Case ID: ohio-st_36/html/0001-01.html
Source: Caselaw Access Project
Author: {"author": "Okey, J. White, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Lindemann v. Ingham.
    Where a mortgagor in possession of goods mortgaged, makes an assignment thereof for the benefit of his creditors, and the assignee proceeds in the probate court to administer the trust, in accordance with the statutes regulating such assignments, the mortgagee cannot maintain an action against the assignee for converting the property to his own use. In such case, his interest in the property under the mortgage, where the assignee is clothed with authority to sell the goods, is transferred to the. fund arising from the sale by the assignee. ' And it will make ng difference that the condition in the mortgage was broken at the time of the assignment.
    Error to the Court of Common Pleas of Hamilton county. Reserved from the District Court.
    On August 19,1874, Iugbam & Brothers brought suit in the court of common pleas of Hamilton county, against Greorge Lindemann, to recover damages for an alleged conversion of personal property to bis own nse. The petition is substantially as follows: The plaintiffs say, that on April 2, 1874, Jacobi & Schoeule conveyed to them, by chattel mortgage, the following chattels, then situate in said county, to wit: one double-cylinder Taylor newspaper press, one job press, all other presses, imposing stones, type, cuts, cases, safes, desks, and all other chattel property comprising the Courier (German) newspaper office in Cincinnati, said chattels being valued at $4,000. That the mortgage was given to secure the payment of four promissory notes made by the mortgagors to the order of the plaintiffs, each for $1,019.89, with interest at eight per cent., dated April 2, 1874, and payable respectively in two, four, six, and eight months after date. That the mortgagors covenanted in the mortgage that on default of payment of any of the notes, or any attempt to sell, or any sale of the goods and chattels, or any part of them, or to remove them or any part of them from the county or from their location, or upon any seizure of them or any part of them by any process of law, or upon failure to insure the same for $5,000, then the mortgagees or their assigns may take them into their possession, or foreclose the mortgage, as if all the notes were due and unpaid. That at the time the mortgage was executed, an affidavit showing the amount due thereon was written upon said mortgage, and sworn to by one of the plaintiffs, and said mortgage was on the same day deposited in the office of the recorder of said co-unty. That the defendant, knowing of the existence of the mortgage, received and - accepted, April 29, 1874, from Jacobi & Schoeule, a deed of assignment, conveying to him the chattels hereinbefore mentioned, being the same covered by said mortgage, in trust, and for the purpose of being distributed pro rata on *the amount due, among the creditors of Jacobi & Schoeule as a firm and •as individuals. That the plaintiffs have given due notice to the defendant that they hold such mortgage on said chattels; that the conditions of the mortgage have been broken by the mortgagors ; that they are entitled to the possession of said property, and they demanded possession of him, but he has refused to deliver to them said property or any part thereof, or $4,000, its value, or any sum whatever, but has sold and converted the same to his own use, under said deed of assignment, for the purposes therein mentioned. That the- conditions and covenants of the mortgage were broken by the mortgagors — -first, by failing to pay the note which became due in two months after April 2, 1874, and all of said notes remain unpaid; secondly, by the removal of said goods; thirdly, by the sale of said goods; fourthly, by the deed of assignment for the purposes therein mentioned; fifthly, by neglecting to insure the goods. That the plaintiffs were entitled to the possession of the goods, the defendant not having received any title thereto by the deed of assignment or in any other way; and that the plaintiffs, on account of the conversion by the defendant of said property, and the refusal to pay to them $4,000, the value thereof, were damaged by the defendant in the sum of $4,000. Wherefore the plaintiffs pray judgment against the defendant for the sum of §4,000, their damages aforesaid.
    The property was left in possession of the mortgagors, under the statute (1 S. & G. 475; 66 Ohio L. 345; Rev. Stats. §§ 4150, 4157). It appears that the demand, above mentioned, was made June 9, 1874, and also that the assignment embraced property in addition to that covered by the mortgage.
    An answer and a reply were filed. Defense .number six in the answer is in substance as follows: The assignment to him, Lindemann, was made by Jacobi & Schoeule, under and in pursuance of the laws of this State; said deed of assignment •was filed by him, as assignee, in the probate court of said county, which court has exclusive jurisdiction in such cases; he took possession of the property assigned to him, as the assignee of said Jacobi & Schoeule, under the assignment laws aforesaid, and the appointment of said probate court; and that in all thiiigs he acted under the orders of said court and the laws aforesaid. He therefore denies that he is answerable to the plaintiffs in this cause.
    To tiffs defense the plaintiffs demurred, the court sustained the demurrer, and the defendant excepted.
    On May 1, 1874, the notice of appointment of the assignee was published as required by law, in which notice the creditors were requested to present tlieir claims against Jacobi & Schoeule to the assignee.
    The probate court, on May 1, 1874, made the following order: “ Upon application of the assignee, and it appearing to the court that Ingham & Brothers, mortgage creditors of said assignors, are satisfied that the Courier newspaper be issued for one day (Saturday, May 2, 1874), and it further appearing to the court that it will be for the benefit of all the creditors of said assignors that the said Courier newspaper business be kept intact, it is therefore ordered that said assignee have said paper issued Saturday, May 2, 1874.”
    The property was appraised, advertised, and, on June 18, 1874, sold by the assignee at public outcry, the whole amount realized being $1,707:94. This was-done under orders of the probate court. That court also confirmed the sale, and subsequently made an order directing the assignee to distribute the proceed.; of the sale pro rata among the creditors who had proved their claims. It does not appear what claims were proved, nor to whom the fund was distributed.
    The issues were tried in the court of common pleas, at the November term, 1875, and a verdict for $3,724.04 was found for the plaintiffs, and judgment was rendered thereon, a motion for a new trial having been overruled.
    Lindemann having filed a petition, in error, in the district court, to reverse the judgment of the court of common pleas, the cause was reserved to this court for decision.
    
