Alabama Machinery & Supply Co. v. Bank of Camden

WALKER, P. J. The appellant, the plaintiff below, sold and delivered the property sued for in this case to T. J. Jones & Go. The written contract of sale and the notes executed by the purchasers for the unpaid part of the purchase price recited that the title to the property should remain in the appellant until all the purchase-money notes were paid. Before the contract of sale or the notes were filed for record, a mortgage of the same property by Jones & Co. to the appellee, was duly recorded, and the appellee acquired possession of the property under that mortgage. The appellee’s claim to the property must prevail, unless at or before the time the mortgage was taken it was charged with notice of the appellant’s title. The evidence bearing upon the question of notice consisted of the testimony of T. J. Jones, examined as a witness for the plaintiff, and W. J. Bonner, a witness for the defendant. The testimony of the witness Jones, so far as it relates to this question, was as follows: “I told the bank before this mortgage was executed that I had no right to mortgage the property, as it had not been paid for. I told the bank this before I gave the bank the mortgage. I told the bank the purchase-money notes for this property were not paid. This was before mortgage to the bank was given. The said mortgage was given to the bank after this firm had overdrawn their account; that they were drawing on the bank right along before and after the same was given. * * * I told them (the bank) there-were some outstanding notes that were unpaid. I am certain that- I told Mr. W. J. Bonner that I had no right to mortgage this property, for I told him that I had not paid for it, and [464] that there were some outstanding notes on this property. I told him there were some notes given, for this planer and matcher to plaintiff that were outstanding. I did not say the notes retained title. When I signed the notes and contract in S'elma to plaintiff I did not read them, and did not know what they contained.” The witness Bonner testified as follows': “T. J. Jones did not tell me the title was outstanding. He did not tell me there was a retention of title to the planer and matcher. I knew there was outstanding debt on the property. I knew T. J. Jones & Co. had purchased the planer and matcher, and that it was unpaid for, as the two payments made on said machinery were made by checks on Bank of Camden, and were paid by the bank. I don’t remember whether T. J. Jones told me when the mortgage was executed that the notes to plaintiff were unpaid; but he told me before. * * * T. J. Jones said nothing to me about purchase-money lien on said property. * * My best recollection is that T. J. Jones did not tell me that he had no right to mortgage this property. He had told me before, and I knew before the said mortgage to Bank of Camden was made, that there was a balance due plaintiff by T. J. Jones & Co. on this property; but I did not know there were any purchase-money lien notes on this property. I did not know there was any retention of title note. T. J. Jones didmot say anything to me about purchase-money lien on said property.” This evidence falls short of tending to show that the appellee had notice of the appellant’s title, or was chargeable with such notice by any fact brought to its attention. The testimony -does not go farther than to show that the bank was fully informed that the property mortgaged to it had not been fully paid for. That property having thus been sold and delivered to the [465] mortgagors, the law gave the sellers no lien upon or title to it, and such lien or title could only exist by contract. Nothing that was said suggested the existence of any such contract. The statements or the witness Jones: “I told the bank before this mortgage was executed that I had no right to mortgage this property, as it had not been paid for. * * * I told Mr. W. J. Bonner that I had no right to mortgage this property, for I told him that I had not paid for it, and that there were some outstanding notes on this property” — suggested the impropriety, from the standpoint of morals, of mortgaging to a third person property not paid for; but there was no intimation of the existence of a contract securing to the seller any right or title to the property. “The particular facts, in order to authorize the inference of actual notice, or to constitute a failure to inquire, a substitute for actual notice, must at least suggest the probability of an adverse interest or right —must be of such kind and amount as would excite in the mind of a prudent man a reasonable apprehension of the existence of some antagonistic incumbrance or claim.”—Simpson & Hall v. Hinson, 88 Ala. 527, 7 South. 264. In the case at bar nothing was said hinting that any antagonistic incumbrance or claim existed. There is no rule of law making information of the existence of a personal liability for the purchase price of property constructive notice of a secret unrecorded contract reserving title to it.—Bell v. Tyson, 74 Ala. 353; Wilkinson v. Setter, 69 Ala. 435. As there was no evidence in the case warranting a finding by the jury that the defendant had actual or constructive notice of the plaintiff’s title to the property sued for, the general affirmative charge in favor of the defendant might have been given. This being true, the appellant could not have been prejudiced by [466] the refusal of the court to give the charges requested by' it, or by the giving of charge 2 requested by the defendant. There being no evidence to sutain plaintiff’s special replication to the fifth plea, it was not error to give charge 1 requested by the defendant. If it was error to give the written charge 3 requested by the defendant, for the reason-that the evidence was such as merely to warrant the jury in inferring that W. J. Bonner was an officer of the bank, and was not such as to justify the court in assuming that fact to be proved, yet the error was without injury to the plaintiff, as it could not maintain its claim to the property sued for without proof of notice, actual or constructive, to the bank, when the mortgage was taken, of plaintiff’s title to the mortgaged property, and there was no such evidence. Affirmed.