Wasatch Livestock Loan Co. v. Nielson
| Decision Date | 23 October 1936 |
| Docket Number | 5614 |
| Citation | 90 Utah 331,61 P.2d 616 |
| Court | Utah Supreme Court |
| Parties | WASATCH LIVESTOCK LOAN CO. v. NIELSON et al |
Appeal from District Court, Third District, Salt Lake County; O. W McConkie, Judge.
For former opinion, see 90 Utah 307, 56 P.2d 613.
Former opinion amended in part.
Thomas & Thomas, of Salt Lake City, and Larson & Larson, of Manti for appellants.
Christenson Straw & Christenson, of Provo, and J. A. Hougaard and E. A Britsch, both of Manti, for respondent.
WOLFE, J., being disqualified, did not participate.
On petition for rehearing.
This cause has heretofore been argued and an opinion rendered. 90 Utah 307, 56 P.2d 613. The Wasatch Livestock Loan Company hereinafter referred to as the loan company, and Hilma N. Becker, in her individual capacity and as the administratrix of the estate of Mary J. Phillips, deceased, have each filed a petition for a rehearing. S. M. Nielson, administrator of the estate of Wm. L. Madsen, deceased, has filed a petition asking that the opinion heretofore rendered be amended to the end that the judgment of the trial court be affirmed in its entirety. In support of its petition for rehearing the loan company stresses the argument that if the general creditors of Wm. L. Madsen, deceased, have a lien on the assets of the estate, such lien attached as of the time of Mr. Madsen's death, at which time the loan company's mortgage was in good standing, and hence superior to the liens of the general creditors of the insolvent estate. It is urged that in the opinion heretofore written we misconceived what the learned author of Jones on Chattel Mortgages and Conditional Sales conceived to be the better doctrine. In the former opinion we quoted at some length from that author, not for the purpose of showing that he favored the conclusions which we reached, but to illustrate the diversity of opinions and the reasons which are advanced in support of the respective views. It is true, as contended by the loan company, that the learned author of that work favors the doctrine contended for by the loan company. It is also urged that we misconceived the holding of the court in the case of Folsom v. Peru Plow Co., 69 Neb. 316, 95 N.W. 635, 636, 111 Am. St. Rep. 537. It is true, as pointed out by the loan company in its brief in support of its petition for rehearing, that the mortgage involved in that action was not recorded at the time the mortgagor died or at the time the administrator took possession of the mortgaged property. In such respect that case is distinguishable from the case in hand. That case, however, is authority for the doctrine that "a general creditor of an estate has no lien on the assets until his claim has been adjudicated and allowed." It was in support of such view that the foregoing case was cited. Other cases where the same doctrine is announced are cited in the Folsom Case, supra. In its final analysis the position of the loan company is that upon the death of a mortgagor the mortgagee is, as to general creditors of the mortgagee, relieved of keeping the mortgage alive as provided by R. S. Utah 1933, 13-0-1 and 13-0-2, and that in any event the general creditors of deceased may not question the validity of a mortgage which was valid and properly filed at the time of the death of the mortgagor. As will be seen from an examination of the authorities cited in the former opinion, there are authorities which, under statutes similar to ours, support the loan company's position. However, in the light of the language used in the various statutory provisions and authorities referred to in the former opinion in this case, we are constrained to adhere to the conclusions reached in that opinion. A further discussion of those authorities would serve no useful purpose. The petition of the loan company for a rehearing is denied.
In support of her petition for rehearing Mrs. Becker contends that at the time Mr. Madsen died and for some time prior thereto he was the bailee and not the vendee of the sheep claimed by Mrs. Becker and Mrs. Phillips, and hence the law with respect to the necessity of having leases of sheep acknowledged and filed has no application. We have read the transcript of the evidence offered and received at the trial. Such evidence establishes these facts. In 1920 Mrs. Becker and Mrs. Phillips each leased sheep to Mr. Madsen. Contrary to the findings of the court below, the evidence is such as to require a finding that the sheep so leased were placed in Mr. Madsen's herd. Mr. Madsen paid the lessors for the leased sheep as by the leases provided. From time to time the leases were renewed, but so far as is made to appear none of the lease agreements were acknowledged or filed. Mr. Madsen bought some but not all of the leased sheep. The number of sheep that Mrs. Phillips and Mrs. Becker were each entitled to receive from Mr. Madsen varied from time to time, but at all times each of them were entitled to in excess of 100 sheep. The increase of the leased sheep were marked and branded with Mr. Madsen's earmarks and wool brand. The original leased sheep were, after being sheared, branded with Mr. Madsen's brand, but the earmarks on the sheep originally turned over to Mr. Madsen were not changed. At the time this controversy arose there were very few, if any, of the sheep originally leased to Mr. Madsen in his herd. It is to be inferred from the evidence that all, or nearly all, of the sheep originally leased to Mr. Madsen had died from old age or other causes before this controversy arose.
In September or October, 1930, Mr. Madsen was informed by Mrs. Phillips and Mrs. Becker that they desired to terminate their leases. One France Brotherson was authorized and directed by Mrs. Phillips and Mrs. Becker to go to Mr. Madsen's sheep herd and separate the sheep to which they were entitled under the lease agreements. Apparently Mr. Madsen was willing to deliver the sheep as provided by the lease agreements, but when Mr. Brotherson attempted to take the sheep out of the Madsen herd an agent of the loan company prevented him from doing so. The loan company at that time claimed its mortgage covered all of the sheep in the Madsen herd. In support of the claim of Mrs. Becker that the leases in question created the relation of bailors and bailee, and not that of vendors and vendee, a number of authorities and cases are cited, among them the following from this jurisdiction: Turnbow v. Beckstead, 25 Utah 468, 71 P. 1062; Wetzel v. Deseret National Bank, 30 Utah 62, 83 P. 570; Rich v. Utah Commercial & Savings Bank, 30 Utah 334, 84 P. 1105. The facts in those cases are distinguishable from the facts in the instant case; but as those cases were decided before the enactment of the law requiring the acknowledgment and filing of leases such as those here brought in question, we need not pause to point out the distinction. The law announced in the foregoing cases is to the effect that if a lease agreement makes the lessee a mere bailee of the sheep leased, then and in such case the lessor's claim to such sheep is superior to the claims of a vendee or mortgagee of the lessee. Independent of statute such is the established law in this jurisdiction. It, however, is clear that when the Legislature enacted the law making the interest of a lessor of sheep in excess of 100 head "subsequent to claims of creditors of the lessee," it thereby changed the law as announced in the cases theretofore decided by this court to the end that when more than 100 head of sheep are leased without complying with the law as to acknowledgment and filing, then and in such case the lessor is precluded from making the claim as against general creditors of the lessee that the lease agreement constitutes a bailment and not a sale. The language of the act is:
It is evident that the purpose sought to be accomplished by the foregoing act was to confer upon those who in good faith...
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