Logan v. Nebraska Moline Plow Co.

• Decision Date: 22 October 1902
• Parties: LOGAN ET AL. v. NEBRASKA MOLINE PLOW CO.
• Court: Nebraska Supreme Court

3 Neb. [Unof.] 516

92 N.W. 129

LOGAN ET AL.

v.NEBRASKA MOLINE PLOW CO.

Supreme Court of Nebraska.

Oct. 22, 1902.

Commissioners' opinion. Department No. 1. Error to district court, Adams county; Adams, Judge.

“Not to be officially reported.”

Action by the Nebraska Moline Plow Company against John S. Logan and Minnie E. Stoner. Judgment for plaintiff, and defendants bring error. Reversed.James H. McIntosh, for plaintiffs in error.

O'Neill & Gilbert, for defendant in error.

DAY, C.

The material facts in this case are undisputed, and, in so far as they are necessary to an understanding of the discussion, are substantially as follows: In 1896 the Moline Plow Company entered into a contract with Minnie E. Spooner, which provided, among other things, as follows: “It is expressly agreed that all bills are to be settled for by note on receipt of goods or upon monthly balances, at the option of second party; and all goods ordered hereafter for this season's trade will be subject to the same conditions as to time and manner of payment as those herein ordered. * * * Second party agreed that the title to and the ownership of all implements which may be shipped as herein provided shall remain in the party of the first part, and their proceeds in case of sale shall be the property of the Nebraska Moline Plow Company, and subject to their order until full payment shall have been made for the goods by the second party to the satisfaction of the first party; but nothing in this clause to release second party from making payment as aforesaid. If the purchaser under this contract fails or becomes insolvent, or any member of the purchaser's firm fails or becomes insolvent or dies, all accounts or notes for goods bought under this contract, including renewal notes, in whose hands soever said notes may be, shall then become due and payable, whether the notes be given in payment for goods or accounts, or collateral security thereto.” Pursuant to this contract certain implements were delivered to the vendee, and in March, 1897, notes were executed by her in favor of the vendor for the amount of the price. The notes, by their terms, became due in October, 1890. On September 3, 1890, the vendee filed a petition of voluntary bankruptcy. On September 6th the plow company instituted this action to replevy the goods still in the possession of vendee, and took them. A few days later the vendee was duly adjudged a bankrupt, and one J. S. Logan was appointed trustee in bankruptcy. The trustee intervened, and claimed the goods replevied by the plaintiff as the property of the bankrupt estate. Upon the trial a finding in favor of the plaintiff was entered, upon which judgment was rendered. To review this judgment the intervener has brought the case to this court on proceedings in error.

Our statute provides that such contract is void as against purchasers in good faith and judgment creditors. Comp. St. c. 32, § 26. The bankruptcy law (section 67) provides that claims which for want of record are not valid against creditors shall not be valid against the bankrupt estate. Section 70 of the bankruptcy law provides that the trustee shall be vested with the title of the bankrupt “as of the date he was adjudged a bankrupt * * * to all * * * property which prior to filing of the petition, he could by any means have transferred or which might have been levied upon and sold under judicial process against him.” These three statutory provisions are claimed by him to give the trustee title to the goods in question, and to entitle him to their return, or a judgment for their value. The finding and judgment of the trial court in favor of the plow company are therefore alleged to be wrong. It is claimed by the plow company that these provisions, taken together, do not give the trustee title to these goods, that the lien given by the conditional sale contract was valid as against all but purchasers for value without notice and judgment creditors, and that the trustee does not come under either category, and therefore section 67a of the bankruptcy law does not apply. The plow company also claims that section 70 only gives the trustee such title as the bankrupt had at the “date he was adjudged a bankrupt,” together with the title and right to vindicate it against property transferred in fraud of creditors. Of course, the real question here is whether or not the provision in subdivision 5 of section 70a in the bankruptcy act vesting the trustee with all the title which the bankrupt could, prior to the filing of the petition, have transferred, or which could have been levied upon for his debts, places the trustee in the position of a judgment creditor as of the date of the filing of a petition in bankruptcy by the debtor. By its naked terms, it seems to do so. This property certainly could have been levied upon at that time by one who had taken out process. The language seems to have been used with an...