Case ID: dakota_3/html/0147-01.html
Source: Caselaw Access Project
Author: {"author": "Hudson J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Nichols, Shepard & Co. v. Barnes et al.
    1. mortgaged property: description of: capable of identification: no® uncertain. In a mortgage executed upon property in the possession of-the mortgagor, a part being described as “ an undivided two-thirds interest, “ same being entire interest of said Wm. H. Wheeler in and to sixty acres “ of wheat now in and growing on the northeast of section 32, in town- “ ship 141, north of 5th P. M.” Held, not uncertain and indefinite; that the property could be identified by inquiry.
    2. same:'RECORD CONSTRUCTIVE NOTICE: PURCHASER LIABLE FOR CONVERSION. The wheat having been sold by the mortgagor to the defendants, who mixed it with other wheat and sold it in the ordinary course of business; the mortgage being on file in the proper office was constructive notice to defendants of plaintiffs’ interest, and defendants were liable for conversion.
    
      Appeal from the District Court of Cass County.
    
    The facts are stated in the opinion.
    
      Twomey de Francis, for defendants and appellants.
    Points and authorities in brief:
    We hold that such a description of property as that contained in this mortgage, is void as to third persons'for its indefiniteness and uncertainty, and that the property so attempted to be conveyed is absolutely incapable of being definitely ascertained: Civil' Code, Sec. 1722; Jones’ Chattel Mortgages, Sec. 55 Fowler v. Hunt, 48 Wis., 345; Mui/r v. Blake, 11N.W. Rep., 621, reversing 9 N.W. Rep., 274; Yant v. Harvey, 7 N. W. Rep., 675; Pennington v. Jones, 10 id., 274; 67 N. C., 40; 12 Am. Rep., 600; Halmv. Fredericks, 80 Mich., 223; Richardson v. Alpena Lumber Co., 40 Mich., 208. An indefinite description in mass, may be made definite — -first, by a separation; second, by delivery; third, by possession passing to the mortgagee: Morrow v. Reed, 30 Wis., 81; Weld v. Cutler, 2 Gray, 195; Crofoot v. Bennett, 2 N. Y., 258; Call v. Cray, 37 N. H., 428; Young v. Young, 6 Peck, 280. The mortgagee could not enter and take away the interest as against the joint owner: Garr v. Hurd, 92 111., 315. Amort-gage1 cannot continue a floating lien: Colder v. Ogden, 15 Pa. St., 528; and until a separation, no title could vest in any particular lot: First Hat. Bank v. Crowley, 24 Mich., 224; Kelly v. Reid, 57 Miss., 89; Draper v. Perkins,'A., 277; Williamson v, Steele, 3 Lea. (Ten.) 527; Potts v. Hewell, 22 Minn., 561; Mer. Hat. Bank v. McLaughlin, 2 Fed. Rep., 131; 50 111., 444; 55 Ga., 543. Would such a description in a bill of sale have passed any title? Holmes '0. Hall, 8 Mich., 65; Ba/mard v: Eaton, 2 
      Cush., 295; ITutchmson v. Hunter, 7 Pa. St., 145; Oolder V. Ogden, 15 id., 528; Keeler v. Ooodwin, 111 Mass., 490; Scudder v. Worcester, 11 Cush., 578; Waldo v. Belcher, 11 Ired., 609. Where part is sold out of a lot, and the whole is destroyed before separation, the loss falls on the vendor: Bcdley v. Smith, 42 N, H., 141; 30 Mich., 224; 24 Mich., 492; 22 Minn., 561; 2 N.T., 258; Wells’Eeplevin, p. 103; 6 Pick., 280; Herman Chat. Mort., p. 76; Duke v. Strickland, 43 Ind., 494. Allowing the mortgagor to remain in possession after harvest, and hold -himself out as the owner of the wheat, shows an implied power of sale which the mortgagee should not .be allowed to deny as against a subsequent purchaser in good faith: Thompson v. Blanchard, 4 N.T., 303; Pratt v. Maynard, 116 Mass., 388; Hat. Bank v. Hamp-son, 52 E. Div., 177; Barnett v. Fergus, 51 111., 352;'29 id., 122; 29 N. H., 557; 21 Wis., 4Í7. Parol evidence cannot be introduced to identify the property in this case, as identification' is impossible.
    