      Folleit (& Coehrcwi and F. Lmnpe, for plaintiff in error,
    cited 9 Ohio, 93; Long on Sales, 1; 8 Howard, 495-544; Burrill on Assignments, 29-31, 67, 68, 84, 85, 325 ; 5 Watts, 36 ; 8 Comst. 238 ; 2 Disney, 295 ; Hilliard on Trustees, 219 ; 4 Johns. Oh. 136 ; 24 Wend. 280; 17 Yt. 310 ; 6 Iredell, 462 ; 11 Ala. 1067; 3 Scammon, .578; 4 Johns. Oh. 460; 3 Ohio, 489 ; 14 Ohio St. 462.
    Yaple, Moos <& Fattison, for defendants in error:
    What is a chattel mortgage, and what are the rights under it?
    
      1. Title of, as to mortgaged property.':’ 26 Oliio St. 663 ; 29 Ohio St. 230 ; 28 Ohio St; 503. ■
    2. When mortgagee may maintain trover. 5 Dutch. 250 ; 1 Beas. 93, 100, 431; 2 C. E. Green, 44; 1 Hall Ch. 334.
    3. More than mere security. Hill v. Beebe, 13 N. Y. 565 ; Butler v. Miller, 1 N. Y. 496 ; Bank v. Jones, 4 N. Y. 497 ; Heyland v. Badger, 35 Cal. 414; Wright v. Ross, 36 Cal. 414.
    4. Distinction between a pledge and a chattel mortgage. Conner v. Carpenter, 28 Vt. 237; Sims v. Canfield, 2 Ala. 455 ; Eastman v. Avery, 23 Me. 248; Day v. Swift, 48 Me. 368; Cortelyon v. Lansing, 2 Caines Cas. 200 ; Gleason v. Drew, 9 Me. 82; Ward v. Sumner, 5 Pick. 60; Haven v. Low, 2 N. H. 13; Ash v. Savage, 5 N. H. 545; Barrow v. Paxton, 5 Johns. 258; Brown v. Bement, 8 Johns. 97; Lewis v. Stevenson, 2 Hall, 63; McLean v. Walker, 10 Johns. 471; Portland Bank v. Stubbs, 6 Mass. 425; Tucker v. Buffington, 15 Mass. 480 ; Bonsee v. Amee, 8 Pick. 236 ; Holmes v. Crane, 2 Pick. 610; Fletcher v. Howard, 2 Aik. 15 ; Conrad v. Atlantic Insurance Co., 1 Pet. 449 ; Story on Bailments, § 287, p. 246; Parks v. Hall, 2 Pick. 206; Gordon v. Massachusetts &c. Ins. Co., 2 Pick. 249 ; Ackley v. Finch, 7 Cow. 290; Hart v. Ten Eyck, 2 Johns. Ch. 100; Lectors v. Ballistier, 3 Pick. 495; Langdon v. Buel, 9 Wend. 80; Patchin v. Pierce, 12 Wend. 61; Gifford v. Ford, 5 Vt. 532 ; Flanders v. Barstow, 18 Me. 357; McLean v. Walker, 10 Johns. 141; Jones v. Smith, 2 Ves. 378; Havens v. Low, 2 N. H. 13 ; Barrow v. Paxton, 5 Johns. 258; Garlick v. James, 12 Johns. 146 ; DeLisle v. Priestman, 1 Browne, 176.
    5. Mortgagor is entitled to the' possession until when. Babcock v. McFarland, 43 Ill. 381; Leland v. The Medora, 2 W. & M. 92; Hall v. Sampson, 35 N. Y. 274; Curd v. Wunder, 5 Ohio, 92; Fairbanks v. Bloomfield, 5 Duer, 434.
    6. Retaining possession until the happening of a certain event. Ballune v. Wallace, 2 Rich. 80.
    7. When a mortgagee is entitled to the immediate possession of tlie property. Hall v. Sampson, 35 N. Y. 274; Hickman v. Perrina, 6 Coldw. 135 ; Broadhead v. McKay, 46 Ind. 595 ; Stewart v. Hanson, 35 Me. 506; Ferguson v. Thomas, 26 Me. 499; Brackett v. Bullard, 12 Met. 308; Foster v. Perkins, 42 Me. 168; Wolfley v. Rising, 12 Ks. 535 ; Kannaday v. McCarron, 18 Ark. 160; Miller v. Pancoast, 5 Dutch. 250; Martin v. Bayley, 1 Allen, 381; Harmon v. Short, 16 Miss. 433 ; Whistler v. Roberts, 19 Ill. 274.
