were paid. In passing upon the question of costs, the court said: "The assignees, when they bought, must have known that the attorney would have a claim for these costs. And when they took an assignment of the action as it stood, and the benefit of the progress then made in it, they took it with the burthens then incident to it, and one of these should be liability to have the costs then incurred deducted from the recovery by them, when judgment should be obtained."

So, in Board of Supervisors v. Brodhead, 44 How. Pr. 411, it was observed: "Certainly the court ought to see that its own officers, when charged with no misconduct, should be paid for their services, before the security is taken away which the control of a suit and the possession of papers gives them." 3 Am. & Eng. Ency of Law, 409. Hoffman v. Van Nastrand, 14 Abb. Pr. 336. Sloo v. Law, 4 Blatchf. (U. S.) 268. Hooper v. Welch, 43 Vt. 169. Coughlin v. N. Y. C. & H. R. R. Co., 71 N. Y. Henchey v. The City of Chicago, 41 Ill. 136. Randall v. Van Wagenen, 115 N. Y. 527.

443.

We are of the opinion that the court, under the facts and circumstances of this case, ought to have withheld its aid in the substitution of attorneys, until the appellants were paid reasonable compensation for their services, or were secured for the same, and that it erred in making the order in the premises.

The judgment is therefore reversed, with costs, and the cause remanded with directions to the court below to proceed in accordance with this opinion.

ZANE, C. J. and MINER, J. concur.

JULIA B. McKIBBON, APPELLANT v. NAT M.
BRIGHAM, MARSHAL, RESPONDENT.

CHATTEL MORTGAGE-MORTGAGEE IN POSSESSION — VALIDITY
EFFECT OF CONTEMPORANEOUS OR SUBSEQUENT VERBAL AGREE
MENT-UNLIMITED EXTENSION OF MATURITY OF INDEBTEDNESS-
SALE OF MORTGAGED CHATTELS BY CREDITOR OF MORTGAGOR
-JUSTIFICATION-FINDINGS CORRECT, JUDGMENT UNDISTURBED.

Chattel Mortgage-Mortgagor in Possession-Validity.

Where a mortgage on a stock of goods, by its conditions,
permits the mortgagor to remain in possession and sell the
mortgaged property in the usual course of trade, and it is not
controlled by statutory regulation, and the rights reserved
show that it is intended as a shield to the mortgagor, and it
operates as a fraud upon the rights of creditors the mortgage
is void in law.

Effect of Contemporaneous or Subsequent Verbal Agreement.
Any agreement outside a chattel mortgage, permitting the
sale of the property mortgaged, whether contemporaneous
with or subsequent to the making of the mortgage, will have
the same effect as if stipulated and read into it.

Unlimited Extension of Maturity of Indebtedness.

Under Secs. 2338 and 2801, C. L. U. 1888, a clause in a mortgage
allowing the mortgagee to remain in possession of the mort-
gaged property and sell in the usual course of business, and
also stipulating that it was not expected that the mortgage
should be paid when due, but that the same should be ex-
tended from time to time in order that the mortgagor should
continue in business as before the mortgage was given, ren-
ders the mortgage invalid.

Justification on Sale of Mortgaged Chattels by Creditor of
Mortgagor.

Where the facts as found show that a mortgage was invalid

and fraudulent in law, a sale by the creditor of the mort

gagor, under an attachment properly issued, or upon an execution based on a valid judgment is justified.

Findings Correct-Judgment Undisturbed.

When the findings of fact are correct, the judgment will not be disturbed if in accordance therewith, even if the conclusions of law are incorrect in technical language.

(Decided October 20, 1898.)

Appeal from the third district court of Salt Lake county, Honorable A. N. Cherry, Judge.

Action by Julia B. McKibbon v. Nat. M. Brigham as United States marshal, to recover the value of certain personal property sold on execution. From a judgment for the defendant plaintiff appeals. Affirmed.

