Court Opinion

ID: 6907388
Source: CourtListenerOpinion
Date Created: 2022-07-23 22:02:45.64054+00
Date Added: 2024-06-11T16:06:24.379621
License: Public Domain

Petition for Rehearing.
(198 Pac. 244.)
On petition for rehearing.
Petition denied and former opinion approved.
Messrs. Botts S Winslow, for the petition.
Messrs. Bauer, Greene S McGurtain and Mr. 8. 8. Johnson, contra.
BURNETT, C. J.
5. In a brief critical in terms and savoring of diatribe, counsel for plaintiff urge that a rehearing should be granted in this case. We *556recall that the plaintiff was the owner of some spruce logs and by a contract in writing, of date September 5, 1919, agreed as follows:
“Stone hereby sells to the company and the company hereby buys from Stone all those certain spruce logs got out by Stone under his contract dated March 11, 1919. * * ”
It is further stipulated in the contract that—
“As each raft is completed and scaled, the logs therein shall become the property and at the risk of the company, and the company agrees that immediately upon the delivery to it of the certificate of the Columbia River Log Sealing and Grading Bureau showing the number of feet included in a raft, the company will promptly execute and deliver to Stone the company’s acceptance for the price of the logs included in such raft at the rate of twelve dollars per thousand feet.”
The language of the agreement upon which the plaintiff predicates his lien and the right to hold the proceeds of the sale of lumber manufactured from the logs, as well as the logs and lumber remaining on hand, is as follows:
“It is understood that Stone expects to discount said acceptance with the First National Bank of Tillamook, and the company agrees that in order further to secure payment of said acceptances’ (which shall mature ninety days after their respective dates) the company will assign to the First National Bank of Tillamook, or such other person as Stone may direct, the invoices of the company against its customers for the lumber manufactured from said logs.”
As authority supporting plaintiff’s contention, there is cited Section 1235, 3 Pom. Eq. Jur. (4 ed.), as follows:
“The doctrine may be stated in its most general form, that every express executory agreement in *557■writing, whereby the contracting party sufficiently indicates an intention to make some particular property, real or personal, or fund, therein described or identified, a security for a debt or other obligation, or whereby the party promises to convey or assign or transfer the property as security, creates an equitable lien upon the property so indicated, which is enforceable against the property in the hands not only of the original contractor, but of his heirs, administrators, executors, voluntary assignees, and purchasers or encumbrancers with notice. Under like circumstances, a merely verbal agreement may create a similar lien upon personal property. The ultimate grounds and motives of this doctrine are explained in the preceding section; but the doctrine itself is clearly an application of the maxim, equity regards as done that which ought to be done. In order, however, that a lien may arise in pursuance of this doctrine, the agreement must deal with some particular property, either by identifying it, or by so describing it that it can be identified, and must indicate with sufficient clearness an intent that the property so described, or rendered capable of identification, is to be held, given, or transferred as security for the obligation.”
6. It is to be noted that the lien there described depends upon an express executory agreement in writing where the contracting party indicates an intention to make some particular property, real or personal, or fund, therein described or identified, security for a debt or other obligation, whence arises an equitable lien upon the property, enforceable against that property, not only in the hands of the original contractor but his successors in interest and purchasers or encumbrancers with notice. It is said that the doctrine is an application of the maxim that regards that as done which ought to be done. In respect to this last observation, that which ought to *558be done is that which the parties contracted to do bnt have not done. It is not grounded on mere moral obligation or upon a supposed advantage which either of the contracting parties has lost by his mere inadvertence. The lien must be some hold upon the identical property in dispute and this in addition to the monetary obligation represented by the debt for which it is supposed to be security. The lien is ancillary to and separate from the debt itself. It must be more than a mere promise to pay out of some particular fund. Such a promise is of no more dignity or obligation than the original agreement to pay the debt itself.
Many cases are cited under the section of Pomeroy already quoted. For instance, in Title Insurance & Trust Co. v. California Development Co., 171 Cal. 173 (152 Pac. 542), the effort was to charge an irrigation system in which the canal began in California and owing to the contour of the country crossed into Mexico and bach into the State of California. Because of the conditions of the laws of Mexico a foreign corporation could not hold title to lands within a certain zone adjacent to the international boundary. To overcome this obstacle a subsidiary corporation was formed to hold title to the part of the system in Mexico. The parent corporation held a large block of the shares in the Mexican corporation. A deed of trust covered those shares of the Mexican plant and authorized a sale of the property to pay the bonds of that concern. The principal question in the ease was the power of a court of equity to compel the disposition of realty or other property situated beyond its jurisdiction, and it was held that as equity operates upon the person in the enforcement of its decrees, the foreign property could *559be affected by tbe judgment of the court where the parties were within the jurisdiction of the court and subject to its process. It was further held that the whole plant could be sold in its entirety, because the contract of the parties contemplated such a result. In other words, there was expression of the intent to create a lien, and designation of the property involved.
