Greig v. Mueller

• Decision Date: 10 June 1913
• Citation: 66 Or. 27,133 P. 94
• Parties: GREIG v. MUELLER et al.
• Court: Oregon Supreme Court

133 P. 94

66 Or. 27

GREIG v. MUELLER et al.

Supreme Court of Oregon

June 10, 1913

Appeal from Circuit Court, Malheur County; Dalton Biggs, Judge.

Action by E.M. Greig against C.C. Mueller and others. Judgment for the defendants, and plaintiff appeals. Reversed, and decree entered for plaintiff.

Howard H. Ford, a dealer in autos, auto goods, and sundries, in connection with his auto repair shop, being in failing circumstances, was adjudged a bankrupt. The plaintiff was appointed assignee of his estate, and as such brought this suit to have canceled a certain chattel mortgage given by Ford to Mueller for the benefit of the defendants, the First National Bank of Vale, hereinafter referred to as the Vale bank, and the First National Bank of Ontario, hereinafter referred to as the Ontario bank. The mortgage was given on May 11, 1911, at which time Ford was indebted to the Vale bank in the sum of $6,700 as evidenced by certain promissory notes and overdrafts, and to the Ontario bank in the sum of $3,500. New notes were executed by Ford to Mueller for said amounts secured by the said mortgage. The mortgage covered "three 40 horse power Oakland automobiles; one 30 horse power Oakland touring car; one 30 horse power Oakland roadster; one 40X45 horse power Pierce Arrow touring car; one lathe, one drill press, one electric motor, two gasoline tanks, of about 300 and 500-gallon capacity, respectively all tools, fixtures, appliances, and all stock in trade goods, wares, and merchandise, and sundries *** including all furniture and furnishings, office safe *** all of the foregoing mentioned and described property now being in that certain brick building on the east side of the Main street in Ontario *** occupied by the party of the first part under the name and style of Ontario Auto Company. ***" It is provided in the mortgage that, "and these presents are on the express condition that if the said party of the first part, his executors, administrators, and assigns, shall well and truly account on the third Saturday of each and every month hereafter during the life of these presents unto the said party of the second part *** for all of the receipts of said business and pay over the net profits thereof after the running expenses thereof shall have been paid, as may be approved by the party of the second part, and the replacement of said stock shall have been provided for in the pleasure of the said party of the second part *** then these presents shall be void." At the time of the execution of the mortgage Ford was largely indebted to the Oakland Motor Car Company, of Detroit, Mich. It appears that one purpose of Ford in making the mortgage was to put himself in a position that he might force a satisfactory compromise or settlement with the Oakland Motor Car Company as well as to secure the mortgagees. Ford made two informal reports under the mortgage to Mueller, which were indefinite and incomplete, but did not pay over any of the proceeds of the business, and continued to sell the goods at retail in the usual way, keeping no specific account of his transactions. He paid his personal expenses as well as the expenses of the business out of the receipts, but kept no account thereof. The Ontario bank was made a defendant, but disclaims any interest in said mortgage. The Vale bank answered, setting up the notes of Ford to Mueller in the sum of $6,700 as given for its benefit for a pre-existing debt, and that they with the mortgage were taken in Mueller's name for the benefit of the said Vale bank. Upon the trial the court found that the mortgage was a valid, subsisting lien in defendant's favor, enumerating the items of goods covered by the mortgage as consisting of more than 400 items, and adjudged that plaintiff is not entitled to any relief. Plaintiff appeals.

J.W McCulloch, of Ontario (McCulloch & Eckhardt, of Ontario, and H.C. Eastham, of Vale, on the brief), for appellant.

C.M Crandall, of Vale, for respondents.

EAKIN J. (after stating the facts as above).

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