State, State Nat. Bank v. (Okl.). State v. Superior Court for King County 652 (Wash.)

1094 State v. Superior Court of Washington for King County (Wash.)

221 State v. Taylor (Wash.).

367 State v. Thomas (Wash.).

978 State v. Van Vlack (Wash.).

.1098 State, Vaughan v. (Okl. Cr. App.) 976 State v. Wallace (Wash.)..

134 State, Westbrook v. (Okl. Cr. App.) State v. West Pub. Co. (Utah).

.1050 State v. Wheeler (Wash.)..

537 State v. Will (Kan.)

276 State v. Wilson (Kan.).

290 State Industrial Commission, Davis

915 Strickland v. Palmer (Okl.).

802 Superior Court for King County, State v.

Union Pac. R. Co., Lynch v. (Colo.)....1061
Union Savings & Trust Co. of Seattle v.
Manney (Wash.)...

Wichita Falls & N. W. R. Co. v. D. Cawley Co. (Okl.)..

70

251

Union State Bank v. Mueller (Okl.).
Union Traction Co., Thompson v. (Kan.).. 990
Union Trust Co., Butler v. (Cal.).
Union Trust Co. v. Hendrickson (Okl.). 440
Union Trust Co. of San Francisco, Cali-
fornia Gas & Electric Corp. v. (Cal.)..
United Artisans v. Cronise (Or.)..
United Grocery Co., Walters v. (Utah).. 473
United Railroads of San Francisco, Graff
V. (Cal.)..

.....

650

601

Wickliffe, Anderson v. (Cal.).
Wilcox, Anderson v. (Cal. App.).
Wilcox, Edmonds v. (Čal.)..
Wilhite v. Cruce (Okl.).
Wilkes, Lusk v. (Okl.).

381

398

1101

962

....

929

146

Wilkinson, Kies v. (Wash.).
Will, State v. (Kan.).

351

..1003

109

Willapa Power Co., City of Raymond
(Wash.)

v.

.1176

Willardson v. Willardson (Utah).

719

603

Williams v. Youtz (Cal.).

383

United States Nat. Bank V. Shupak (Mont.)

Williamson v. Holloway (Okl.).

44

324

Williamson v. Salt Lake & O. R. Co.

Unwin v. Barstow-San Antonio Oil Co. (Cal. App.)..

(Utah)

680

622

Willis v. Willis (Utah).

685

Van Vlack, State v. (Wash.).

Vashon Nav. Co., Carlson v. (Wash.).
Vaughan v. State (Okl. Cr. App.).

860 Wilson, State v. (Kan.)..
975 Winbigler v. Clift (Kan.).

563

Wilson v. Joseph (Wash.).
Wilson, People v. (Cal. App.).

745

1116

41

537

[Cases in which rehearings have been denied, without the rendition of a written opinion, since the publication of the original opinions in previous volumes of this Reporter.]

THE

PACIFIC REPORTER

VOLUME 172

(64 Colo. 388)

whom the defendant in error had a judg

FIRST NAT. BANK OF FT. COLLINS v. ment. The agreed record on error discloses

SHAFER et al. (No. 8989.)

1. TRIAL 368

(Supreme Court of Colorado. April 1, 1918.)
AGREED STATEMENT OF
FACTS-MATTERS NOT INCLUDED.
In suit tried on an agreed statement of
facts, one of the parties desiring to rely on a
contract between the parties must set out the
contract in the statement, or the evidence in re-
spect to it from which its existence can be de-
termined by the court.
2. CHATTEL MORTGAGES

200-FRAUD OF MORTGAGEE IN PERMITTING CONVERSION OF SECURITY.

Where chattel mortgagee permitted and aided mortgagor in selling sufficient of the mortgaged property to pay the mortgage debt, and in converting proceeds to his own use, and took possession of remainder of the property, a fraud was perpetrated on the mortgagor's general creditors, and the mortgage was void as to a judgment creditor of the mortgagor who had an execution outstanding at the time of the sale of such remaining property under the mortgage, and the proceeds of such sale was subject to garnishment to satisfy such judgment. 3. CHATTEL MORTGAGES 179-FRAUD AS TO GENERAL CREDITOR EFFECT OF TAKING

POSSESSION.

