some were destined to points beyond the of injury and to run across said track, under state. the circumstances he claims he did, and be[2, 3] By the first assignment of error lieve that those in charge of the engine knew complaint is made because the court in- of plaintiff's position on the car, and of his structed the jury, if they believed the Tuck-probable ignorance of the approach of the ers saw plaintiff and realized the danger to which he was being exposed of being struck by the engine, then it was their duty to use all reasonable means at their command that persons of ordinary prudence would have used, under the circumstances, to prevent injury to plaintiff; and if the jury believed they failed to use such means, and that such failure was the proximate cause of the injury to plaintiff, then to return a verdict for plaintiff. The contention is that there is no evidence to support the submission of said issue. In view of W. W. Tucker's testimony, we think the evidence justified the submission of the issue. If he saw plaintiff about to enter track 2 while the engine was 12 feet distant from plaintiff, then his brother also saw him under the same circumstances, and the jury could find that they should have at once called to plaintiff and given a stop signal instead of waiting until he had stepped on the track. From the evidence it appears that a heavy engine cannot be stopped in less distance than that testified to in this case, namely, about 62 feet, so it is not made to appear that a stop signal alone would have availed anything; but, as the engine was going slowly, the extra distance might have been of much avail if plaintiff had been warned by the Tuckers as he was about to step on the track. In considering this matter we of course must view the evidence most favorably to appellee and must necessarily discard the testimony of J. J. Tucker as to the position of plaintiff when he called to him and accept that of W. W. Tucker as to the distance from the engine when he first saw that plaintiff was about to step upon the track. It follows that, if J. J. Tucker saw plaintiff all the time, he also saw him about to step on the track when 12 feet distant from the engine, and it was for the jury to say, in view of all the circumstances, whether said J. J. Tucker and W. W. Tucker exercised ordinary care to use all the means in their power to prevent the injury, and, if they did not exercise such care, whether by exercising the same they could have averted the injury. We overrule the assignment. engine, if he was ignorant thereof, or in the exercise of ordinary care would have known thereof and would, in the exercise of such care, have foreseen that plaintiff, under the circumstances, would probably jump from the car and run across the track, and in so doing would be exposed to the danger of being struck by the engine, and believe that those in charge of the engine, in the exercise of ordinary care, should and could have rung the bell or blown the whistle or given other warning to plaintiff of the approach of the engine, and that, had either been done, he would have been advised of the approach thereof and avoided contact therewith, and you believe they failed to do either to warn him, and believe such failure, if any, was negligence, and that such negligence was the proximate cause of the injury of plaintiff, you will return a verdict for plaintiff; but, unless you so find, you will return a verdict for defendant." The objection made to this charge is that it submits various matters concerning which there is no evidence, and that the issue whether failure to blow the whistle or ring the bell was the proximate cause is made dependent upon contingencies of an uncertain character dependent upon actions of plaintiff not to be anticipated or foreseen. There is no evidence that the persons in charge of the engine, viz., the engineer and fireman, who were the only persons who could give signals by means of whistle or bell, knew that plaintiff was riding the cars until after he was injured; nor is there any evidence that they knew he was prob ably ignorant of the approach of the engine, nor that they could or would, in the exercise of ordinary care, have foreseen that plaintiff would jump from the cars which in fact did not collide violently with the stationary ones, nor that, if he did jump off, he would run across track 2 instead of staying between the two tracks. If it should be contended that the Tuckers were partially in charge of the engine and saw plaintiff on the cars, then