Case Name: Andrew A. Anderson v. Levi Brenneman et al.
Court: Michigan Supreme Court
Jurisdiction: Michigan
Decision Date: 1880-06-23
Citations: 44 Mich. 198
Docket Number: 
Parties: Andrew A. Anderson v. Levi Brenneman et al.
Judges: The other Justices concurred.
Reporter: Michigan Reports
Volume: 44
Pages: 198–202

Head Matter:
Andrew A. Anderson v. Levi Brenneman et al.
Warner of dawn to merchandise under contract — Symbolical delivery of mortgaged merchandise — Mling of mortgage.
A contract purchaser can waive his claim to a specific lot oí merchandise by consenting that it be sold to some other person, or pledged or mortgaged to a creditor as the vendor’s property, to revert to the vendor; and if he does so, his ownership ceases, and the merchandise must be regarded as the property of the vendor and liable to execution against him, subject to the rights of the later purchaser or pledgee.
Where heavy merchandise like pig iron is mortgaged and the mortgage is not placed on file, and there is no actual delivery or apparent change of possession, there must be a sufficiently clear and unequivocal designation of the property to serve as notice of the mortgage to creditor’s or subsequent purchasers; and it is for the jury to decide under proper instructions what is sufficient notice thereof.
Where only symbolical delivery of mortgaged chattels oan be made and they are left where the right of possession is uncertain, doubts must be decided in favor of creditors and against the mortgagee, since he could have protected himself fully by filing the mortgage.
Error to Marquette.
Submitted June 17.
Decided June 23.
Trespass on the case. Defendant brings error.
Affirmed.
Dan H. Ball for plaintiff in error,
as to delivery, cited Elmore v. Stone Langd. Sel. Cas. 111; Beaumont v. Brenger id. 185; Marvin v. Wallis id. 228; Castle v. Sworder id. 257; Colwell v. Keystone Iron Co. 36 Mich. 51; Fry v. Miller 45 Penn. St. 441 ; Smith v. Putney 18 Me. 87; Morse v. Powers 17 N. H. 286; Carpenter v. Snelling 97 Mass. 452 ; McPartland v. Read 11 Allen 231; Weld v. Cutler 2 Gray 195 ; Herm. Chat. Mortgages 203-6; Schouler Pers. Prop. 504-6; Pettitt v. Bank 4 Bush 334; Thoms v. Southard 2 Dana 475; Thayer v. Dwight 104 Mass. 254; Whitney v. Tibbits 17 Wis. 359; Story on Bailments, § 297.
E. J. Mopes and F. O. Clark for defendants in error,
as to delivery, cited Gorham, v. Fisher 30 Vt. 428 ; Prescott v. Locke 51 N. H. 94; 12 Amer. 57; Blackburn on Sales 151-4; Benjamin on Sales 222; Barrett v. Godard 3 Mas. 111; Rapelye v. Mackie 6 Cow. 253; Fuller v. Bean 34 N. H. 300; Warren v. Buckminster 24 N. H. 342; 2 Kent’s Com. 498 ; Russell v. Carrington 42 N. Y. 118 ; Davis v. Hill 3 N. H. 382; Barnard v. Poor 21 Pick. 378; Hanson v. Meyer 6 East 614. Where the goods sold are left with the vendor the sale is presumed fraudulent: Hatch v. Fowler 28 Mich. 210; Jackson v. Dean 1 Doug. (Mich.) 525 ; O'Donnell v. Seger 25 Mich. 378; Watkins v. Wallace 19 Mich. 77.

Opinion:
Marston, C. J.
Some of the questions discussed we think do not fairly arise upon this record. The action is brought against the sheriff for releasing a quantity of iron levied upon by him by virtue of certain executions in favor of the plaintiffs against the Marquette & Pacific Polling Mill Company.
The controversy is narrowed down to 30-| tons, which the sheriff claims was the property of Sylvester T. Everett under a contract with the company dated August 1st, 1877. Ten and a half tons of this iron was made previous to the date of the contract with Everett, and although sought to be applied thereon afterwards, yet it previously had been mortgaged to S. Coles as security for a debt of the company.
The record sets forth that " 30£ tons had, by consent of said Everett, been pledged by said Polling Mill Company to S. Coles of Marquette, to secure an indebtedness for supplies advanced by said Coles to employees of said company, to the amount of $521.97, and that said pledge had been made by giving to said Coles two receipts for said iron as it lay piled on the dock as aforesaid, and marking each pile with the initials ' S. O.' " These receipts were as follows :
"Peceived, Marquette, July 28, '77, on the Polling Mill dock, twenty-five tons pig iron in piles Nos. 1, 2 and 3 ; 14-J-tons of the above to be held by S. Coles as security for note of the Marquette & Pacific Rolling Mill do., due Aug. 18r '77 — $300. The balance, 10£ tons, to be held by S. Coles as security for note of the M. & P. R. M. Co., due Sept. 2, '77 — $221.97. When said notes are paid, the said iron is released and reverts to W. W. Wheaton, ag't.
