Court Opinion

ID: 6541722
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:16:14.90522+00
Date Added: 2024-06-11T15:55:51.123085
License: Public Domain

Smith, J. The bill in this case alleged that Avandana Brothers were merchants in New Orleans, and Meshew was their agent in Randolph County; that the defendant, Brown, being indebted to said firm in the sum of $298.27, made his note for the sum payable to the order of said Meshew, and secured the same by mortgage upon real estate; that Hecht, Bro. & Co., the holders of a certain other promissory note of said Brown for $374.77, also secured by mortgage upon other lands, had indorsed the same to Meshew without recourse upon them, but the consideration for said transfer had moved from Meshew’s principals, the Messrs. Avandana, and the transfer was in reality for their benefit; that Meshew had afterwards delivered both of ■said notes and mortgages to his said principals, but without any indorsement in writing, and they had without writing sold and delivered the same to Henderson, and he had transferred them for value, but without recourse, to the plaintiff The bill further stated that Meshew had, at his own expense, redeemed the mortgaged lands from a tax sale, and had paid the taxes for several years, and that the plaintiff had offered to repay these advances, but his offer had been declined. And that Meshew had committed sundry depredations upon the lands by cutting timber, whereby the value of the lands was depreciated. But it was not claimed that this deterioration had proceeded so far as to affect the plaintiff’s securities for his debts. Meshew, Brown and wife, Henderson and Avandana Brothers were made defendants to the bill. And the prayer was, that as between Meshew and the plaintiff' an account might be stated, giving Meshew credit for his redemption money and taxes, and charging him with the value of the timber cut from the lands and converted to his own use, the plaintiff offering to pay into court any deficiency that might be found due by him; that the notes and mortgages might be declared to have been executed in the one case, and to have been transferred in the other, to Meshew as agent for Avandana Brothers, and to be subsisting charges upon the lands; and that the plaintiff have judgment against the maker of them for principal and interest, they being past due, and for general relief. There is no specific prayer for foreclosure, but we assume from his coming into chancery that this relief is desired. The bill was dismissed upon a demurrer which specified that it did not show any right in the plaintiffs to maintain the suit. The action of the court is apparently based upon the idea that Caldwell could not sue because the notes were made payable to Meshew’s order, and had never been indorsed by him. If, as the demurrer admits, Meshew was but an agent in the transactions in the course of which these notes and mortgages were made or transferred to him, the securities were the property of his principals, and they could transfer them by delivery without indorsement. And it is probable that under our statute, which requires all actions to be prosecuted in the name of the real party in interest, the holder under such a transfer might sue, even at law. (Heartman v. Franks, 36 Ark., 501.) But certainly in equity the assignee of choses in action must be permitted to enforce his rights in his own name. Of course it is open to Meshew to deny his agency in the matters out of which the debts arose, and also to deny the assignment, which must then be proved. Eor the mere possession of the instruments unindorsed is not evidence of ownership, nor is their exhibition sufficient ground of recovery. And the plaintiff would only succeed to the rights of his assignors and recover subject to such defenses as were available against them. 1 Daniel Neg. Inst., secs. 741, 743; 1 Jones Mortgages, sec. 818. Reversed and remanded, with directions to overrule the demurrer and require the defendants to answer.