Court Opinion

ID: 7103935
Source: CourtListenerOpinion
Date Created: 2022-07-24 12:18:41.944173+00
Date Added: 2024-06-11T16:13:30.433329
License: Public Domain

Robinson, J.
I. The following are the facts of the case: Woodworth, being indebted to intervenor Linderman, executed, in security of the debt, a mortgage upon his interest (one-half) in the property of a *145partnership composed of himself and Mather. Soon thereafter W oodworth purchased the interest of Mather in. the copartnership property and business, and the firm was dissolved. To secure notes given for the purchase of the projjerty, Woodworth executed to Mather a mortgage upon the property acquired by him, and formerly owned by the firm. Mather transferred the notes and mortgage to the Grinnell Barb-Wire Company. The contest in the case is between the company and Linderman, and involves the question as to the interest of each in the proceeds of the stock now in the hands of the receiver.
II. The mortgage to Linderman is in form a bill of sale, and in terms conveys “the undivided half” of the stock of goods in controversy. It has no relation to, and cannot be made to include, any property or interest which the mortgagor might acquire after it was executed. Therefore, when Woodworth subsequently purchased Mather’s interest in the stock, the purchase did not in any manner inure to the benefit of Linderman. Mather exchanged his ownership of an undivided one-half of the stock for notes secured by a mortgage on all the stock. He claims that he did this without actual knowledge of Linderman's mortgage, which was not then of record; but we are of the opinion that the evidence shows that he had such knowledge when his mortgage was taken. His claim as to an undivided one-half of the stock was junior to the lien of Linderman, and as to the remainder it was superior. Woodworth‘seems to have taken possession of the stock under his purchase from Mather, and two weeks later it was seized on attachment. The only showing as to the disposition made of it is contained in an agreement, which is as follows: “ It is mutually agreed that the stock of hardware, tinware, cutlery, and property of whatsoever character described in the Linderman bill of sale, or mortgage of the Grinnell Barb-Wire Company, contested in this cause, covers one and the same stock of goods, and that through the action of the receiver appointed *146by this court the said stock of goods has been converted into cash, and is now in the hands of the receiver, the sum being in the neighborhood of six hundred dollars.”
The evidence does not show the value of the stock at the time of the Mather sale. The mortgage given to Mather was to secure notes amounting to $2,596. He was to have all the accounts and notes of Woodworth & Co., and was to pay all the debts of the firm contracted in Coin, Iowa, and Woodworth was to pay any other debts of the firm which might exist. As to the value of these accounts and notes, and the amount of the indebtedness, there is little, if any, evidence. Woodworth was to keep the stock “ up to three thousand dollars,” but it is not shown that it was ever worth that sum ; nor do we think it material, for the purposes of this decision, to know the value of the stock at any of the dates involved in this controversy. By the terms of his bill of sale, Linderman had a claim upon an undivided one-half of the stock, and of necessity that included a claim upon the undivided one-half of each article included in the stock. The same is true as to the interest in the other undivided one-half acquired by Mather. Each of the mortgages in question was given to secure individual indebtedness, and.no question as to the rights of partnership creditors is involved. We cannot presume that a portion of the goods was sold to pay creditors of Woodworth and Mather, and there is no evidence to that effect. On the contrary, the agreement which we have quoted tends to show that the proceeds of the entire stock of goods are now in the hands of the receiver. The language of the agreement is that “ the said stock of goods has been converted into cash, and is now in the hands of the receiver, the sum being in the neighborhood of six hundred dollars.” In our opinion there is no room for the presumption that a portion of the stock has been sold for the benefit of Mather. The Grinnell Barb-Wire Company is entitled to all the rights created by the mortgage to him. Each of the claims of the company and Linderman is more than one-half of the amount of money in the *147hands of the receiver. We therefore conclude that the district court erred in adjudging the lien of Linderman to be superior, as to an undivided one-half of the stock,to that created by the mortgage to Mather. One-half of the money in the hands of the receiver should be paid on the claim secured by the Linderman bill of sale, and one-half on the claim secured by the Mather mortgage. The judgment of the district court is accordingly
Modified and Affirmed