Eckman v. Munnerlyn

• Decision Date: 09 October 1893
• Citation: 32 Fla. 367,13 So. 922
• Parties: ECKMAN et al. v. MUNNERLYN.
• Court: Florida Supreme Court

13 So. 922

32 Fla. 367

ECKMAN et al. v. MUNNERLYN.

Florida Supreme Court

October 9, 1893

Appeal from circuit court, Hillsborough county; G. A. Hanson, Judge.

Action in attachment by Eckman & Vetsburg against James K Munnerlyn. From a judgment for defendant, dissolving the attachment, plaintiffs appeal. Reversed.

Syllabus by the Court

SYLLABUS

1. A mortgage covering a stock of merchandise, under which the mortgagor is permitted, by agreement or understanding of the mortgagee, to sell the goods at discretion, or in the usual course of business, is fraudulent and void as to existing creditors of the mortgagor, and it makes no difference whether the agreement or understanding in reference to the sale of the goods be expressed in the mortgage itself, or not. If it was so agreed or understood at the time the mortgage was executed, whether in writing or parol, the security is thereby rendered void as to the creditors of the mortgagor.

2. Where the mortgagor of a stock of merchandise is permitted by the mortgagee to sell the same in the usual course of trade without accounting for the proceeds, it will justify the creditors of the mortgagor in suing out an attachment against him, on the ground that they have reason to believe that he will fraudulently part with his property before they can obtain judgment against him; the issue in such case being not that an intentional fraud existed, but whether or not the affiant in the attachment proceedings had reason to believe that the defendant would fraudulently part with his property before judgment could be obtained against him.

COUNSEL

Phillips & Carter, for appellants.

R. H Liggett, for appellee.

OPINION

MABRY J.

Samuel H. Eckman and Abraham Vetsburg, as copartners doing business in the firm name of Eckman & Vetsburg, commenced, in the circuit court for Hillsborough county, Fla., on the 10th day of December, A. D. 1888, a suit of attachment, returnable rule day in January, 1889, against James K. Munnerlyn. The affidavit upon which the attachment is based was made by an agent of the plaintiffs, and, after reciting that fact, states 'that James K. Munnerlyn, of the county of Hillsborough, is justly indebted to the said Eckman & Vetsburg in the sum of nine hundred and forty-five and 60-100 dollars, and that the said amount is actually due, and affiant has reason to believe that the said James K. Munnerlyn will fraudulently part with his property before judgment can be recovered against him.' On the day of the issuance of the attachment writ, it was levied upon certain real estate situated in Hillsborough county, as the property of the defendant in attachment, and on the 28th day of the same month it was further levied upon a part of a stock of goods belonging to defendant, being in a certain storehouse in Clear Water Harbor, an inventory of the same being referred to in the sheriff's return. The defendant, Munnerlyn, entered a motion on rule day in January, 1889, to dissolve the attachment, and filed an affidavit traversing the ground upon which it had issued. An additional motion to dissolve the attachment was made on the 16th day of January, 1889, on the grounds (1) that the bond of attachment was not executed by plaintiffs; (2) that said attachment bond is executed in the firm name of Eckman & Vetsburg, and not by the individual members of the copartnership. A jury was waived, and the cause submitted to the court, and the following judgment entered, viz.: 'This cause coming on to be heard upon traverse of the plaintiffs' affidavit, and upon motion to dissolve the attachment herein, the court having heard and examined the evidence and testimony, and listened to the argument of counsel, and being fully advised in the premises, the court being satisfied that there is not sufficient evidence presented to sustain the allegations in the plaintiffs' affidavit for attachment, it is therefore ordered that said attachment be, and the same is hereby, dissolved, and the property held by the sheriff thereunder be released, and restored to the defendant herein.'

