Court Opinion

ID: 3605085
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:50:48.872093+00
Date Added: 2024-06-11T13:58:40.412929
License: Public Domain

Where a mortgagor of goods remains in possession, and has some definite right to the possession, they may be sold on execution against him; and the sheriff is not liable to the mortgagee for the mere levy and sale, although he sells without any reservation of the rights claimed under the mortgage. So much was decided inHull v. Carnley, which was twice before this court. (1 Kern., 501; 17 N.Y., 202.) But that case went no further than the precise proposition just stated. The essential ground of the decision was, that the mortgagor's possessory right could be seized and sold on process in favor of his creditors: that the purchaser would take his situation and rights in respect to the property: that the lien of the mortgage would remain undisturbed by the sale, and even by the transfer of possession to the purchaser; and that the remedies of the mortgagee would not be impaired or affected by the sale and delivery. In that case it appeared that the property, consisting of ponderous articles, was all purchased at the execution sale by one person, although it was bid off in parcels; and that it all remained in the purchaser's possession, or in that of the mortgagor under a lease from him, even down to the time of the trial. (1 Kern., 502;17 N Y, 203, 205.) It was, therefore, evident that the mortgagee sustained no actual injury by the levy and sale. When his right to the possession accrued according to the condition of the mortgage, he had the same right to take the goods which he would have had if they had not been levied upon or sold; and there was no practical embarrassment in the way of exercising that right. Another difficulty in that case was stated to be, that neither trespass nor trover would lie, under the former system of practice, where the plaintiff, at the time of the alleged trespass, or conversion had not the possession of the goods or right of possession. (Per DENIO, J., 1 Kern., 509; PRATT, J.,17 N Y, 204.) The action, it is true, was brought under the new practice (Code), but it was very properly considered that *Page 239 
the principles of law applicable to the question had not been changed, and therefore that the plaintiff could not in any form complain of a seizure and sale merely where he had no right to the possession of the property.
But I now proceed to observe that at common law an action on the case might be brought where, for the technical reason which has been mentioned, trespass, or trover would not lie. For every legal wrong there was some appropriate remedy. A person having only a reversionary interest in chattels or a mere lien without possession or right of possession could not bring trespass or trover (7 Term. R., 9), because those were not in form the appropriate remedies. But if he suffered an actual injury, in respect to his reversionary or other special or peculiar interest, the law did not leave him without redress. An action on the case would be founded on the peculiar interest which the plaintiff had in the property, and the wrong done to him in respect to that interest. Thus the owner of a horse may hire him out on bailment for a definite period of time. If a trespasser or a thief should take and convert the chattel before the bailment had expired, the owner could not sue in trespass or trover; but no one will doubt that he might have an action on the case, founded on his reversionary interest. Either the general owner or the bailee could sue in such a case. The latter could maintain trespass or trover founded on the possession, and he could recover entire damages, holding the same in trust for the owner. But that consideration only places in a stronger light the right of the reversioner to sue for the injury to himself in a case where the taking and conversion are lawful as to the person having the present or possessory right. In such circumstances, for example, where, as in the present case, the goods are taken and sold under a legal process against the party in possession, no one is injured except the reversioner; and however gross and manifest the injury may be to his interest, the law affords no remedy except by an appropriate action in his name. No one else can represent him because there is no one else to complain even of a technical trespass. He may, therefore, sue to redress *Page 240 
any actual wrong which he has suffered. At the common law his remedy would be by action on the case, and now it must be by an action of the same nature.
This doctrine, which I persuade myself is a very plain one, was not applied in Hull v. Carnley, because in the circumstances of that case there was no room for its application. The mortgagee, who was entitled to the possession after the expiration of a certain period, received no injury from the sale of the goods under execution against his mortgagor. When that case was laid before the court, Judge PRATT, who delivered the opinion, seemed to regard the action as in trespass or trover, although it was brought under the new practice. But he observed that if an action for the consequential damages to the mortgagee had been brought, it could not have been sustained, "for the reason that although the property was sold in parcels, it was all bid in by one man and remained in the possession of the mortgagor (under a lease from the purchaser) at the time of the commencement of the suit." "It is manifest, therefore," the judge added, "that he sustained no actual damage." Nothing further need be said in order to show that the decision is no authority for holding that the mortgagee, where it is not manifest that he has sustained no injury, may not sue for the wrong when the mortgaged goods are thus sold in hostility to his right.
We come now to the facts of this case as they have been found in the court below. The property in question consisted of liquors of various kinds, cigars and a variety of other articles usually kept in a city restaurant. It was property difficult to be followed and identified, and liable to be speedily consumed. The sale was hostile to the plaintiff's mortgage, of which the defendants, who directed the proceedings, had notice. The defendants also received the proceeds of the sale. The goods were sold in parcels to different purchasers, and were delivered to them accordingly. Upon these facts the Superior Court held, "that although the defendants had a right to seize the property under their execution and to sell the mortgagor's interest in it, and deliver it in bulk to a purchaser of such *Page 241 
interest, they had no right with a knowledge of the mortgage to sell the property in parcels out and out, to different purchasers, and deliver to each purchaser the separate parcels so bought by him, and thereby destroy the value of the plaintiff's security." I think this was a correct view of the case. It not only does not appear that the plaintiff sustained no injury, but the circumstances justify the opposite presumption. Who and how many the purchasers were we know not. Their very names were probably unknown, the sale being at auction. The goods were thus dispersed, no one could tell where, and if not in fact consumed before the plaintiff's right of possession accrued, they were nevertheless liable to consumption and loss. I think that in all cases of this nature, where the mortgaged property is sold and delivered in parcels to different purchasers, a presumption of injury to the mortgagee arises, the sale being without any recognition of his rights. In this particular case there can be little doubt that the proceedings resulted in the total loss of the plaintiff's lien. The law is not so unreasonable as to afford no remedy for such a wrong.
We have been referred to the manner in which the plaintiff's case is set forth in his complaint. The plaintiff's title and interest under his mortgage are therein disclosed, and it is there alleged in substance that the defendants, knowing of the mortgage and intending to injure the plaintiff, wrongfully took the goods and absolutely sold and converted the same to their own use. The authority under which they sold, and the special circumstances of the sale, showing how the injury to the plaintiff was produced thereby, are not set forth. I think therefore there was some defect in the statement. But this defect was amendable before or after judgment, and it is still amendable. (Code, § 173; Lounsbury v. Purdy, 18 N.Y., 515.) Again, the questions made at the trial arose upon the facts as proved, and the ground was not taken that the complaint was not adapted to the case which the evidence disclosed.
It is also now urged that for aught that appears the mortgagors were able to pay the debt, and consequently that the plaintiff may not have been injured by the loss of his lien. *Page 242 
But as this point was not suggested at the trial, we are not required to consider the question whether the insolvency of the mortgagors was a necessary part of the plaintiff's case. I think therefore that the judgment ought to be affirmed. A majority of my brethren however, are of opinion that a new trial should be granted for the reasons assigned by Judge SELDEN, and the question whether the plaintiff can maintain the suit for the injury sustained by him, according to the principles of this opinion, is left undetermined.
Judgment reversed and new trial ordered.