H. J. Dininny, Esq. and Charles Baldwin, Esq., for appellant.

A creditor at large of the mortgagor cannot attack the mortgage. He must first clothe himself with a judgment or execution or some legal process against the property. Jones on Chattel Mortgages, 3d Ed., Sec. 345; Cobbey on Chattel Mortgages, Sec. 774; Markham v. Pac., 394; Bank v. Bates, 120 U. S. 536; Thompson v. 27 N. Y. 568; Frary v. 41 Mich., 376;

Newton v., 2 Utah, 287;
Pac., 584; Beckenshoff v.

Leopold v.

19 Cal., 109.

19

16

A chattel mortgage on a stock of merchandise is not fraudulent in law because the mortgagor is allowed to retain possession and sell the goods under an agreement to account to the mortgagee for the net proceeds of the sale. To show the trend of modern decisions we cite: Klein , 20 Ohio State, 110; McFadden v. Ind. 590; Morse v.

V.

V.

90

, 22 Fed. Rep. 501; Francisco

54 Ohio State, 307; Wright v. 231; Ford v.

35 Mich.

24 N. Y. Rep. 359; Forbes v.

S., 426; Howard v. - 13 Pac. 556; Ethridge v. Sperry, 139 U. S., 266.

Messrs. Stephens & Smith, for respondents.

Where the mortgage is fraudulent in its inception no subsequent possession can cure the fraud.

Had plaintiff actually taken possession of the mortgaged property and commenced an action for the foreclosure of the mortgage we could at any time before sale, have garnished her or issued execution and levied upon the property, and justified our proceeding by showing the fraud in the inception of the mortgage. Bump on Fraudulent Conveyances, 4th Ed., Sec. 120; Wells v. Langbein, 20 Fed. 183; Chenery v. Palmer, 6 Cal. 123; Delaware v. Ensign, 21 Barb. 185; Parshall v. Eggart, 54 N. Y. 18; Blakesley v. Rosmund, 43 Wis. 116; Stine v. Munch, 24 Minn. 390; Rathburn v. Berry, 31 Pac. 679; McKinney v. Wood, 43 Mo. Appeals, 152.

An agreement which allows the mortgagor to remain in possession and dispose of the goods as before the mortgage was given, makes the mortgage void per se. Wells v. Langbein, 20 Fed. 189; Lyon v. Bank, 29 Fed. 556; Robinson v. Elliott, 22 Wall. 513; Simmons v. Jenkins, 76 Ills. 479; Russell v. Winn, 37 N. Y. 591; Leopold v. Silverman, 16 Pac. 581; Bump on Fraudulent Conveyances, Secs. 115-120.

MINER, J.

It appears from the findings in this case that George J. McKibbon was the owner and engaged in keeping a drug store under the title of the Park Terrace Pharmacy, and

for convenience the business was conducted by George E. Wright and he was the accredited owner of the business, so far as the public was concerned. The Nelden Judson Drug Company, a creditor of said pharmacy understood that McKibbon was the owner. About March 1, 1894, McKibbon sold his interest in the drug store to Wright for $700, and took his note therefor. At this time the Park Terrace Pharmacy was indebted to the Nelden Judson Drug Company in the sum of $426, which Wright assumed and agreed to pay. Wright continued to purchase goods of the Nelden Judson Drug Company, and on July 18, 1895, was indebted to them in the sum of $568. There was no change in the manner of extending credit. From the time Wright purchased until July 18, 1895, he paid the Nelden Judson Drug Company on account of the Park Terrace Pharmacy, $1800. In February 1895, McKibbon died in Iowa. This fact was not known to the Nelden Judson Drug Company until a chattle mortgage was afterwards filed covering the stock. On July 5, 1895, Julia B. McKibbon, the plaintiff, widow of George J. McKibbon, through her attorney, took a new note, in the place of the old one given to Mr. McKibbon, from Wright, payable to herself, for $694, due in 90 days and surrendered the old note. The note was secured by chattel mortgage on the stock of drugs. This mortgage purported to convey the same to plaintiff.

At the time the mortgage was given it was verbally agreed between Wright and the plaintiff that Wright should remain in possession of said mortgaged property and continue to sell the same in the usual coure of business; buy new goods, keep up the expenses of the store, and pay over the proceeds, if any, to the plaintiff, to apply on the indebtedness; and it was also agreed at the

18 Utah-6.