Zorn v. Livesley , 44 Or. 501 ( 1904 )

Mr. Justice Bean,

after stating the facts in the foregoing terms, delivered the opinion of the court.

There was no error in sustaining the motion to strike out parts of the defendants’ first separate answer, and in sustaining the demurrer to the third. The motion was directed to an allegation that defendants had no knowledge or notice of plaintiffs’ mortgage at the time they bought the hops, except the constructive notice which the record imputed to them, and a conclusion of law that, by reason of certain facts pleaded, the plaintiffs “waived and surrendered their alleged claim of the mortgage lien upon the said hops.”

1. The mortgage was of record, and the record conclusively imputed notice to the defendants of its contents, and of plaintiffs’ rights thereunder. It was therefore no defense that at the time they purchased the hops they did not have actual notice of the mortgage.

2. If the plaintiffs had, by their acts or conduct, waived their rights under the mortgage, the waiver came from the facts pleaded, and not from the conclusion drawn by the pleader therefrom. It is alleged that plaintiffs delivered possession of the hops to Sing Boo, and authorized him to sell them to the defendants free and discharged from the mortgage lien, and to receive the purchase price thereof. This, if true, constituted a complete defense, and there could be no injury to the defendants in striking out the averment that they thereby waived and surrendered their lien as against the defendants. Nor were defendants denied the right to give any competent evidence on the trial they might have, supporting the defense.

3. The third defense was substantially the same as the second, and was not sufficient to constitute an estoppel. The plaintiffs were not obliged, in order to preserve their lien, to take immediate possession of the hops after they had been harvested and baled, although they had the right to do so under the mortgage. If they allowed the hops to remain in the possession of the mortgagor, it would not evidence an intention to release their lien. The mortgage was of record, and they could safely rely upon the notice conveyed by the record.

4. In order to estop the plaintiffs by any act of Sing Boo, unless he was their agent for the sale of the hops, they must have had knowledge of his purpose and intention, and the defendants must have relied thereon in ignorance of the truth. i; Before it can be claimed,” said Mr. Justice Thayer in Page v. Smith, 13 Or. 410 (10 Pac. 833), “that a party shall not be permitted to falsify his own declaration, act, or omission, it must be shown that he thereby intentionally and deliberately led the other party to believe a particular thing true, and to act upon such belief. And his answer to a pleading in a case must show that such was the fact.” The defendants’ answer falls far short of this requirement. There is no averment that the plaiutiffs, by their acts or conduct, intentionally and deliberately led the defendants to believe that the hops belonged to Sing Boo, or that, relying thereon, the defendants were misled and deceived. The allegation is that the plaintiffs allowed the hops to remain in the possession of Sing Boo with authority and permission to sell and dispose of them free from the lien of the mortgage, thus setting up in substance the same defense as the one already pleaded.

5. The new matter alleged in the reply is not a departure from the cause of action set up in the complaint. There is some uncertainty in the complaint as to whether the note, for the security of which the chattel mortgage was given by Sing Boo to the plaintiffs, was intended to include the money already received by him from the plaintiffs and future advances, or whether such money and advances were to be in addition to the note, and a defense is sought to he made on this ground. The reply, in answer to this defense, and in support of the complaint, sets out the same matter more in detail. It is not repugnant to, nor an abandonment of, the cause of action set up in the complaint. It was merely designed to affirm the averments of the complaint and make them more certain, and was but a new assignment of the cause of action alleged, and therefore not a departure : Mayes v. Stephens, 38 Or. 512 (63 Pac. 760, 64 Pac. 319); Crown Cycle Co. v. Brown, 39 Or. 285 (64 Pac. 451); Kiernan v. Kratz, 42 Or. 474 (69 Pac. 1027, 70 Pac. 506).

6. No error was committed in sustaining the objection to the question propounded to the witness Becker in referring to his possession and knowledge of the shipping receipt issued by the steamboat company to Sing Boo. He was not the agent of the plaintiffs for the purpose of selling and shipping the hops, or doing anything with them, unless it was to haul them to the plaintiffs’ warehouse. All the evidence shows is that the plaintiffs authorized and requested him to haul the hops to the warehouse ; but that would not make him their agent for the purpose of shipping them and taking a shipping receipt therefor, or charge the plaintiffs with his knowledge in reference thereto.

7. Nor was there any evidence upon which to submit to the jury the question of Sing Boo’s authority to sell the hops. The plaintiff Hoefer testified that he never gave Sing Boo or’ any other person any authority to sell the hops, and this evidence stands uncontradicted. There is no doubt that the sale of a chattel by the mortgagor with the consent of the mortgagee, and with the intent on his part to relinquish the lien, would convey a good title to the purchaser, free from the lien : 2 Cobbey, Chattel Mort. § 637. But there is no evidence to bring this case within the rule. The order to Becker was nothing more than the consent of the plaintiffs that the hops might be removed to their warehouse, and there stored until sold with their knowledge. They were not to be removed from the warehouse without their consent. There is no evidence of any intent on the part of the plaintiffs to allow the hops to get beyond their control, or to permit the sale thereof; and, without some such evidence, there -was nothing for the jury.

It is argued that, because the hops were in the possession of Sing Boo after they had been hauled by Becker to the river, there is a presumption that the mortgage had been paid; but, if so, it was overcome by the testimony, which shows that Sing Boo got possession of the hops from plaintiffs’ warehouse and shipped them without plaintiffs’ knowledge or consent.

It is also argued that it wras not shown by the plaintiffs that the note and mortgage executed by Sing Boo to them had not been paid and settled in full. Conceding that this was an issue in the case, and that the burden was upon plaintiffs, there was sufficient prima facie evidence of that fact. The note and mortgage were produced by the plaintiffs, their execution proven, and they were admitted in evidence. In addition, the bill of particulars which was furnished the defendants, and which shows in detail all the transactions between the plaintiffs and Sing Boo, was also admitted without objection. It purports to show an itemized statement of all the money paid and advanced by the plaintiffs, and all credits and payments made by Sing Boo, and it does not appear that special attention was called to the alleged defect in the evidence upon the question of the nonpayment of the note and mortgage.

The judgment of the court below will therefore be affirmed. Affirmed.