    8. "When sale is a conversion of the mortgagee’s property, and gives him a complete cause of action. Edson v. Newell, 14 Minn. 228; Case v. Jewett, 13 Wisc. 498; Newman v. Tymeson, 12 Wisc. 448.
    9. A chattel mortgage being a conveyance which vests the title in the mortgagee for tlie purpose of subjecting the property to the satisfaction of his debt, the mortgagee is considered the true owner for that purpose, and has a right to the actual possession and control of the property in the event of any forfeiture or of the non-payment of the debt due him from the mortgagor. An agreement between the parties in reference to the temporary possession of the goods does not alter the rights of the mortgagee. Hall v. Snowhill, 2 Green, N. J. 8 ; Pratt v. Skolfield, 45 Me. 386; Lacey v. Giboney, 36 Mo. 320; Green v. Dingley, 24 Me. 131; Burton v. Tannehill, 6 Black. 470. And for this purpose he may enter upon the premises of the mortgagor in the night and seize the mortgaged property, if he can do so without violating the criminal law. Sutterwhite v. Kenney, 3 Strobh. 457; London Co. v. Drake, 6 C. B. N. S. 768 ; McNeal v. Emerson, 15 Gray, 384.
    10. May bring action for conversion or replevin. Ashley v. Wright, 19 Ohio St. 291; Welsh v. Whittemore, 25 Me. 86 ; Prior v. White, 2 Ill. 261; Conkey v. Hart, 14 N. Y. 22; Russell v. Butterfield, 21 Wend. 300 ; Russell v. Butterfield, 21 Wend. 400; Whitney v. Lowell, 33 Me. 318; Coles v. Clark, 3 Cush. 399; Bailey v. Godfrey, 54 Ill. 507; Braley v. Brynes, 21 Minn. 483; Welch v. Sackett, 12 Wisc. 243; Frisbie v. Langworthy, 11 Wisc. 375; Spriggs v. Camp, 2 Spears, 181; Fox v. Kitton, 19 Ill. 519; Coty v. Barnes, 20 Vt. 78; Huggans v. Fryer, 1 Lans. 276; Frost v. Mott, 34 N. Y. 253; Muller v. Way, 103 Mass. 481; Shaw v. Bond, 12 Mass. 447; Reddick v. Gressmam, 49 Mo. 389 ; Howland v. Willett, 3 Sandf. 607; Alden v. Lincoln, 18 Metc. 204; Goodrich v. Willard, 2 Gray, 203 Pickard v. Low, 15 Me. 48; Brackett v. Bullard, 12 Met. 308 ; Coty v. Barnes, 20 Vt. 78; Case v. Winship, 4 Blackf. 435 ; Melody v. Chandler, 12 Me. 282; Miller v. Pancoasi, 5 Dutch. 250; Dean v. Davis, 12 Mo. 112; Spriggs v. Camp, 2 Speers, 181; Holmes v. Sproul, 31 Me. 73; Hughes v. Graves, 1 Litt. 317; Duke v. Strickland, 43 Inch 494; Alden v. Lincoln, 13 Met. 204; Parsons v. Merrill, 5 Met. 356; Smith v. Smith, 24 Me. 555. There are the largest number of authorities, which, where they are the supreme law of the State, establish the doctrine that, after default, a mortgagor has no leviable interest in the property.
    
