Case ID: ala_85/html/0091-01.html
Source: Caselaw Access Project
Author: {"author": "STONE, C. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Collier & Jones v. Wood Brothers.
    
      Bill in Equity by Creditor, to enforce and foreclose Mortgage as General Assignment.
    
    1. Mortgage for advances, as general assignment. — A mortgage given to secure an indebtedness for advances, past, present, and future, conveying the mortgagor’s crop then planted, and substantially all the rest of his property, will be declared and enforced as a general assignment at the instance qf another creditor, enuring equally to the benefit of all the creditors (Code, § 1737), so far as it secures the past indebtedness, but not as to advances made on the faith of it.
    . 2. Lien of execution lost by laches. — The lapse of an entire term, without the issue and return of an execution, works a forfeiture of the lien (Code, § 2894); and when so lost, it is not revived by a subsequent execution, though a new one may be thereby acquired.
    3. Conveyance of exempt property; distribution among creditors. ■When exempt property is embraced in a mortgage, which is afterwards declared a general assignment, only creditors having a waiver of ex-emp'.ions can share in the proceeds of its sale, on a distribution of the entire proceeds of the mortgaged property among .all the creditors.
    Appeal from the Chancery Court of Pike.
    Heard before the Hon. JOHN A. Postee.
    The bill in this case was filed on the 8th October, 1886, by Wood Brothers, merchants and partners in trade, as creditors of Ezekiel Warrick, against said Warrick, G. C. Collier and Thomas H. J ones, the two latter being partners in trade doing business under the firm name of Collier & Jones; and sought to have a mortgage, which Warwick had executed to Collier & Jones, declared a general assignment, and enforced and foreclosed as such for the benefit of all said Warrick’s creditors equally. The mortgage, a copy of which was made an exhibit to the bill, was dated the 21st May, 1886, and filed for record on the next day; purported to be given to secure an indebtedness of $700 to said Collier & Jones, due by promissory note of even date with the mortgage, due October 1st, 1886, “and any other amount they may advance to me [Warrick], in money or otherwise, before the 1st day of January, 1887;” and conveyed property which was thus described: “My entire crop grown the present year by me, or under my control or direction, on the E. Hendricks plantation, and all other plantations cultivated by me, or under my direction, in Pike county, Alabama; also, two mules,” particularly described, “one cow and calf, one sow, twenty head of hogs, one road-wagon and harness, one cane-mill, with two kettles, and all of my household and kitchen furniture.” The complainants recovered a judgment for $68 against said Warrick, on the 9th May, 1884, in which was included a waiver of exemptions of personal property; and executions on this judgment had been issued and returned as follows: 1st, May 21st, 1884, returned “No property found” October 17th, 1884; 2d, December 21st, 1884, with same return April 8th, 1885; and, 3d, issued July 23d, 1886, with same return. The bill alleged that the mortgage conveyed substantially all of tbe property belonging to said Warrick; that tbe advances made to bim, under it, by Collier & Jones, during tbe year 1886, did not exceed $500; and that they bad received, of tbe crops raised during tbe year, enough to pay that indebtedness.
    A joint and several answer was filed by tbe defendants, in which tbey admitted tbat tbe mortgage conveyed substantially all of tbe mortgagor’s property; and in answer to particular interrogatories, tbey stated tbe consideration of tbe mortgage, tbe advances made at different times by Collier & Jones to tbe mortgagor, and tbe amount and value of tbe property wbicb tbey bad received under tbe mortgage. According to these statements, Collier & Jones bad been making advances to Warrick for several years, to enable bim to make a crop, taking a mortgage on bis crop and other property each year, and carrying the balance at tbe end of tbe year into tbe next mortgage; the balance of indebtedness for 1885, carried into tbe mortgage of 1886, was $673.70; tbe amount of advances made during tbe year 1886, under tbe mortgage, was $372.74; tbe proceeds of sales of cotton received, from tbe crop of 1886, $162.60; leaving a balance of $810.98 due and unpaid, wbicb, as tbey alleged, was more than tbe value of tbe residue of tbe mortgaged property.
    Tbe cause being submitted for decree on bill and answer, with exhibits, tbe chancellor declared tbe mortgage a general assignment, and ordered a reference to tbe register, to ascertain and report, after due advertisement, tbe names of creditors, with tbe amount of their respective debts; “ also, the present condition of tbe mortgaged property, into whose bands it has gone, and tbe value thereof.” Under this reference, tbe register reported, tbat the debt due to tbe complainants, including interest, was $82.60; tbe mortgage debt of Collier & Jones, with interest, $881.38; amount of “ cotton, Ac.” received by them, $264.84; and tbe value of tbe mortgaged property in Warrick’s bands, $271.08. This report was confirmed without objection; and tbe chancellor thereupon rendered a decree, ordering Collier & Jones to pay into tbe bands of tbe register tbe sum of $264.84, and War-rick to deliver to tbe register, for sale, tbe property remaining in bis bands; declaring tbat tbe complainants, by virtue of their execution, “ which was in tbe bands of tbe sheriff before tbe mortgage to Collier & Jones was executed,” bad a prior lien on tbe mortgaged property, but this lien did not extend to tbe crop then planted; tbat tbe costs of suit must be first paid out of tbe money paid over to tbe register by Collier & Jones, tbe complainant’s debt out of tbe proceeds of sale of tbe property delivered up to tbe register by Warrick, arid tbe balance distributed pro red a among Collier & Jones and other creditors.
    Collier & Jones appeal from tbis decree, and assign each part of it as error.
    M. N. CARLISLE, for appellants, cited Code, §§ 2894, 1737.
    ¥m. H. PARKS, contra.
    
