Stockyards National Bank of South Omaha v. B. Harris Wool Co.
| Decision Date | 31 December 1926 |
| Docket Number | 25031 |
| Citation | 289 S.W. 623,316 Mo. 426 |
| Parties | Stockyards National Bank of South Omaha, Appellant, v. B. Harris Wool Company |
| Court | Missouri Supreme Court |
Appeal from Circuit Court of City of St. Louis; Hon. Charles B Davis, Judge.
Affirmed.
S. T G. Smith and Thos. S. Meng for appellant.
(1) Consent of the mortgagee to sale of the mortgaged property by the mortgagor does not discharge the mortgage lien unless the property is actually sold pursuant to such agreement. Here it is conceded that the property had not been sold (but was in the possession of defendant, mortgagor's agent) at the time plaintiff asserted its rights under the mortgage demanded possession of the mortgaged property and brought suit in replevin therefor. Sexton v. Besheard, 21 Ida. 338. Defendant having sold the mortgaged property as the agent of the mortgagor, and having denied the validity of plaintiff's mortgage, was clearly liable for conversion of the property. Dusky v. Rudder, 80 Mo. 400; Banking House v. Brooks, 52 Mo.App. 364; Shaphard v. Hynes, 104 F. 452. Particularly is this true where the mortgagee's consent to the consignment was upon the condition that it receive the proceeds of the property, and the evidence showed that such condition had not been complied with. (2) Consignment of property merely signifies the delivery of possession of property to another than the owner. Sturn v. Baker, 150 U.S. 326; Block v. Col. Ins. Co., 47 N.Y. 403; Harris v. Coe, 71 Conn. 163; McDonald Comm. Co. v. Boggs, 78 Mo.App. 31. (3) The release of a mortgage of record is open to explanation the same as a receipt. If a release is made by mistake or misapprehension and no intervening rights have been acquired on the faith of the apparent release, it may be disregarded and the original lien enforced in priority to liens subsequently attaching. Christy v. Scott, 31 Mo.App. 337; Seiberling v. Tipton, 113 Mo. 373. Plaintiff had accepted the renewal mortgage in the belief that it was a valid instrument. There being no suspicion of fraud on plaintiff's part with respect to the alleged alteration, the validity of its debt was not affected. Marth v. Wiskerchen, 186 Mo.App. 515. Plaintiff was therefore entitled to enforce its original mortgage lien. (4) Defendant being merely a factor, had no other or greater rights in the wool than its principal, Wrathall, and was clearly guilty of conversion. Arkansas City Bank v. Cassidy, 71 Mo.App. 199; Koch v. Branch, 44 Mo. 546; Spraits v. Hawley, 39 N.Y. 444; Lafayette Co. Bk. v. Metcalf, 29 Mo.App. 384; Natl. Bk. Com. v. Morris, 114 Mo. 255; Lehman v. Schmidt, 87 Cal. 21.
Jones, Hocker, Sullivan & Angert for respondent.
(1) Independent of any consideration of the errors assigned by the appellant, the judgment should be affirmed because, for various reasons, the defendant's demurrer to the evidence should have been sustained. (a) The mortgage of September 28, 1917, was effectually discharged by the cancellation of the notes, the recorded release, the delivery of the canceled notes and mortgage to Wrathall, and taking of the new notes and mortgage of March 26, 1918. 5 R. C. L. p. 453, sec. 88; 11 C. J. 684; Brown v. Dunckel, 8 N.W. (Mich.) 537; Herr v. Milling Co., 22 P. 770. (b) The mortgage of March 26, 1918, given in discharge of the first, was made payable to Stockmen's Securities Company, a new payee, by reason of which there was a complete novation. 29 Cyc. 1137; Carman v. Harrah, 182 Mo.App. 365; Sherer v. Rubedew, 11 Ida. 536; Bunn v. Lindsay, 95 Mo. 259. (c) The mortgage of March 26, 1918, so far as it attempted to cover growing wool on the sheep, was invalid and unenforceable against the defendant. Under the statutes of Idaho and at common law a mortgage on growing wool is good only in equity between the parties thereto and against third parties with actual notice. The enumeration of personal property which may be mortgaged under the Idaho statute is exclusive of all other forms of personal property. Rev. Code of Idaho, 1908, sec. 3406; Idaho Comp. Stat. 1919, secs. 6373, 9460; Beeler v. Mercantile Co., 8 Ida. 644; Dover Lumber Co. v. Case, 31 Ida. 276; Case Note, 1 L. R. A. (N. S.) 451. If it could be said that the law of Idaho on this subject is not settled by the foregoing authorities, it is presumed to be the same as the law of Missouri, about which there can be no dispute, New Eng. Bank v. Nat. Bank, 171 Mo. 307; Littlefield v. Lemley, 75 Mo.App. 514. (d) Even if the mortgage of March 26, 1918, could be held valid, the evidence conclusively shows that the plaintiff consented to or acquiesced in the sale or consignment of the wool by Wrathall, relying on him to apply the proceeds on the mortgage. The plaintiff is therefore estopped to sue for conversion, or in any manner defeat the rights of the defendant, acquired in ignorance of the mortgage. Knollin v. Jones, 7 Ida. 466; Mills v. Glennon, 2 Ida. 105; Bellevue Bank v. Hailey Nat. Bank, 215 