Court Opinion

ID: 6718732
Source: CourtListenerOpinion
Date Created: 2022-07-20 22:50:57.222222+00
Date Added: 2024-06-11T16:01:32.779789
License: Public Domain

SAYRE, P. J.
(Sayre, Middleton and Mauck, JJ., 4th Dist Sitting)
Epitomized Opinion
The First Savings and Trust Company held a first mortgage on the buildings and leasehold of the Goodman Piano Co. The Guaranteed Mortgage Co. had a mortgage of $7,000 on the same property subordinate and inferior to plaintiff’s lien. Both mortgages also covered the fixtures, furniture and stock subject to the Piano’s Company’s right to sell and dsipbse of the same in the ordinary conduct of its business. As the Bank’s mortgage was not paid, a petition was filed setting up the mortgage and asked that the liens be marshaled and a receiver appointed. Shortly afterwards a received was appointed. A year afterwards the ease was heard on the original petition and a cross-petition which had been filed by the Mortgage Co. The court found that the Bank had a first lien on the leasehold and buildings only and that the Mortgage Co. had a lien subordinate only to the lien of the Bank on the same property. An order of sale was then made. Then the Mortgage Co. filed a supplemental cross-petition, claiming that inasmuch as the money in the honds of the receiver was not sufficient to pay all the creditors, that the money in the receiver’s hands be first applied to the payment of the Mortgage Co. before distribution be made upon the claims of general creditors. The Mortgage Co. based its right to this protection upon the ground that its mortgage not only covered the buildings, but the fixtures, furniture and goods contained therein as well. The court found against the Mortgage Co. and dismissed the petition. As an appeal was then prosecuted by the Mortgage Co., a motion to dismiss was filed by the receiver based upon the contention that a part of the case only could not be appealed. Held:
1. As the interest of the appellant and the receiver acting for the general creditors was separate and distinct from that of all others, that portion of the case which relates to them may be separately appealed under GC. 12231.
2. That the terms of the mortgage did not give the Mortgage Co. any prior rights over a general creditor to the furniture and goods belonging to the debtor.
2. That the terms of the mortgage did not give the Mortgage Co. any prior rights over a general creditor to the furniture and goods belonging to the debtor.