Walker v. Vaughn

McCurdy, J. The first question arising on the record nat- urally is, what was the effect of the. mortgage given by Williams to Walker taken by itself. It is said by the respondents that this was absolutely void, as Williams was not at the time of the giving of the mortgage the owner of the property purporting to be conveyed. Upon this point, whether there can be a valid mortgage of personal property to be acquired in futuro, many authorities have been cited, and the decisions seem not to be uniform. It is hardly necessary to examine them particularly, as there has been a late decision of this court which must be considered as establishing the law here. In the case of Rowan v. Sharps’ Rifle Manufacturing Co., 29 Conn., 283, it was held, “ where a mortgage of a factory and its equipments embraced in its terms such machinery and stock as should be afterwards purchased and placed upon the premises, and the mortgagee had afterwards taken possession of the factory with such subsequently acquired property, that whatever effect was to be given to the provision in itself, it became operative upon possession being taken by the mortgagee.” In the present case, as in the one cited, possession of the property was taken by the mortgagee; and his title would [584] have been complete had no other transaction intervened to affect it. But before his title had been so completed or possession could have been taken by him, viz., on the 7th of October, Smith, Daniels & Co., who at this time were the owners of the property, in pursuance of their previous agreement perfected the sale to Williams and delivered to him the articles. Williams in part payment gave them his note and secured it by a mortgage of a portion of the property. It is found that this mortgage was given the same day and soon after the sale. The petitioner thereupon claims that there was an interval between them, and so that his mortgage becomes the first. It seems to us otherwise. The original agreement was upon the condition that the note to be given should be secured by a mortgage. The understanding of the parties evidently was that the three acts, the sale, the giving the note, and securing it by mortgage, should be continuous and one transaction. They were substantially one. There is always some space between the execution of two instruments. The mortgage from Williams to Smith, Daniels & Co. took effect as soon as Williams had power to make a complete conveyance to any one, and must take priority over the mortgage to the petitioner. But the petitioner insists that Smith, Daniels & Co. are estopped from setting up their title, for the reason that on the 5th of October Smith stated to him in reply to a question that the property was sold; and Smith was informed that a mortgage was about to be placed upon it, and a schedule was being taken for the purpose. The reply to this is to be found in the language of the court, that “ the petitioner did not inform him for what purpose he inquired, neither did Smith know the object of the inquiry, but honestly believing that the agreement that the firm had entered into with Williams would be carried out, replied as aforesaid.” There have been so many decisions in this state on the subject of estoppels, and the principles are so well understood, that it is not necessary to quote authorities. The elements of estoppel do not exist in this case. The conversation was loose and casual, an agreement for the sale had in .fact been [585] made. No representations were made which were intended or calculated to influence or mislead the petitioner. It does not appear that his course was affected by the answer. With respect to the remark that there was about to be a mortgage, it is not found that this was heard by Smith ; but the inference from the finding, in its allusion to the noise of the machinery, is that he did not hear it. An estoppel is not to be favored which in the particular case is calculated to do injustice. It is further argued that Smith, Daniels & Co., upon learning at the clerk’s office of the mortgage to the petitioner, should have rescinded their contract of sale. There was no occasion for them to do this, and they would have had no object in doing it, as according to our view their mortgage was first and their title paramount in relation to the articles secured to them. The prayer of the petitioner should be granted, he taking subject to the mortgage of Smith, Daniels & Co. In this opinion the other judges concurred.