Court Opinion

ID: 6543050
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:17:20.499322+00
Date Added: 2024-06-11T15:55:53.199214
License: Public Domain

Manseieed, J. The decree cancelling the notes of Woodyard & Co., for the payment of which Cross’ note was assigned to the appellants as collateral security, did not affect the power of Nelson to sell the mules in the manner required by the deed of trust. If he had made such sale, it would have been a matter of no concern to Cross whether the amount due on his note was payable to Woodyard & Co. or to the appellants. The proceeds of the sale would, in either event, have been received by Nelson, and his misapplication of the fund could not have deprived Cross of the right to have the mortgage satisfied. If a surplus remained, he could have recovered that; but he would have had no cause of action against the purchaser. But the manner in which the mules were appropriated to the satisfaction of the debt secured was unwarranted by the deed of trust, and the appellants do not stand in the attitude of purchasers under that instrument. It was therefore pertinent to the issue tried below to inquire whether, at the time the mules were delivered to them, the appellants were entitled to collect Cross’ note. Their right to do so, by virtue of its original assignment to them, ceased as against Woodyard & Co., on the rendition of the decree the latter obtained against them; and the conversion of the property is admitted to have been wrongful as against Cross. But if, notwithstanding the decree referred to, the appellants were still the rightful holders of Cross’ note, they were liable to him for only the difference between the amount due upon it and the larger sum agreed upon as the value of the mules. Jones v. Horn, 51 Ark. 19. Nor this reason the testimony of Tappan was of importance to the appellants, and it was error to exclude it. It would have shown, not only that the conversion of the mules took place before the institution of the suit in which the decree cancelling the original debt was rendered, but that, after the decree was obtained, Woodyard & Co., the payees of Cross’ note, agreed with the appellants for a sufficient consideration to permit them to retain whatever benefit had accrued to them from the disposition made of the trust property. This placed the appellants, who still had possession of Cross’ note, in the position Woodyard & Co. would have occupied if, without parting with their right under the deed, they had converted the property it conveyed. No special damage is claimed ; and, on the case presented by the rejected evidence, the recovery of Cross, according to the established rule in such cases, should be limited to the value of the property converted less the sum of $135 shown to be due on his note. Jones v. Horn, 51 Ark. 19. If, within fifteen days from this date, he will enter a remittitur for that amount, the judgement as to the rest of the sum recovered will be affirmed; otherwise the judgment will be reversed, and the cause remanded for a new trial.