Kester v. Schuldt

• Decision Date: 30 December 1905
• Citation: 85 P. 974,11 Idaho 663
• Parties: KESTER v. SCHULDT
• Court: Idaho Supreme Court

85 P. 974

11 Idaho 663

KESTER v. SCHULDT

Supreme Court of Idaho

December 30, 1905

PROMISSORY NOTES-CREATES LIEN WHEN-WHEN RIGHTS TO PERSONAL PROPERTY LITIGATED-INJUNCTION WHEN PROPER REMEDY.

1. A promissory note providing that the express condition of the sale and purchase of the goods for which the notes were given is such that the title, ownership or possession does not pass until the note and interest are paid in full, and that the payee has full power to declare the note due and take possession of goods at any time he may deem himself insecure even before the specified maturity of the same, retains the ownership in the payee of the note.

2. Where it is shown that defendants in original suit filed an answer alleging title to the personal property in dispute in George H. Kester, and defendants were prevented from making such showing by evidence, such evidence being rejected on objection from counsel for plaintiff there and defendant here, it is not a bar to an action thereafter commenced by Kester against plaintiff in that action for the possession of such property, and to enjoin the sale thereof on the judgment in an original action.

3. An injunction will issue to restrain and enjoin the sheriff from selling personal property, where it is shown that the plaintiff has no plain, speedy and adequate remedy at law, or that the defendant is insolvent and not able to respond in damages.

(Syllabus by the court.)

APPEAL from District Court of Nez Perce County. Honorable E. C Steele, Judge.

Action to enjoin the sheriff of Nez Perce county from selling certain personal property. Judgment for plaintiff, from which defendants appeal. Judgment affirmed.

Judgment affirmed with costs to respondent.

James E. Babb, for Appellant Schuldt.

Daniel Needham, for Appellant Phillips.

Whatever title and rights respondent had under and by reason of said agreement he waived them all by permitting property to be mortgaged, and standing by and permitting said property to be sold under foreclosure proceedings and is now estopped to claim any title or interest under the same. (Pomeroy's Equity Jurisprudence, 3d ed., sec. 805.) Under the conditional sale note the vendor was to get all the property and full pay for same. Courts look with disfavor on such transactions. (Henryford v. Davis, 102 U.S. 243, 26 L.Ed. 160; Palmer v. Howard, 72 Cal. 293, 1 Am. St Rep. 60, and note, 13 P. 858.) All the other questions in this case were determined in the case of Phillips v. Salmon River Min. Co., 9 Idaho 149, 72 P. 886, and so often referred to in the case at bar, except the question as to whether plaintiff had or had not a plain, speedy and adequate remedy at law, and we maintain that he had a remedy at law under the statutes of this state, and that the temporary injunction should have been denied and should not have been made perpetual. (Ency. of Law, pp. 401, 402, 405, 406, par. 2; Richards v. Kirkpatrick, 53 Cal. 433; Washington etc. R. R. Co. v. Coeur d'Alene etc. Co., 2 Idaho 580, 21 P. 562; Pomeroy's Equity Jurisprudence, 3d ed., sec. 1361.)

I. N. Smith, for Respondent.

Conditional sale notes have been sustained in the following cases: Harkness v. Russell, 118 U.S. 663, 7 S.Ct. 51, 30 L.Ed. 285; Means Transfer Co. v. McKenzie, 9 Idaho 165, 73 P. 135; Studebaker Bros. v. Mau, 13 Wyo. 358, 80 P. 151; Kidder v. Wittler-Corbin Machinery Co., 38 Wash. 179, 80 P. 301. The next point is, Was Kester a party to the case of Phillips v. Salmon River Min. etc. Co., and were his rights adjudicated therein? The record affirmatively discloses that he was not a party and the findings of the court show that his rights were not adjudicated therein, nor was the question of ownership of the property litigated in that case. The principle that courts cannot adjudicate the rights of parties who are not directly before it, is fundamental. (Gregory v. Stetson, 133 U.S. 579, 10 S.Ct. 422, 33 L.Ed. 792.) This is as applicable to courts exercising appellate jurisdiction, as to those whose jurisdiction is original. (Terry v. Abraham, 93 U.S. 38, 23 L.Ed. 794; Davis v. Mercantile Trust Co., 152 U.S. 590, 14 S.Ct. 693, 38 L.Ed. 563; Dodson v. Fletcher, 78 F. 214, 24 C. C. A. 69.)

