Leadbetter v. Leadbetter

• Decision Date: 13 January 1891
• Citation: 125 N.Y. 290,26 N.E. 265
• Parties: LEADBETTER v. N. H. LEADBETTER, Limited.
• Court: New York Court of Appeals Court of Appeals

125 N.Y. 290

26 N.E. 265

LEADBETTER

v.N. H. LEADBETTER, Limited.

Court of Appeals of New York.

Jan. 13, 1891.

Appeal from supreme court, general term, first department.

Z. S. Sampson, for appellant.

Joseph F. Bosworth, for respondent.

O'BRIEN, J.

The order from which this appeal is taken determined the right of two claimants to a certain fund, which both claimed to be entitled to. The party who succeeded in the courts below is the receiver of the defendant, and the other claimant, who failed and brings this appeal, is a judgment and execution creditor of the defendant. The undisputed facts upon which the question arises are these: The defendant is a corporation organized under the limited liability act. In proceedings in this action to dissolve it, by reason of insolvency, the respondent, William G. Shaller, was appointed receiver on the 28th of October, 1889. Previous to this, and on the 13th day of February, 1889, the defendant duly executed and delivered, and procured to be filed in the proper office, a chattel mortgage for $3,000, to secure the payment of its notes to that amount, for money borrowed. The condition of the mortgage was that the defendant should pay the notes as they became due, and that, in case of default in the payment of the notes, or any of them, when due, or in case the mortgagor, before the notes, or any of them, became due, should remove any of the goods, or suffer any attachment or other process against property to be issued against it, or any judgment to be entered against it, then the said sum of $3,000 should become instantly due, and the mortgagee, or his assigns, should have the right to take possession of the goods, and carry them away, and sell the same for the best attainable price, on five days' notice to the mortgagor, and from the proceeds pay the amount unpaid on the notes, and render the sum remaining to the mortgagor or his assigns. Some of the notes, to secure which the mortgage was given, were paid. Before the receiver was appointed, two of the notes became due, and remained unpaid,-one on the 10th of August, 1889, and another on the 10th of October, 1889. On the 25th of October, 1889, William E. Hardy, who brings this appeal, recovered a judgment against the defendant for $4,823.42, and on the same day procured execution to be issued thereon, and a levy to be made on the property covered by the mortgage. This levy was made, as will be seen by the dates, three days before the receiver was appointed. On his appointment there were three parti...