      *Eggleston v. Mundy, 4 Mich. 295 ; Baltes v. Reipp, 1 Abb. N. Y. App. Dec. 78; Hamill v. Gillespie, 48 N. Y. 556 ; Hall v. Sampson, 35 N. Y. 274. In Massachusetts it can not be seized under and by virtue of an execution, and such is the common law doctrine. Lyon v. Coburn, 1 Cush. 278 ; Brackett v. Ballard, 12 Met. 308. In addition to the above, we find the following cases sustaining the doctrine that a mortgage vests the title in the mortgagee, and that after breach of condition it becomes absolute; others absolutely vested in the mortgagee; and that tho mortgagor has no interest then subject to be levied on under execution against him; and he may not only reduce tho property to actual possession, but some of the courts go still further and establish tho principle that this absolute title of the mortgagee which vests in him can not be divested even by payment or tender of the money. Dean v. Davis, 12 Mo. 112; Haskins v. Patterson, 1 Edm. Sel. Cas. 122; Langdon v, Buel, 9 Wend. 80; Burdick v. McVanner, 2 Den. 170; Woodworth v. Morris, 56 Barb. 103; Patchin v. Pierce, 12 Wend. 61; Brown v. Bement, 8 Johns. 75; Winchester v. Ball, 54 Me. 558 ; Kannady v. McCarron, 18 Ark. 166; Wood v. Dudley, 8 Vt. 434; Holmes v. Bell, 3 Cush. 322; Heyland v. Badger, 35 Cal. 404; Dungan v. Mut., &c. Co., 38 Md. 242; Peters v. Ballistier, 3 Pick. 495; Homes v.. Crane, 2 Pick. 610 ; Moore v. Murdock, 26 Cal. 514 ; Brack 
      
      ett v. Bullard, 12 Met. 308; Talbot v. Deforest, 3 Ia. 586; Bryant v. Carson, &c., 3 Nev. 313; Hall v. Sampson, 35 N. Y. 274; Flanders v. Barstow, 18 Me. 357; Montgomery v. Kerr, 1 Hill (S. C.) 291; Ferguson v. Clifford, 36 N. H. 86; Jewett v. Preston, 27 Me. 400; Robinson v. Lewis, 2 Jones Eq. 25 ; Kea v. Council, 2 Jones Eq. 345 ; Bragleman v. Dane, 15 Alb. Law J. 289 ; Phillips v. Hawkins, 1 Branch, 262; Lull v. Matthews, 19 Vt. 322; Frische v. Kramer, 16 O. 125 ; Constant v. Matteson, 22 Ill. 546 ; Duppee v. Grinnell, 69 Ill. 371; Pledger v. Mandeville, 1 Brev. 296; Robinson v. Campbell, 8 Mo. 365 ; Thornhill v. Gilmer, 12 Miss. 153 ; Fuller v. Acker, 1 Hill, 475 ; Smith v. Acker, 23 Wend. 667 ; Case v. Boughton, 12 Wend. 62; Gates v. Smith, 2 Minn. 31; Eddy v. Caldwell, 7 Minn. 225 ; Judson v. Easton, 58 N. Y. 664; Parshall v. Eggart, 52 Barb. 367; Wright v. Ross, 36 Cal. 414; Freeman v. Freeman, 2 Green (N. J.) 44; Brown v. Phillips, 3 Bush, 656 ; Johnson v. Houston, 47 Mo. 227; Porter v. Parmly, 43 How. Pr. 445 ; Nichols v. Webster, 1 Chand. (Wis.) 203; Hill v. Robinson, 24 Miss. 368 ; Dane v. Mallory, 16 Barb. 46 ; Bell v. Shrieve, 14 Ill. 462; Mattison v. Bancus, 1 N. Y. 295; Butler v. Miller, 1 N. Y. 496 ; Stewart v. Taylor, 7 How. Pr. 251; Ackley v. Finch, 7 Cow. 290 ; Green v. Dingley, 24 Me. 131; Burton v. Tannehill, 6 Blackf. 470; Boone v. Rains, 7 Mon. 384; Brown v. Lipscomb, 9 Port. 472.
   Okey, J.

