Ludden & Bates Southern Music House v. Dusenberry

• Decision Date: 25 November 1887
• Citation: 27 S.C. 464,4 S.E. 60
• Court: North Carolina Supreme Court
• Parties: LUDDEN & Bates Southern Music House v. Dusenberry.

4 S.E. 60

27 S.C. 464

LUDDEN & Bates Southern Music House

v.Dusenberry.

Supreme Court of North Carolina.

November 25, 1887.

1. Sale—What GONSTIDTUTES—Rent with Option to Puechase.

Plaintiff shipped an organ to one under a written agreement to pay a certain sum per month as rent, with a clause that he might purchase, at any time during its continuance, by paying a stipulated price therefor, and that the amount paid as rental or advance deposit should be deducted from the price. Held, that it was a contract of hiring, and not of sale.

2. Bailment—Of Personal Property—Reservation of Rights—Doty to Record-Acts S. C. December 21, 1882.

Acts. C. December 21, 1882, (18 St. 35,) provides that every agreement between vendor and vendee, or bailor and bailee, of personal property, whereby the vendor or bailor reserves any right to himself, shall be null and void as to subsequent creditors, or purchasers without notice, unless reduced to writing, and recorded as provided for mortgages. Plaintiffs rented an organ under a written agreement, and it was shipped to lessee, but was levied upon at the depot before the lessee received it, under a judgment against him, and sold by the sheriff to the defendant. Held, that as the lease was not recorded, and defendant did not know of it, he was entitled to a judgment for the possession of the property.

Appeal from court of common pleas, Horry county.

The Ludden & Bates Southern Music House, plaintiffs, sued George H. Dusenberry, defendant, to recover possession of an organ sold to defendant at an execution sale. Judgment for defendant, and plaintiffs appealed.

W. W. Harllee, for plaintiffs. Walsh & Scarborough, for defendant.

McIVER, J. This action was brought by the plaintiffs to recover possession of an organ shipped by the plaintiffs from Goldsborough, North Carolina, to A. W. Franks, at Bucksville, South Carolina, on or about the twenty-sixth of March, 1884, under an agreement of which the following is a copy:

"Notice to Lessee. Carefully read the terms of agreement before signing, as no verbal or written agreement or understanding not contained herein will be recognized by us.

[Signed] "Ludden & Bates Southern Music House.

"This certifies that I, A. W Franks, now residing at Bucksville, Horry county. South Carolina, have received of Ludden & Bates Southern Music House one Packard organ, style 14, No. 22, 160, and valued at ninety-five dollars, which I am to use with care, and to return in as good condition as it now is, the ordinary use and wear thereof excepted; and in case of loss or damage by fire, water, tempest, or otherwise, 1 agree to make good such loss or damage. I have agreed to hire said instrument for the term of nine months from this date, and to pay during said term the sum of ninety-five dollars as rent therefor, in the following manner, viz.: Ten dollars on the twenty-fifth day of March, 1884, which is in payment of the rent for the first month only, and as advance deposit to secure against damages to said instrument while in my possession, or for any expenses incurred in its recovery in case the aforesaid rental payments are not paid as agreed; and thereafter ten dollars on the twenty-fifth day of each and every month thereafter during the term above specified, with interest at the rate of 8 per cent, after maturity upon all rental payments not made as above stipulated. I further agree to make all payments in current funds at their office at Savannah, Georgia, without notice or demand, and to assume all cost of remittance or collection of drafts, etc. But if default shall be made in either of said payments, or I shall sell, offer forsale, remove, or attempt to remove, the said instrument from my aforesaid residence, without the written consent of said Ludden & Bates Southern Music House, then and in that case I agree to return the same, and they or their agent may resume actual possession thereof; and I hereby authorize and empower the said Ludden & Bates Southern Music House or its agent to enter the premises wherever said instrument may be, and take and carry the same away, hereby waiving any action for trespass or damages therefor, and dis-chiiming any right of resistance thereto. And I further agree to pay all expenses incurred by the said Ludden It is also further understood that 1 may, at any time within said term of rental, purchase the said instrument by paying the above valuation therefor, and then, and in that case only, all amounts theretofore paid as rental or advance deposit shall be deducted from price of Instrument.

"Witness my hand and seal this twenty-fifth day of March, 1884.

[Signed] "A. W. Franks, [l. s.]"

When the organ reached its destination at Bucksvilie it was stored in a warehouse, and when Franks, some time after its arrival, applied for it, offering to pay the freight, but declining to pay the storage, he could not get it. Afterwards, on the fifteenth of July, 1884, the organ while still in the warehouse, was levied on by the sheriff, under an execution issued to enforce a judgment recovered by Sampson & Son against Franks in 1883, and at the sale under such execution the defendant became the purchaser, and he, having complied with his bid, took possession of the organ, and this action was then brought against him by the plaintiffs to recover possession of the organ; they basing their claim upon the grounds that Franks never had any such title to or possession of the organ as would subject it to the' lien of an execution against him, and that defendant could not claim the protection accorded to a subsequent purchaser for valuable consideration without notice. Under the charge of the circuit judge, the jury rendered a verdict for the defendant, and from the judgment entered thereon the plaintiffs appealed, upon the several grounds set out in the record. These grounds raise three questions: (1) Whether Franks ever had such a possession of the organ as would render it liable to levy and sale under an execution against him; (2) whether the title to the organ ever passed out of the plaintiffs, either absolutely or conditionally, and into Franks; (3) whether the defendant can claim the protection accorded to a subsequent purchaser for valuable consideration without notice. These questions all depend upon the answer to the inquiry, what was the real nature of the contract between the plaintiffs and Franks, as evidenced by the agreement, of which a copy is above set out? If, as the circuit judge instructed the jury, the true construction of this agreement is that it was a contract for the conditional sale of the organ, whereby the plaintiffs retained the title for the purpose of securing the payment of the purchase money, then clearly the relations between the parties were those of mortgagor and mortgagees, (Straub v. Screven, 19 S. C. 445;) and as the agreement was not recorded, and there is no pretense that the defendant had actual notice of the agreement, he was clearly in the position of a subsequent purchaser for valuable consideration without notice, under the case of McKnight v. Gordon, 13 Rich. Eq. 222. So, too, if there was a conditional sale of the organ, then the delivery to the carrier was a delivery to the consignee, Franks, although he never acquired the actual possession, and the instrument, wherever found,...