Rector-Wilhelmy Co. v. Nissen

• Citation: 35 Neb. 716,53 N.W. 670
• Parties: RECTOR-WILHELMY CO. v. NISSEN ET AL.
• Decision Date: 23 November 1892
• Court: Supreme Court of Nebraska

35 Neb. 716

53 N.W. 670

RECTOR-WILHELMY CO.

v.NISSEN ET AL.

Supreme Court of Nebraska.

Nov. 23, 1892.

Syllabus by the Court.

1. A chattel mortgage upon a stock of goods to secure the payment of four notes of $200 each, payable respectively in 30, 60, 90, and 120 days from date, contained these words: “That, in case of default made in the payment of the above-mentioned promissory notes, or in case of attempting to dispose of or remove from said county of Douglas the aforesaid goods and chattels, or any part thereof, or if at any time the said mortgagee or its successor or assigns should feel unsafe or insecure, then, and in that case the said mortgagee,” etc., “may take immediate possession of said goods,” etc. Held, that the mortgagors must be in default, or be about to do or have done some act which tends to impair the security, to authorize the mortgagee to take possession before the maturity of the notes.

2. While a mortgagee may prove any facts tending to show the conduct of the mortgagors in regard to the mortgaged property, they cannot be permitted to prove mere rumors or reports in regard to the same.

3. Instructions examined, and held to state the law correctly.

Error to district court, Douglas county; DAVIS, Judge.

Action by Peter C. Nissen, Ulila Nissen, and William H. Alford, partners as Nissen, Alford & Co., against the Rector-Wilhelmy Company, for conversion. Verdict and judgment for plaintiffs. Defendant brings error. Affirmed.Bradley & De Lamatre, for plaintiff in error.

Hall, McCulloch & English, for defendants in error.

MAXWELL, C. J.

1. The pleadings in this case are as follows: Plaintiffs, for cause of action against the defendant, say “that said defendant is a corporation organized and doing business in the county of Douglas and state of Nebraska. That on and prior to the 22d day of June, 1888, said plaintiffs were engaged in the retail hardware business in the city of Omaha, Nebraska, and on said day had a stock of hardware, tinware, cutlery, and such other items of stock as are usually found in a retail hardware store, which said stock was of the value of $3,000. That they were indebted on said last-mentioned date to said defendant in the sum of $800, and that the only other indebtedness said plaintiffs had at said date, or subsequent thereto, was as follows: To Lee-Clark-Andressen Hardware Co., $150; to Simmons Hardware Co., $132. That on said 22d day of June, 1888, said defendant prevailed upon said plaintiffs to, and said plaintiffs did, give to said defendant a chattel mortgage upon said stock of goods to secure to them the payment of said indebtedness. That by said mortgage said indebtedness was made payable as follows: $200 in thirty days from date of mortgage, $200 in sixty days, $200 in ninety days, and $200 in four months; said amounts being evidenced by promissory notes, as described in said mortgage. That when said mortgage was given, and contemporaneous therewith, said defendant agreed with said plaintiffs that said mortgage should not be placed on record unless default was made in the payment of said notes mentioned in said mortgage, or some condition of said mortgage violated; and that said plaintiffs would be allowed to conduct their said business as before, and pay said notes out of the proceeds of said business. That long prior to the maturity of the first of said notes so secured, viz., on the 2d day of July, 1888, said defendant, without cause, and without any defaultmade in the conditions of said mortgage by these plaintiffs, and in violation of their said contemporaneous agreement, and contrary to the terms of said mortgage, forcibly took possession of said stock of hardware, and converted the same to its own use, against the protest of these plaintiffs; said defendant pretending to act under its said mortgage. That after giving said mortgage they did no act, nor were they at the time said property was seized as aforesaid about to do any act, nor had they in contemplation the doing of any act, which would tend in any manner to impair the security of said mortgage, but, on the contrary, were using their utmost endeavors to be ready, and would have been ready and able, to meet said notes as they became due. That the stock so as aforesaid seized and controlled by defendant was at the time of said seizure and conversion of the value of $3,000, and that no part of the same has been returned by said defendant to these plaintiffs, nor to any one for them, nor has any payment been made therefor; and that by reason of said unlawful seizure and conversion these plaintiffs have been damaged in the sum of $3,000, the value of said stock of goods, and said defendant, by reason thereof, has become and is indebted to these plaintiffs in the sum of $3,000, no part of which has been paid. Wherefore plaintiffs pray judgment against the defendant in the sum of $3,000, with interest from July 2, 1888, and for costs of suit.” A copy of the contract of partnership is set out, which need not be noticed.

The answer of the Rector-Wilhelmy Company is as follows: “Now comes the defendant, and for answer to the plaintiffs' petition says it admits that it is a corporation duly organized under the laws of the state of Nebraska, and doing business in the county of Douglas, state of Nebraska. Admits that on the day alleged in plaintiffs' petition plaintiffs had a stock of hardware, etc., as set out in their petition, but denies that it was worth the sum of $3,000. Admits that plaintiffs were indebted in the various amounts to the parties set out in their petition, but denies that those amounts were their only indebtedness, and alleges that they were indebted for the purchase price of their stock of goods to one firm in the amount of $1,400, and that about $200 of this became due on the 1st day of July, 1888, and $200 every two months thereafter, and that plaintiffs at the time of the filing of the said mortgage were in default of their said July payment of $200. Alleges that plaintiffs at said time of filing said mortgage were insolvent. Admits that about the time mentioned in plaintiffs' petition plaintiffs gave defendant a chattel mortgage upon their said stock of goods as security for their said indebtedness to defendant. Admits that the notes were made payable as set out in plaintiffs' petition. Defendant denies that when said mortgage was given there was any contemporaneous agreement that said mortgage would not be placed on record, but alleges that it was represented to defendant by plaintiffs that William H. Alford, one of the plaintiffs herein, had $1,000 due him from the old country, which he expected daily to receive, and that, so soon as he received this,--which would not be more than a few days,--he would pay off the entire indebtedness of plaintiffs to defendant. That after two or three days from the giving of said...