the fact remains that they could not reasonably anticipate that plaintiff would become apprehensive without cause and jump from the cars, and that [4, 5] By assignment No. 2 another com- he was ignorant of the approach of the enplaint is made of the charge; the portion gine and would run across right in front objected to being copied in the assignment of the same instead of staying between the and being very long. After requiring the two tracks. An injury which could not finding of various matters, descriptive of have been foreseen or reasonably anticipated how plaintiff came to be injured, as al- as the natural and probable result of a negleged by him, the court added the follow-ligent act is not proximately caused by such ing: "And you believe 'kicking the cars act. At the time when the appellee claims into the siding at the rate of speed at which they were 'kicked' would have caused a person of ordinary prudence, situated as plaintiff was, to jump from the car for fear the employés of appellant should have given warning by ringing the bell or blowing the whistle, there were no facts or circumstances known to them which would cause them to reasonably anticipate that the failure to ring the bell or blow the whistle would cause injury to appellee or any one else. Under the facts they could not anticipate injury to appellee as probable until it became apparent that he was verging upon track 2 in a manner indicating that he did not know of the existence of the engine on said track. T. & P. Ry. Co. v. Bigham, 90 Tex. 223, 38 S. W. 162; Kreigh v. Westinghouse C. K. & Co., 152 Fed. 120, 81 C. C. A. 338, 11 L. R. A. (N. S.) 684; Railway v. Reiden, 48 Tex. Civ. App. 401, 107 S. W. 661; Pullman Co. v. Caviness, 53 Tex. Civ. App. 540, 116 S. W. 412; Railway v. Elliott, 55 Fed. 949, 5 C. C. A. 347, 20 L. R. A. 582; Railway v. Welch, 100 Tex. 118, 94 S. W. 333. We sustain the assignment. The third assignment relates to the sufficiency of the evidence, while the fifth complains of the verdict as excessive. In view of another trial, we will not go into the matters raised by these assignments. There is no merit in the fourth assignment of error complaining of the charge on contributory negligence under the federal Employers' Liability Act of 1908, and the same is overruled. NUNN v. PADGITT BROS. et al. 1. CHATTEL MORTGAGES (§§ 220-222, 225*)— While a chattel mortgagor in possession may sell the property in recognition of the mortgagee's right, a sale in denial of such right would be a conversion by the mortgagor and also by the purchaser if he persisted in denying mortgagee's right. [Ed. Note.-For other cases, see Chattel Mortgages, Cent. Dig. §§ 468-470; Dec. Dig. $$ 220-222, 225.*] 2. TROVER AND CONVERSION (§ 11*)-OWNER- Conversion, Cent. Dig. §§ 95-98; Dec. Dig. § 3. CHATTEL MORTGAGES (§§ 220-222*)—SALE OF PROPERTY-CONVERSION BY MORTGAGOR. Where the mortgagee of chattels sold the mortgage notes to plaintiff and subsequently in effect a mortgagor in possession as to plainpurchased the mortgaged property, he became tiff; and hence his subsequent sale of the property in denial of plaintiff's rights was a conversion. [Ed. Note.-For other cases, see Chattel Mortgages, Cent. Dig. §§ 468-470; Dec. Dig. §§ 220-222.*] 4. CHATTEL MORTGAGES (§ 225*)-RECORDING -EFFECT BETWEEN PARTIES. That a chattel mortgagor denied, when he sold property covered by a recorded chattel mortgage, that the property was incumbered would not be a defense to the right of the mortgagee to sue the purchaser of the property for its conversion by the denial of such mortgagee's rights. [6] Assignment No. 6 is overruled. The court did not err in refusing to give the charge on assumed risk. In view of the fact that the issue of discovered peril was in the case, it would have been improper to have given the charge in question, which applied to the whole case. When plaintiff seeks a recovery upon the issue of discovered peril as well as upon other theories, charges on contributory negligence and assumed risk should be limited to be considered only upon the other theories, as such defenses cannot be urged to defeat liability arising by reason of discovered peril. Railway v. Finn (Civ. App.) 107 S. W. 94; s. c., 101 Tex. 511, 109 S. W. 918; Kelley v. Railway, 101 S. W. 1166; Railway v. Scarborough, 104 The fact that the county clerk advised purS. W. 408. chasers of property covered by a recorded chattel mortgage that the property was not The judgment is reversed, and the cause mortgaged would not prevent the purchasers remanded. On Motion for Rehearing. MOURSUND, J. [7] We have carefully considered appellee's motion for rehearing and conclude that the evidence is sufficient for the jury to find that the engineer, notwithstanding his denial, did see appellee on the side of the car. However, we are still [Ed. Note. For other cases, see Chattel Mortgages, Cent. Dig. 88 468-470; Dec. Dig. § 225.