Case ID: ny-st-rep_39/html/0916-01.html
Source: Caselaw Access Project
Author: {"author": "Barnard, P. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Walter J. Donohue, Recr, Resp’t, v. Edwin M. Jackson, Impl’d, App’lt.
    
      (Supreme Court, General Term, Second Department,
    
    
      Filed July 2, 1891.)
    
    Conversion—Chattel mortgage.
    Before the judgment on which the plaintiff was appointed receiver was recovered, the deb:or gave a chattel mortgage on his stock of goods and fixtures, and gave possession thereof to another person under a bill of sale which conveyed the" stock not covered by the mortgage. After plaintiff's appointment defendant took possession of the same. No levy has been made on this property. Held, that the mortgagee having reclaimed the property before the creditor got a specific lien by levy, he could not be held liable for a conversion.
    Appeal from judgment in favor of plaintiffs.
    Action for conversion of chattel property.
    
      John C. Donohue (John F. Brennan, of counsel), for app’lt; Ralph E. Prime, for resp’t.
   Barnard, P. J.

—The plaintiff is a receiver for a judgment creditor of one Sims. The judgment was recovered in November, 1891, and the plaintiff was appointed in supplementary proceedings receiver in January, 1890. Sims executed a mortgage upon a stock of goods and fixtures for a good consideration, which mortgage was exécuted and filed in the proper office May 29, 1889. In July, 1889, Sims sold the stock of goods to one McCue, and delivered the possession of the property to him. The mortgaged property consisted of the fixtures used in the business and the goods making up the stock which were in the store at the date of the mortgage

The bill of sale to McCue is peculiarly worded. It conveys the stock in store not covered by the mortgage, which was stated to mean all goods put in since the date of the mortgage and the right to all other stock and fixtures in said store not subject to-the lien of said mortgage.

The mortgaged property was reserved, but it was delivered to McCue, and he used it in the business from November, 1889, until May, 1890, when the mortgagee took possession. Mumper v. Rushmore, 79 N. Y., 19.

The creditor never made a levy upon the property, and as between Sims and the mortgagee in May, 1890, the mortgage was good, and when the mortgagee took the property into his possession under it he was not subject to the statute as to change of possession. Before the lien of any creditor attached, the mortgagee had taken possession and sold the property. The receiver got nothing by his appointment except what was subject to the debtor’s mortgage. Sims could not have sued the mortgagee for a conversion of the property. He had delivered the same to another person, who legally held the possession for the mortgagor and not for the mortgagee. Before the creditor got a specific lien by levy the mortgagee had reclaimed his property.

The judgment should, be reversed and a new trial granted, costs to abide event.

Dykman and Pratt, JJ., concur.