P. 126; Peoples v. Whitworth, 238 P. 306; Smith v. Seed Co., 232 P. 574; Hare v. Young, 26 Ida. 691; 21 C. J. 1172; 5 R. C. L. p. 445; Jones on Chattel Mortgages, secs. 457, 457a; Case Note, 43 L. R. A. (N. S.) 302. An agreement allowing a mortgagor to sell the mortgaged property and apply the proceeds on the mortgage amounts in practical effect to a substitution of the personal obligation of the mortgagor for the security of the mortgage. Ramsey v. Packing Co., 201 Pac. (Cal. App.) 481; St. Louis Drug Co. v. Robinson, 81 Mo. 18; Randal v. Buchanan, 61 Mo.App. 445; Fields v. Wagon Co., 109 Mo.App. 84; Dodson v. Dedman, 61 Mo.App. 209. (e) The mortgage of March 26, 1918, is invalid as against the defendant because it was not filed for record as required by the statutes of Idaho. The sheep were in Minidoka County when the mortgage was made and executed in favor of the Stockmen's Securities Company, and they remained in that county until April 4, 1918. Since the mortgage was never recorded in Minidoka County, where the sheep were located and kept at the time of the execution of the mortgage, no lien ever attached as against third persons without actual notice, even though the mortgage was afterwards recorded in Cassia County, where the sheep were later taken. Cowden v. Mills, 75 P. 767; Hales v. Zander, 103 P. 669; Pollak v. Davidson, 6 So. (Ala.) 313; Burlington State Bank v. Bank, 166 S.W. 499; Yund v. First Nat. Bank, 82 P. 7 (Wyo.) ; Powers v. Freman, 2 Lans. (N. Y.) 127; First Nat. Bank v. Wood, 50 N.W. 869; Hansboro State Bank v. Elevator Co., 179 N.W. (N. D.) 669; Muller v. Bardshar, 205 P. 845; Farmers' Bank v. Bank of Britton, 23 P. 914; Fasset v. Wise, 47 P. 1095; Sublett v. Hurst, 164 S.W. (Tex. App.) 450; Bailey v. Culver, 175 S.W. (Tex. App.) 1083; Brinnberry v. White, 167 S.W. (Tex. App.) 207; Cappon v. O'Day, 162 N.W. 655; J. H. Davis & Co. v. Thomas, 45 So (Ala.) 898. In so far as the Missouri statute is analogous, the Missouri decisions support the foregoing proposition. In this State the provision of our statute that a mortgage be filed where the mortgagor resides means where the mortgagor resides at the time of the execution of the mortgage. Bank v. Metcalf, 29 Mo.App. 394; Bank of Commerce v. Morris, 114 Mo. 262; Bevans v. Bolton, 31 Mo. 437; Lasswell v. Henderson, 144 Mo.App. 396; Bank v. Heading Co., 198 Mo.App. 601. Neither did the plaintiff comply with the other section of the Idaho statutes which provides that in case of removal of the property from one county to another, the mortgage shall be filed in such other county within ten days thereafter. The sheep were removed from Minidoka County on April 4, 1918, but no attempt was made to file the mortgage in Cassia County until May 10, 1918. Rev. Code of Idaho, sec. 3410; Ida. Comp. Stat. 1919, sec. 6377. (2) If a chattel mortgage is altered after execution, without the consent of the mortgagor, it is unenforceable. Stringer v. Mfg. Co., 189 Mo.App. 337; Forsee v. Zenner, 193 S.W. (Mo. App.) 975. And in this State all such alterations are material Kelley v. Thuey, 143 Mo. 434; Carson v. Woods, 177 S.W. 623. (3) The word "consignment," as used in this case, should be understood in the sense of "shipment" and not as a delivery to a factor for sale on commission. There was no agreement of agency as in the ordinary case where goods are delivered to a commission merchant for sale. The defendant took the wool as purchaser unless it was taken by the Government. The transaction was not the result of agreement merely, but resulted from Government regulations under war powers. Commonwealth v. Harris, 32 A. 92; Hardy v. Munroe, 127 Mass. 64; Gillespie v. Winberg, 4 Daly (N. Y.) 318; 1 Bouv. Law Dict., p. 619.
This is an action for the alleged conversion of a quantity of wool, which was delivered by one Wrathall to defendant, who received the wool, made certain advances thereon to Wrathall and disposed of the wool in accordance with certain compulsory regulations promulgated by the United States Board of War Industries, which regulations were shown to be in force and effect during the year 1918. The action was tried to a jury, resulting in a verdict and a judgment thereon in favor of defendant, from which judgment plaintiff has appealed to this court. The judgment nisi was affirmed by this division of this court, an opinion, expressing our conclusions, having been prepared by one of the judges of this court, but subsequently a rehearing was granted to appellant. The cause was thereupon reargued, and reassigned to the writer hereof for an announcement of the conclusions of this court. From an examination of a voluminous record, we gather the following salient facts:
Plaintiff during the times herein mentioned, was a national bank, with its principal place of business in...
To continue reading
Request your trial
-
First & Farmers State Bank of Ghent v. Crosby
... ... to South St. Paul, where they were delivered to the pens ... Co. 75 Minn. 496, ... 78 N.W. 85; Stockyards Nat. Bank v. B. Harris Wool ... Co. 316 Mo. 426, ... ...