Hibbard, Spencer, Bartlett & Co. v. Cribb

WiNsnow, J.

I dissent from the decision of the majority of the court in this case because it seems to me that such decision is a • radical departure from well-established legal principles.

The first mortgage was for $3,500, which was made up of two separate valid claims, viz., .a firm debt of $1,300, and a debt of one of the partners individually of $2,200. The mortgage has been held void as to the $2,200 claim at the suit of attacking firm creditors. Plaintiff has never attacked the first mortgage, but has always claimed under its second mortgage.

Now it is manifest that the first mortgage was only void as to creditors of the firm who attacked ;it by legal proceedings. It was perfectly valid as between the parties. It transferred the title to the goods; consequently the mortgagor retained no title adverse to the first mortgage, nor *407could be grant that wbicb he did not have. Eetaining no title, he c'ould convey no title; hence the appellant, under his grant, got no title save the bare equity of redemption after the §3,500 was paid. He is not a Iona fide purchaser for value; he is not an attacking creditor; he is simply the mortgagee of an equity of redemption, which equity, as to him, is subject to the payment of $3,500. In my judgment, the firm creditors who have attacked the first mortgage, and as to whom only a part of it is void, should be adjudged entitled to the funds in court arising from the sale of the mortgaged property up to $3,500, after which the appellant’s right would attach. I have not attempted to cite authorities in this opinion; they will be found in the briefs of counsel, and I believe they fully sustain the positions here taken.

OetoN, J., took no part.

A motion for a rehearing was denied November 17,1891.