   STONE, C. J.

As to all tbe property, then in actual existence, conveyed by Warrick’s mortgage on May 21, 1886, and as to all tbe debt to Collier & Jones, save that part which was contracted simultaneously with tbe execution of tbe mortgage, we agree with tbe chancellor that tbe conveyance must be held a general assignment, — Code of 1886, § 1737. It is clearly shown, and without conflict, that tbe conveyance contains substantially all of Warrick’s property, and it must “enure to tbe benefit of all tbe creditors of tbe grantor equally.” — Holt v. Bancroft, 30 Ala. 193; Stetson v. Miller, 36 Ala. 642; Crawford v. Kirksey, 55 Ala. 282; Bromberg v. Heyer, 69 Ala. 22; 74 Ala. 524; Watts v. Eufaula National Bank, 76 Ala. 474.

In bolding that Wood Brothers bad a vital lien by virtue of their execution, which prevailed over tbe mortgage, tbe chancellor erred. Their latest execution, issued prior to tbe making of tbe mortgage, bore date December 21, 1884, and was returned April 8, 1885. Tbis was more than twelve months before tbe mortgage bears date — May 21, 1886. Tbis caused a lapse of more than an entire term, and tbe lien was lost. — Code of 1886, § 2894, and authorities cited. Tbe execution issued in July afterwards could not restore tbe lost lien.

Under tbe principles declared above, it becomes important to inquire what part of the debt to Collier & Jones was contracted contemporaneously with tbe execution of tbe mortgage ; for as to such part, tbe doctrine of general assignment does not apply. Tbis will include every thing purchased, or received by Warrick at that time, and every thing purchased and received by him subsequently, pursuant to tbe terms of tbe agreement then made. — Tison v. People's S. & L. Asso., 57 Ala. 323; Lovelace v. Webb, 62 Ala. 271; Collier v. Faulk, 69 Ala. 58.

Both tbe crops and other property conyeyed are subject in tbe first instance to Warrick’s debt, contracted contemporaneously with tbe mortgage; and this will include advances afterwards made, pursuant to tbe mortgage agreement. After satisfying this part of tbe debt due to Collier & Jones, then any balance ’of tbe property mortgaged, including crops and every thing else conveyed by tbe mortgage, enures equally to Collier & Jones and tbe complainants, pari passu; and to any and all other creditors, in whose favor Warrick has waived bis exemptions of personal property. Creditors not having waiver of exemptions, it would seem, have no recourse against exempt property, if claimed. — Shirley v. Teal, 67 Ala. 449; Danner v. Brewer, 69 Ala. 191.

[Reversed and remanded.