The bill of exceptions recites that the objections to the execution of the bond were overruled by the court, but that the attachment was dissolved, and the property held by the sheriff thereunder was released, and restored to the defendant. Plaintiffs below appealed from the judgment of the court, and the assignment of error here is that the court erred in granting the order dissolving the attachment. On the issue made by the traverse of the ground alleged in the affidavit for attachment, plaintiffs read, without objection, the said affidavit, and introduced P. S. Coggins, who testified that he was the agent for plaintiffs, and had been for 3 1/2 years, and made the affidavit on which the attachment was based. Two day before the attachment was sued out, witness presented statement of plaintiffs' account to Munnerlyn, and he admitted it to be correct. Witness asked Munnerly to pay the account, but he said he could not do so, and did not have the money. Munnerlyn was then asked to pay a part of the account, and he said he could not do it. He was then asked to secure the debt in some way, but said he could not do that, and told witness that C. B. Rogers & Co. had a mortgage on his property. Witness afterwards told Munnerlyn that he (witness) was out of traveling money, and needed some, and Munnerlyn agreed to let witness have it on his own account. Munnerlyn paid nothing on the account, and owed plaintiffs about $1,600. Witness heard other drummers say that they could get nothing from Munnerlyn, and some were going to sue, and others attach. Ed. Clark said he would only sell Munnerlyn goods for cash. Tunno told witness that Munnerlyn was in failing circumstances. No one told witness that Munnerlyn was trying to dispose of his property fraudulently. Munnerlyn said he had about $300 belonging to other parties, but it was placed with him on deposit. Witness and Munnerlyn went together to Duneden, and on the way Munnerlyn consulted his lawyer. Sommerville, of Duneden, told witness that Munnerlyn had been down there to get title to some land from Douglass & Sommerville put in himself, (Munnerlyn.)

Plaintiffs introduced in evidence three mortgages executed by Munnerlyn and wife to C. B. Rogers & Co. to secure an alleged indebtedness therein. The first one was executed and acknowledged on the 19th day of December, 1885, to secure the payment of four promissory notes bearing date November 12 1885, each for $1,000, with interest at 8 per cent. until paid, and due, respectively, 6, 12, 18, and 24 months from date. The property described in this mortgage is certain real estate situated in Clear Water Harbor, Hillsborough county, and also a 'stock of merchandise' situated in a mentioned store building in the said town of Clear Water Harbor. This mortgage was not admitted to record until the 20th day of September, 1888. The second mortgage, executed by J. K. Munnerlyn, alone, to C. B. Rogers & Co., bears date December 15, 1888, and was filed for record, and recorded, the 18th day of December, 1888. This mortgage recites that the said Munnerlyn 'is justly indebted to the said party of the second part [C. B. Rogers & Co.] in the sum of $4,320, which indebtedness is now witnessed by 4 certain promissory notes for $1,080 each, dated December 13th, 1888, and due, respectively, at 6, 12, 18 months, and 2 years from date, the payment thereof being secured by a mortgage executed December 13th, 1888, by said James K. Munnerlyn and Sarah J. Munnerlyn, his wife, to said parties of the second part herein. And whereas, the said parties of the second part consider that said mortgage upon said property therein described is not sufficient to secure them for the amount due upon said notes, now, therefore, in consideration of the indebtedness above described, and the further consideration of one dollar in hand paid,' and to further secure said indebtedness, the mortgagor conveys all the stock in trade, in goods, wares, and merchandise, in a store on Cleveland street, Clear Water Harbor, upon condition of defeasance upon the payment of said notes. This mortgage contains a clause that the said mortgagor shall retain possession of said granted property, but on default of payment of said notes, or any attempt on his part 'to sell said goods, except in the usual retail way, and that he will pay over the money received therefrom to the said parties of the second part as the goods are sold, or to remove them from the county of their present location, or upon any seizure of them by any process of law, then the said parties of the second part' may take possession of said property. The third mortgage, being executed by Munnerlyn and wife to C. B. Rogers & Co., bears date the 21st day of December, 1888, and purports to convey four lots in Clear Water Harbor, additional to what is conveyed in the first-mentioned mortgage, and for the purpose of securing the payment of $4,320. It contains the following clause, viz.: 'This mortgage being given to further secure the payment of the notes for the above amount given by the parties of the first part herein on December 13th, 1888, and secured by a mortgage of even date herewith, said notes being for $1,080 each, and due, respectively, six, (6,) twelve, (12,) eighteen (18) months, and 2 years from date, with 8 per cent. interest until paid.' It is the usual mortgage, in other respects, and was admitted to record the 31st day of December, 1888. It was admitted that Munnerlyn made an assignment on December 29, 1888, of all his property, preferring certain of his creditors,--first among them, C. B. Rogers & Co., for $4,320. The assignment is not before us, and all we know of it is from the admission above stated. This was...