Nathaniel S. Donaldson, Pl'ff in Error. vs. Solon Johnson, et. al., Def's in Error

Nathaniel S. Donaldson, Pl'ff in Error. vs. Solon Johnson, et. al., Def’s in Error. Where personal property, has been mortgaged, under the provisions, of the Statutes of the State, the bona fide of which is disputed, in an action by a party interested in the property, it is error in the Judge to admit in evidence, on the trial, the declarations of the., mortgagor, made on the. same day of the execution of the mortgage, but subsequently to the delivery of the mortgage to the proper officer to be recorded. The Statute is to bo constreued in such manner as that, on the filing-of the mortgage, a change of possession, for all the purposes of the lien, is implied, and neoessatily results; and, to the same extent as if an actual change of possession had been made. Whore a mortgagor of personal property remains in possession, vending and applying such property to his own use, it is improper to. admit in evidence the declarations of the mortgagor to. defeat the. rights acquired by the mortgagee, in the property. Where two issues are presented, by a declaration, one claiming the property in' dispute to be'in the plaintiff, and the other claiming that the defendant detained the goods; and the Jury find a general verdict in favor of the plaintiff, tho verdict will be set aside- ^Ut in such a case, it may 1}0 within tho province of the Judge, on, the application of the plaintiff before a writ of error is brought, to order the verdict to be entered in proper form, to meet the "issues presented by the jiroceediiigs. Error to the Circuit Court of Washington County. This was an action of Replevin, brought by the plain-tiS in error, the defendant below, against the defendants in error, the plaintiffs below. The declaration charged the receiving and detention of a quantity of merchandise, which they refused to deliver to the plaintiffs below. The -defendant denied the taking; -and gave a special notice of justification as respects the taking and detention of the goods, to wit; that the defendant Johnson took the goods under and by virtue of tin attachment, he being Sheriff of the County of Washington; and justified such taking and detention, upon the basis that the title in such goods was 'not in the plaintiff below. The cause was tried at the April Circuit for Washington County, and a verdict was found by the Jury for the defendants in error. On -the trial, various exceptions were taken by the ■plaintiffs in error to the proofs offered and given by the parties, plaintiff‘and defendant, none of which need be stated here, except such as were considered by the Court as. being material, and are noticed in the opinion. On the trial it was proved that William H. Lord, Daniel Baylis and William Daggett, constituted a mercantile firm at -Port Washington, and which firm was, or claimed to be, indebted to the plaintiff in a -large sum of money. That to secure the sum so claimed, Donaldson, the -plaintiff below, by his agent, who was acting in securing his debt, took from the said firm a chattel mortgage, for securing .such demand; the defendants other than Johnson, having taken the goods in store and keeping for Johnson. The defendants gave in evidence four writs of attach-, raent, upon which the goo,ds in question were levied upon and Retained, and which formed the basis of the defence. The giving in evidence these attachments was objected to by the plaintiffs in error; but the Judge admitted the evidence. The defendants also ottered in evidence several other Chattel Mortgages, executed on the same day of the Mortgage to the plaintiff by the firm' of Lprd & Co., to secure other debts against said firm. On the tyial of the cause the declarations of one or ípore of the firm of Lord &; Co., were offered in evidence tyhereby it yvas proved that Bayliss,, one of said firm, had at various times made declarations in regard to the execution of the, mortgage to the plaintiff below, tending to, shoyv fraud in its execution, which evidence was objected to, but overruled by the Judge and the evidence was. given, and the defendant below excepted thereto. These, declarations appeared to have been made subsequent, to th© execution of the mortgage, and after the same was de-, posited with the proper officer to be recorded, and in the absence of the