Reed Fertilizer Co. v. Thomas

• Decision Date: 23 October 1896
• Parties: REED FERTILIZER CO. v. THOMAS et al.
• Court: Tennessee Supreme Court

37 S.W. 220

REED FERTILIZER CO. v. THOMAS et al.

Supreme Court of Tennessee.

October 23, 1896.

Appeal from chancery court, Sullivan county; Hugh G. Kyle, Chancellor.

Bill by the Reed Fertilizer Company against Jacob Thomas and others to obtain judgment on a note, and to set aside a trust assignment. A demurrer to the bill was sustained, and complainant appeals. Affirmed.

A. B. Whiteaker, J. H. Wood, and W. G. Stuart, for appellant. Kirkpatrick, Williams & Bowman, for appellee Citizens' Bank of Jonesboro. Newton Hacker and John Fain, for appellee First Nat. Bank of Jonesboro. Tipton & Simerly, for appellee People's Bank. Shields & Mountcastle, for appellee First Nat. Bank of Morristown. Taylor & Winston, for appellees Thomas and wife and others.

WILKES, J.

This bill is filed to obtain judgment upon a note, and to set aside a trust assignment and subject the property embraced in it to complainant's debt. The bill was demurred to in so far as it sought to set aside the assignment, and the demurrer was sustained by the chancellor. Complainant appealed and assigned errors. The cause has been heard by the court of chancery appeals, and it affirmed the decree of the chancellor, and complainant has appealed to this court and assigned many errors. The questions presented by the assignments are:

That the instrument was acknowledged before a deputy clerk who is a beneficiary under the assignment, and was therefore illegal and void, and did not authorize the registration of the instrument, and such registration would not, under these circumstances, be notice to the world. We have held at the present term of the court that an acknowledgment taken before an officer related to the party, or interested as a beneficiary under the instrument, is not void, but irregular. We consider this question as settled, although, as heretofore stated, such practice should be abandoned, and not persisted in. See Cooper v. Association (Tenn.) 37 S. W. 12.

It is said that the delay provided for in this deed of trust, for its execution, renders it fraudulent upon its face. The mere length of time granted in such instruments is of minor importance, unless the conveyance covers more property than is necessary or requisite to pay the debt secured, and no averment to this effect is made in the bill. The decisions in this state have sustained instruments of this character granting a similar, and some of them a longer, period of delay. Hartman v. Allen, 9 Lea, 657; Roane v. Bank, 1 Head, 526; Doyle v. Smith, 1 Cold. 21.

It is said the conveyance reserves to the grantors the possession of the realty for two years, together with the right to the rents during that time. The trust deed provides that, if the debts are not paid by the expiration of two years, then the trustee shall take possession of all the property, and sell for the payment of the debts. In a subsequent part of the instrument it provides that the trustee shall take immediate possession of all the personal property, including the growing crops, and dispose of the same for the purposes of the trust. While the instrument does not expressly state who shall have the rents of the real estate during the two-years delay, yet we think a fair construction of the instrument is that these rents should go to the trustee, just as the growing crops are directed to go. In the absence of any provision for possession, it passes, with the execution of the instrument, to the grantee. Reeves v. John, 95 Tenn. 434, 32 S. W. 312. But we think the fair and proper construction of this instrument is that...