Swords v. Occident Elevator Co.
Decision Date | 31 December 1924 |
Docket Number | 5588. |
Parties | SWORDS v. OCCIDENT ELEVATOR CO. |
Court | Montana Supreme Court |
Appeal from District Court, Stillwater County; H. J. Miller, Judge.
Action by George W. Swords, as receiver of the Citizens' National Bank of Laurel, against the Occident Elevator Company. Judgment for plaintiff, and defendant appeals. Reversed and remanded.
Sterling M. Wood, of Billings, for appellant.
Nichols & Myers, of Billings, for respondent.
Stated briefly, the facts out of which this controversy arose are that the Citizens' National Bank of Laurel held a chattel mortgage upon a crop of grain belonging to G. A. Starkweather to secure an indebtedness of something over $17,000. The mortgage had been filed in the office of the county clerk and recorder, and, while it was still in full force and effect the Occident Elevator Company purchased a portion of the mortgaged property, and paid the purchase price to Starkweather directly.
This action in conversion was instituted by the bank, through the receiver in charge of its business, to recover from the elevator company the value of the grain so purchased, and in the complaint the transactions are set forth at length. The answer is a general denial.
Upon the trial, and after the plaintiff had rested, the defendant sought to show that it purchased the grain in controversy from Starkweather and paid the purchase price to him directly under an agreement with the plaintiff bank that it might be done. The offered evidence was rejected, and, the defendant having rested, a verdict was returned in favor of the plaintiff by direction of the court, and from the judgment entered thereon defendant appealed.
1. It is contended that the mortgage was not entitled to be filed and therefore did not impart constructive notice.
Section 8276, Revised Codes, provides that every chattel mortgage, in order to be entitled to be filed, must be signed and acknowledged by the mortgagor and bear the affidavit of good faith by the mortgagee. The section then proceeds:
In the mortgage in question there appears immediately below the mortgagor's signature and above the acknowledgment and affidavit the following:
and no authorities to the contrary are cited.
It is insisted by defendant that our chattel mortgage statute must be construed strictly, and some of the early decisions of this court announce that rule, but it has never prevailed in this state since the adoption of the Codes, although the statute was apparently overlooked in Reynolds v. Fitzpatrick, 23 Mont. 52, 57 P. 452. Since July 1, 1895, it has been the law of this state that-
Section 4, Pol. Code 1895; section 4, Rev. Codes 1907; section 4, Rev. Codes 1921.
No exception is made in the chattel mortgage statute; hence we are bound by the rule of construction quoted above. The mortgage conforms substantially to the requirements of section 8276.
In passing, we observe that, if the matters stated in the first offer of proof be true, defendant must have had actual knowledge of the bank's mortgage, otherwise there would appear to be no reason for defendant consulting the bank and securing its consent before purchasing the grain.
2. When defendant sought to show that the grain had been purchased from Starkweather and the purchase price paid to him, by consent of the bank, counsel for plaintiff objected upon the ground that the manifest purpose was to prove a waiver which had not been pleaded. Upon the admission of counsel for defendant that such was the purpose, the objection was sustained and the offered evidence excluded. It is urged that the court erred in the ruling, and that the evidence was admissible under the general denial in the answer.
A general denial is authorized by statute (section 9137, Rev. Codes), and the effect of it is to put in issue every material allegation constituting the statement of plaintiff's cause of action, and casts upon the plaintiff the burden of establishing, prima facie at least, the presence of every element necessary to a recovery. Hickey v. Breen, 40 Mont. 368, 106 P. 881, 20 Ann. Cas. 429; Chealey v. Purdy, 54 Mont. 489, 171 P. 926.
Glass v. Basin & Bay State Min. Co., 31 Mont. 21, 77 P. 302. From these definitions it follows that, to state a cause of action in conversion, plaintiff must disclose by his complaint that at the time of the alleged conversion he had a general or special ownership in the chattels, a right to the immediate possession thereof, the value of his interest, and that the acts of the defendant which deprived him thereof were wrongful. Interstate National Bank v. McCormick, 67 Mont. 80, 214 P. 955.
The general denial puts in issue all of these allegations, and any evidence which tends to negative any of them is admissible. Chealey v. Purdy, above. If in this action the bank consented to the sale of the grain by Starkweather to defendant and to the payment of the purchase price therefor to Starkweather directly, then the appropriation of the property by the defendant was not wrongful (United States Nat. Bank v. Great Western Sugar Co., 60 Mont. 342, 199 P. 245), and plaintiff cannot complain under the familiar maxim "volenti non fit injuria,"-"he who consents to an act is not wronged by it." Section 8744, Rev. Codes.
After a conversion of mortgaged chattels has actually taken place, the mortgagee may waive the tort (26 R. C. L. 1144), or he may waive his lien upon the property at any time. (11 Corpus Juris, 674).
The distinction between a waiver of the conversion and a waiver of the lien is important as it relates to the question of pleading. The defense that the tort has been waived admits that defendant converted the property and that plaintiff had a cause of action therefor, but seeks to show that plaintiff chose to treat the act as not wrongful and thereby to relinquish his right of action. Such a defense is in the nature of a confession and avoidance, which must be pleaded specially. It is such a defense as is required to be pleaded by subdivision 2 of section 9137, Revised Codes. 31 Cyc. 218; Bowers on Conversion, § 543.
In 38 Cyc....
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