Where the acts of both mortgagor and mortgagee have been such as to unlawfully defeat the rights of the general creditors of the mortgagor in the collection of their debts, thereby perpetrating a fraud, the mortgagee cannot avoid the effect of his acts by taking possession under the mortgage.

White, Garrigues, and Bailey, JJ., dissenting. En Banc. Error to Weld County Court; Herbert M. Baker, Judge.

Action by John E. Shafer and others, doing business as the Shafer Hardware Company, against Peter Balmer, in which the First National Bank of Ft. Collins was garnished. Upon appeal to the county court from a judgment of the justice court there was judgment against garnishee, and it brings error. Affirmed.

Lee & Shaw, of Ft. Collins, for plaintiff in John Paul Lee, of Eaton, for defendants in error.

error.

HILL, C. J. This case, instituted before a justice of the peace, was, upon appeal, tried to the court upon an agreed statement of facts. The judgment was against the plaintiff in error bank, who, upon a traverse of its answer to a garnishee summons, was held to be the debtor of Peter Balmer, against

that on June 4, 1915, Balmer was a farm
tenant of one Signor, at which time they
gave a joint note to the plaintiff in error for
$1,300, due December 4th, following, secur-
ing it by a chattel mortgage on certain stock,
machinery, and crops then growing on the
Signor place; that on November 4, 1915,
Balmer and Signor executed to plaintiff in
error another note for $340, due November
20th, same year, and secured it by chattel
mortgage on that portion of the same prop-
erty not then disposed of; that on Decem-
ber the 27th, following, Balmer turned over
to plaintiff in error bank the stock and ma-
chinery covered by the mortgages; that on
January 6, 1916, the bank sold it at public
The testi-
sale for the sum of $1,007 net.
mony of Nelson, the bank's cashier, is to the
effect that, after crediting all amounts receiv-
ed from Balmer, he was still indebted to the
bank on the note $147. It is admitted that
the garnishee summons was served on Nelson
immediately at the close of said public sale,
the proceeds being in his possession, but that
no indorsement of them had been made on
the notes. What Signor's interest in the
matter was is not disclosed. As the briefs
treat the debt evidenced by the notes and
the property covered by the mortgages as
that of Balmer alone, we shall acquiesce in

this view of it.

The record shows that in August, September, October, November, and December, 1915, Balmer sold to one Ogden $639.25 worth of oats and potatoes, which were covered by the first mortgage, and what was remaining when it was executed by the second; that he received in payment for these sales nine checks for $549.74; that the balance, $89.51, was used in the purchase of sacks, coal, and the rent of sacks; that all of these checks but four, for a total of $94.73, went through plaintiff in error's bank; that in one of them for $108.90 the bank's name was inserted as one of the payees; that a sugar company gave checks for beets covered by these mortgages as follows: One for $431.45 payable to the bank, Balmer, and Signor; one for beet seed for $150 (the payee in this check is not shown by the record); one to W. H. Barnes for $13.41; one to M. C. Andrews of $119.77; and one to the bank, Balmer, and