The petition does not show that Lindemann filed the deed of assignment in the probate court, pursuant to the acts relating to assignments by debtors to assignees for the benefit of creditors, nor that he acted under the orders of that court in doing the things of which Ingham & Brothers complain ; and hence, the questions sought to be made by the plaintiff in error may not arise on the petition. But these facts are alleged in the sixth defense ; and Ingham & Brothers demurred to -that defense, and the court sustained the demurrer. It seems, therefore, pertinent to inquire whether, if the petition had embraced the additional matter set forth in that defense, it would have contained facts sufficient to constitute a cause of- action. If a petition in tbat form would have been sufficient, it is clear tbat the court properly sustained the demurrer to that defense; but if the facts alleged in the petition and in the sixth defense, when taken together, would constitute no cause of action, the court erred in sustaining the demurrer.

Counsel for defendants in error have, with great industry, collected more than three hundred cases, which are claimed to bear on the question involved in this- case. ¥e deem it unnecessary, in this report, to do more than state the result of our examination of them. We entertain no doubt that the general rules of law with respect to chattel mortgages are as claimed by counsel for defendants in error in their able argument. These rules have been recognized in a number of our cases. Thus, in Robinson v. Fitch, 26 Ohio St. 659, 663, it was said: “A chattel mortgage in the usual form conveys to the mortgagee the property mortgaged, and he thereby becomes the general owner of it, and in the absence of a reservation of the right of possession in the mortgagor, he is entitled to the immediate possession of it. If there is such a reservation in favor of the mortgagor, such reservation only affects the possession according to the terms of the reservation, the title to the property remaining, in the meantime, in the mortgagee, who becomes entitled to the immediate possession on breach of the condition.” Gilmore, J.

But this is not inconsistent with the existence of an equity in the mortgagor, notwithstanding a breach in the condition of the mortgage. This is well illustrated in the instructive case of Carty v. Fenstemaker, 14 Ohio St. 457. It appeared in that case that Oarty caused personal property in possession of Alspach to be seized on an attachment as the goods of Alspach. There was, at the time, a chattel mortgage upon the property in favor of Fenstemaker,. executed by Alspach, and the condition therein was then broken, so that the mortgage had become absolute. Eenstemaker obtained possession of the property from the officer by replevin, and thereupon took from Alspach an assignment of all his interest in the property that might remain after satisfying the mortgage debt. Carty having subsequently obtained judgment against Alspach, in the action wherein, the attachment was issued, brought suit against Fenstemaker to reach that portion of the proceeds of a sale of the property which might remain after satisfying the mortgage debt. The court held, that while the officer was not entitled, under the provisions of the statute relating to attachments, to retain possession of the property as against such mortgagee, yet that, notwithstanding the condition of the mortgage was then broken, a lien was secured by the levy of the attachment, in favor of Carty, upon any balance that might remain after satisfying the mortgage debt; that this lien was superior to the rights of Fenstemaker under his assignment from Alspach subsequently made ; and, further, that the lien thus 'secured by the attachment might be enforced by Carty in an action against Fenstemaker. See, also, Morgan v. Spangler, 20 Ohio St. 38.

