Megown v. Fuller

• Decision Date: 09 April 1928
• Docket Number: 1434
• Parties: MEGOWN v. FULLER, ET AL. [*]
• Court: Wyoming Supreme Court

266 P. 124

38 Wyo. 211

MEGOWN v. FULLER, ET AL. ^[*]

No. 1434

Supreme Court of Wyoming

April 9, 1928

Rehearing June 19, 1928.

Rehearing Denied 38 Wyo. 211 at 221.

APPEAL from District Court, Fremont County; BRYANT S. CROMER, Judge.

Action by S. H. Megown, as liquidating agent of the First National Bank of Shoshoni, against George B. Fuller and others. Judgment for defendants, and plaintiff appeals.

Judgment reversed and case remanded.

M. C Burk, F. A. Michels and W. E. Hardin, for appellant.

The lien of the bank and the plaintiff was continuous from November 3, 1919, to the time of the action; the filing of a chattel mortgage is a substitute for a transfer of possession, Boswell v. Bank, 16 Wyo. 161; 5 R. C. L 409. The mortgage was competent evidence to prove existence of the lien, Reynolds v. Morton, 22 Wyo. 174. Chattel mortgages are good between parties, without acknowledgment or filing, Boswell v. Bank, supra; Schlessinger v. Cook, 9 Wyo. 256; Bank v. Co., (Mont.) 197 P. 994; release of old and taking of new mortgage in a renewal transaction, continues the debt and lien and gives no priority to an intervening judgment of creditor or mortgagor, Bachman v. Hurtt, 26 Wyo. 332; the security continues as long as the debt can be traced, Bank v. Bank, 11 Wyo. 62; Huber v. Bank, (Wyo.) 231 P. 63; Packard v. Kingman, 11 Ia. 219; Cornwell v. Moss, 147 P. 824; Sioux City Co. v. R. R. Co., 76 N.W. 838. Two or more instruments concerning the same transaction should be construed together when it can be done, 6 R. C. L. 850; Ins. Co. v. R. R. Co., 110 P. 99. Release of a claim ex contracto does not release an allied claim in tort, Davis v. Co., 79 P. 596; 34 Cyc. 1092; Seaver v. Snyder, 122 P. 402. A receipt in full payment is not conclusive that payment was made, Leach v. Church, 15 O. S. 169; the transfer of the brand in question was fraudulent as to plaintiff, Frauenthal v. Bank, 44 A. L. R. 871, Stumbaugh v. Anderson, 26 A. S. R. 121; Dowell v. Applegate, 15 F. 419; Godfrey v. Hays, 41 Am. Dec. 58. Transfers to relatives for inadequate consideration, are badges of fraud, 27 C. J. 647; likewise, transfers to persons who had no use for the property, 27 C. J. 495 and notes. The burden of proof was upon defendants to show good faith in the transaction, Smith L. Cases, Vol. 1, p. 687; Deloney v. King, 76 P. 4; Sutherland Damages, (4th Ed.) Sec. 349; commingling of mortgaged goods with other goods, without consent of mortgagee, imposes lien upon the whole, 12 C. J. 496, 499; Mining Co. v. Mining Co., 17 P. 760. The rule applies in confusion by the wife of the goods of her husband mortgaged to a bank, Inglebright v. Hamont, 53 Am. Dec. 430; Bank v. McHenry, 213 P. 1059; Lightman v. Lane, 120 N.E. 771. The judgment should be reversed.

E. E. Enterline, for defendants and respondents.

The releases were made by the cashier and filed with the County Clerk, who was thereby authorized to cancel the mortgages and stamp the word "paid" thereon, 4798 C. S. In Bachman v. Hurtt there was no intention to release the lien or the mortgage; an express release discharges the debt, Sioux City Co. v. Ry. Co., 106 Ia. 573; the trial court's action is sustained by Christofferson v. Howe, 58 N.W. 830; Drumm-Flato Co. v. Barnard, 72 P. 257; Holmes v. Ellis, 225 P. 538; Ambrister v. Dalton, 168 P. 231. The intention of the parties governs, Mtg. Co. v. Hirsch, (Ala.) 11 So. 63; fraud on the part of defendants was not established by the evidence, Bank v. Ford, 30 Wyo. 110; Hillsdale Bank v. Christensen, 32 Wyo. 68. Where mortgaged property is commingled with property of like kind, the more equitable doctrine is to give each party his due proportion, 12 C. J. 31; Hinton v. Saul, (Wyo.) 259 P. 185.

KIMBALL, Justice. BLUME, Ch. J., and RINER, J., concur.

OPINION

KIMBALL, Justice.

This is an action for conversion of mortgaged cattle. Trial was had without a jury. At the conclusion of plaintiff's evidence, the trial court held that plaintiff had not made out a case, and gave judgment for defendants. The plaintiff appeals.

