Harris v. Harris

25 Mo. App. 496, 1887 Mo. App. LEXIS 343
CourtMissouri Court of Appeals
DecidedApril 19, 1887
StatusPublished
Cited by3 cases

This text of 25 Mo. App. 496 (Harris v. Harris) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Harris v. Harris, 25 Mo. App. 496, 1887 Mo. App. LEXIS 343 (Mo. Ct. App. 1887).

Opinion

Lewis, P. J.,

delivered the opinion of the court.

This action was commencfed in the lifetime of August Leisse, who has since died, and is now represented by Virgil M. Harris, his administrator. The petition sets forth, substantially, that the plaintiffs are residents of Philadelphia, Pa., and that the defendant, Leisse, is indebted to them in the sum of $1,275.88, for goods, wares, and merchandise, sold and delivered to him in the months of March, April, May, June, and July, 1884; that Leisse was, and for many years had been, engaged in the box factory business, and, at the time of said sales, his stock in trade had become very much depleted, he was wholly insolvent, and made said purchases for the purpose of defrauding the plaintiffs, it being his intention never to pay for the things purchased ; that, in July, 1884, Leisse made a general assignment for the benefit of all his creditors, to the defendant, Otto Moser, as assignee; that the assignee soon after, without any notice to the plaintiffs, but with the consent of the defendant, the International Bank, caused all of the assigned property to be sold in bulk for the sum of four thousand dollars ; that the defendant bank thereupon “resurrected” a chattel mortgage, bearing date April 30, 1879, which mortgage is set out at length in the petition. This instrument conveys to the defendant bank, in consideration of one dollar, and indebtedness mentioned, “ all the engines, machinery, and fixtures, tools, and appurtenances constituting a box factory, as well as the two horses, harness, and wagons, and lumber, and stock on hand, belonging thereto. * * * Also, such [499]*499other lumber, or stock on hand, and engines, and •machinery, fixtures, and tools, which may be acquired by said A. Leisse hereafter, in the prosecution of the box factory business.” The condition follows that, “whereas Leisse is already indebted to the bank, and desires to obtain further advances from the same, now, if the said Leisse shall well and truly pay, and satisfy all such indebtedness, present or future, this deed is to be void, otherwise to remain in full force and effect.” The petition further states that, under this mortgage, the bank claims the entire proceeds' of said sale made by the assignee, and, on August 20, 1884, procured, from the circuit court, an order directing the assignee to notify all of Leisse’s creditors of the bank’s claim, and that each such creditor, if he desires to contest said claim, be required to file his objections with the assignee -within twenty days after the allowance of such creditor’s claim ; that, by the terms of the mortgage, and, also, by agreement between the parties to it, the mortgageor retained possession of the property pretended to be conveyed, carrying on the box factory business, and buying, selling, replenishing, changing, and disposing of the said stock, machinery, furniture, etc., with the knowledge and consent of the mortgagee ; that the mortgage was, and is, a conveyance to the use of the grantor, and was intended, by both parties, to cheat, hinder, and delay the creditors of Leisse ; that Leisse is now insolvent, and has no property subject to legal process ; that he is aged and infirm, and is without any prospect of becoming even partly able to pay any of his debts ; that the plaintiffs have duly proved up their claim before the assignee, for the sum of twelve hundred and eighty-six dollars ; that the assignee holds to the' validity of the mortgage, and will, at the expiration of the said twenty days, pay over to the defendant bank, the proceeds of said sale, so that the plaintiffs will lose their debt; that the plaintiffs are. without any remedy at law. Wherefore they pray: (1) Nor a judgment against Leisse for the amount of [500]*500tbeir debt. (2) That the mortgage be declared void, and that the plaintiffs’ claim be paid out of the proceeds of the said sale. (3) That the assignee be enjoined from paying over said proceeds to the bank until the further order of the court herein.

• It is alleged in the brief for the appellants that there was a judgment by default against Leisse’s administrator, but this fact does not appear in the transcript before us. There was a general judgment for the other defendants.

The same mortgage above described was before this court for examination, as to its validity and effect, in the case of Moser v. Claes (23 Mo. App. 420). The-facts of that case were sufficiently parallel with those developed in the present record, to lead to the same conclusion in both cases, as to the merits of the instrument in question.- We there held, in effect, that the mortgage was fraudulent and void, so far as the materials and stock in trade were concerned; but that, as to the other property conveyed, it was a valid and forcible security, from the date of its registration, in favor of the International Bank. No satisfactory reason is shown us for a departure from those conclusions, and, after careful further consideration, we must re-adopt them, in their application to the present case. It follows that, to the extent of so much of the-four thousand dollar fund as does not represent the stock in trade, the bank’s prior claim, under its mortgage, is fatal to the plaintiffs’ demand. It is shown by a calculation in the brief for appellants, that, by the-effect of a certain stipulation at the trial, the value of the stock in trade is to be estimated at $1,575.89. This, then, is all that the plaintiffs could claim out of the-fund, if there were no prior claim upon it, other than that of the International Bank.

The record shows that, on a day before this suit was-instituted, Claes & Lehnbeuter obtained a judgment, by confession, against Leisse, for $2,027.32, and immedi[501]*501ately caused execution to issue, and notice of garnishment to be served on the defendant, Moser, the assignee. The case of Moser v. Claes above mentioned, was the result of that garnishment, being an issue upon interpleader between Claes & Lehnbeuter, on the one' hand, and the International Bank on the other, to determine which of them was entitled to the fund in the assignee’s hands. The present plaintiffs were not parties to that proceeding, and are not bound by its resulting judgment, as a matter of law. But, from what appears of it in this record, we must hold that the garnishment takes precedence of the plaintiff’s claim. It is not disputed that at least $2,027.32 would be required to satisfy the Claes & Lehnbeuter judgment, and this amount exceeds what will' remain, after an appropriation of the share due to the International Bank, by virtue of its mortgage. Claes & Lehnbeuter had a judgment perfected against Leisse, but their garnishment is still pending, although virtually decided in their favor by this court, in reversing and remanding, with directions, the judgment in Moser v. Claes. It is clear, however, that their equities, as against the assignee, are prior to those of the present plaintiffs, who have not even a general judgment substantiating their claim against Leisse. Whether its allowance by the assignee does, or does not, give them a standing in court, to attack the mortgage for fraud in its execution, it is not material to inquire in this connection. The notice of garnishment antedates the commencement of this suit, and so establishes a prior claim upon the fund, as against .these plaintiffs. Talbot v. Harding, 10 Mo. 350 ; George v. Williamson, 26 Mo. 190; Pritchard v. Toole, 53 Mo. 358; Jackman v. Robinson, 64 Mo. 292; Zoll v. Soper, 75 Mo. 462.

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Bluebook (online)
25 Mo. App. 496, 1887 Mo. App. LEXIS 343, Counsel Stack Legal Research, https://law.counselstack.com/opinion/harris-v-harris-moctapp-1887.