H. T. Simon-Gregory Dry Goods Co. v. McMahan

Biggs, J. —On the sixteenth day of February, 1894, the defendant McMahan mortgaged and delivered to Earle, the interpleader herein, a chattel mortgage on a stock of goods to secure various alleged creditors, whose debts, as stated in the mortgage, amounted to about $3,800. The mortgage was filed for record on the same day, and the possession of the goods turned over to Earle. The mortgage provided that he should sell the goods for the purpose of satisfying the alleged claims. Three days after the execution of the mortgage the plaintiff attached the goods as the property of McMahan, and they were taken from the possession • of Earle. On the twenty-first of April the interplea herein was filed by Earle, in which ■ he claimed the property under the chattel mortgage. In answer to the interplea the plaintiff admitted the execution of the mortgage and the possession of — 504 — the property by Earle, but averred that at the time the mortgage was executed McMahan was largely indebted, and in fact insolvent; that the mortgage was not given in good faith; that the debts therein mentioned were not justly due, and that the mortgage was devised and concocted by McMahan, Earle and the alleged beneficiaries, for the purpose of covering up and concealing the property of McMahan, so as to defeat his bona fide creditors. The interpleader filed a replication putting in issue the affirmative matter in the answer, and upon the pleadings thus framed the rights of property under the interplea were tried. Under the instructions of the court the jury found the issues for the plaintiff and judgment was entered accordingly, and the interpleader, having unsuccessfully moved for a new trial, has brought the case here for review. The interpleader moved the circuit court to make an order directing the coroner of the county to summon a jury for the trial of the cause. The motion was supported by the affidavit of the interpleader, in which it was stated that the sheriff of the county was prejudiced against the affiant, and also that he was an interested party. The circuit court declined to make the order, and this constitutes the first matter of exception. It was held in the case of State v. Leabo, 89 Mo. 247, that the trial court is not conclusively bound by the mere affidavit of a litigant that the sheriff is prejudiced against him. The other ground of the motion is equally untenable. While the sheriff may be bound by the result of the litigation and may be subjected to an action for damages as for an illegal levy, yet he is fully protected by the conditions of the attachment bond (R. $., sec. 527) which in legal contemplation makes him entirely disinterested. — 505 — On motion of the plaintiff all witnesses were •excluded from the court room during the progress of the trial. The interpleader moved that the beneficiaries named in the mortgage, who had been subpoenaed as witnesses, should be relieved from the operation of the rule. This the court declined to do, and the inter-pleader excepted and still excepts. The request of the interpleader should have been granted and the action of the court in refusing it was •error. Any person who is pecuniarily interested in the trial of a cause, whether he is a party of record or not, has the constitutional right to be present when the cause is being heard. The importance of this is manifest to all who have had the least experience in the trial of causes. 1 Thompson on Trials, section 279; Chester v. Bower, 55 Cal. 46; Ryan v. Couch, 66 Ala. 244. It is true that some discretion must be accorded to trial courts in reference to this and kindred matters •of practice, but the discretion is judicial and is subject to review, and it will be good ground for reversal where it appears to have been unsoundly exercised. Now, in the present case the validity of the debts of the beneficiaries and their good faith in accepting the mortgage were the real matters of controversy. It was thereafter all important that they should have been present during the progress of the trial for the purpose of directing their counsel. The interpleader was a trustee only, and presumably he knew nothing of the origin or bona fides of the debts or of the part taken by the beneficiaries in the procurement of the mortgage. In the third assignment of error the interpleader claims that the circuit court erroneously permitted the plaintiff to impeach its own witness. The witness was one of the beneficiaries in the mortgage. It seems that hlis deposition had been taken in the attachment suit, and plaintiff’s counsel asked him if he did not testify — 506 — to certain matters at that time. Some he admitted, and others he denied. Afterwards plaintiff introduced two witnesses, who were present at the time the deposition was taken, to prove what the witness had said concerning the same matters. The defendant objected on the ground that the testimony was in the nature of impeachingevidence, and upon the further ground that the deposition itself was the best evidence. The court overruled the objections, and admitted the testimony. The testimony was not offered by way of impeachment, but as proof of admissions of an interested party. We think, however, that the objections should have been sustained on the other ground. The deposition was the best evidence of what the witness said, and presumably contained-all he did say. The recollection of the witnesses who were present, and heard the testimony given, is not so trustworthy. They may have misunderstood the witness, or his admissions may have been accompanied, with explanations which they had forgotten or had not fully comprehended. In every judicial inquiry the all important aim should be to arrive at the exact truth, and therefore the best and most reliable evidence which is in the possession of the parties, or accessible to the court, should be produced to establish every material fact. The circuit court against the objections of the interpleader permitted the plaintiff to read a letter, which purported to have been written by the defendant in the attachment anterior to the mortgage and the delivery of the goods to the interpleader. This letter contained statements derogatory to the good faith of the mortgage and the genuineness of the debts therein mentioned, and was therefore clearly incompetent, unless there was some independent evidence of a conspiracy to defraud the other creditors of the defendant. Williams v. Casebeer, 53 Mo. App. 644. Whether there — 507 — was such, evidence or not we can not say, as neither party has seen proper to set out in his abstract the evidence at any length, and we are not disposed to go through a voluminous transcript for the purpose of verifying the statement. The plaintiff introduced evidence tending to prove that the defendant in the attachment did not owe anything to his father, who is mentioned in the mortgage as a creditor; that the debt of another beneficiary was stated to be $600, whereas it was only $300, and that the debts of two others were already secured by a mortgage on real estate. The court, at the instance of the plaintiff, instructed the jury that, if any of said debts were found to be fraudulent, this would vitiate the mortgage as to all. This is the well settled rule in this state. Boland v. Ross, 120 Mo. 208; State ex rel. v. Hope, 102 Mo. 410. However, the instructions of the court ignored the interpleader’s explanation of the overstatement of the debt for $300, which was to the effect that the creditor had been clerking for the defendant and there were unsettled matters of account between them, and that at the time the mortgage was prepared they did not know, and had no ready means of ascertaining, the true balance. If this was the only reason for the overstatement of the debt, we do not think it was sufficient of itself to vitiate the mortgage. In Boland v. Ross, supra, the supreme court held that, if the amount stated in the mortgage was inserted by mistake, this would not affect the security. The court further instructed the jury at the instance of the plaintiff that, if the books of account which were included in the mortgage were left in the hands of McMahan until after the levy of the writ of attachment, the issues should be found for the plaintiff. Without admitting that the instruction announced a correct proposition of law, it suffices to say that there was no — 508 — evidence to authorize the court to give it. This alone is sufficient to condemn it. In another instruction, given at the instance of the plaintiff, the jury were told that the conveyance of property by a debtor to his near relatives “'was a badge of fraud.” This was clearly error. Such a fact may be considered by the jury in determining the character of the conveyance, but it is questionable whether even an instruction, which directly authorized the jury to consider it as an independent fact, would not be objectionable as a comment on the evidence. The interpleader complains that the circuit court committed error in' permitting counsel for plaintiff to open and close the argument to the jury. This action of the court was proper, for the reason that the burden of proof was on the plaintiff. The latter’ admitted the execution of the mortgage and that it had been recorded, and that possession of the goods had been delivered to the interpleader, and that he was in possession at the time the attachment writ was served. This made a prima facie case for the' interpleader, and placed the burden of the entire issue on the plaintiff. But for the reasons last stated the circuit court did commit error in refusing to instruct the jury, as the inter-pleader requested, that the onus was on the plaintiff. For the reasons above mentioned the judgment of .the circuit court will be reversed and the cause remanded. All the judges concur.