Russell v. Winne
Russell v. Winne
Opinion of the Court
The agreement given by the plaintiff’s intestate to the defendant, upon the postponement of the sale by'the latter, was not an estoppel upon the plaintiff. It merely bound the intestate to take care of the property, until the day of sale, and produce it, at that time, and in the meantime, not to interfere therewith, by virtue of his mortgage. There was no agreement by the intestate to abandon his claim to the property, or concession of the right of the sheriff thereto, and, of course, nothing done by the latter upon the faith of any such agreement or concession.
The description of the property contained in the mortgage was sufficient to cover the stone, and also the goods belonging to the mortgagor in the store, at the time. That description, after fully pointing out
This brings us to the question, whether the judge was correct in his charge to the jury, that the mortgage was void as to the goods in the store, as the mortgage contemplated the sale of those goods by the mortgagee for his benefit. This question is only material, as affecting the validity of the mortgage as to the stone, as there was no claim made by the plaintiff on account of those goods, although sold by the defendant on the same executions as the stone. The judge could not have referred to any clause in the mortgage authorizing a sale of the goods, as the clause in the mortgage giving the right of possession and use of the property to the mortgagor was equally applicable to the stone in question as to the goods. He evidently referred to the proof showing the constant dealings of the mortgagor in the goods, selling portions thereof, from time to time, as his own, for his own benefit, with the knowledge and assent of the mortgagee, *thus evidencing an agreement that the mortgagor might so deal with the goods. The judge held, that the evidence conclusively proved this, and hence his legal conclusion, that the mortgage was void as to the goods as against creditors. This legal conclusion only need be examined, as the evidence, if not conclusively showing the above facts, tended strongly in that direction, and should have been submitted to the jury, had it not been held conclusive by the court.
The question then is, whether an agreement by the mortgagee, made with the mortgagor, that the latter may sell, for his own benefit, and as his own, portions .of the property covered by the mortgage, renders the mortgage
In Edgell v. Hart (9 N. Y. 213), it was decided by this court, that an agreement contained in the mortgage, authorizing the mortgagor to sell the property for his
The only remaining question is, whether, if the mortgage be fraudulent as to creditors, as to a part of the property mortgaged, it can be upheld as to the residue. As applied to this case, if the mortgage be fraudulent and void as to the goods in the store, is it valid as to the stone? The judge ^charged that it was; thus sharply presenting the point. In this, I think, he erred. The mortgage was one single instrument, given to secure one debt. To render it valid, it
I think it entirely settled, that, if a mortgage be one which, by reason of the fraudulent purpose and intent with which it is executed, is declared void by statute, it is wholly void, notwithstanding it may include property as to which it would be valid, if it could be regarded as a mortgage of that only. To speak more clearly, if a mortgage be given with the fraudulent intent to cover up and conceal from creditors a portion of the debtor’s property, it is altogether void, notwithstanding it also includes land or other property, in relation to which there is a bona fide intent to convey it as security for an honest debt, and no other purpose and intent. A mortgage, void in part, as a violation of the statute, is void altogether. (Goodrich v. Downs, 6 Hill 439; Grover v. Wakeman, 11 Wend. 194; Fulton Bank v. Benedict, 1 Hall 480, 546; Jackson v. Packard, 6 Wend. 415; Rice v. Welling, 5 Id.
If, therefore, the appellant is entitled, on this appeal, to insist upon that instruction, as the law of this case, he has a right, thereupon, to claim that, as matter of law, his motion for a nonsuit should have been granted. If the instruction had proceeded upon the assumption, that the defendant had shown, by extrinsic proof, that, in respect to the goods in the store, they were included in the mortgage, with intent to cover them, and hinder and prevent their being taken by creditors, while the stone were in fact mortgaged, in pursuance of a demand for security, and with bond fide intent that they should be held for that purpose, and no other, then we could not, on exception, examine the facts, to see whether that fraud was sufficiently established. But, where it appears, that the judge pronounced the instrument void on its face, because the mortgage itself “ contemplated the sale of the goods in the store,” we are at liberty to examine and see whether he gave a correct legal construction to the mortgage; and, if not, then, obviously, such instruction, by itself, did not prejudice the defendant, and we might disregará it, and determine the case on the other questions raised. So far from this instruction being of prejudice to the defendant, it was altogether in his favor; because, having told the jury that the mortgage was void as to the goods, he also told them, that they might take that fact into consideration, in deciding as to the honesty and good faith of the mortgage. I think, however, that neither the mortgage nor the-evidence warranted any such peremptory instruction. A stipulation that, until default, the mortgagor may remain in the full and free possesssion, and in the full and free enjoyment, of the goods, not
But I think that the defendant was entitled to submit to the jury the question, whether it was not according to the agreement and intention of the parties, that the mortgagor should sell the goods in the store, and appropriate the sales to his own use; and, if so, then the instruction requested, that if, for this reason, the mortgage was voi as to the goods, it was void also as to the other property, should have been given.
The mortgaged property was left in the possession of the mortgagee. He was a store-keeper, and the goods mortgaged embraced all his stock in trade—“all my goods and chattels now in my store.” The mortgagor continued his business, selling goods and buying others, without keeping any separate account of sales of mortgaged goods. He did not pay over the proceeds to the mortgagee. The men whom he employed “ traded and got goods after the mortgage was given.” The plaintiff, when he took the mortgage, did not visit the premises or take any means of identifying the goods then in the store, so that he might distinguish them from any others which might be purchased by the mortgagor, nor do anything indicating that he did not suppose that the business of selling and “ trading” would go on
Now, I think it clear, that, if the only issue in this case had been, was this mortgage delivered and received upon an ^understanding, and with the intent, that the mortgagor should continue to deal with the goods in the store as his own, “ trading” with them, and selling as opportunity offered, and appropriating the avails to his own use, and the jury had found in the affirmative on that issue, their verdict could not be declared without sufficient evidence to support it. If not, then, the mortgage being altogether void, if void as to the goods, for the reason so found, the defendant was entitled to the instruction asked, and to have the jury pass upon the question. Upon this ground, I think, the judgment should be reversed and a new trial granted.
Judgment reversed, and new trial awarded.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.