Nor is the general rule of law, as to the rights of the mortgagee, inconsistent with, but it is subordinate to, another wrell settled rule which is thus expressed in Smith v. Parsons, 1 Ohio, 233, 242: “ Contracts must be expounded according to the laws in force at the time they were made; and the parties are as much bound by a provision contained in a law, as if that provision had been inserted in, and formed part of, the contract.” Burnet, J. And see Jewett v. Railway, 34 Ohio St. 601, 607; Brine v. Insurance Co., 96 U. S. 627.

If the statute in force at the time of the execution of the mortgage under consideration in Carty v. F&mtemaker, had provided that an officer levying an attachment, as in that case, should sell the property on the attachment, holding possession in the meantime, and after satisfying the mortgage debt out of the proceeds of the sale, apply the balance, so far as needed for the purpose, in satisfaction of the attachment, no serious doubt can be entertained that the act would have been valid. It would have been a perfectly lawful mode of reaching any possible interest the mortgagor might have in the property, without resorting to a suit against the mortgagee.

The mortgage in this case was executed on April 2, 1874, and according to the principle stated, the mortgagees were liable to be affected, as to their remedies on the mortgage, by the provisions of our statutes then in force relating to assignments. This clearly appears from Hanes v. Tiffany, 25 Ohio St. 549. There the affidavit on the mortgage was wholly defective, so that the mortgage was void as against the creditors of the mortgagor. The court held that it was also void as against an assignee for the benefit of creditors. That case was not decided in ignorance of the general rule on the subject. As to the claim that the assignee could stand in no better condition than the assignor, "White, J., distinctly stated that “the correctness of this position at common law is admitted.” And the supreme court of the United States has repeatedly held that the common law rule is applicable under the bankrupt law. Gibson v. Warden, 14 Wall. 244; Stewart v. Platt, 101 U. S. 731. But the decision in Hanes v. Tiffany, approved in Kilbourne v. Fay, 29 Ohio St. 264, 278, is a clear and distinct recognition of the principle that a mortgagee of personal property takes his mortgage subject to the provisions of our assignment laws in force at the time, and that under those laws the assignee stands in a better position than the assignor.

We come now to consider the condition of the law relating to assignments at the time the chattel mortgage in question was executed. The act of 1859, regulating the mode of administering assignments in trust for the benefit of creditors ” (56 Ohio L. 231, 4 Curwen, 3352), was amended in various particulars (57 Ohio L. 39, 117; 58 lb. 3, 105 ; 60 lb. 8 ; 69 lb. 172; 71 lb. 28, 73; 73 lb. 146), re-enacted with its amendments in 1878 (75 Ohio L. 936), and finally incorporated into the Revised Statutes, §§ 6335-6358. As it existed in 1874 (1 Swan & Or. 709, Swan & Sayler, 395), at the time the mortgage in question was executed, it provided a comprehensive, though by no means perfect mode of administering assignments in the probate courts for the benefit of creditors. It extended to assignments of property of every sort, and plainly included the right of a mortgagor of chattels, as well' before as after condition broken. The assignee was required to file the deed of assignment or a copy thereof with the probate judge, and to give bond for the faithful performance of his duty, on which bond any person injured by the misconduct or neglect of duty of the assignee might bring suit, to cause an inventory and appraisement of the property to be made under oath, and returned to the probate court; to file in the probate court, at the same time, a schedule, under oath, setting forth all the debts and liabilities of the assignor within the knowledge of the assignee ; to cause notice to bo given in some newspaper of general circulation in the county of his appointment as assignee., in which notice he shall require creditors to present their claims; and, under the orders of the probate court, to convert all the assets into money, sell the real and personal property, either for cash or upon such other terms as the probate court may order, and make return of such sales to the probate court.

The laws then in force further provided that the creditors should present their drams to the assignee for allowance within six months after publication of notice of his appointment; that the probate court shall order the payment of all incumbrances and liens upon any of the property sold, or rights and credits collected, out of the proceeds thereof, according to priority ;” and that at the expiration of eight months from the appointment, “a dividend shall be declared, payable out of the assets of the assignor applicable to the payment of non-preferred claims.”