*] 5. CHATTEL MORTGAGES (§ 225*)-RECORDING -EFFECT AS TO PURCHASERS. from being liable to the mortgagee for its conversion. [Ed. Note.-For other cases, see Chattel Mortgages, Cent. Dig. §§ 468-470; Dec. Dig. § 225.*] 6. CHATTEL MORTGAGES (§ 225*)-PURCHASE OF MORTGAGED PROPERTY-CONVERSION BY That defendant agreed to advance money with which to purchase property covered by a recorded chattel mortgage only on condition that mortgagors should first convey to her that she might convey to her son and in that method give her what she considered greater security for the money advanced would not prevent defendant's purchase from being a conversion of the property as to mortgagee. [Ed. Note.-For other cases, see Chattel Mortgages, Cent. Dig. §§ 468-470; Dec. Dig. § 225.*] 7. CHATTEL MORTGAGES (§ 170*)-CONVERSION OF PROPERTY. Whoever with actual or constructive notice of the chattel mortgage is directly or in For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep'r Indexes directly the instrumentality through which a conversion of mortgaged property is brought about is liable for the conversion. see Chattel [Ed. Note.-For other cases, Mortgages, Cent. Dig. § 305; Dec. Dig. § 170.*] 8. CHATTEL MORTGAGES (§ 204*)-RECORDING OF MORTGAGE-PERSONS AFFECTED - PURCHASER OF MORTGAGED NOTES. It appears from the evidence in substance that J. M. Mullins and Davis McMackin were partners in business under the firm name of Dallas Electrical Construction Company in the city of Dallas. W. G. Nunn, of Ladonia, Tex., an acquaintance of some years of both Mullins and McMackin, upon their request, indorsed their note for $100 in order to enable them to negotiate same at bank, which was done. Nunn, as indorser, was later compelled to pay same by reason of the default of Mullins and McMackin. Subsequent to the circumstances related above, Mullins sold McMackin his interest in the Dallas Electrical Construction Company. In Rev. Civ. St. 1911, art. 5661, provides that all persons shall be charged with notice of a chattel mortgage duly registered "and of the rights of the mortgagee, his assignee or representative thereunder," and article 5659 provides for discharging of mortgage by acknowledging satisfaction of the debt upon the registry book. Held, that the failure of the purchaser of chattel mortgage notes to have the assignment of the notes to him recorded would not prevent persons purchasing the property from being charged by the registra-payment of part or all of the purchase price, tion with notice of the mortgage and of his rights thereunder. [Ed. Note.-For other cases, see Chattel Mortgages, Cent. Dig. § 451; Dec. Dig. § 204.*] 9. CHATTEL MORTGAGES (§ 225*)-RIGHTS OF ASSIGNEE-CONVERSION OF PROPERTY. An assignee of notes secured by a recorded chattel mortgage was not negligent in permitting the property to remain in the possession of one who he knew had purchased it from the mortgagor, so as to prevent him from recovering for its conversion by sale, in view of Rev. Civ. St. 1911, art. 5665, making chattel mortgages void against subsequent purchasers, etc., unless registered, where the property remains in mortgagor's possession. [Ed. Note.-For other cases, see Chattel Mortgages, Cent. Dig. §§ 468-470; Dec. Dig. § 225.*] 10. CHATTEL MORTGAGES (§ 229*)-CONVERSION OF PROPERTY-ACTIONS-AMOUNT OF RECOVERY a Where the value of property covered by recorded chattel mortgage exceeds the amount of the debt, the judgment, in an action by a mortgagee for conversion, should be for the debt and, if the debt exceeds the value of the property, should be for such value. [Ed. Note.-For other cases, see Chattel Mortgages, Cent. Dig. §§ 479-483; Dec. Dig. § 229.