Court Opinion

ID: 7107415
Source: CourtListenerOpinion
Date Created: 2022-07-24 12:22:30.0029+00
Date Added: 2024-06-11T16:13:37.163953
License: Public Domain

Supplemental Opinion on Re-hearing.
Given, J.
*2896 7 *2908 *2919 10 11 *288An opinion was filed in this case, December 15, 1894, affirming the judgment of the district court. A re-hearing was granted, that we might again consider the case in the- light of certain contentions made by the appellant that were not specifically emphasized on the former submission, and not directly noticed inthe opinion. Appellee insists that these contentions were not made on the former submission, and that, therefore, appellant *289is not entitled to now make them. True, they were not ar e as specifically as now, but sufficiently so, we think, to entitle them to consideration. On the former submission, appellant contended that the following facts were established by the evidence, and rested his right to recover thereon: “(1) That Carvell agreed to ship and sell the cattle in plaintiff’s^ name; (2) that Carvell agreed to apply the proceeds in payment of plaintiff’s mortgage; (3) that the defendant bank received the proceeds charged with notice of the trust character of the funds.” We found that appellant had failed to establish an agreement that the cattle were to be sold in his name, and with this finding we are still content. Appellant now contends that there was an agreement between him and Carvell that the proceeds,arising from the sale of the cattle should be applied to the payment of his mortgage; that this agreement created an agency between the parties, and rendered the proceeds a trust fund; and that the bank received the same charged with notice of their trust character. It is insisted that, if each of these propositions should be answered in the affirmative, the judgment of the district court must be reversed. A careful review of the evidence leads us to the conclusion that there was no material difference in the agreement under which these cattle were sold from that which had previously existed between these parties for several years as to the sale of other lots of cattle. We have no doubt but that it was expected by appellant and intended by Carvell, that the greater part of the proceeds should be applied upon Carvell’s indebtedness to appellant; that Carvell should ship and sell the cattle through the commission house in Chicago, cause the proceeds to be returned to the defendant bank, and appellant to be notified, so that he might send his notes to the *290defendant bank, to be credited with whatever Carvell should cause to be so applied. The proceeds were sent to the defendant bank, credited to Carvell, and two thousand dollars, for which Carvell ejave his check, was credited upon the notes, and that amount transmitted to, and received by the plaintiff. Carvell was not only authorized to sell the cattle in his own name, but, so far as any agreement was made, the proceeds were left subject to his control. We said in the former opinion, that even if a trust relation was shown, between plaintiff and Carvell, it was not shown that defendant had notice of it, or of facts from which it could be said, under the circumstances, that, it should be held to have been put upon inquiry to ascertain the existence of such a relation. We still think, that this is the proper conclusion to be drawn from the evidence. It is true, that defendant’s officers knew of appellant’s mortgage, that the mortgage to the bank was junior, and, as the cashier says, that plaintiff’s mortgage was to be paid when the cattle were sold, but this notice falls far short of showing knowledge of the trust relation contended for. The cattle were sold by Carvell in his own name, and the proceeds were sent to the bank in his name, and to his credit. We see no reason why the bank should even have suspected that this fund was the property of the plaintiff. Appellant cites several cases holding, in effect, that the stipulation in the mortgage of chattels, or an agreement between a mortgagor and motgagee, that the mortgagor shall retain possession and sell the mortgaged property, and pay the amount to the mortgagee, is not per se fraudulent and void as against other creditors, but presents a fact to be considered in determining the validity of the mortgage. It does not seem to us that these cases are controlling upon the question under consideration. Counsel also cite In re *291Maxwell's Estate, 83 Iowa, 590 (50 N. W. Rep. 56). In that case, the mortgagor having sold the mortgaged land, the mortgagee released her mortgage and consented that the amount due to her might be retained by her son, the mortgagor, to be invested by him in her name and for her benefit. The mortgagor died soon after, and the money in his hands was traced to the possession of the bank where the mortgagor had deposited it. This court said: “A mortgage released to permit a sale of the property free • from its lien would not bind the money received in payment for the property.” Applying this principle of the law, it is clear that appellant, having consented to the. sale of the cattle, has no lien upon the proceeds by virtue of his mortgage, nor is such a claim made. It is further said in that case: “But the facts show something more in the form of an agreement between the parties, to the effect that the money was to be held and invested for the mother.” There is no such agreement in this case. It was not even agreed, as we understand the evidence, that the proceeds of the sale of these cattle were to become the property of the appellant, or that in making the sale and controlling the proceeds, Carvell was to act in any other capacity than that in which he had previously acted. If it may be said that there was an agreement that the proceeds of the sale should be applied to the payment of plaintiff’s mortgage, we do not think it was such an agreement as constituted Carvell the agent of the plaintiff for the sale of the cattle, nor the proceeds to be a trust fund for the benefit of the plaintiff; but, even if these two propositions were answered in the affirmative, we are still of the opinion that the defendant bank had no notice of such a trust relation, nor of facts that should be held to have put it upon inquiry, *292Aided by tbe further arguments, we have considered the case with care, and are still of the opinion that the judgment of the district court should be affirmed.