United States Ozone Co. v. Morrilton Ice Co.

• Decision Date: 14 November 1932
• Docket Number: 4-2731
• Citation: 54 S.W.2d 282,186 Ark. 485
• Parties: UNITED STATES OZONE COMPANY v. MORRILTON ICE COMPANY
• Court: Arkansas Supreme Court

54 S.W.2d 282

186 Ark. 485

UNITED STATES OZONE COMPANY v. MORRILTON ICE COMPANY

4-2731

Supreme Court of Arkansas

November 14, 1932

Appeal from Conway Chancery Court; W. E. Atkinson, Chancellor affirmed.

Decree affirmed.

W. P Strait, for appellants.

Robinson House & Moses and Edward Gordon, for appellees.

OPINION

MEHAFFY, J.

On June 28, 1926, the appellants sold to the Morrilton Ice & Fuel Company, Charles Daugherty and James Daugherty certain material for $ 2,020, who paid cash with the order $ 510 leaving a balance of $ 1,510. This sum was not paid, and on September 30, 1926, appellants filed suit in the Conway Chancery Court against the Morrilton Ice & Fuel Company and the Daughertys for the balance due and prayed judgment for the debt, interest and costs, and that a lien be declared, and the property described be sold to pay the indebtedness, interest and costs.

A decree was entered in favor of appellants for the indebtedness, a lien was declared, and the property was ordered sold. An appeal was taken to this court, and the case was affirmed here. Morrilton Ice & Fuel Co. v. Montgomery, 181 Ark. 180, 25 S.W.2d 15. The Morrilton Ice & Fuel Company was a partnership, composed of James Daugherty and W. Charles Daugherty.

Before the above case was determined, a corporation was organized by the Daughertys under the name of Morrilton Ice Company, and the property of the partnership was conveyed to this corporation in November, 1927. About December 5, 1925, W. Charles Daugherty and James Daugherty executed and delivered to the Bank of Morrilton a note for the sum of $ 10,000. The note became due and payable December 12, 1925, and bore interest at the rate of 10 per cent. per annum until paid. The mortgage was properly recorded, and it contained the following clause:

"This mortgage is also given to secure any other indebtedness that we, or either of us, may be due the said Bank of Morrilton at any time prior to a foreclosure of this instrument."

Thereafter, in February, 1926, the Bank of Morrilton made another loan of $ 12,000 which became due in February, 1927. This note also bore interest at the rate of 10 per cent. per annum until paid. There was still another loan made July 29, 1926, for $ 4,216, and this note also bore interest at the rate of 10 per cent. per annum until paid.

The Bank of Morrilton thereafter became insolvent, and the Bank Commissioner took charge and sold the assets of the Bank of Morrilton to the First State Bank of Morrilton. In October, 1927, the First State Bank of Morrilton assigned and delivered the notes above mentioned, together with the mortgage securing the payment of said notes, to the Bankers' Trust Company of Little Rock, Arkansas, and thereafter the Bankers' Trust Company transferred and assigned said notes and mortgage to the Southwest Public Service Corporation.

It is alleged by the intervener, Southwest Public Service Corporation, that there is still due $ 37,607.80, with interest at the rate of 10 per cent. per annum from November 1, 1930, until paid.

The assignment to the Bankers' Trust Company was as follows: "For value received, this note, together with all mortgage liens securing the payment of same, is hereby transferred and assigned to the Bankers' Trust Company without recourse on the First State Bank."

This suit was begun by appellants in the Conway Chancery Court who alleged the indebtedness of $ 1,510 with interest, for which they had a materialman's lien; that the lien had been foreclosed, the property ordered sold, and appeal taken to this court, where the...