Court Opinion

ID: 6239251
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:40:18.555106+00
Date Added: 2024-06-11T08:58:08.924084
License: Public Domain

Opinion,
Mr. Justice Mitchell:
The facts set forth in the petition of appellants imperatively required that the execution should be stayed and the judgment-opened.
As to Henry Kemmerer the case is so plain that it is difficult to state any reasons more forcible than the uncontested facts as they stand on the record. Henry mortgaged his interest in a certain tract of land called the Homestead, as security for a debt of his brother Daniel to the plaintiff, Brooke. The mortgage was a joint mortgage by Daniel and Henry covering several tracts belonging to Daniel and, as already said, the Homestead of Henry. But Henry personally owed nothing to *293Brooke, and the bond to Brooke which accompanied the mortgage expressly stipulated that Henry joined in it and the mortgage, solely that the Homestead should be security for the loan to Daniel. Subsequently Henry and Daniel conveyed their property to a trustee to sell, and pay liens. The trustee sold several parcels of Daniel’s land, and as he did so, the plaintiff Brooke released the lien of his mortgage, and allowed the proceeds of the sales to be paid to the other liens, none of which were prior to his, and one at least was admittedly posterior. By this conduct he discharged the land of Henry from its obligation to him.
But on the facts averred in the petition Daniel was equally entitled to relief. As already said he and Henry had conveyed all their real estate to one Kendall in trust to sell. Whether the instrument was technically an assignment for the benefit of creditors, it is not material at present to inquire. It was a trust to sell, “ pay the liens in the order of their priority,” settle other liabilities, and pay over any balance remaining to the grantors. Under it Kendall was a trustee for the Kenunerors and his duty under the very terms of the instrument, was to pay the liens in the order of their priority. Instead of doing so, he sold from time to time, paid liens out of their order, and plaintiff not only permitted but actively assisted him in so doing by releasing his first lien on the lands sold, and yet allowing the proceeds to go to other liens none of which were superior to his and at least one inferior. It is alleged in the petition, and the depositions seem to sustain the allegation, that without touching Henry’s Homestead and also leaving untouched portions of Daniel’s land, enough money had been realized by sales of other parts to pay plaintiff’s lien as well as the others which stood upon an equal footing with it, and that upon an accounting by Kendall it would appear that plaintiff had been paid in full. Kendall did not account nor does he seem to have given any information. On the contrary he made a fraudulent and colorable sale to one Harrison, with a nominal consideration of $21,950, but in reality without the passage of a cent of money, for the very purpose of preventing the owners of the land from learning what he, their trustee, was doing with it.
In all of this the plaintiff not only acquiesced but actively *294assisted by release of Ms lien upon parcels of the land from time to time, without which the scheme could not have been carried out.
It is said that Kemmerer (meaning as I understand it, Daniel) was troublesome and impeded the transactions, and that the scheme was the only way to facilitate a settlement. It may be that the actions of Kendall, and the participation of Brooke in them, are susceptible of an honest explanation, but if so, it ought to be made to a jury, for as the case now appears explanation is badly needed.
The order discharging the rule to open judgment is reversed, the rule to open judgment made absolute, and the record remitted for further proceedings ; so much of the fund in court as may be applicable to tins judgment to abide the final judgment.
A motion for a re-argument subsequently made was refused May 27,1889.
Opinion, Mr. Justice Mitchell :
On the case as presented we see no reason to change the views heretofore expressed. Should the appellant fail to substantiate his version of the transactions, or should the facts appear in any way materially different from what they are now presented, the result may be different. All we now decide is that appellant has made out such a prima facie case as entitles him to a hearing.
Re-argument refused.