The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1903-09-30

It's Oneratlon, what " owed to them
before 1t paid anything TO Its mortgage
creditors. Our Legislature. believing in
the wisdom of this Equitable rulo of
iurisprudence took UP the subject and
enacted 1t into law" and extended
the principle from transportation to min
Ing and manufacturing companies.
whether the policy OF the legislation
was q mistaken one or not-and Judge
our court must have considered 1t mis-
take-it certainly had most respectable
parentage, and submit. 10 founded in
as much reason and public need as the
liens and preferences given to mechanics,
hotel keepers and others.
THE LANGUAGE OF THE STATUTE
DISCUSSED. -HYPOTHECATIONs
But. to return to the discussions: 1t Is
seon in the statute Just quoted that la
borers and supplement arc given q lien
that Is prior to liens created by mortgage,
deed OF trust, sale. hypothecation or con-
veyance. Now. while 1t is true that the
Legislative draughtsman did not put down
In his category, go nomine, every con.
celvable lien, and actually did omit to
mention the lien OF party holding n
pledge or collateral, yet think It Is but
fair to infer from the comprehensive
language used that, II not expressly em-
braced In the word hypothecatlon It was
Intended that pledges and collateral
should be covered by the other words
used. Hypothecation, In the strict sense
OF the Roman law, is said to be pledge
without possession by the Pledge; but.
to mo in the connection used
In the statute, It was Intended to be I'M
denstood in It's popular sense where
pledges OF personal property and the
giving OF bonds and stocks as collateral
security are commonly spoken OF as
hypothecations Of them. The court. in
its opinion page 1867, traces the origin
of chapter So OF the Code (section 17Ol
and seq). concerning warehouse receipts.
to the act Of April 10th. 1874. the title
OF which 1t says Is. IAN act to prescribe
how hypothecation Of products and COM
modities shall be made. and to prohibit
the hypothecatIon Of consignments except
on conditions" There. evidently. the
word was used In broad sense. em-
bracng pledges and other such negotia-
tons, and was intended to cover Just
such a thing az was done in this case,
viz: the pledging Of receipts with banks
as collateral security for loans: and 1t
Is to be presumed that the Legislature in
1877. three years thereafter when 1t
created a preference in laborers and sup
ply-men over liens by "hypothecation."
had the hypothecation OF warehouse re-
cotrts directlv in mind
THE LEGISLATURE OR THE COM
MON LAW.
Assuming, then. that the Legislature,
in the act quoted. intended to give a
laborer or a supply man preference,
by virtue of his lien. over the lien which
a man who held a pledge or a collateral
had. does not this case present squarely
this issue: Whether or not the Legisla-
ture had the power to say that M!llhtser
should have the flour as against thu
common law. which, as interpreted by
our Court OF Appeals, would ysythat
the banks should have the flour becatse
the warehouse receipts we're, negotiable
Can the Legislature amend the COM
mon law!
Many cases are cited by the court. bu'
other than Lickbarrow VS.. Mason, the
case they rely upon most seems 10 be
Gibson VS.. Stevens s How. 3S4, where
warehouse documents were taken and ne-
gotiated for advances made on the goods
and then an attachement, in suit on a
claim against the original owners. was
levied on the goods; the court sustaining
the claim OF the holders Of the ware
house documents as against the attach.
ing creditors. But Is not that long way
from the case Of creditor who is given
by statute prior lien on those goods |?
ply lien creditor, had no priority, and
it was case In which plainly the maxim
qui prior In tempore potion in jure should
prevail.
ANOTHER DIFFICULTY WHICH THE
COURT MEETS AND OvERCOMES.
But the court in order to make this
decision had not only to declare that the
holder OF an hypothetical warehouse
receipt. who had himself taken 1t from
this warehouse man. to secure a loan
which tho holder had made upon 1t.
was purchaser for value and without
notice, but it had to do more: The
warehouse man (the Gallego Mills Com
pany) was, as the court admits, not
licensed as such, and had not complied
with other requisites Of the statute on
warehouse receipts Code 1887, chapter
80, sec. 1891 and seq) so the court there
upon CONSTITUTES that this statute did not
abrogate, but was only declaratory, OF
the common law: and reaches the conclu-
sion that although there has been no
pretensions to compliance with this
statute. the warehouse receipts In this
case are good at common law by which
they are negotiable: that the statute hav-
ing failed to repeal the common law.
did not affect the negotiabillty which they
possessed at common law.
A CURIOUS RESULT
Now. howsoever this may be, and
hope may be pardoned for doubling ita
correctnessr-for the very act of April is.
1874, which the court says was the pro-
totype of chapter 50, seems to be Intend
ed to be all-comprehenssve. and expressly
to have defined which warehouse receipts
were to ne negotiable and which not
II the court is right there would seem to
be a most curious result that would
follow. Thus: Suppose there had been
compliance by the mills In every particu-
lar with the regulations OF chapter 50.
Then, the warehouse receipts In this case
would have been negotiable by the
statute; but by the terms of the statute
the indorsee, Of the receipts Is to be
deemed the owner Of the property
so far as may be necessary 10
give effect to any sale to such person or
to any pledge or lien for his benect.
created or secured by such transfer" In
other words, he was to hold them for
the purpose of fulfilling their hypotheca-
ton to him, and not for the purpose OF
giving effect to their sale to him; and.
as already shown, the supply lien statute