McTeer v. Huntsman

Decision Date13 October 1898
Citation49 S.W. 57
PartiesMcTEER et al. v. HUNTSMAN et al.
CourtTennessee Supreme Court

Bill by McTeer, Hood & Co. against Huntsman Bros. & Co. and others to foreclose a trust deed of personal property. From a decree for complainants, defendants appeal. Reversed.

Tipton & Miller, J. M. Simerly, and Curtin & Haynes, for appellants. Boren & Edens, for appellees.

BARTON, J.

This is a contest over a stock of goods and its proceeds between a number of the creditors of J. A. Jones, who, during the year 1895, was a merchant doing business at Elizabethton, in Carter county, Tenn. One of these creditors — J. G. Emert — had a deed of trust covering the stock, which was executed on January 11, 1895, and registered in the register's office of Carter county on the same date. The defendants Daniel Briscoe Bros. & Co., on March 11, 1895, obtained a judgment against Jones before a justice of the peace for the amount of $632.22, on which judgment the defendant W. P. Waters had become stayor, and on March 11, 1895, — the date of that judgment, — the defendant Jones executed another mortgage or deed of trust on the stock of goods to secure and indemnify Waters as stayor. But, as he had done after the execution of the Emert deed of trust, he still remained in possession and control of the goods, selling and disposing of them. On April 20, 1895, Jones, being indebted to the complainants in this case, executed a third mortgage or deed of trust on this stock of goods to secure the complainants, and also to secure Waters as stayor for judgment in favor of Briscoe Bros. & Co. On or about July 2, 1895, defendant Jones still being in the actual possession of the goods, the defendants Huntsman Bros. & Co. and Etchison, Bate & Stark obtained judgments before a justice of the peace of Carter county against Jones, procured the issuance of execution on these judgments, and had them levied on the stock of goods. The defendant Waters also procured the issuance of executions on judgments in favor of Daniel Briscoe Bros. & Co., and had them levied on the same stock of goods. Huntsman Bros. & Co., Etchison, Bate & Stark, and Daniel Briscoe Bros. & Co. filed a bill in the chancery court of Elizabethton attacking the deeds of trust that had been made as fraudulent, and insisting on the lien of their executions; but it does not appear that any active steps were taken under this bill, and these defendants were proceeding under their justices' judgments, executions, and levies when the bill in this case was filed. The bill in this case attacks the deed of trust made to Emert as being fraudulent in law, and void on its face, and fraudulent in fact. It alleges that the deed of trust made to secure Waters as stayor on the Briscoe Bros. & Co. judgments, dated March 11, 1895, was also fraudulent and void, and also that the same had been forfeited, waived, and abandoned by Waters, the beneficiary. This bill avers the validity and bona fides of the deed of trust made to secure the complainants, and dated April 20, 1895; alleges that the transaction was in entire good faith; that the defendant Waters had accepted the trust, and had taken immediate and absolute possession of the goods, but had subsequently neglected his duties, and had not properly discharged the trust; and the court was asked to take charge of the goods, appoint a receiver, and enforce the trust, and to prevent the property from being taken and wasted under the levies of the executions, which it was averred were invalid, and in violation of the rights of the complainants. The chancellor decreed in favor of the complainants. The defendants Huntsman Bros. & Co., Etchison, Bate & Stark, and Daniel Briscoe Bros. & Co. have appealed.

First, as to the Emert claim: It will probably be sufficient to say that he has not appealed from the decree of the chancellor. But, if he had, it is too clear for controversy that the deed of trust made to him was fraudulent in law, and invalid. This deed of trust, which, as we say, was executed on January 11, 1895, conveyed the stock of goods, describing it as a stock of dry goods, notions, sugar, coffee, boots and shoes, tobacco, cigars, canned goods, syrups, etc., describing its location. The deed recited that Jones was indebted to Emert in the sum of $625, for which he had executed his 12 promissory notes of $50 each, due in 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, and 12 months from date, and one for $25, due in 13 months from date. It was further provided that this instrument was only to cover so much of said stock of goods as would pay or make certain the payment of said notes and accrued interest. It was further provided that, if Jones should fail to pay any of these notes at maturity, all the other notes should become due, and it was provided that in that event the mortgagee, Emert, was authorized to take possession of the property. Defendant Jones remained in possession of the property, replenishing, buying, and selling and disposing of the property as he pleased. This was, of course, fraudulent in law and in fact. See Bank v. Brier, 95 Tenn. 331, 32 S. W. 205; Bank v. Haselton, 15 Lea, 237; Bank v. Ebbert, 9 Heisk. 153; McCrasly v. Hasslock, 4 Baxt. 1.

As to the second deed of trust, made on March, 11, 1895, to secure Waters, the same remarks apply, and, in addition, it may be said that he abandoned and waived by his course of action all rights and claims thereunder.

The third deed of trust, made to secure the complainants, was as follows: It conveyed the same stock of goods, and recited, "but said sale is in trust, however, to secure a debt due Daniel Briscoe Bros. & Co., of Knoxville, Tennessee, for the sum of $632.22, which is a judgment on Squire J. F. Burrows' docket, and stayed by the said W. P. Waters, W. P. Waters being the trustee named in the deed, and he is secured as stayor by mortgage on said goods here conveyed, and which mortgage is registered in the register's office of Carter county, Tennessee; and the further sum of $676.75 due McTeer, Hood & Co., of Knoxville, Tennessee, due by note of even date with this deed, and as follows." Then follows a list of notes, each being for $135.33, due in 3, 6, 9, 12, and 15 months from date, all bearing interest. The deed further recites: "In order to enforce and carry out this trust, the trustee will take immediate possession of said goods, wares, and merchandise, and continue by himself or his agent to sell said goods, wares, and merchandise at retail where they are now stored, or at some other proper place, and pay off said indebtedness as same falls due; and, if said goods fail to pay off said indebtedness as it falls due, the trustee may advertise a sufficiency of said goods, wares, etc., as will bring money enough to pay said indebtedness then due, and sell same at auction, and pay the indebtedness then due, with the cost of this trust; and, if anything remains after the said debts are paid, then the same shall revert to said J. A. Jones. Signed and acknowledged the 20th of April, 1895." The deed was properly probated and recorded on the same day. Waters, the trustee named in the deed, rather reluctantly agreed to accept the trust, but as a matter of fact never took any actual possession of the stock of goods, and never had any real control over the business. At the time of this transaction the complainants were represented by one of their...

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2 cases
  • Hasbrouck v. LaFebre
    • United States
    • Wyoming Supreme Court
    • October 13, 1915
    ...v. Mueller (Or.), 133 P. 94; Orton v. Orton, 7 Or. 478, 33 A. R. 717.) Tennessee; (Tennessee Nat. Bank v. Ebert, 9 Heisk. 153; McTeer v. Huntsman, 49 S.W. 57; Robinson Baugh, 61 S.W. 98; Moore v. Wood, 61 S.W. 1063.) Texas; (Wilbur v. Kray, 73 Tex. 533, 11 S.W. 540; Nat. Bank v. Lovenberg, ......
  • McTeer v. Briscoe
    • United States
    • Tennessee Supreme Court
    • September 16, 1899
    ...appeal was prayed to the supreme court, and the cause was there heard, and the decree of the court of chancery appeals was there affirmed. 49 S. W. 57. The bill continues: "In addition to the affirmance of the decree of the court of chancery appeals, the said supreme court rendered a judgme......

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