Loveland v. Cooley

Canty, J. 1. On January 5, 1894, plaintiff had a verdict. February 24th a motion for a new trial was made by defendant on the judge’s minutes, and denied on March 6th. On March 12th he appealed to this court from the order denying the motion, and filed a supersedeas appeal bond. Thereafter, on March 24th, on motion made on notice, an order was made extending defendant’s time to serve a proposed case, and settle a case. Pursuant to this, defendant served a proposed case, which was returned by plaintiff. Plaintiff proposed no amendments, and on April 14, 1894, on proper notice, the court settled the case. [264] ■ The respondent, on the authority of Van Brunt & W. Mfg. Co. v. Kinney, 51 Minn. 337, (53 N. W. 643,) moved this court to ’Strike'the settled case out of the return. In that case, after the time to settle-a case had expired’, the appellant served a proposed case, when he had no right or authority to do so. No order was made extending his time, or giving him leave to serve it. The respondent returned it, as he had a right to do, but the court settled the case. This court struck it out .for the reason that respondent had no opportunity to serve proposed amendments to a proposed case, which he was obliged to recognize, or appellant had a right to serve. This is not such a case. Here the appellant obtained a right to serve his proposed case before he served it. The court below had jurisdiction to settle the case after an. appeal from the order had been taken to this court even though a supersedeas bond had been given on the appeal. See Pratt v. Pioneer Press Co., 32 Minn. 217, (18 N. W. 836, and 20 N. W. 87.) 2. This is an action, of replevin, between the holders of different chattel mortgages on the same property. In November, 1888, plaintiff loaned one Mayo $1,000, and took from him his note for the amount, secured by a chattel mortgage. On August 8, 1890, she loaned Mayo $60 additional, and this, with the principal and interest then due on said nóte,’ amounted to $1,200, for which he gave her new notes, secured by a new chattel mortgage. On August 6, 1892, lie gave her new- notes for $1,200 for this same indebtedness, secured by a new chattel mortgage. She has always retained all of the notes, and has never made any written satisfaction of any of thése mortgages. In April, 1891, between the making of said second and third chattel mortgages, Mayo, being indebted to the defendant in the sum of $200, gave defendant his note therefor, secured by a chattel mortgage on the three horses, wagon, and harness, for the recovery of which this action is brought. The three mortgages to plaintiff covered this same property, and also some other stock and property. All of these chattel mortgages were properly filed of record immediately after their execution. : The defendant’s mortgage is prior to the third mortgage of plaintiff, and defendant contends that the giving to plaintiff of her third mortgage, and notes secured by it, was a payment and satisfaction [265] of the first two .mortgages given to plaintiff, and that, therefore, defendant’s mortgage is the first lien. Plaintiff contends that this third mortgage is a mere renewal of her first and second, and not intended as a payment of her first or second, which she claims are still in force, and prior to defendant’s mortgage. The filing of plaintiff’s first mortgage having, under the statute, ceased to be constructive notice when defendant took his mortgage, the court left it to the jury to determine whether or not plaintiff’s third mortgage was by her and Mayo intended as a payment of her second mortgage. The jury found for plaintiff. We cannot agree with appellant that the evidence does not sustain the verdict. On the trial, plaintiff called Mayo as a witness, and on cross-examination he testified that in April, 1893, he paid $450 on plaintiff’s note; that, with her permission, he sold some of the property covered by her mortgages, and paid her this $450 out of the proceeds, but stated that he did not say that $450 was all of the proceeds, but that was what he paid her. He was then asked if he sold other stock, the proceeds of which he did not turn over to her. The objection that this was incompetent and irrelevant and immaterial was sustained, and this is' assigned as error. Defendant introduced evidence tending to prove that plaintiff had actual knowledge of defendant’s mortgage at and since the time it was made. Defendant then offered evidence to prove what stock covered by plaintiff’s mortgage Mayo sold. The same objection was made and sustained. Defendant’s counsel then stated, in substance, that his object was to prove that, of the property covered by her first two mortgages, and not covered by his, she had sold sufficient to satisfy her debt, after knowing of his mortgage. The court ruled this-evidence incompetent, and this is assigned as error. Plaintiff was then recalled for cross-examination, and stated that she did not give Mayo permission to sell and dispose of this property as he pleased, — only as he counseled with her. She was also asked how much he disposed of, to her knowledge, and the same objection was sustained, and this is assigned as error. We are of the opinion that all of these assignments of error are well taken. “A senior mortgagee, having actual notice of a junior mortgage of the same property, cannot release that portion of the property not covered by his mortgage, so as to throw the whole burden of his mortgage upon [266] the property covered by the junior mortgage; and, if he does, the value of the part of the property so released will be deducted from the amount due upon the senior mortgage, before this can be charged upon the property covered by the junior mortgage.” Jones, Chat. Mortg. § 493. See, also, Jones, Mortg. §§ 722, 723. The trial court, in his memoranda to the order denying the motion for a new trial, states that this proposition of law does not apply; that the holder of the first mortgage cannot be compelled to account to the holder of the second mortgage for the property thus released unless there was a showing of prejudice to the second mortgagee by reason thereof. However this may be, it does not excuse the errors complained of. The defendant was at least entitled to ascertain the amount of the property so released, and the identity of the same, as one step in the process of proving that he was prejudiced. 3. One of the grand jurors of a prior term of the court was called by defendant as a witness, and was asked what plaintiff stated before the grand jury, in his presence, as to her mortgage and defendant’s. The objection to the question was properly sustained. The witness was incompetent. 1878 G. S. ch. 107, §§ 40, 41; In re Finney’s Will, 27 Minn. 283, (6 N. W. 791, and 7 N. W. 144.) 4. Plaintiff was asked on cross-examination whether she did not state before the grand jury that, when defendant’s mortgage was given, she consented to its being prior to her mortgage. We are of the opinion that the question was competent, and the witness was not, like the grand juror, incompetent. Neither was the question a mere impeaching one, but called for an answer which might disclose the admission of a fact material in the case. The fact that it might not be possible to contradict her answer, if unfavorable, did not render it incompetent, and it was error to sustain the objection. These are all the points raised, worthy of consideration, and the order appealed from is reversed, and a new trial granted. Gimtllan, C. J., absent on account of sickness; took no part, (Opinion published 61 N. W. 138.)