Norton v. Ladd , 22 Conn. 203 ( 1852 )

Ellswokth, J.

From the motion it appears, that Douglass and Prentice, of Lisbon, on the 9th day of August, 1849, being indebted to the plaintiffs and others, by a mortgage bill of sale of that date, mortgaged to them, to secure their respective debts, certain personal property, giving them therein power, in case of default of payment, to sell, and after deducting charges and expenses, to apply the avails in payment, and if there was not enough to pay in full, all were to be paid,pro rata. Norton, Converse & Co., the respondents, being co-mortgagees, took possession of a certain portion of said property, to wit, forty-five bales of sheetings, and, acting in behalf of all the mortgagees, and under the power of. sale conferred on them by said deed, sold the goods in New York, and in November and December, 1847, received the net proceeds, being $2,095.57. The mortgaged debts, now unpaid, are found to be $2,843.92. The plaintiffs insist, for all concerned, that this sum shall be divided in payment of the debts, pro rata.

It appears further, that these sheetings had been manufactured by Douglass & Prentice, at their mill in Lisbon, from materials furnished by, and belonging to, George W. Tarbox, of New York, and the goods, when manufactured, were to be delivered to him, in the city of Norwich. It was found, that the sheetings were in fact his property, but subject to a lien in favor of Douglass & Prentice, for their work and labor in making them; that, shortly prior to giving said mortgage deed, Douglass & Prentice had attached said sheetings, as the property of said Tarbox and one Hiram Tar-box, to secure debts due from them to Douglass & Prentice ; that these debts, and the lien aforesaid were, by said mortgage deed, as well as the sheetings themselves, conveyed to said morgagees and were a part of their security; that George W. Tarbox, before the bringing of this bill, had released to Douglass & Prentice,- whatever interest he might have in the sheetings, and which was in fact received by the mortgagees, in full payment, in discharge of his said debt to Douglass & Prentice, which debt and suit therefor, as already stated, had become the» property of the mortgagees. It further appears, that the sheriff, when he attached said sheetings, for Douglass & Prentice, as aforesaid, took possession of them, and delivered them to Norton, Converse & Co., as receipters, to hdd until the suits should be ended, and they gave him their bond to be responsible therefor ; but as George W. Tar box had no longer any interest in the sheetings, and the debt was held and owned by the mortgagees, and was, in fact, paid, by their taking, the interest of said Tarbox in payment, the bond was no longer important, and, being in the hands of the plaintiffs, at the time of'the trial before the committee, was produced to. them,' and the plaintiffs’ counsel directed it to be delivered up, as a canceled bond, when the trial was finished..

The above.is a statement of all the material facts found by the committee, upon the truth of which the superior court held and decided, that the defendants should pay over the avails of said sheetings to the creditors, pro rata, including of course the defendants.

In this decree, we see no érror. . The equity and law of the case are most obviously with the plaintiffs. Upon what principle can the defendants withhold the money from the mortgagees ? They had an equal title to the sheetings, when assigned to them, and to the money received from them, when sold. The sale, was made under the mortgage deed, and made by the defendants, as representatives' of the mortgagees, and they can not now be permitted to repudiate.their character, and assume some new’relation to this fund. They can not cease-to be agents and trustees, at their own election and convenience. This would be, to violate the first principles of the law, and to shock every sentiment of justice and honor. No -part of the law is better settled, or more scrupulously enforced, or more frequently recognized in this court, than that an agent shall not deny the title of his principal, or avail himself of his peculiar situation, ,to obtain an advantage over him. We can- not allow the defendants to abuse the confidence reposed in them by their co-mortgagees.

We do not say, that there is no possible case, where an agent may not call in question his principal’s title, or his right to demand of him moneys, which he has received, as his representative ; although such cases are exceedingly rare,— as, where the principal had stolen the property, or where the agent had been compelled to surrender it to its true owner; but nothing of this is true in the present instance.

It was said on the argument, that the defendants are liable to account -for the property to George W. Tarbox, the owner of it, at the time it was mortgaged to the creditors ; but the answer to this is, that said Tarbox has since released to the creditors in the deed, all the right and interest he then had, in satisfaction of the claim they held against him. Nor are the defendants exposed, in any way, on the bond they gave to the sheriff. That suit and debt have become the property of the creditors, now calling for the money, and the defendants have nothing to fear from that suit hereafter. Besides, the bond is virtually canceled, by what took place on the trial before the committee. The grounds of defence are clearly too shallow and unsatisfactory to be seriously urged upon this court, and to allow them the force claimed by the defendants’ counsel, would bring a reproach upon the administration of justice.

It is said again, that the plaintiffs are not entitled to relief, because they have adequate remedy at law, for that each creditor can bring his action of assumpsit, to secure his share of the money in the defendants’ hands. But what is his share ? and how can it be ascertained, once for all, in separate actions at law ? How can the amount of each one’s debt, (for his debt may be contracted,) and his pro rata portion of the fund be decided, so that the defendants themselves can safely pay over to creditors, unless all parties are brought before the court and a final settlement is made ? We should be sorry to be obliged to yield to the defendants’ objection, even on their own account; for then they would be- exposed to some fifty or more suits, when one is sufficient; and after all, the rule of settlement, adopted in one case, might be repudiated in the next.

It is said again, that there is error in the decree, inasmuch as the defendants were clearly entitled to be paid their charges and expenses, out of the fund. They insist, that they have acted in good faith throughout, and are not to be punished by a forfeiture of their expenses and costs. We think the defendants have not so conducted. They have unnecessarily subjected their co-mortgagees to expenses and great delay. Aside from the fact, that error is not predicable of discretion, we entirely approve of the manner in which this question was disposed of below. .

There is no error.

In this opinion, the other judges concurred, except Hen-man, J., who tried the cause in the court below, and was, therefore, disqualified.

Judgment affirmed.