*] Appeal from Dallas County Court; W. F. Whitehurst, Judge. Action by W. G. Nunn against Padgitt Bros. and others. From a judgment for defendants, plaintiff appeals. Reversed and rendered. Wood & Wood, of Dallas, for appellant. Alex F. Weisberg, J. Hart Willis, and Spence, Knight, Baker & Harris, all of Dallas, for appellees. RASBURY, J. Appellant sued appellees for the value of certain personal property alleged to have been converted by appellees and upon which appellant, at the time of such conversion, had a mortgage lien properly registered to secure an indebtedness due him. The appellees in effect urged as a defense to the suit that they used proper diligence to ascertain the existence of the lien and failed to do so, and hence were innocent purchasers, and further that they never took actual possession of the property; and hence there was no conversion of same. Mullins accepted McMackin's 18 promissory notes, each for $75, secured in payment by chattel mortgage on the property, for the value of which this suit was brought. The mortgage was registered as directed by statute, and recites the transaction to be for the purposes we have just stated, and subrogates by its terms all purchasers of the notes to the benefits of the mortgage. After the sale by Mullins to McMackin, in order to enable Mullins to borrow $500 from the Guaranty State Bank & Trust Company, Nunn signed a note for that amount jointly with Mullins. The bank accepted the note. To secure the bank in the payment of the $500 note and Nunn in his indorsement thereof, as well as the repayment to him of the amount paid out on the $100 note, Mullins transferred the 18 McMackin notes to the bank. McMackin paid off sufficient of the mortgage notes to reduce the $500 note to $271, when payments ceased. Thereupon Nunn was compelled to take over the balance, which he did, and whereupon the bank transferred him the unpaid mortgage notes. Nunn attempted to col lect the amount due him by Mullins and McMackin but was unable to do so. In the meanwhile, for some reason and in manner not made clear by the record, Mullins repurchased from McMackin the business of the Dallas Electrical Construction Company and operated same for about one month, when he sold a portion of the tools, implements, etc., to one of the appellees, Mrs. Amelia Wunderlich; such portion being covered by the mortgage securing the payment of the 18 notes given by McMackin to Mullins, transferred by Mullins to the bank and by the bank transferred to Nunn. Mrs. Wunderlich paid $260 for the property sold her by Mullins, and the transfer was by bill of sale warranting title free of liens, etc. On the same day she purchased the property, Mrs. Wunderlich, in consideration of the note of Frank Courtney and Emil Wunderlich, her son, for $260, due one year from date with 8 per cent. interest, conveyed the same property to them and as security for payment of the note retained a lien or mortgage against the property so conveyed. By *For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep'r Indexes also, in his right of redemption, a property which is or may be valuable, and which he may lawfully sell in recognition of the right of the mortgagee. Such a sale is therefore no conversion of the mortgagee's interest, but a sale in denial of the mortgagee's right would be a conversion in him, and perhaps in the purchaser also. It would certainly be a conversion in the purchaser if he took the property on a purchase of the whole interest and persisted in a denial of the mortgagee's right afterwards." Also: "One who buys property must, at his peril, ascertain the ownership; and, if he buys of one who has no authority to sell, his taking possession in denial of the owner's right is a conversion." See, also, McCown et al. v. Kitchen, 52 S. W. 801; Scaling v. First National Bank, etc., 39 Tex. Civ. App. 154, 87 S. W. 715; Buffalo Pitts Co. v. StringfellowHume Hardware Co., 129 S. W. 1161. the terms of the conveyance Courtney and Wunderlich are required to remove the property to 126 Bryan street, to keep it insured with loss payable to Mrs. Wunderlich, not to remove same from its location without her consent, and to keep same in good condition and repair, and provided for the usual conditions of forfeiture and seizure in case of default in payment of the note, etc. Before buying the property, both Mrs. Wunderlich and her attorney inquired particularly of Mullins, who was then in possession of the property by virtue of his repurchase from McMackin, if there was any lien or incumbrance against the property and if any other person had any interest therein, and he assured them that no liens existed and he was sole owner thereof. Mrs. Wunderlich and her son, Emil Wunderlich, testified that they inquired of the county clerk concerning a mortgage against the property, and that they were informed none was of record. The same parties also testified that, while Mrs. Wunderlich took a conveyance from Mullins to herself and in turn conveyed to Emil Wunderlich and Frank Courtney, she