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes
172 P.-1

Signor for $93.90; two others to the parties and apply the proceeds thereon, is not suslast named for $838.39. Balmer testified tained by the record. While the agreed statethat none of the $431.45 check went to the ment of facts is not very clear on several bank to pay off his notes, but that he was things, the deductions to be gathered from it given permission to use this money to pay on this are that the bank took possession for hauling of beets and pay the help, pro- with the consent of Balmer under its purporttecting the bank's interest in the crops; that ed chattel mortgages, and that it was purhe was not clear as to the amounts paid out,porting to sell the property thereunder; othbut testified to items as follows, beet haul-erwise why insert in the sale notice the words ing $75, threshing $116, cutting grain $40, "First National Bank of Ft. Collins, mortfor labor $93.90; that he paid $45 to a man gagee." Tht record is silent as to any exin Ault on an old debt of his, $25 to Barnes press declarations concerning such an agreefor a cultivator, $15 for a hog, and $45 to an ment. If it had been made, it should have implement company; that he fed most of the been inserted in the agreed statement of facts wheat and alfalfa covered by the mortgages by appropriate language, and not left uncerto his hogs; that he had given the bank a tain to be urged by deductions. If such rough estimate of the amounts paid out; agreement could not be secured, then the testhat so far as he knew the bank had no timony concerning it should have been proknowledge that the funds were being used duced and set forth in the record. This was for other purposes than to save crops, ex- not attempted. From the record before us, cept that he told Nelson of purchasing culti- we are of opinion that there was no error in vator from Barnes and feeding some of the the ruling as made on this subject. wheat and alfalfa to his hogs. Nelson admitted that he gave Balmer permission to use some of the money, but stated that it was for the sole purpose of harvesting the crops; that he had never asked him for payment of any settlement.

[2] The record contains sufficient to sustain findings that Balmer gave to the bank two notes for $1,640 and interest and chattel mortgages to secure each on his stock, equipment, farming implements, and crops; that thereafter and during what is termed the life The record shows that early in December, of the mortgages, it allowed Balmer to sell 1915, and before the bank took possession of about $2,286 worth of crops covered by the the property it sold, a bank at Severance had mortgages and apply the proceeds to his own secured a judgment against Balmer and gar- use, except $431.45, which the bank credited nished the sugar company; that the plaintiff upon the notes; that checks for about $1,400 in error bank paid $178 of the money receiv-received from the sales of these crops included by it from the sales of these crops to the ed the name of the bank as one of the Severance bank in satisfaction of this judg- payees; that checks for an additional sum ment; that this payment was with the con- of about $300 payable to Balmer received sent of Balmer; that the advertisement of from the sale of these crops also passed the public sale of the property was signed by through the plaintiff in error's bank; that the auctioneer, but included the language the bank knowingly permitted Balmer to oth"First National Bank of Ft. Collins, mort-erwise appropriate the most of the wheat and gagee"; that at the time of the service of the alfalfa crops covered by the mortgages. In garnishee summons upon Nelson as cashier such circumstances, we cannot agree with of the bank, the only credit indorsed on the the contention of plaintiff in error that there notes was one for $414.98, bearing date is no testimony to sustain the findings of the December 23, 1915. The judgment was trial court; that the action of the parties against the bank for $270.89, being the to the mortgages constitute a fraud against amount of the Balmer judgment in favor of the right of the judgment creditors of Balthe defendant in error. The position of the mer. The defendant in error was entitled to trial court was that the public sale of the re-its judgment as rendered. It had an execumainder of the property not theretofore sold tion or attachment outstanding against Balby Balmer was under the purported chattel mer at the time of the sale. It was looking mortgages by consent of Balmer, and not un- for something to levy upon. The bank had der any agreement between him and the bank all his property covered by the two chattel by which he turned it over to them as se- mortgages, and it was not only allowing him curity for the debt, or otherwise, than a sur- to sell part of it and convert the proceeds to render of possession under the purported his own use, thereby preventing his other mortgages; that upon account of the acts of creditors from collecting their claims, but Balmer and the bank pertaining to the mort- was aiding him in such transaction by havgaged property, its disposition, etc., the mort-ing or allowing the checks received therefrom gages were void as against the attaching to include its name as payee by collecting, or creditors of Balmer.

[1] The contention of the plaintiff in error that the property was turned over to the bank by Balmer under an agreement outside of the mortgages, that the bank was to receive it as security for its debt, have it sold,

indorsing them to him, and, instead of applying the proceeds in payment of his debts secured by the mortgages, it turned the money back to him, yet keeping the remainder of the property still covered by the mortgages, and it thus continued to so do up to the time