STOCKSLAGER, C. J., AILSHIE, J. Ailshie, J., Stockslager, C. J., concurring. Sullivan, J., sat at the hearing but took no part in the decision.

OPINION

The facts are stated in the opinion.

STOCKSLAGER, C. J.

This action involves the title and right of possession of certain property heretofore used on what is known as the "Salem Barr" mine. This mine is a placer property, and at the time the property in dispute was placed thereon was owned and operated by the Salmon River Mining and Development Company. It is alleged in the complaint that the Salmon River Mining and Development Company has no right, title or interest in or to said property, and that it was never owned by said Salmon River Mining and Development Company, and as a foundation for this allegation two promissory notes of $ 450 each, dated April 9, 1900, payable to George H. Kester, respondent herein, signed Salmon River Development Company, by its president and secretary, due July 11, 1900, with interest at the rate of one per cent per month. The two notes above referred to are what are termed conditional sale notes, and contained a description of the property in controversy alleged to have been sold as above indicated, except the seven hundred feet of pipe. On the twentieth day of August 1902, $ 150 was paid on one of the notes, and on September 21, 1902, $ 100 was paid on the same note. The condition of the notes was that title to said property should remain and be in said Kester, and the ownership and right of possession thereof shall likewise remain and be in Kester until both were fully paid.

It is alleged in the eighth paragraph of the complaint that the "Salmon River Mining and Development Company" at no time ever complied with the conditions of said contracts, nor did they ever pay the purchase price of said machinery. The ninth allegation is "that the property last above hereinbefore described is now owned by the plaintiff by virtue of the foreclosure of the chattel mortgage heretofore existing upon said property, and the subsequent transfer of said property to this plaintiff, which transfer was made long prior to the levy on the order of sale above referred to."

Exhibit "D" purports to be a chattel mortgage given by the Salmon River Mining and Development Company, to the Lewiston National Bank, describing the property in dispute, save the seven hundred feet of pipe, and as an additional description says: "All piping, belts and belting and all tools, implements and appurtenances of property hereinbefore described, or used herewith." This mortgage was given to secure a promissory note for $ 300, dated March 28, 1901, due on demand, with interest after date at the rate of one per cent per month. It is then shown by the complaint that on the twenty-first day of May, 1903, respondent Schuldt, as sheriff, by virtue of an affidavit and notice of foreclosure, took possession of the property in dispute, which description includes seven hundred feet, sixteen inch gauge pipe. On the twenty-eighth day of May, 1903, as such sheriff, he sold said property to the highest bidder and realized from the proceeds of such sale, after paying all expenses, the sum of $ 100.35, and that he paid said sum of $ 100.35 to the Lewiston National Bank and received the following receipt:

"Lewiston, Idaho May 29, 1903.

"Received from William Schuldt, sheriff, one hundred and 35/100 dollars, proceeds of sale in cause of Lewiston National Bank v. Salmon River Mining and Development Company.

"LEWISTON NATIONAL BANK.

"GEO. H. KESTER, Cashier."

Plaintiff claims the seven hundred feet of pipe by reason of the sale of this property to the First National Bank of Lewiston by the sheriff under the chattel mortgage, claiming that he bought the property from the bank after its purchase at the sale. The answer denies that plaintiff is the owner of the property in dispute, including the seven hundred feet of pipe. Avers that respondent Phillips, on the eighth day of December, 1903, secured a judgment and decree of foreclosure and sale against the Salmon River Mining and Development Company, for the sum of $ 699.30. Aver that the property levied upon by the sheriff was the property of the Salmon River Mining and Development Company. The answer then sets up affirmative defense by alleging the lien of respondent Phillips, its record and judgment thereon against the Salmon River Mining and Development Company, on the eighth day of December, 1903. It is alleged that the chattel mortgage given to the bank was subsequent to the filing of the lien of respondent Phillips, and hence subject to such lien. "That the pretended sale of said property under said pretended chattel mortgage was made subject to all liens on said property, as appears from the return of sale thereof." It is alleged in the affirmative answer that plaintiff in this action, being the cashier of the First National Bank of Lewiston, had notice of all the transactions between the Salmon River Mining and Development Company and the bank, and that he also had notice of the judgment rendered against the Salmon River Mining and Development Company in favor of respondent Phillips, and on information and belief alleges that...