was not in fact buying the property for her own use but for her son and Courtney and took such method, under advice of counsel, as the best plan of securing herself in the payment of the money advanced to them, which was in fact only a loan. Appellant, Nunn, before filing suit, attempted to locate the mort- [4] Incidental to a discussion of the quesgaged property, but was unable to do so. It tion of who in fact converted the property, was developed upon trial of the case that we divert long enough to say that the denial same was in possession of Emil Wunderlich by Mullins of the existence of the mortgage in storage. The witness Boettiger testified is without force as a defense to Nunn's right the same was of the value of $295. Mrs. to recover in case of conversion. To hold Wunderlich paid Mullins $260 therefor. that mortgages registered under statutory diNunn's debt after this suit was filed was re-rection can be ignored by third persons upon duced to $274.16 by payments received from some bankrupt proceeding, presumably against either McMackin or Mullins. The essentials of the facts here stated are undisputed. Upon trial before jury there was a verdict against appellant followed by judgment, from which he has appealed. The appellant has filed two assignments of error; the first attacking the charge of the court, and the second challenging the sufficiency of the evidence to sustain the verdict and judgment. We think the criticism of the charge by appellant correct, but we forego a discussion thereof for the reason that we think the cause should be reversed and judgment here rendered for appellant on the grounds urged in the second assignment. [1, 2] As applicable to the undisputed facts in this case, it was said in Western Mortgage & Investment Co., Ltd., v. Shelton, 8 Tex. Civ. App. 550, 29 S. W. 494, quoting from an eminent authority (Cooley's Second Ed. on Torts, 527): "When the mortgagor of chattels is left in possession, he has not only such a special property as will enable him to maintain trover against a wrongdoer, but he has [3] Mullins, by his sale of the notes to Nunn, became, after his purchase of the property from McMackin, in effect a mortgagor in possession and had no right of course to sell in denial of the mortgage, and the result under the cases cited and the undisputed evidence is that either Mrs. Wunderlich or Emil Wunderlich, her son, and Frank Courtney bought and held before and upon trial the mortgaged property in denial of Nunn's mortgage. the assurance of those in possession of the property that such mortgages do not in fact exist would be to utterly destroy the very purpose of the requirement instead of sustaining it. [5] Nor do we think that the testimony of Mrs. Wunderlich and her son that the county clerk advised them that there was no mortgage upon the property entitled to any weight. We do not deny the truth of the testimony. Such information, we conclude, was given at the county clerk's office. The information was incorrect, however, since the mortgage was in fact registered there and an inspection of the record would have shown as much. We do not understand that it is the right of the public to rely upon the clerk as to what the records of his office do or do not disclose, but that it is the right of the public to inspect such records and themselves ascertain their contents, and that the public will be bound by the records alone as they actually exist. We then come to the question of whether appellee Mrs. Wunderlich (her son and Courtney not being parties to the suit) under the evidence bought the property, and, if she did, whether it was in recognition or denial of the mortgage, and, if that Nunn was negligent in not placing upon she did not purchase the property, whether the the record an assignment of the notes, so as facts stated in law constitute conversion. to give Mrs. Wunderlich notice thereof, and That she did not buy or incumber the prop-in permitting Mullins to remain in possession erty in recognition of the mortgage is not thereof after repurchasing same from Mcdenied. Mackin. We have said that, while Mrs. Wunderlich may have acted in good faith in the purchase of the property or in loaning money thereon, she did so subject to or with full knowledge of the prior mortgage, whichever theory of the transaction may be adopted. [8] Nor does the failure of Nunn to place upon the record an assignment of the notes affect the notice imported by the registration of the mortgage. Article 5661, R. S. 1911, provides that, when chattel