      H. F. Miller, for plaintiff and respondent.
    Points and authorities cited:
    Wheeler mortgaged all the interest he had in the crop .of wheat in question, being an undivided two-thirds interest in the sixty acres of wheat in his possession on land particularly and fully described. Can any person owning an undivided interest in growing crops, make a mortgage thereof, valid as between himself and his mortgagee, and, by filing the same, give constructive notice of the mortgagee’s lien, to a third person? Every man may transfer his own property, either absolutely, by bill-of sale, or .conditionally, by mortgage: Bump on Fraudulent Conveyance, p, .62..
    If Wheeler was a tenant in common with some third .party, as assumed by appellants, still his interest was 'subject to -levy on execution: Freeman on Ex., Sec. 125. ■
    An assignment by Wheeler of his interest in the growing crop, as described in the mortgage, would have passed his interest to the assignee: Carter v. Jarvis, 9 Johns., 148; Gibson v. Stevens, 8 JIow., (U. S.) 384; Pratt v. Parkman, 24 Pick., 42; Morgan v. Smith, 29 Ala., 283.
    Any person, whether tenant in common, joint tenant or partner, may mortgage his individual interest: Shuart v. Taylor, 7 How. Pr., 251. The mortgagee becomes a tenant.in common, in place of the mortgagor: Smith v. Bice, 56 Ala., 417; Garr v. Hurd, 92 111., 313. Either a landlord or tenant may mortgage his individual interest, valid if filed, to the extent of that interest, as against third persons: , Potts v. Newell, 22 Minn., 563. By filing, the mortgage became notice of the lien thereon to all subsequent purchasers and incumbrancers: Civil Code, Sec. 463.
    Appellants had no right to buy any wheat raised on that quarter section, without inquiry: Jones on Chattel Mortgages; 54-59-61; Winter v. Landphere, 42 Iowa, 741; Lawrence v. Evarrts, 7 Ohio St., 194; Pettis v. Kellogg, 7 Cush., 456.
    Wheat threshed, removed and sold in the market, .may be identified as the same covered by a mortgage of ten acres of growing wheat: jDuke v. Strickland, 43 Ind., 494; Jones’ Chattel Mortgage, 60, et seg; Smith v. Jenks, 1 Denio, 580; Butler v. Hill, 1 Bax., (Tenn.) 375; Coles v. Clark, 3 Cush., 399.
    The question whether findings of fact are justified by the evidence cannot be raised on a bill of exceptions: St. Croix Lvmber Co. v. Pennington 2, Dak., 467.
   Hudson J.

This action is brought by the plaintiff, a private corporation, to recover' of the defendants for the conversion ■ of a quantity of wheat. The plaintiff claims title to the property by virtue"of a chattel mortgage, executed to it by one Wheeler, who, while the mortgage was in full force, surreptitiously, as is alleged, gold and delivered the wheat to defendants, which was put into ■ their warehouse, mixed with other wheat and sold in the ordinary course of business, they not having any actual knowledge of the claim of the plaintiff to the wheat. A demand of the same was made upon the defendants, which was refused.

There seems to be but one question raised in this contention — • namely, whether the description of the property in the mortgage was not too uncertain and indefinite, in that, it did not point out-the subject matter of it so that a third person, by its aid, together with such inquiry as the instrument itself suggested, could identify the property. The description in the mortgage is as follows:

£í An undivided two-thirds interest, the same being the entire ££ interest of said ¥m. H. Wheeler, in and to sixty acres of wheat ££ now in and growing on the northeast ^ of. section 32, in town-£C ship 141, north of range 51 west of the 5th P. M.”