mortgagee. Various other evidence was given on the trial of the part of the defendants below which was claimed, showed fraud on the part of Lord & Co., in the execution of the mortgage to the plaintiff below, but \yhich do not appear necessary to be stated; nor, does such evidence come within the purview of the decision of this Court. Such evidence was objected to, but admitted by the Court, and excepted to by the counsel for the plaintiff. The principal exception taken by the plaintiff below on the trial, which vras considered by this Couft^ relates the evidence offered and admitted, of the declarations of dome one or more of the firmlof Lord & Co., tending to show, that the execution of the chattel mortgages was fraudulent, as against creditors of fhe firnq, other than the mortgagees. The Jury found for the defendants, and assessed tine damages for the detention of the property at six cents, $nd found the value of the property replevied to be $1,* $18,49; and upon this verdict the Court ordered a general yerdict to be entered m fqyor of th,e defendants. G. James & II. S. Or.fan, counsel for the plaintiffs in Jjrror, made and argued the following points, to-wit: 1. The notice of said defendants in error was insufficient to admit ip evidence the said attachments against Lord, Bayliss and Daggett, in justification to the officer, file said Solon Johnson, one of said defendants, or for any ¡other purpose whatever.-r-3rd Stephens’ nisi prius, 2647; Gould on pleading, ch. 3 § 1¡ 166-9; 6 Wendell, 438; 12 Jfendell, 473; 8 Wendell, 570; 6 Bill, 277; 1 Dana, 578; 1 Mass. 153; 4 J. J- Marshall, 254; 11 Johnson, 132; 13 Johnson, 475; 17 Johnson, 320. 2. Other mortgages, of the same date, and to secure the same debt as the one in question, and upon other property than that described in the writ, ought not to have been introduced in evidence for the reason that it was immaterial and irrelevant, and did not show, or tend to show fraud in the conveyance in question. — 1 Conn., 393; 10 Conn., 280, 3.The statements of Lord, Bayliss and Daggett, or either of them, after the execution of the sportgagp to £he plain-fiffiin error, ought not to h$ve been receiyed in evidence to prove, or as tending to prove fraud in the execution of the mortgage, or to prejudice in any manner the right of the mortgagee, Donaldson. — 1 Mass., 165; 12 Rich., 08;, 14 Mass., 245; 10 Conn., 60;, 6- Vermont, 325; 2 Cowi & Hill’s Míes, 654; 5 Johnson, 412; 12 Wend., 161; 5 Term Rep., 412;, 1 Greenleaf onev,., 212; 1 Starki&’s Rep.,, 60; 4 Mass., 709. 4. The statements of Daggett, one of the mortgagors, iis relation to the 'value of the, property mortgaged to Don^' afdson, ought not to have been admitted in evidence for the reason that Daggett was a competent witness in the case. — 15 Johnson,, 493; 12 Pickering 89. 5. The court ought not to have charged the jury as mat" ter of law, that the secrecy of the transaction might properly be taken into consideration by the jpry with othetp circumstances, to show the character ©f the transaction; for the reason it had nothing to do with the character of the transaction. — -16 Pickering, 556; ,16 Pick., 462. 6. The refusal of the Court toma,struct the jury, “ That; if the jury found that the mortgage was upon as good consideration, and was-not taken, by Donaldson with intent to defraud, hinder, or delay the creditors of Wm. Hi Lord & Co., that the plaintiff ought to recover and that unless they found Donaldson guilty of taking the mortgage with intent to defraud, hinder or delay the creditor®, of William H. Lord & Co., that then the plaintiff was entitled to recover.” — 14 Mass. 245; 3 Met. 99,; 17 Pick. 453-; 9 Conn. 135. 7.The judgment of the Court upon the verdict of the jury was error. — 12 Wendell, 161; 12 Wendell, 31; 13 Wendell, 425; G Hill, 277; do 613; 5 Benia, 21; 7 Haifa mond, (2d part,) 232. Smith & Palmer, counsel for the Def’ts in Error, made and argued the following points: A mortgage bn personal property unaccompanied by possession, is presumed to be fraudulent and void. 17 Wend., 54-56; id., 181. It is' not sufficient that the retention óf possession was for the mortgagor’s accommodation, for the purpose of carrying on his vocation. — Gardiner vs. Adams, 12 Wend. 297; Doane'vs. Eddy, 16 id. 223; or the better to enable the mortgagor to-pay'his mortgage debt. — BeeJcman vs. Bond. 