Faisst v. Waldo

ft 9 i. as to Fpraymeite? Cockrill, C. J. If the true state of the case, as the preponderence of the evidence indicates, is that the property in dispute belonged to the plaintiffs, and that they delivered it to the defendant, with a reservation of title in themselves, under an agreement that he was to become the owner when he had hauled enough logs to the plaintiff’s saw-mill, at a stated rate per thousand feet, to pay the agreed purchase price of the property, together with any debt the defendant might incur for supplies furnished or advances made to him by the plaintiffs to enable him to carry out his contract to sup-iffy the logs, then the title would not vest in the defendant until he paid the full amount of the account he incurred in pursuance of the contract, as well as the purchase price of the property. To reach that conclusion, it is not necessary to hold that a vendor of chattels, who makes delivery to his vendee, can reserve the title in himself as security for a debt to be paid after the obligation for the purchase money has been discharged. The Supreme Court of Connecticut seems to hold that a contract to that effect constitutes a valid conditional sale, and not an equitable mortgage. New Haven Wire Co. Cases, 57 Conn. 352, 386, 389. If the contract in this case is found to be as in the hypothesis stated, then the intention of the parties will be carried into effect by appropriating- the earnings of the defendant to the extinguishment of the supply account, before applying them to the payment of the purchase price of the property. The g'eneral rule is that where neither debtor nor creditor makes an appropriation at the time of payment, the law applies it to the liabilities of earliest date. The reason is because that course is presumed to conform to the intention of the creditor. Kline v. Ragland, 47 Ark. 119. If there is any particular reason for a different appropriation, the rule does not apply. Thus, where cotton covered by a mortgage is delivered to the mortgagee, with authority to sell and retain the proceeds, the law appropriates the payment to the discharge of the mortgag'e debt, because the parties have impliedly agreed in advance how the proceeds shall be disposed of. Greer v. Turner, 47 Ark. 17; Fort v. Black, 50 id. 257. Whenever the relation of the parties or the nature of the account or transaction between them shows that an appropriation of payments to the earliest items of the account would do injustice between them or fail to conform to their understanding or agreement, another application is made. Upham v. Lefavour, 11 Met. (Mass.), 174; Price v. Dowdy, 34 Ark. 285. If it be true in this case, as the appellee contends and the appellants seem to concede, that the latter, as vendors, could not reserve the title in themselves as security for any debt except that for the purchase price, then the agreement of the parties that the title should not pass to the appellee until payment of his account, as well as the purchase price, could not have the effect the parties intended, unless the earnings of the defendant were first appropriated to the extinguishment of the account. If that appropriation would conform to the intent entertained by the parties when they entered into the contract, and no other appropriation would, the presumption is they intended the appropriation to 'be made in that way, and the law makes it accordingly. Johnson's Appeal, 37 Pa. St. 268. Upon that theory, the plaintiffs’ evidence, if believed by the jury, would have established title to the property in them. In order to prove the right of property, it was not necessary for them to go further and show that the purchase price had not been paid. Having shown the existence of the indebtedness, the burden was cast upon the defendant to prove that the debt had been paid or otherwise discharged. 2 Wharton, Ev. sec. 1284; Lawson’s Presumptive Ev. 163; Farr v. Payne, 40 Vt. 615; Jackson v. Irvin, 2 Camp. (Eng. N. P.), 50; Bell v. Young, 1 Grant’s Cas. 175. The payment was a condition, according to the plaintiffs’ version of the transaction, to be performed by the defendant before the title vested in him. But where a party is under obligation to perform an act as a condition precedent to the vesting of a right, the burden is upon him to show performance before he can assert the right. The court charged the jury in this case that the burden was on the plaintiffs to show that the defendant was indebted to them for the purchase price of the property, and that they could not recover in the absence of such proof. That was error. % As to forfeiture of conditional sale. It is not enough, however, in replevin for the plaintiff to show that he has the right of property — he must prove the right of possession. Upon plaintiff’s own showing in this case, the defendant came lawfully to the possession of the property in suit, under his contract with them. The burden was upon them, therefore, to show that his right to possession had ceased. They met their obligation in that behalf by testifying' that their contract with the defendant required him to use the property only under the rules and regulations of the mill, for the purpose of carrying' out the contract to supply logs to the mill; and that the defendant had ceased to carry on the work before suit, and was attempting- to sell the property for the purpose of removing it to another saw-mill. If that was true, it showed a forfeiture of the defendant’s rig'ht of possession, and warranted the plaintiff’s action. McRea v. Merrifield, 48 Ark. 166. The attitude of the plaintiffs, after they had adduced evidence to show the condition upon which the sale was made, the defendant’s promise to pay, and his violation of the contract by abandoning the work, was analogous to that of a mortgagee who, in a suit against the mortgagor for possession, rests upon the evidence afforded by the introduction of his mortgage, without producing or accounting for the notes or proving that they have been paid. In that case the mortgage is said to be evidence both of title and indebtedness, and both are presumed to continue to exist until the mortgagor shows that there is no debt, and therefore no title ; if that is not shown, the right of the mortgagee to possession is established. 1 Jones on Mort. sec. 71; Smith v. Johns, 3 Gray, 517; Powers v. Patten, 71 Me. 583. Nor the error indicated, the judgment must be reversed, and the cause remanded for a new trial. It is so ■ordered.