mortgages are registered as was the one in this controversy, "all persons shall be thereby charged with notice thereof, and of the rights of the mortgagee, his assignee or representative thereunder." Article 5659, R. S. 1911, provides that the only way by which satisfaction of mortgages may be entered of record, and as corollary relied upon by those subsequently dealing with the property, is by acknowledg ing satisfaction of the debt upon the book containing the registry of the mortgage. No such satisfaction was shown on trial in this controversy. [6] To establish that she did not do so in denial thereof, so as to constitute conversion, the claim is made that the form of conveyance to her was not what it purported to be, to wit, a sale, but simply a vehicle to give Mrs. Wunderlich security of greater dignity and was unaccompanied by actual physical asportation of the property. Waiving any question of Mrs. Wunderlich's right to deny, in an equitable proceeding, her own solemn declaration that she was the owner of the property, we nevertheless believe the proposition unsound. Mrs. Wunderlich agreed to advance the money with which to purchase the property only on condition that Mullins first conveyed it to her that she might in turn convey it to her son and Courtney and by such method secure what she considered security of a greater dignity for the money she was advancing, but which, however considered, is but what our statute denominates a chattel mortgage; and it was by her direction and with her knowledge that the property was so purchased and incumbered and then delivered to her son and Courtney. To hold that such acts do not establish conversion would, in our opinion, result in great injustice to parties acquiring evidences of debt secured by chattel mortgages duly registered. As illustrative of the point, second mortgages would and could acquire the dig-legal right in Nunn to prevent it, since Mulnity of first mortgages, since it is here urged exactly that Mrs. Wunderlich is in effect but a mortgagee, and to which we agree. [7] The true rule, it seems to us, is that whosoever directly or indirectly is the instrumentality through which the conversion is accomplished is liable for the conversion, when such conversion is made with either actual or constructive notice of the pre-existing debt and mortgage. Constructive notice in this proceeding is not denied, and, that being true, appellee took the property as her own or as security for her debt at her peril, and, if by such taking it was lost or destroyed, she is liable for the value thereof. We are not to be understood, of course, as holding that second mortgages cannot be accepted without constituting conversion, but that such second mortgagor cannot under guise of a purchase sell to another, who in turn wastes or destroys same, and then defend, in a suit for conversion, on the ground that he was but a second mortgagor and, not having actually laid hands on the property, is not liable. But it is further urged that, Mrs. Wunderlich having bought the property or loaned money thereon in good faith, she should be protected for the reason [9] In like manner do we think the claim that Nunn was negligent in permitting the property to remain in possession of Mullins untenable. Even though he was aware that the title to the property had passed back into the possession of Mullins, there was no lins had the right to purchase and McMackin the right to sell subject to the existing lien. The statutory provisions relating to chattel mortgages contemplate the existence of valid and enforceable mortgages where the property is permitted to remain in the possession of the mortgagor and directs that in all such cases the mortgage shall be void against creditors, subsequent purchasers, and mortgagees or lienholders, unless such mortgage or lien shall be registered in the manner provided by the other provisions of the act. Article 5655, R. S. 1911. As we have said, the mortgage in this controversy was so registered. [10] The undisputed evidence shows the value of the property converted by Mrs. Wunderlich to be $295. Nunn's debt is undisputed and is $274.16. The rule is that, when the converted property exceeds the amount of the debt, the judgment shall be for the debt, and, when the debt exceeds the value of the property, it shall be for such value. In the application of that rule the judgment of the trial court is reversed, and judgment here rendered for appellant against Mrs. Wunderlich for the amount of his debt. Reversed and rendered. |