Holt v. Mahoney

244 N.W. 98, 60 S.D. 158, 1932 S.D. LEXIS 30
CourtSouth Dakota Supreme Court
DecidedAugust 30, 1932
DocketFile No. 7315.
StatusPublished

This text of 244 N.W. 98 (Holt v. Mahoney) is published on Counsel Stack Legal Research, covering South Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Holt v. Mahoney, 244 N.W. 98, 60 S.D. 158, 1932 S.D. LEXIS 30 (S.D. 1932).

Opinion

POLLEY, J.

This action was brought to recover on three promissory notes and to foreclose three chattel mortgages given to secure the payment of said notes. All of said notes and mortgages were executed by the defendant Joseph Mahoney, who was a citizen of the state of Nebraska. The first note for $6,500 was *159 executed on-the 16th day of November, 1925, and payable March 16, 1926. The second note is for $4,500, dated January 16, 1926, and due June 10, 1926. The third note is dated March 24, 1926, and due on demand. All three of these notes were executed and delivered at Johnstown in the state of Nebraska, and were payable at the 'Citizens’ Bank in Johnstown, Neb. The mortgage given to secure the first note described 100 head of cattle located on a certain half section of land in Todd county, B. D. This mortgage was filed in the office of the register of deeds of Lyman county on the 20th day of November, 1925. The second mortgage described 330 head of hogs and 2,000 bushels of corn on the same farm in Todd county, S. D., and was filed in the office of the register of deeds of Lyman county on the 25th day of January, 1926; and the third mortgage described 78 head of cattle, 200 head of hogs, and 2,500 bushels of corn situated on the said farm. All the property described in this mortgage is included in the property described in the other two mortgages. This third mortgage was filed in the office of the register of deeds of 'Lyman county on the 27th day of March, 1926. At the time these mortgages were filed as aforesaid, Todd county was attached to Lyman county for judicial purposes. The payee in all of the notes was an officer of the Citizens’ Bank of Johnstown, but it is conceded that said notes and mortgages were the property of the said Citizens’ Bank, and were duly assigned to plaintiff.

On or about the 10th day of December, 1925, the defendant Mansour sold to the defendant Mahoney some 3,000 bushels of corn and some other feed on the said farm in Todd county, S. D., upon which the live stock described in the above mortgages was then located, and the corn described in the third mortgage above referred to was a part of the corn sold to Mahoney by Mansour. On the above date, to-wit, December 10, 1925, Mahoney gave to Mansour two promissory notes, one for $1,000, payable on the 3d day of March, 1926, and one for $1,500, payable on the 1st day of April, 1926, in payment for the said corn and other feed. But Mansour retained) no lien on the property sold to Mahoney, nor did he take security of any kind for the payment of said notes. Mansour was a resident and citizen of Valentine, Neb. The said notes were executed and delivered to Mansour at Valentine, Neb., and were payable at the Fanners’ National Bank in Valentine, Neb.

*160 'At the time of the execution and delivery of the notes last above mentioned, Mahoney told Mansour that, if he would present them at the Citizens’ Bank at Johnstown, said bank would pay him the money due thereon. Pursuant to such information, the defendant Mansour, within a day or two thereafter, took said notes to the said bank at Johnstown, and, failing to find the plaintiff at the bank, left the said notes with one of the employees, telling such employee what Mahoney had told him. Within a few days thereafter the plaintiff in this action, J. A. Holt, who was then president or cashier of the said 'bank, returned said notes to Man-sour at Valentine, Neb. Mansour testified that, when Holt returned said notes, he told Mansour that he did not have the money to pay said notes, and further said: “Mahoney owes us more money than we can loan him and we couldn’t take care of those notes, but if you will let Mr. Mahoney feed the -corn and hay, we will pay those notes from the first proceeds off from them cattle and hogs on your place.”

This conversation took place on or about the 20th day of December, 1925, but nothing' was said about the mortgage that Ma-honey had given to the Johnstown bank. Mansour testified that at a later date he had another talk with plaintiff, and that plaintiff again told1 him that he wouldl pay the said- notes. The Mansour notes were not paid when due, and about that time he learned, for the first time, that the plaintiff had the mortgages on the Ma-honey cattle and hogs. Mansour then went to- Mahoney, and, with actual knowledge of the existence of plaintiff’s mortgages, procured from him a chattel mortgage on so much of the said live stock as had not then been sold to secure the payment of the two notes that Mahoney had given to- Mansour on the 10th day of December, 1925. Mansour, claiming his said chattel mortgage to ■be superior in right to the mortgages that had -been given to plaintiff, instituted proceedings to foreclose the same. Plaintiff then commenced this action. A receiver was appointedi. The mortgaged property was sold, and the receiver is holding a sufficient amount of the proceeds of such sale to pay Mansour’s notes in -case final judgment should be in his favor. Defendant Mahoney entered no appearance in the case and the controversy was between plaintiff and Mansour.

*161 Findings of fact, conclusions of law, and judgment were for plaintiff, and defendant Mansour appeals.

The chattel mortgages given to the plaintiff at Johnstown, Neb., do not contain a receipt over the name of the mortgagor as required 'by sections 1578, 1579, Rev. Code 1919; therefore they were voidi under these statutes; they were not entitled to be filed, and did not impart constructive notice of respondent’s rights. Because of these facts, appellant contends that said mortgages do not constitute a lien on the mortgaged property, and that he is entitled to payment in full of the amount due on his said notes before anything shall 'be paid to the plaintiff. On the other hand, plaintiff contends that his notes and the said chattel mortgages are Nebraska contracts, that they constitute good and valid chattel mortgages under the laws of the state of Nebraska, and that they should be governed by the laws' of the state where executed, and be given the same force and effect as though the laws of this state had been fully complied with.

Appellant cites a formidable array of authorities in support of his contention, and it may be that such contention is supported by the weight of authority, but it is needless to review such authorities, because this court is already on record in support of the rule to the contrary. The case of Grieme v. Robkes, 45 S. D. 480, 188 N. W. 745, decided by this court in August, 1922, is directly in point. The note involved in that case and the mortgage given to secure the same were both executed and delivered at Galva in the state of Iowa. At the time of the execution of the mortgage, the property described therein was located in Brookings county in this state. The mortgage constituted a good and valid chattel mortgage under the laws of the state of Iowa, but it did not contain the receipt by the mortgagor for a copy of the mortgage as required by the provisions of sections 1578, 1579, Code of 1919, and would therefore have been void had it been executed in South Dakota. But this court held that the mortgage being good at the place where it was executed constituted a valid lien as between the parties in this state. This case was followed by the Supreme Court of Iowa in Kusser v. Sioux City Horse & Mule Co., 199 Iowa, 200, 200 N. W. 404.

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Related

Kusser v. Sioux City Horse & Mule Co.
200 N.W. 400 (Supreme Court of Iowa, 1924)
Grieme v. Robkes
188 N.W. 745 (South Dakota Supreme Court, 1922)

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Bluebook (online)
244 N.W. 98, 60 S.D. 158, 1932 S.D. LEXIS 30, Counsel Stack Legal Research, https://law.counselstack.com/opinion/holt-v-mahoney-sd-1932.