19 id. 444. Where a mortgage is taken upon a stock of goods, which are suffered to remain in the possession of the mortgagor, to be sold at retail or wholesale, as other merchandize; such'mortgage is fraudulent and void, as against creditors. — Wood vs. Lowrey, 17 Wend. 492. A mortgage of hay and grain and produce to secure á debt, the mortgagor to remain in possession and use and consume them, is fraudulent. — -Robins vs. Parker, 3 Met., 117. If a mortgage containing articles consumable in their úse, stipulate or it permit the mortgagor to remain in pos-feession and’use 'them, the conveyance is fraudulent as to creditors. — Charlton vs. Lay, 5 Humph. 496; Smith’s leading cases, 34-74, and the authorities there cited. — See Peck. vs. Carmichael, 9 Yerg. 325. The declarations of Bayliss, or either of the firm of Lord & Co., made at or about the time of the mortgage are admissible, against them and those claiming under them. — 1 Cow. & Hill’s notes 650-651-652; 1 Greenleaf 133-134-135, id. 244-601-603. And are admissible to show fraud in the vendor even after sale. — Cow. & Hill, 1 Part 653, and authorities there cited-, Wills vs. Farley, 3 Cart-and Payne, 395; Cow?, en & Hill 178, and authorities, there cited. Testimony in regard to other conveyances of property, at or about the same time was admissable. — 1 Cowe% & Hill’s notes 452-465, and the authorities the%e cited. They are part of the res gestae, and their admissipn rests in the sound discretion of the Court. — 1 (h een.leaf-on Ec. 133; Rawson vs. Haight,^ 2 Bing, 104; 9 Bingham, 349-352; 4 Pick. 379; 11- Pick. 309. [MAJORITY — LahRab,ee, J.] By the Court. LahRab,ee, J. This, cause ivas triedj before- me at the last Spring Term of the Washington Circuit. The principal ground of error is the permitting the declarations of one of the mortgagors, Bayliss, to he given in evidence to the Jury, to show fraud in the execution of the chattel mortgage to Donaldson. I decided that these declarations should be received, because they were shown to have been made while the mortgagors remained in possession of the property, and upon the. same day that the mortgage was executed. But I arp now satisfied that my decision was wrong, and concur With my brethern that the judgment should be reversed, It appears pretty plainly, that Bayliss made these declarations subsequent to the delivery of the mortgages (for fhere were several of them) to the Town Clerk, to be filed; and this filing our statute makes equivalent to ari actual change of possession. If then, there had been a phange of the possession, would the statements of any qne or all the mortgagors have been received to show fraud in the transaction 1 Certainly not. The authors ties are nearly all the other way, and it,is now too well §ettled to be questioned. The declarations of a formef. pwner cannot be received to affect the title of a succeed* ing owner, where such declarations are made after the former owner hag parted with his interest. Hurd vs. West, 7 Cowen, 752; Sprague vs. Kneeland, 12 Wendell, 161; 14 Mass. 245. It was contended, however, by the counsel fpr the de» fendant^ in error, as the mortgagors, remained in possess^ [on of the property, using and selling the same, and ap~. plying {he proceeds to their own use, that their declara», tions, rqade under such circumstances, were properly ad» pitted to show the character of the original transaction, Were this a case of i>rst impressions, this position would in my mind, admit of no question; but the authorities are, pow the other way. But this question aside, there is an» other difficulty apparent on the record, which is insuper» pble. The verdict does not warrant the judgment. By the pleqdings, two issues were made. Is.t, The deteni tion of th.e property, and — -2d. The title to it. There, was a gpneral vepdict for the defendants, not in form a finding upon these issues, and though it was probable, enough to have warranted the Court in putting the ver-; diet in proper form? yet as no application was, made by the defendants for this purpose, but they chose to enter up their judgment on the verdict such as it was, it is now too late to correct it. Sprague & Cary vs. Kneeland, 12 Wendell, 161; Rogers vs. Arnold, Id. 30. For these reasons the judgment at the Circuit must bq Reversed, and the cause remanded for a new trial, Judgment reversed.