November 3, 1919, defendant George B. Fuller, to secure the payment of 2 promissory notes amounting to $ 15000, due November 1, 1920, gave to the First National Bank of Shoshoni, Wyoming, a chattel mortgage of "his entire herd of cattle," being 454 head, 6 head branded flying H and the rest branded T6.

November 1, 1920, the mortgagor, to secure 3 notes amounting to $ 16000, due November 1, 1921, gave a similar mortgage of "his entire herd of cattle," being 394 head, 4 head branded flying H and the rest branded T6.

December 17, 1921, the mortgagor, to secure two notes amounting to $ 13000, due June 30, 1922, gave a similar mortgage of "his entire number of cattle," being 350 head all branded T6.

November 16, 1922, the mortgagor, to secure 2 notes amounting to $ 14000, due October 1, 1923, gave a similar mortgage of "his entire number of cattle," being 238 head all branded T6.

January 30, 1924, the mortgagor, to secure 2 notes amounting to $ 15500, due October 1, 1924, gave a similar mortgage of "his entire number of cattle," being 226 head all branded T6.

The mortgages included the "increase" of the cattle, the described brands, and other property not necessary to be mentioned. The first two mortgages were to the bank. The others were to S. H. Megown, who, as the cashier of the bank, took the notes and mortgages in his name for the use and benefit of the bank. Each mortgage was filed with the county clerk of the proper county a few days after its execution.

All of the mortgages except the last have been released. The one of November 3, 1919, was released December 17, 1920; the one of November 1, 1920, was released June 9, 1922; the one of December 17, 1921, was released January 15, 1923, and the one of November 16, 1922, was released May 2, 1924. The releases were by written instruments filed with the county clerk. Each of the first two releases recites that, the mortgage "having been satisfied by the payment of the debt secured thereby, " the county clerk is authorized to discharge the mortgage. Each of the last two releases recites that, "in consideration of the payment of the debt named therein," the mortgagee releases the mortgage.

The debt evidenced by the notes secured by the unsatisfied mortgage of January 30, 1924, remains unpaid.

About December 1, 1924, the First National Bank of Shoshoni, went into voluntary liquidation, and the plaintiff, S. H. Megown, was appointed "liquidating agent."

In May, 1925, when the secured debt amounted to over $ 16600, the plaintiff published notice of foreclosure of the mortgage of January 30, 1924, but sold no property, for the reason, as he testifies, that there was no property to be found. It seems from the evidence that there were at that time no more than 20 or 30 head of T6 cattle on the range.

August 25, 1925, the plaintiff, as liquidating agent of the bank, commenced this action against the mortgagor, Caroline Fuller and Karoline Fibiger. Caroline Fuller is the wife of the mortgagor, and Karoline Fibiger is the mother of Caroline Fuller.

Defendant George B. Fuller, the mortgagor, has been at all times the owner of the T6 brand, and each of the successive mortgages included all cattle of that brand, their increase and the brand itself. The first two mortgages included also a few cattle of the flying H brand, but the other mortgages included only the T6 cattle. There was testimony to the effect that, when the third mortgage was being prepared, the mortgagor told the bank that the flying H cattle might as well be omitted, as there were so few of them, and it would seem that Caroline Fuller, from that time at least, claimed the cattle of the flying H brand that had been included in the former mortgages.

The flying H brand formerly belonged to Park Fuller who, in January, 1921, transferred it to George J. Fuller, minor son of defendants George B. and Caroline Fuller. In November, 1922, George J. Fuller transferred it to his mother, Caroline Fuller, who has since been the record owner of that brand, claiming all cattle bearing it.

The CF brand has at all times belonged to defendant Karoline Fibiger. No cattle of that brand were described in any of the mortgages.

The defendant George B. Fuller has had the active care and management, including the superintendence of branding of calves, of the flying H cattle claimed by his wife and the CF cattle claimed by Mrs. Fibiger, as well as of the T6 cattle belonging to him. All the cattle, as is customary in this state, have been permitted for a large part of the time to run at large on the open range. The means of identification is the brand. See Secs. 3091, 3095, 4682, Wyo. C. S. 1920. It was of course the duty of the mortgagor, in branding calves of the cattle in his care, to place the T6 brand, or, at least, to place no other confusing brand, on the calves of T6 cows.

The plaintiff claimed, and undertook to prove on the trial, that the mortgagor, during the period covered by the successive mortgages, had placed the flying H and CF brands on T6 cattle that were covered by the mortgages; and that, as a result of this practice, a large part of the mortgaged cattle had lost their means of identification as mortgaged property, and been wrongfully mingled with the cattle claimed by Mrs. Fuller and Mrs. Fibiger.

To establish the fact of misbranding and mingling of cattle there was evidence that the T6 brand on several grown cattle had been vented, and the animals rebranded with flying H or CF; that some calves of T6 cows were branded with flying H or CF, and that calves bearing the flying H brand were seen following T6 cows on the range. Some of this evidence related to a time as early as 1921, and some as late...