Court Opinion

ID: 5171838
Source: CourtListenerOpinion
Date Created: 2022-01-02 04:57:06.033476+00
Date Added: 2024-06-11T08:26:07.445129
License: Public Domain

ON REHEARING.
DUNN, J.
Appellants contend that the court committed several errors in the original opinion, but we think it necessary to discuss only one of such alleged errors, which is numbered 7 and reads as follows:
“The court erred in failing to hold that a portion of the mortgaged property, to wit, a cow, three horses, a wagon and an automobile, were not sold and were still subject to the mortgage, which was unsatisfied, at the time of the issuance and levy of the writ of attachment; that if this property was transferred from appellants to respondent and from respondent to appellants and the lien of the mortgage was thereby destroyed, it was waived by1 respondent’s act, and in failing to decide that whether the debt was still secured by the mortgage on the above-mentioned property, or said security had been so waived, the attachment is violative of C. S., sec. 6779, subd. 1, and must be quashed.”
All of the property covered by the chattel mortgage was sold by agreement of appellant and respondent on the 17th day of May, 1921, except the cow, the horses, the wagon, and the automobile mentioned above. On May 20, 1921, respondent took a bill of sale of this remnant of said mortgaged property and gave appellants credit therefor in the sum of $400 on the balance of $1,515.75 remaining due to respondent on the note of appellants for $2,800. Respondent on the same day sold back to appellants this remnant of the mortgaged property and took therefor a title-retaining note for $400. After the sale of the greater portion of the mortgaged property by agreement on the 17th day of May, 1921, respondent undoubtedly lost its right to enforce its-lien against the property sold, but between the 17th and 20th days of May, 1921, its balance of $1,515.75 was se*55cured by its mortgage on the cow, the three horses, the wagon and the automobile. When it became the purchaser of these the lien of its mortgage became merged in its title, and upon its sale of this property to appellants and its taking from them a title retaining note for $400, so far as this property was concerned it substituted another form of security for the chattel mortgage. It no longer held security for the balance of $1,115.75, which remained after crediting on the note the $400. But can it be said that such security as it had after the 17th day of May had become valueless without any act of respondent? We think not. It seems clear to us that by this transaction the respondent became an actor, and waived its security for the balance of this note and that therefore it was not entitled to a writ of attachment. For the reasons stated the former decision of this court and the order of the trial court denying the motion to quash the attachment are reversed. Costs to appellant.
(December 4, 1922.)
Rice, C. J., and McCarthy, J., concur.
Budge and Lee, JJ., dissent.