Walters v. Slimmer

FITZHENRY, District Judge (after stating the facts as above). [1] The evidence offered, but excluded, of which the defendants complain of being denied the benefit, referred to the financial irresponsibility of Jahn and numerous real estate transactions in which the mortgagor had been engaged through a number of prior years, and previous dealings between the plaintiffs and Jahn. The financial ability or irresponsibility of a mortgagor, where it is clear the mortgagees relied upon the mortgage security, was clearly immaterial and the production of this testimony was an effort to bring to the attention of the jury incompetent evidence. The dealings between Jahn and the plaintiffs, which the excluded testimony disclosed, covered two previous transactions where Jahn had purchased cattle from the plaintiffs, giving a mortgage in each case to secure the purchase price, and in which he had upon each occasion later shipped the mortgaged property to the defendants. They sold it, settlements were made with Jahn, who, in turn, paid the amount of the first mortgage in full and made a partial payment on the second. The first of these transactions was in April, 1913; the second one took place in July, 1914, 14 months before the transaction in question. Jahn claimed that he sold the mortgaged property in all three instances through ignorance, and no attempt was made to show that the defendants had any knowledge whatever, at the time of the sale in September, 1915, of any previous course of dealings or individual transactions between Jahn and the plaintiffs that would operate as a waiver of plaintiffs’ rights as mortgagees or that would estop them from asserting any legal right which they possessed. The previous conduct of the mortgagor in selling the property and applying the proceeds to the payment of the mortgage debt could avail a third person nothing, where the mortgagor sold the property without the consent of the mortgagee and failed to apply the [438] proceeds of the sale to the mortgage debt, and this is especially true where the third person was not aware of any previous conduct on tire part of the mortgagor at the time the rights of the third person intervened. 11 Corpus Juris, p. 636, § 349. The second assignment relied upon is without merit here, for the reason that at the time of the taking of the depositions in this case, counsel for plaintiffs had stated at the conclusion of the examination o.f several witnesses: “We have other witnesses outside who can testify to the loading of the cattle, etc.” Whereupon counsel for defendants said: “Their testimony will not be necessary.” The District Court certainly was warranted in accepting the stipulation as a waiver of identification. [2] The contention that the defendants had no constructive notice of the chattel mortgage covering the shipment of cattle from Gladbrook, Iowa, for the'reason that the mortgage covering the shipment was not executed, acknowledged, and recorded in conformity with the laws of the state of Iowa, for want of the notary’s certificate of authority, is raised for the first time in this court. The technical sufficiency of the chattel mortgages was not questioned upon the trial. Just before the conclusion of the evidence, defendants offered to prove that they had no actual knowledge of the making, acknowledgment, or recording of the chattel mortgages mentioned in plaintiffs’ declaration, which fact was readily admitted, whereupon the court stated to counsel for defendants that, unless some other reason were shown, a directed verdict for the plaintiffs would be ordered. If the defendants wished to avail themselves of the defense of a lack of constructive notice for the reason assigned, the court certainly gave them an opportunity to offer it and have it considered, but no offer nor suggestion of this character of defense was made. An objection to the acknowledgment of an instrument must be raised in the trial court, and is not available for the first time upon appeal or error. 1 Corpus Juris, p. 771, § 48. [3] No question being made upon the validity of the Iowa mortgage, it comes clearly within the rule of comity, and was a lien upon the chattels it covered when they were brought into the state of Illinois. Hoyt v. Zibell, 259 Fed. 187, 170 C. C. A. 254; Shapard et al. v. Hynes et al., 104 Fed. 449, 45 C. C. A. 271, 52 L. R. A. 675. In the view we take of the first, second, and third assignments, the court properly directed a verdict and entered judgment thereon. The denial of the nrotion for a new trial was a matter purely in the ■ discretion of the trial court, which is not subject to review. Judgment affirmed.