" W. W. Wheaton, Tr. and Ag't."
" Rec'd check on 2nd National, Cleveland, $304.08, to take up note due Aug. 15, 1877."
" Received, Marquette, Sept. 19, '77, on the Rolling Mm dock, twenty (20) tons pig iron in piles Nos. 4 and 5, to be held by S. Coles as security for note of the Marquette & Pacific Rolling Mill Co., due Oct! 22, '77 — $360. When said note is paid, the said iron is released and reverts to W. W. Wheaton, ag't.
" W. W. Wheaton, Ag't."
Wheaton was the " treasurer, general manager and agent " of the Rolling Mill Company.
The first levy was made October 3, 1877. After the levy was released, this iron was shipped to Everett, he having paid Coles the amount of his claims thereon. There was evidence tending to show that .this iron was not marked with Coles' initials or in any way, at the time the first levy was made.
Without passing upon the title, if any, which Everett acquired or took under his contract before inspection, acceptance or any other act was done to designate it as his, or to show that it was of the quality specified in his contract, let us see if this iron does not stand upon a different footing.
This iron was, with the consent of Everett, pledged by the company as its own property to secure a company debt, and was to revert to the company upon payment of the debt. This constituted a clear waiver by Everett of his rights under the contract. Under Ms contract he was entitled to the first three thousand tons of No. 1 Bessemer iron manufactured by the company, and the company was not to manufacture any other iron until this quantity was made, and so fast as made it was to become the property of Everett.
As already said, whether Everett could or could not insist upon and claim the iron, as manufactured, to the amount specified, it is clear that he could waive his right, and permit the company to sell or mortgage some of the iron as manufactured and in lieu thereof take iron subsequently manufactured. If he permitted or consented to a sale thereof no pretense could be made that he would not be bound thereby, and in case of a mortgage thereof he clearly would have lost all right as against the mortgagee. Would his waiver in case of a mortgage extend beyond this ?
If the property was mortgaged to the full value thereof, as it is conceded this was, or even if not to the full value, it could hardly have been the intention of the parties that the iron so mortgaged could be considered as a part of the three thousand tons. If so, he might in addition to the contract price, be compelled to pay the mortgage debt, which was not his to pay, or if not paid, to lose the property on a sale thereof under the mortgage, and if sold under the mortgage to the mortgagee or a third party, none would claim that the iron so sold could be charged to Everett as a part of the three thousand tons which his contract called for. This also must have been the understanding of the parties. The security was given to Coles with Everett's consent, and when the debt secured thereby was paid, "the said iron is released, and reverts to W. W. Wheaton, ag't." Wheaton was the agent of the company and not of Everett. Had this iron been mortgaged to Coles without the knowledge of Everett, a very different question would have arisen, viz., the right of Everett to the iron under his contract. By his consent he permitted the company to treat the property as its own, to pledge it for the company's debts, and to provide for its return to them upon payment of the demand. This was utterly inconsistent with an absolute ownership in Everett. The iron being then the property of the company, the execution debtor was liable to levy, subject to the right of Coles.
It is not claimed that anything in the nature of a mortgage or notice, was placed on file in the proper office as required by our statute. By whatever name the arrangement with Coles may be termed, the object and only one was security for a debt. To be good as against the creditors of the Boll ing Mill Company, the proper instrument not having been placed on file, an " immediate delivery followed by an actual and continued change of possession " was absolutely essential. No such delivery and actual and continued change of possession of such bulky property could be expected or insisted upon. Tet there should be, even of bulky articles, such a clear and unequivocal designation thereof that creditors or subsequent purchasers could not be misled or be in- doubt as to the nature of the transaction. What this should be, must be a question for the jury under proper instructions. It must also in this connection, be borne in rnind that the creditor can protect himself by filing in the proper office his mortgage, or a 'copy thereof, where the articles are of that bulky nature that a symbolical delivery only can be made, and they are permitted to remain in a place where the possession may be equivocal or what could not be said to be an actual possession. Under such circumstances, where doubts exist, they must be solved in favor of the purchaser or creditor, and against the mortgagee, because he having power to protect himself fully and prevent others from being deceived, has not done so.
When we turn to the charge we find it even more favorable than the above would warrant, and that the plaintiff in error has no cause for complaint.
The judgment must be affirmed with costs. '
The other Justices concurred.