Brand v. McMahon — 38 N.Y. St. Rep. 576

Majority

p. 576

George P. Brand, Pl’ff, v. James W. McMahon, Def't.

(Supreme Court, General Term, Fifth Department,

Filed June 2, 1891.)

Headnote

Fixtures—Machinery in mile.

Defendant’s father, since deceased, sold to one B. certain machinery for his mill, it being agreed that the title should remain in the vendor until it was paid for, and that it should retain its character of personalty and not become a part of the realty. Afterwards, the vendor, becoming paralyzed, B. gave him notes for the price of the machiney and a chattel mortgage and bill of sale thereof. Plaintiff became the purchaser of the mill on a foreclosure sale, and defendant removed the machinery from the mill. In an action for conversion the court charged that if B. purchased and took title to the machinery, although cn credit, and the notes and chattel mortgage were given as evidence of and security for the indebtedness thus created, the machinery became a part of the realty and was covered by the mortgage thereon and passed to plaintiff on the sale; but that if B. took the property under the agreement that it should retain its character and the title remain in the seller until payment, and the chattel mortgages were executed in pursuance of that agreement, defendant was entitled to a verdict. Held, no error.

Motion by the plaintiff for a new trial on a case and exceptions ordered to be heard at the general term in the first instance, after verdict for the defendant at the Cattaraugus circuit

E. C.. Sprague, for the motion; W. G. Laidlaw, opposed.

The action was trover for the wrongful taking and conversion of a quantity of the machinery of a steam sawmill, which was claimed by the plaintiff as the purchaser, on mortgage foreclosure, of the freehold which included the mill; and by the defendant, as the personal representative of the owner of the machinery, as personal property.

In February, 1887, one Bacon was the owner of a small tract of land .on which there was a saw-mill, run by water, and the property was subject to the lien of several mortgages, the latest of which was one of $1.000, under which the plaintiff, took his title. At that time Bacon negotiated with one John McMahon, the father of the defendant, since deceased, for the purchase of the machinery, including boiler and engine, of a steam saw-mill, owned by the latter, which resulted in the delivery of possession of the ma

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chinery to the former. Bacon thereupon proceeded to take out a portion of the machinery already in his mill and replaced it by the steam machinery thus procured from McMahon, which he attached to the freehold in a substantial manner.

In 1888, the mortgage of $1,000 was forelosed, and the plaintiff became the purchaser on the sale, shortly after which the defendant, representing the estate of his father, who had died in the meantime, went onto the premises and removed therefrom the machinery in question; this was the alleged conversion for which this action was brought.

The testimony of Bacon and the defendant in respect to the negotiations under which the former obtained possession of the machinery was to the effect that it was agreed between him and John McMahon that the title to the property should remain in the latter until it was paid for, and that it should retain the character of personal property and not become a part of the realty.

This testimony was not contradicted by any direct evidence, and was countervailed, if at all, only by evidence of what subsequently took place between the parties. The proof shows that in the latter part of July, after Bacon put the new machinery into his mill, John McMahon was attacked with paralysis, and his son, the defendant, not expecting him to live, sent for Bacon and procured him to execute to his father four notes of $275 each, for the price which had been put on the machinery, and a chattel mortgage on the engine and boilers to secure the notes. The notes were dated July 1, 1887, and were made payable in one, two, three and four years, respectively. Bacon also executed at the same time what was called a bill of sale of the same property, which was in effect another chattel mortgage; it purported to transfer the engine and boiler to McMahon, “to have and to hold until said McMahon is paid in full for said mill, which will be upon payment of note for $275, due July 1, 1891.” The defendant’s account of this transaction was as follows: “I showed him father’s condition; as he could see himself; and I told him there was nothing to show anything about the mill, if he (Bacon) would happen to die or claim the property, we had nothing to show that it was ours, and I sat down and drew a chattel mortgage and bill of sale, and drew up the notes, etc.” It also appeared without dispute that at the time of the foreclosure sale, the auctioneer made public announcement of the claim of McMahon to the machinery and of the ground of that claim. There were no facts in dispute in the case, unless the conclusion of fact, to be drawn from the evidence above referred to, as to what was the agreement between the parties under which Bacon took possession of the machinery and put it into his mill, and that question was submitted to the jury.

Upon that subject the court instructed the jury very clearly that if, under the agreement between the parties, Bacon purchased the machinery and took title to it, although on credit, before he put it into his mill, and the notes and chattel mortgages were

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given as evidence of, and security for, an indebtedness thus, created, then the machinery became a part of the real estate and. was covered by the mortgage, and passed to the purchaser under the foreclosure sale ; but that if, on the other hand, they came to the conclusion that the arrangement was made between McMahon and Bacon, as testified to by the defendant and Bacon, that. McMahon permitted Bacon to take the property upon an agreed valuation of $1,000 and put it into his mill, as he did, under the further agreement that the property should not become a part of. the realty, but that it should retain its character as personal property, and that title to it should remain in McMahon down to the time he was paid his $1,100, and that these chattel mortgages, were executed in pursuance of that agreement, then the defendant, was entitled to a verdict. The exceptions of the plaintiff to these instructions raised the only real question which is presented by this appeal.

We think the charge was in harmony with the doctrine of the well known cases of Mott v. Palmer, 1 Comst., 561; Tifft v. Horton, 53 N. Y., 377 , and Tyson v. Post, 108 id., 217; 13 N. Y. State Rep., 503. The language of the court in Tifft v. Horton, is particularly applicable to this case, where it is said, at page 381, that neither a prior nor subsequent mortgagee could claim personal property affixed to the freehold, as subject to the lien of the-mortgage, “ where by the express agreement of the owner of the-fee and the owner of the chattel, its character as personal property was not to be changed, but was to continue, and be subject to the right of removal by the owner of the chattels on failure of performance of conditions.”

The question of fact, or of the inference to be drawn from the-facts, as to the real character of the agreement under which this, machinery was affixed to the freehold was, as we have seen submitted to the jury and the fact was found in favor of the defendant. Under the doctrine of the cases above cited we think that finding entitled the defendant to a dismissal of the complaint

The motion for a new trial must be denied and judgment ordered for the defendant on the verdict

Macomber; J., concurs.