Court Opinion

ID: 6547088
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:20:27.744128+00
Date Added: 2024-06-11T15:55:59.870614
License: Public Domain

Hirx,, C. J. (after stating the facts). This case is a sequel to Hyatt v. Bell, 83 Ark. 360. The material facts in regard to the origin of this litigation may be found therein stated; the other material facts are in the preceding statement. An important matter in this case is the sharp conflict in the evidence as to whether the guaranty was cancelled by agreement after its execution. This was submitted to the jury in several instructions. It must be taken from the verdict returned by the jury under those instructions that they found in favor of Bell upon that issue. The instructions were erroneous wherein they submitted to the jury the question of an election of remedies growing out of the suit of Bell against Hyatt. There was no election of .remedies by virtue of that suit which would preclude Bell from maintaining this suit, and the court should have so instructed the jury as a matter of law, and only left for their determination the question of fact above indicated, as to whether the guaranty was effective or whether it had been cancelled before the trade for the half interest in the livery stable was consummated. The principle is well established that a vendor of chattels who has reserved title until .the purchase price is paid may, upon default of payment, retake the property and thereby cancel the debt, or he may sue to recover the debt and thereby affirm the sale — in which case he looks to the debtor and not to the property; in the other case he looks to the property and not to the 'debtor. But that principle does not apply here. The Turner ’note contained reservation of title. The guaranty erroneously describes it as retaining a vendor’s lien upon 'the printing plant. The two rights are different. A vendor’s lien on personal property can only be created by suit, and only when the property is in the hands of the vendee. When it passes out of the hands of the vendee, the right to create a vendor’s lien against it is gone. When the title to personal property is reserved, the title does not pass, and the property may be retaken upon default in the payment. When default was made on the Turner note, which was owned by Bell, the property had passed out of the hands of Turner, having been mortgaged to Hill, which mortgage was purchased from Hill by the Bank of Ozan. This mortgage was made with the consent of Old, and he thereby waived any right to pursue the property and create a vendor’s Men upon it, as his action in consenting to the mortgage of it placed it beyond the possibility of that remedy being available to him or his transferee (after maturity) of the note. But, as seen, that right did not in fact exist, as the note reserved the title, and not a Men; but his action in consenting to the mortgage of it was equally a waiver of the reservation of the title, in so far as the mortgagee and those holding under him were concerned. This action of his in consenting to the mortgage defeated Bell from recovering the property in the suit of Hyatt v. Bell. The guaranty by its terms only became effective in the event that the Turner note was not paid, and Bell had “to foreclose and enforce the vendor’s lien therein reserved.’.’ Therefore, in order to make the guaranty effective, Bell was required to attempt to foreclose and to enforce a vendor’s lien. The only action that was open to him was to seek to recover the property in a replevin suit, in order that he might then bring suit to enforce a vendor’s Men or maintain his replevin suit upon the reservation of title. Old’s action, as heretofore shown, in consenting to the mortgage defeated that suit. There was no record notice of this conduct, and no showing that Bell had actual knowledge of it when he brought that suit. It was a fact developed in that litigation. To permit him now to defeat Bell’s suit on the guaranty on account of Bell having brought this necessary suit in order to hold the guaranty would be to enable him to profit by his own act in derogation of Bell’s rights, and to which Bell was not a party. The terms of the guaranty having required him to pursue this remedy, although the remedy may be erroneously described in it, before it became effective, Bell was required to pursue the only course open to him — that is, to seek to recover the property. And, now that he has exhausted that remedy, then the terms of the guaranty bring into being his remedy upon it, and he should be entitled to recover upon it. The jury has settled the only open question in the case, that is, whether the guaranty was cancelled or effective, and, having decided the latter, then it was the duty of the court to have entered judgment upon the verdict first rendered by the jury. It is objected that said verdict is insufficient to render judgment upon it, because the amount of recovery is not therein stated. This amount is undisputed. The face of the note and the guaranty show that the principal was $400 with interest. There was a credit upon the note of $105.59. There was an allegation in the complaint, which was not denied in either answer, that the plaintiff had expended for costs $60 in his suit with Hyatt. The amount being undisputed, the court should have directed it inserted in the verdict, or rendered judgment upon the verdict as it stood for the undisputed amount. The.court committed two errors: First, in giving the instructions which he did at the instance of the defendant (appellee) in regard to the election of remedies, and in modifying those that he gave at the instance of the plaintiff (.appellant) so as to embrace the same question. These instructions placed an additional burden upon Bell which he should not have been compelled to carry, and which the jury evidently disregarded. This is not prejudicial error as to the appellees. The only real issue in the case — whether the guaranty was effective or whether it was cancelled — was properly submitted in instructions numbered 1 and 4 and 5 given at the instance of the appellant and No. 3 given at the instance of the appellee. The other error of the court was in giving a peremptory instruction for a verdict in favor of the defendant. This error occurred after the proper verdict had been returned, and it is unnecessary to order a new trial on account of it. Harris v. Graham, 86 Ark. 570. The judgment is reversed and cause remanded with directioná to enter judgment upon the verdict first rendered, for the amount of the note and interest, less the credit thereon, against Turner and Old, and the additional sum against Old of $60 for the costs expended in the Hyatt suit. Mr. Justice Battle concurs in the reversal, but not in directing judgment entered on the first verdict.