of Alabama

May 13, 1915

Rehearing Denied June 30, 1915

Appeal from City Court of Bessemer; J.C.B. Gwin, Judge.

Detinue by the Donahoo Horse & Mule Company against Steve Durick. Judgment for defendant, and plaintiff appeals. Transferred from Court of Appeals under section 6, p. 449, Acts 1911 Affirmed.

The facts sufficiently appear. Plea 6 is as follows:

Defendant says that he bought or traded for the horse, the subject-matter of the suit, on the 2d day of July, 1913, from J.L. Gray, who was then in the city of Bessemer, and gave said Gray, in exchange for said horse, a horse then belonging to defendant, and reasonably worth the sum of, to wit, $65 and in addition thereto, on said date, he gave said Gray merchandise to the value of $10, and agreed to pay at a later date to said Gray the further sum of $95. Defendant avers that he then and there took possession of the horse about which this suit is brought, and became the bona fide owner thereof, and that thereafter, on July 4, 1914, defendant avers that he paid said Gray the remainder of said purchase price, that is, $95, and that Zack M. Gray, the brother of J.L. Gray, knew of and assented to the said sale of said horse to defendant by J.L. Gray. Defendant avers that he had no notice of plaintiff's claim to said horse, and knew of no facts sufficient to put him on inquiry that, if followed up, would have disclosed plaintiff's claim, previous to and down to the time of the time of paying the money and other things of value for said horse.

Estes Jones & Welch, of Bessemer, for appellant.

L.L Lockwood and T.T. Huey, both of Bessemer, for appellee.

McCLELLAN J.

The action is detinue to recover a horse. The plaintiff (appellant) is the mortgagee; and the defendant (appellee) is the purchaser of the animal from the mortgagor. The defense successfully asserted below was that the defendant was a bona fide purchaser for value and without notice of the plaintiff's existing mortgage on the animal. The mortgage was executed June 10, 1913. On July 3, 1913, the mortgage was filed for record. On July 2, 1913, defendant and the mortgagor made this trade: Defendant agreed to give the mortgagor, for the horse in suit, $10 in value in merchandise, a horse then owned and in the possession of the defendant, and to later pay the mortgagor $95 in money. This trade was, on that day, effected to this extent: The mortgagor delivered the horse in suit to the defendant, and the defendant delivered the merchandise and the other horse to the mortgagor. On July 4, 1913, the very next day after the mortgage was filed for record, and after constructive notice thereof had become operative upon the defendant in virtue of the filing of the mortgage for record, the defendant paid the mortgagor the $95, as stipulated in the agreement between them. On the facts stated, the point was taken below, and is stressed here, that one who does not pay in full the purchase price of personal property at the time of the purchase or before notice of the outstanding right or claim is brought home, or is imputed under the registration statutes to him, cannot invoke the protection the law accords to a bona fide purchaser for value and without notice.

So far as presently important, Code, § 3386, provides:

"Conveyances of personal property to secure debts, or to provide indemnity, are inoperative against creditors and purchasers without notice until recorded. ***"

In the decision of Dudley v. Abner, 52 Ala. 582, this court construed the above section (then section 1561 of the Code of 1867) in respect of the term "purchaser"; the court saying:

"And he is a purchaser for a valuable consideration who parts with something of value for the thing purchased."

This case was decided in 1875. The statute in question has been thrice re-enacted since the decision in Dudley v. Abner. Its readoption comprehended the construction put upon it by this court in that case. This construction does not, as is apparent, make a condition to one's being a bona fide purchaser that he shall have paid, or shall have become irrevocably bound to pay, the whole purchase price he agreed to pay before notice of the outstanding claim or lien. The purpose of such statutes is, as said by Jones on Chattel Mortgages, at section 313, "to protect those who have acquired rights under circumstances which would render them liable to be defrauded unless so protected." This object confirms the correctness of the announcement made in Dudley v. Abner, as before quoted. This conclusion does not conflict with the further rule that the protection accorded such a purchaser is limited, in degree, when the jurisdiction of a proper forum is invoked to ascertain and give effect to the proportionate degree of protection, to the extent he has parted "with something of value," incurred "some new obligation," relinquished "some security," or has done "some act on the faith of the purchase which cannot be retracted, and which would leave the buyer in a worse position if his purchase should be set aside; a mere agreement by the buyer, which he can avoid in case his title proves defective, being insufficient." 35 Cyc. pp. 351, 352.

The action is detinue. It is of statutory creation. Code, § 3788 et seq. The statutes creative of the system do not provide for an ascertainment and effectuation of the proportionate protection of a purchaser, who in good faith has parted with value, but not all of the purchase price, before notice of the outstanding claim or lien of another to the property. The Supreme Court of Missouri, in Dougherty v. Cooper, 77 Mo. 528, 534, 546, found warrant or authority in the statutes of that state for such method of proportionate protection of a purchaser, when the action was one of statutory replevin. We cannot take that liberty with our statutory system creative of the action of detinue. Under it, a plaintiff must be entitled to the immediate possession of the chattel at the time he commences his suit; the gist of the action being the wrongful detention of the chattel. Jesse French Co. v. Bradley, 138 Ala. 179, 35 So. 44. Is he (plaintiff) so entitled when the buyer (from the mortgagor) has, without notice and in good faith, and in reliance upon and in compliance with the agreement with the seller (mortgagor), parted with values--when he has assumed, under such circumstances, a position that to set aside his purchase would result in defrauding him, who, as stated, was innocent in his dealing with the selling mortgagor? Our answer is that, in view of the definition of "purchaser," as employed in the statute (section 3386), established in Dudley v. Abner, supra, and of the object of the statute (section 3386), and of the conceded right of the innocent buyer to protection pro tanto, the asserter of the outstanding claim to or lien on the property is not, in an action of detinue, entitled to the immediate possession of the chattel; for to affirm otherwise would allow the buyer to be defrauded when, to the extent of his payment, he is due to be protected. According to the practice prevailing in the state of Michigan, the verdict or the judgment may be so ordered or contrived as to protect the proportionate right of the buyer. O'Neill v. Thompson, 152 Mich. 396, 398, 399, 116 N.W. 399; Moore v. Vrooman, 32 Mich. 526. That practice cannot, as before indicated, be adopted here. The statutes governing detinue do not contemplate it.

If the powers of a court of equity are to be invoked to apportion the proportionate protection to which the purchaser is entitled, the plaintiff (appellant) must become the actor. To impose that obligation on the purchaser (appellee) would be...