Sigel-Campion Live-Stock Commission Company v. Haston

• Decision Date: 12 March 1904
• Docket Number: 13,547
• Citation: 75 P. 1028,68 Kan. 749
• Parties: SIGEL-CAMPION LIVE-STOCK COMMISSION COMPANY v. JAMES HASTON et al
• Court: Kansas Supreme Court

75 P. 1028

68 Kan. 749

SIGEL-CAMPION LIVE-STOCK COMMISSION COMPANY v. JAMES HASTON et al

No. 13,547

Supreme Court of Kansas

March 12, 1904

Decided January, 1904.

Error from Reno district court; M. P. SIMPSON, judge.

Judgment is affirmed.

SYLLABUS

SYLLABUS BY THE COURT.

1. PROMISSORY NOTE -- Sufficient Consideration Between Husband and Wife. If a wife place in circulation her note, secured by a mortgage on her land, for the purpose of procuring the satisfaction of her husband's debt, which object is attained, the advantage he derives from the transaction is a consideration to her.

2. PROMISSORY NOTE -- Satisfaction of Debt by Transfer of Note and Mortgage no Diversion of Funds. If, in such a case, the note and mortgage are given for the purpose of procuring funds to be paid by the mortgagee to the creditor in satisfaction of the debt, it will not constitute a diversion of the securities from their original purpose if the creditor takes them by indorsement and assignment from the mortgagee in lieu of the funds themselves.

3. CORPORATIONS -- Foreign Corporations May Sue. Isolated, independent transactions in this state incidentally necessary to the business of a foreign corporation conducted at its domicile, fully completed before action commenced, will not prevent recovery in the courts of this state by such corporation under section 1283, General Statutes of 1901, when no repetition of such acts is in contemplation and the territory of the state is not being made the basis of operations for the conduct of any part of the corporation's business at the time the suit is begun.

Prigg & Williams, for plaintiff in error.

George A. Vandeveer, and F. L. Martin, for defendants in error.

BURCH J. All the Justices concurring.

OPINION

BURCH, J.:

On February 20, 1901, the Sigel-Campion Live-stock Commission Company, a corporation of the state of Colorado, commenced an action to foreclose a mortgage given by James Haston and Mary J. Haston, his wife, to the Schirmer Insurance and Investment Company, and assigned to the plaintiff. Various parties were made defendants. Mary J. Haston answered, claiming part of the land as her own; that the mortgage and the note it secured were accommodation papers; that she was a surety of her husband; that she received no consideration for executing the paper; that no consideration passed for the assignment of the paper by the payee to the plaintiff; that the mortgage was void under the bankruptcy law; that a conveyance of a part of the land by her to J. M. English, one of the defendants, was void; and that the plaintiff had no right to recover, on account of failure to comply with the corporation laws of this state. Howard S. Lewis answered as trustee in bankruptcy of James Haston, claiming the note and mortgage to be void under the bankruptcy law, charging the English transfer to be void, and impeaching the right of plaintiff to recover, as a foreign corporation which had not complied with the law regulating its right to do business in this state.

James Haston adopted the answers of his wife and Lewis, trustee, and pleaded his discharge in bankruptcy. Elmore-Cooper Live-stock Commission Company and Sattley Manufacturing Company, judgment creditors, set up liens upon the land. English made default. At the conclusion of the trial, findings of fact were made, and upon them judgment was rendered for the plaintiff, foreclosing the mortgage against the land of James Haston, but releasing the land of Mary J. Haston from its lien. After the satisfaction of the plaintiff's lien, the balance of the proceeds of the sale of James Haston's land, if any, was to be paid to Lewis, trustee. The deed to English was set aside, and judgment creditors were given first liens upon Mary J. Haston's land. The plaintiff asks for a reversal of so much of the judgment as denies it a first lien upon Mary J. Haston's land, and the trustee in bankruptcy asks for a reversal of so much of the judgment as enforces the mortgage against James Haston's land.

The right of the plaintiff to recover against Mary J. Haston is clear, unless she can impeach the acquisition of title to the note and mortgage by the plaintiff. Under the well-understood rule, only the findings of fact and uncontroverted allegations in the pleadings can be considered. (Shuler v. Lashhorn, 67 Kan. 694, 74 P. 264.)

In April, 1900, James Haston agreed with the plaintiff and the Schirmer Insurance and Investment Company to execute a mortgage upon his own and his wife's land to the Schirmer Insurance and Investment Company for a loan of $ 10,000, out of the proceeds of which the plaintiff was to receive certain sums of money then due it from James Haston, and be repaid other moneys which it agreed to advance to James Haston to pay for feeding cattle. Afterward it was agreed between James Haston and the plaintiff that the amount of the advancements should be increased in order to pay judgment and other liens against the land, and to purchase other real estate to be included in the mortgage, and the amount of the mortgage was increased to $ 15,000 for these purposes.

At the date of these negotiations James Haston was indebted to the plaintiff in a considerable sum. Before the execution and delivery of the note and mortgage, which were delayed for some months, the plaintiff paid out, according to agreement and for the items specified, sums of money sufficient to make up the full amount of $ 15,000. After their execution the note was indorsed and the mortgage was assigned by the payee to the plaintiff. The payee paid nothing to the Hastons for the paper, and the plaintiff paid the payee nothing for it. This fact the court expressed in the form of a legal conclusion relating to consideration,...