The mortgage also covered other property, is in the usual form, and was filed with the register of deeds, as provided by law. By section 1745 of the Civil Code, the filing of a mortgage of personal property in conformity to law, operates as notice thereof to all subsequent purchasers, etc. It is very clear that the defendants purchased this property with this constructive notice, unless the description contained in the mortgage was too indefinite to enable them to identify it by inquiry and by the terms therein employed. By this description it appears that this crop of wheat was growing on land so particularly described that had it been a deed of the land it certainly could be identified. It was as definite as descriptions of real estate are usually made. Then if the land could be identified, could any particular sixty acres of wheat in the possession of W. II. Wheeler, growing upon this quarter section and in which he had an interest, be identified .by inquiry? We can hardly see how a description of this, property could be more definite, Had. this been an absolute sale, it need not have been more s'o, to pass the title. Had the property been levied upon by exe-eution, the return of the officer and his [advertisement of sale by such description must have been held sufficient. In Potts v. Newell, 22d Minn., 563, property was described in a chattel mortgage as “ All the right, title and interest of the said Lewis “ Gauthier, in and to that certain crop of wheat, raised upon the tc land of the said Gauthier, situated in the town of Egan, county “ of Dakota and State of Minnesota, b'y one Robert O’Neil, “ during the year of 1875.” It appeared that-the crop had been cut and was- in stack at the time t]ie mortgage was executed, and that the interest of the mortgagor was one-third, which had been set apart. ' This one-third interest having been seized by virtue of an execution against the goods of the mortgagor, it was held that the title passed to the mortgagee under the mortgage, and the" levy Under .the execution could not be sustained. We cannot see that" the description of the property in that case was any more definite than .the one at bar.

The learned .counsel lays stress upon the fact that in the case of Potts v. Newell, the. interest of the mortgagor was set apart. This circumstance was important in that case, for the reason that the mortgage did not s.taté what was the extent of the interest. The setting apart defined it as one-third, and on setting apart the title vested. ' But in the case at bar the mortgage does "state the interest to .be two-thirds and the entire interest of the mortgagor. It is said'in one case .that a description like this, “ My entire crop “ of cotton and corn of present year,” is sufficiently definite. Had it been two-thirds of my entire crop, etc., would it not have been equally definite? We think it would. It being a fractional part, the amount of the whole being given, cannot render it too uncertain.

ít is impossible to describe personal property so well as to preclude tlie necessity of parol evidence to identify it. Thus, in case of a mortgage of a pile of wood upon a certain lot of land, upon which there are also other piles of wood, resort may be had to extrinsic evidence to determine which pile was intended: Sargeant v. Solberg, 22 Wis., 132. Parol evidence in these and like cases serves to apply the description to the subject matter intended to be embraced in it, and is admissible for that purpose: Dodge v. Potter, 18 Barb., (N. Y.,) 193.

It is said that the defendants in this case could not tell when the wheat was offered for sale, whether the same was covered by mortgage or not. That is very true; nor could they tell whether the persons offering it had any title to it or not. From anything that there appeared, it might have been stolen property; and in the latter.case the real owner, on proof of its conversion, could recover for his property so converted. This risk is taken by all persons purchasing such property of a stranger; and is it a greater hardship when the legal title is held under a chattel mortgage? The law has afforded some protection in the latter case by providing for the filing of the instrument, or a copy, where all persons may-have an opportunity to inspect it, whereas in the former no such .protection is afforded. The mortgagor’s possession of the property is jprima faeie evidence of ownership. So is that of a thief. Such hazards cannot well be avoided.

It is claimed that such a risk as is taken under the chattel mortgage law is against public policy as being in restraint of trade. This is but one side of the question. Upon the other side it may be said that business transactions would be greatly embarrassed and retarded if personal property could not be encumbered in the hands of the owner, to aid the man of limited means. It is that by which many a poor man has become prosperous, and the man of money secured his just dues, and both mutually benefitted.

In this case the defendants have suffered from the dishonesty of a rogue. All business men are liable to suffer from disboneat men, and not oftener in transactions of this kind than others.

The judgment of the District Court is

Affirmed.

All the Judges concurring.