Harbison v. Tufts

• Citation: 27 P. 1014,1 Colo.App. 140
• Parties: HARBISON v. TUFTS.
• Decision Date: 26 October 1891
• Court: Court of Appeals of Colorado

27 P. 1014

1 Colo.App. 140

HARBISON v. TUFTS.

Court of Appeals of Colorado

October 26, 1891

Appeal from district court, Las Animas county; J.C. GUNTER, Judge.

Action by James W. Tufts against Jennie Harbison to try the title to a soda fountain. Judgment for plaintiff. Defendant appeals. Affirmed.

John & McKeough, for appellant.

Jesse G. Northcutt, for appellee.

BISSELL J.

This is a controversy over a soda fountain to which the respective parties claim title. The cause was tried to the court upon an agreed statement of facts, from which it substantially appears that in March, 1889, Hosick & Co. bought the fountain of Tufts for $500, and delivered to him for the purchase price some 12 promissory notes for different sums, maturing at various periods between the 1st of May, 1889, and the 1st of October, 1890. According to the statement, it was agreed between the parties at the time of the sale that the title should remain in Tufts to secure the purchase price until the maturity and satisfaction of the several notes. The agreement, which was in writing, was acknowledged by a member of the firm, and recorded in the proper office of the county for the record of such instruments. The fountain subsequently passed into Hosick & Co.'s possession, and was set up in a drug-store occupied by them for retail purposes. Within less than 60 days from the time of the purchase, Hosick, who had previously bought out his partner's interest in the concern, undertook to mortgage the property to Nelson T. and G.T. Clairborne. This mortgage covered, in terms, the whole stock and fixtures of the store, including the fountain. The mortgage provided that the mortgagor, until default, should keep, retain, and use the property described in it. Afterwards the Clairbornes transferred the note to one Gross, who, on the maturity of the paper and default in its payment, took possession of the property, attempted to foreclose the mortgage, and in the proceedings sold the fountain to the appellant, Jennie Harbison. To reverse the finding of the court adjudging the right of property to be in Tufts the appellant prosecutes this appeal.

The court did not err in its judgment. The law which is decisive of the rights of the parties to this controversy has been settled by the previous adjudications of the supreme court. By the terms of the attempted contract of mortgage between the Clairbornes and Hosick, he had the right to use and enjoy the property, and dispose of it in the ordinary methods and channels of trade, and he was under no obligation, by the provisions of the agreement, to account to the mortgagees for the proceeds of what might be sold. Such a mortgage has been adjudged invalid as to all existing creditors who are permitted to assert its invalidity as against any but bona fide purchasers for a valuable consideration. As was well said by the learned justice of the supreme court who delivered the opinion which first established the law in the state, (9 Colo. 13 Pac.Rep., infra:) "When the mortgagee stipulates, either in the mortgage or out of it, that the mortgagor may sell the very thing composing his security, and retain the proceeds, he thereby destroys every vestige of a valid statutory or common-law mortgage, and leaves himself in no better position than if it had not been executed. Besides the inevitable tendency of the...