Moors v. Reading
| Decision Date | 08 January 1897 |
| Citation | 45 N.E. 760,167 Mass. 322 |
| Parties | MOORS et al. v. READING et al. |
| Court | United States State Supreme Judicial Court of Massachusetts Supreme Court |
Robert
M. Morse and John Duff, for plaintiffs.
Sherman L. Whipple and William R. Sears, for defendants.
The question in this case is whether there was any evidence for the jury that the plaintiffs took and retained possession, so as to give them a valid title to the goods replevied. If they were mortgagees, their title would not be valid unless the mortgaged property was delivered to and retained by them; no record of the mortgages having been made. St.1883, c. 73, § 2. If, however, they were pledgees, their title would also fail unless the property was delivered to and retained by them. So that it makes no difference, in the determination of the case, whether they were mortgagees or pledgees. Blanchard v. Cooke, 144 Mass. 207, 225, 11 N.E. 83. The facts upon which the decision must depend are not now in dispute. Those which were proved, or which the plaintiffs' evidence tended to prove, may be summed up as follows: One Houdlette was a dealer in iron, carrying a stock of goods in his store in Boston. In 1889, he borrowed money of the plaintiffs, which has never been repaid, and which the plaintiffs sought to secure in the following manner Houdlette executed to the plaintiffs a "general collateral agreement," so called, setting forth that all the merchandise transferred or to be thereafter transferred by him to them should be held only as security for his present or future indebtedness to them. He also from time to time, usually about once a month, executed to them a bill of sale of goods in his store. In some instances, but not always, upon receiving the bills of sale, they executed and delivered to him a special instrument of defeasance. These bills of sale were intended to cover all of the stock of goods in store from time to time, and did so cover it, except so far as new goods may have come in between the dates of two transactions, or as goods may have been released on orders as hereinafter stated. Soon after the date of each bill of sale, the plaintiffs took possession by going to Houdlette's store, where statements were made by or in behalf of Houdlette that possession of the goods was given and on behalf of the plaintiffs that possession was taken, by touching some of them, by appointment of Houdlette's bookkeeper as agent of the plaintiffs to take and hold possession of the goods for them, and by his acceptance of such agency. From time to time, as new bills of sale were received, the plaintiffs gave written orders to the bookkeeper to deliver to Houdlette portions of the goods included in former bills of sale. These orders were usually for round amounts, as called for by Houdlette's bookkeeper, being about the same in amount as the amounts of the new bills of sale; the amount being fixed by what the bookkeeper thought would be sufficient to cover the deliveries by Houdlette for the next month. The quantities in these orders were expressed in gross, as, for example, 75,000 pounds sheet-plate iron and steel, 50,000 pounds angle iron, 200 kegs rivets. It was not intended to make sales of goods in excess of the amounts covered by these orders; but Houdlette made sales from all the goods in store, without regard to whether they had or had not been released by the plaintiffs, and this was permitted by the bookkeeper. Whenever the bookkeeper thought the amount of an order had been fully drawn, he would get a new one. No setting apart or separation of the goods covered by these orders was made, and new goods, as they came in, were mingled with the old, and there was nothing to distinguish them. Sales were made from the general stock of goods on hand, without discrimination; and the proceeds of the sales went to Houdlette. The bookkeeper was paid by Houdlette, and the plaintiffs did not pay or agree to pay him anything. Since the plaintiffs did not take possession on the day of the date of each bill of sale, there were usually some goods in the store which had come in between the date of the bill of sale and the day of taking possession, and which, therefore, were not covered by the bills of sale. No attempt was made to keep such goods separate. The above methods were pursued for nearly four years, at the end of which time Houdlette went into insolvency, and his assignees took possession of the goods.
If it be assumed that there was from time to time a sufficient taking of possession by the plaintiffs at the outset, the facts effectually negative the plaintiffs' view that there was any such retention of possession by them as to meet the requirements of the law. The obvious purpose of the statutory provision as to unrecorded mortgages, and of the rule of law as to the retention of possession by pledgees, is to prevent mortgagors or pledgors, by means of their possession of the property, from misleading people into the belief that they are its real owners. Accordingly the rule is general that if mortgagors whose mortgages are unrecorded and pledgors are allowed to remain in possession of the mortgaged or pledged property, the mortgagees or pledgees will lose their lien. Possession or control of the property may be given to a mortgagor or pledgor for certain special purposes without producing this effect; e.g., to make sale thereof for the sole benefit of the mortgagee or pledgee, or to keep the property specifically for him for a time as his bailee or agent. There are numerous cases in which the question has arisen, and been determined, whether, under the particular facts there shown, the lien of a mortgagee or pledgee has been lost by reason of permitting the mortgagor or pledgor to be in possession of the property. Kellogg v. Tompson, 142 Mass. 76, 6 N.E. 860; Moors v. Wyman, 146 Mass. 60, 15 N.E. 104; Thacher v. Moors, 134 Mass. 156; Thompson v. Dolliver, 132 Mass. 103; Thayer v. Dwight, 104 Mass....
To continue reading
Request your trial