New v. Sailors

• Citation: 16 N.E. 609,114 Ind. 407
• Parties: New et al. v. Sailors.
• Decision Date: 25 April 1888
• Court: Supreme Court of Indiana

114 Ind. 407
16 N.E. 609

New et al.
v.
Sailors.

Supreme Court of Indiana.

April 25, 1888.

Appeal from circuit court, Boone county; Thomas J. Terhune, Judge.

J. L. Sailors having made a voluntary assignment for the benefit of his creditors, Hamilton M. Sailors filed an intervening petition claiming priority over Andrew J. New and other creditors, on account of a certain chattel mortgage. Judgment for plaintiff, and defendants appeal.

W. R. Stokes and Jas. A. New, for appellants. Geo. W. Stubbs, for appellee.

Mitchell, C. J.

On the 21st day of April, 1884, James L. Sailors, being the owner of a stock of dry goods, boots, shoes, hats, caps, etc., in Thorntown, Boone county, Ind., executed a chattel mortgage, covering the stock above described, to his brother, Hamilton M. Sailors, of Kokomo, Ind. It was recited in the mortgage that the mortgagor was indebted to the mortgagee in the sum of $1,700, evidenced by a promissory note dated January 1, 1883, for $1,200, and by a standing guaranty of $1,200, to Byram, Cornelius & Co., of the city of Indianapolis, and that if the mortgagor should well and truly pay the note at maturity, and save the mortgagee harmless from the guaranty, then the mortgage was to be void. The mortgage contained a further stipulation to the effect that the mortgagor should retain possession of the property mortgaged until the note and guaranty became due, and that he would not remove the property from the place where it then was, “except the necessary sales to be made in carrying on said business of selling goods.” The mortgage was duly recorded. On the 4th day of May following, the mortgagor, gage was duly recorded. On the 4th day of May following, the mortgagor, finding himself in failing circumstances, made a voluntary assignment for the benefit of his creditors. Pending the administration of the matter of the assignment, the mortgagee filed an intervening petition in the Boone circuit court, in which he set forth that there was due him from the assignor the sum of $1,451.96, for which amount he claimed priority over the general creditors, on account of the chattel mortgage above mentioned, a copy of which was filed with his petition. The petitioner alleged in his petition that $900.62 of the amount for which he claimed a preference had been paid by him in taking up nine promissory notes which he had theretofore signed, as the surety of the assignor, to Byram, Cornelius & Co., and that he had paid $292.35, to the same parties on an account due from the assignor, for the payment of which he had become bound by a written guaranty. It was further alleged that the petitioner had paid $258.98 to Butterworth &amp...