Court Opinion

ID: 6548318
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:21:34.88799+00
Date Added: 2024-06-11T15:56:02.056212
License: Public Domain

Wood, J., (after stating the facts). In Martin v. Schichtl, 60 Ark. 595, 598, we said: “Equity requires no particular words to be used in creating a lien. It looks through the form to the substance of an agreement, and if, from the instrument evidencing the agreement, the intent appears to give, or to charge or to pledge, property, real or personal, as a security for an obligation, and the property is so described that the principal things intended to be given or charged can be sufficiently identified, the lien follows.” This language was recently quoted by the Chief Justice speaking for the court in Ward v. Stark, 91 Ark. 268, 273. See other cases cited in appellant’s brief, and especially Wood v. Holly Mfg. Co., 13 So. 948, and 100 Ala. 326, where in a similar case the court said: “that a lien created by contract, and not sufficient as a legal mortgage, will generally be regarded as in the nature of an equitable mortgage. The form of the contract is immaterial. Though a lien may not be expressed in terms, equity will imply a security from the nature of .the transaction, and give it effect as such, in furtherance of the agreement of the parties, if there appears an intention to create a security.” Cox v. Smith, 93 Ark. 371. The instrument under consideration in express terms creates a lien upon the property in controversy in favor of the appellant. The lien thus created is in the nature of a mortgage. It is an equitable mortgage from the railway company to appellee on the engine and tender, which the appellee can enforce in equity, notwithstanding the property has passed into the hands of a receiver. The receiver took the title to the property burdened with all the equities to which it was subject in the hands of the debtor. 23 A. & E. Ency. (2 ed.) 1091-1093; Auten v. City Electric St. Ry. Co., 104 Fed. 395; 34 Cyc. 348, note. The lien which is here sought to be enforced is created by contract. The statutory remedy, whereby the vendor of personal property, in an action against the vendee for the purchase money, may impound the property while in the possession of the vendee to prevent him from selling same is an entirely different proceeding from that resorted to herein. Sections 4966-67, Kirby’s Digest. Cases arising under that statute have no application here. The judgment dismissing the complaint was erroneous. It is therefore reversed, and the cause remanded for further proceedings not inconsistent with this 'opinion. Hart, J., concurs in the judgment.