In United States Fidelity & Guaranty Co. v. Fidelity Trust Co., 49 Okl. 398 (153 Pac. 195), there was an express written agreement to bond and mortgage a railroad to be built by subscriptions, which security was given to accomplish the repayment of those very subscriptions; and on this express agreement the lien was enforced against those in privity with the railroad company to whom the subscriptions were made. In Walker v. Brown, 165 U. S. 654, there was an actual delivery of certain municipal bonds to the debtor, with the written agreement that they should be placed as collateral to the debtor’s note. In Ketchum v. St. Louis, 101 U. S. 306, the case depended upon a public statute which authorized St. Louis County to issue $700,000 in bonds in aid of the Pacific Railroad Company, and required the custodian of the company’s funds to pay certain monthly installments in liquidation of the bonds and interest thereon. In Hurley v. Atchison, Topeka & S. F. Ry. Co., 213 U. S. 126 (53 L. Ed. 729, 29 Sup. Ct. Rep. 466, see, also, Rose’s U. S. Notes), the company had a contract with a coal mining corporation whereby the latter agreed to furnish such coal as the railroad company required to operate its trains, and on the fifteenth of each month the railroad company should pay for the coal delivered during the preceding month. The coal company became involved *560and in order to meet its pay-roll a supplemental agreement was made with, the railroad company whereby the latter paid in advance for coal to a certain amount. It was held as against the assignee in bankruptcy of the coal company that he stood in no better plight than his assignor, and that the circumstances showed an intent to pledge the coal for the advances made by the railroad company. There, the coal to be mined was distinctly specified as the subject of the lien.
In Ingersoll v. Coram, 211 U. S. 235 (53 L. Ed. 208, 29 Sup. Ct. Rep. 92, see, also, Rose’s IT. S. Notes), it was expressly stipulated that Ingersoll was to be paid his fee as attorney for contestant of the Davis will, “out of the funds secured from the estate,” and the amount of the fee was also specified. In all of these cases there is an express designation of the property to be affected and the amount for which it is to be charged, so as to leave nothing for future adjustment in that respect.
The instrument upon which the plaintiff bases his suit expressly provides that the property and possession thereof shall pass to the Silver Spruce Company. It is never intimated anywhere in the contract that there was any intention for Stone to retain possession of the logs or the lumber. All that the Silver Spruce Company agreed to do was to furnish security, not to Stone, but to those to whom he might negotiate the acceptances. We also note that it proposed to assign as security, not the property itself, but the “invoices of the company against its customers for the lumber manufactured from said logs.” An “invoice in commercial transactions” is defined to be a written account of the particulars of merchandise shipped or sent to a purchaser, consignee or factor, *561etc., with the value or prices and charges annexed; Merchants Exchange Co. v. Weisman, 132 Mich. 353 (93 N. W. 869). “An invoice of goods is-merely another term for hill rendered”: Pipes v. Norton, 47 Miss. 61. It was held in Dows v. Bank, 91 U. S. 618 (23 L. Ed. 214), that—
“An invoice is neither a bill of sale nor evidence of a sale, and, standing alone, furnishes no proof of title.”
It differs from a bill of lading.
This court in Walker v. First Nat. Bank, 43 Or. 102 (72 Pac. 635), speaking by Mr. Justice Bean, said:
“A bill of lading represents and stands for the property for which it was given, and the right and title of such property may pass by an indorsement of the bill, or by a mere delivery thereof, when such was the intention with which the indorsement or delivery was made. But neither the indorsement nor delivery of a bill of lading has any effect in passing the title or dominion or control over the property, except as the result of a contract between the parties, and the real transaction may be shown by parol.”
We have, therefore, at hand an instance where there is no expression of an intent to pledge or grant a lien upon the logs or lumber, but only to assign invoices which do not affect the title of the property one way or the other. Taken according to its legal effect, the contract is secured only by the personal responsibility of the Silver Spruce Company. Still further, we derive from 27 R. C. L. 571, an authority cited by the plaintiff, this doctrine:
“There has been much discussion and confusion in the cases as to the origin of the principle giving a vendor, who has conveyed the legal title, a lien for the purchase money. It is not a rule of the common law but is exclusively a doctrine of equity, adopted, it has been said, from the civil law. This rule of the *562civil law applied to the sale of both real and personal property, and courts of equity while adopting it as to realty have not done so as to personalty, and it is held that a seller of personal property has no lien for the price after the delivery of possession.”
As said by the same authority in the preceding section, “our statutes evidence an abhorrence of secret liens.” Hence it would not be compatible with trade facilities, if every seller who parts with the possession of goods could assert an equitable lien without giving any notice of it. It was to illustrate this policy of the law that the citations of our statutes granting liens upon logs and lumber were entered in the former opinion.
It is to be regretted that the plaintiff disposed of his property so hardly earned, as loggers do, to some irresponsible concern. But, having parted with his property and given up possession, no lien can be devised for him. He stands in no better relation to the property than any other creditor of the Silver Spruce Company. Our statutes have made it easy for sellers of such chattels to secure themselves for the purchase price, and in view of the precedents against equity’s recognition of a vendor’s lien on personal property with which the seller has parted possession, we cannot give the plaintiff relief.
We adhere to the former opinion.
Former Opinion Approved. Rehearing Denied.
Bean, Brown and Johns, JJ., concur.