These provisions show very clearly that the legislature intended to vest in the probate court full and complete jurisdiction over the whole subject of assignments of this character. True, the court is so organized as to render it impracticable that it should exercise jurisdiction in actions for money against the debtors of the assignor. It is also. true, that where the real estate assigned is incumbered with liens, the assignee may file a petition to sell the same in the court of common pleas. This provision was made because of the complex questions which are sometimes presented in regard to liens on real estate, embracing, as they do, questions as to liens by mortgage and judgment, liens by execution foreign and domestic, vendor's liens, mechanics’ liens, liens of occupying claimants, and others. But even questions of this character may be determined in the probate court.

The express exception that the petition, in the case just mentioned, may be filed in tbe court <of common pleas, affords additional evidence that the legislature intended that in all other respects the jurisdiction of the probate court, in the administration of the trust, should be exclusive, though not final, for there is the right to appeal or prosecute error. TIence, as the equitable interest of the mortgagor passed with possession of the property to the assignee, complete jurisdiction as to that interest was vested in the probate court, when the assignee took the proper steps and obtained the proper orders in that court. The only way in which that court could deal with that interest was to order a sale of the property free of all claims, the interest of the mortgagees being transferred to the fund arising from the sale by the assignee ; and upon full consideration we are satisfied that is the proper construction of the statute, and that an assignee is not placed, by the law in the dangerous position of being compelled to determine, at his peril, whether or not he should obey the order of the court. What the rights of the parties may be where the assignment is made to prevent the mortgagee from taking possession of the property, and for the mere purpose of placing it in the hands of an assignee selected by the mortgagor himself, we need not determine.

It is said, however, that a mortgagee, after condition broken, has no lien upon the property, as he is the owner, and hence that the statutory provision to which reference has been made does not apply. That the mortgagee is the owner in the sense that there is no interest in the mortgagor remaining after condition broken, which the mortgagor, his creditor, or assignee, can assert, is a proposition which finds little support elsewhere, and, as we have seen, none in Ohio. Where the mortgage debt equals the value of the property, the remaining equity of the mortgagor may be of no real value; but where the debt is small and the value of the property great, the interest of the mortgagor may be many times as large as the interest of the mortgagee, though the latter is called the legal title ; and finding that the assignee has authority to sell, in every such _ case,, when authorized by the probate court to do so, even in opposition to the will of the mortgagee, the rights of the latter can only be protected by holding that they are embraced by the phrase in our assignment law, “ incumbrances and liensand such we are clear is the proper construction of the statute.

I am awai’e that it is expressly provided that a purchaser of real estate, under the assignment laws, shall take “ the title free from all liens on the same for all debts due by the assignor.” From the absence of any such provision as to personal property, it is supposed the same rule does not apply in the case of a sale of chattels. But this is clearly an erroneous view. The provision follows that clause of the statute which requires that “ deeds shall be made to the purchasers,” a form which is not required where the assignee sells chattels. It would be unreasonable to say, looking at the various provisions of our statutes on the subject, that the legislature intended that the rule, cmeat emptor, should apply in its largest sense to purchasers at a sale by an assignee, where the property was personal, but that they should take the property, if real estate, discharged of all liens. A fair construction of the statutes require us to say there is not one rule as to lands and another as to chattels; and that in Ohio, under the circumstances here disclosed, “the maxim, cmeat emjptor, does not apply to the case of a sale by assignees for the benefit of creditors ” (Burrill on Assignments, 3d ed. § 416 ; 2 Hovenden on Frauds, 35 ; Adams v. Humes, 9 Watts, 305), whatever the character of the property may be.

Dwyer v. Garlough, 31 Ohio St. 158, is not inconsistent with the conclusion at which we have arrived. There a mortgage of real estate had been executed by husband and wife, but there was no provision in the statute authorizing the wife to be made a party in the probate court in any proceeding on the part of- the assignee to sell the premises. As complete relief could not be granted to the mortgagee in the probate court, it was held that he might bring suit on the mortgage in the court of common pleas, notwithstanding the assignment.

The statute contains no express provision for notice to the mortgagee of the proceedings to sell. Notice in some form was essential. Ray v. Norseworthy, 23 Wall. 128. Whether this requirement is satisfied by the public notice given, we heed not determine. The facts set forth in the statement of tlae case tend to show not only notice to the defendants in error, but consent, on their part that Lindemann should dispose of the property as assignee. The proceedings of the probate court .are not set forth at large in the record. Moreover, the jurisdiction of that court having been properly invoked, its orders, however irregular, cannot be questioned in this collateral way. Shroyer v. Richmond, 16 Ohio St. 455.

Of course, the act regulating assignments does not undertake to invest the assignee with property which did not belong to the assignor; nor is the interest of a mortgagee any less now than it was before the assignment law was passed. But the interest of an insolvent debtor as mortgagor of chattels, in possession, is as .large now as it was before the passage of that act; and it is clear that whatever that interest may be, it passes, as we have said, by the assignment. We place this case distinctly on the ground, that under provisions of our statutes in relation to assignments, in force when the mortgage to Ingham & Brothers was given, and°which statutes remained in force during the pendency of the proceedings in the probate court, Jacobi & Sehoeule, the mortgagors in possession, though the condition of the mortgage was broken, could make an assignment of the chattels mortgaged to an assignee for the benefit of creditors; and that when the assignment was filed in the probate court, and the proper orders were obtained from that court, it was the duty of the'assignee to sell the property, notwithstanding any objections of the mortgagees, their interest therein being transferred to the fund arising from the sale, and the rights of the mortgagees and the creditors must be worked out in the proceeding in the probate court. Whether, in a case like this, where the fund is insufiieent to satisfy the mortgage debt, any of the costs and expenses of administering the'trust can be taken from such fund, and what the rights of the mortgagees may be with respect to the moneys realized from the sale and ordered to be distributed, are- questions which we are not called upon to determine. Nor have we considered what the rights of the parties may be where the mortgagee is in possession at -the time of the assignment.

Judgment reversed.

This case was decided while Gilmore, O. J., was a member of the court.

White, J.

I dissent from the judgment in this case. In my opinion the mortgagees were entitled, on demand, to the possession of the mortgaged property.

The act regulating the mode of administering assignments does not undertake to invest the assignee with property which did not belong to the assignor. The act does not enlarge the power of the assignor over property beyond what it was before the act was passed, but merely prescribes the mode in which the property assigned is to be administered for the benefit of creditors. That the assignee only has the right of possession to the “ property, money, rights or credits belonging to the assignor at the time of the assignment ” is apparent from section 2 of the act. True, it was held in Hanes v. Tiffany, 25 Ohio St. 549, that a mortgage void as to creditors is also void as against the assignee for the benefit of creditors. This was on the ground that as between a mortgagee claiming under a mortgage void as to creditors, and an assignee for the benefit of creditors, the property was to be regarded as belonging to the assignor at the time of the assignment. It is said in that case that the rights of creditors may be as effectually asserted through the assignee as they could be by judgment and execution in case there had been no assignment. Rut it is plain that as against the levy of a creditor, a mortgagee claiming under a valid prior mortgage, is entitled to the possession of the mortgaged property. The effect of the present ruling is, that the assignee for the benefit of creditors acquires greater rights as against the mortgagee than were possessed by the assignor or could be acquired by the creditors. The statute, in my judgment, warrants no such conclusion.

The mortgagee is, of course, liable to account to the assignor for the surplus, if any, after the payment of the debt secured by the mortgage; but that liability does not affect his right to recover the property under his mortgage. This is the rule in assignments in bankruptcy, and, also, where administration is granted1 on tbe estate of tbe mortgagor, and I can see no reason for giving to our assignment act a broader operation.

Tbe assignee stands in no better position, as against tbe mortgagee wbo lias tbe right to tbe possession of the mortgaged property, than be does as against a mortgagee who has possession in fact. Tbe effect of tbe decision, therefore, would seem to be to declare, that an assignee of tbe mortgagor may recover tbe possession of tbe mortgaged property from a mortgagee in possession, without tbe payment of tbe debt tbe mortgage was given to secure.

Tbe foregoing being, in my opinion, the only material ques-> tion, I express no opinion upon other matters discussed.