Summers and Brannin v. Roos & Co. 16. The retention of the deed of trust by Summers & Brannin, from the 19th day of December to the 30th day of January, is not, of itself, evidence of a fraudulent intent by the parties to the deed, if the evidence shows that the deed was made bona fide, and not intended to defraud creditors. The sixth instruction was modified by the court (the modification is embraced in brackets), and plaintiffs in error excepted: 6. If the jury believe, from the testimony, that the debt of A. Roos & Co. was not contracted until the 14th of February, 1867, and that the deed of trust was recorded before that date, on the 30th of January, 1867, then the deed of trust [if the note it was intended to secure was for a debt then due] was notice to them, and they cannot set up that they had no notice of its existence. W. & J. R. Yerger, for plaintiffs in error. W. P. Harris and J. B. Chrisman, for defendants. SHACKELFORD, C. J. On the 20th day of March, A. D. 1867, the defendants in error filed, in the circuit court of Lawrence county, their affidavits, in which it is alleged that William P. Baggett, of said county, is indebted to them in the sum of $5,370.06, and that said Baggett "has property and rights in action which he converts, and unjustly refuses to apply to the payment of his debts; that he has assigned and disposed, or is about to assign or dispose, of his property or rights in action, or some part thereof, with intent to defraud his creditors, or give an unfair preference to some of them; and that he has converted, or is about to convert, his property into money or evidences of debt, with intent to place it beyond the reach of his creditors;" and thereupon the usual attachment was sued out by the defendants in error against the estate of said Baggett, and placed in the hands of the sheriff of said county, and by him it was levied upon certain real estate and personal property, as the property of the said Baggett, on the 20th day of March, 1867. On the 30th day of March, 1867, J. J. B. Hilliard made affidavit before the clerk of the probate court of said county, that the goods, wares and merchandise attached as aforesaid by the sheriff, on the 20th day of March, A. D. 1867, under and by virtue of the attachment sued out by defendants in error against the estate of said Baggett, belonged to him, and that he was the owner of said prop Summers and Brannin v. Roos & Co. erty as trustee under a deed in trust, executed on the 19th day of December, A. D. 1866, by the said William P. Baggett to him as trustee, for the use of Summers & Brannin; and prayed for the possession of the property. Claimant Hilliard executed bond, and the property so attached was delivered up to him by the sheriff. About the same time, other creditors, who are named in the record, attached the same property as the property of Baggett in controversy in the case under consideration. An issue was made up at the May term, 1867, of said circuit court, to try the right of property, and the case submitted to a jury. Before the trial of the right of property, judgment was obtained at the May term, 1867, upon the debt of defendants in error, and upon the claims of the other attaching creditors of Baggett; all of which judgments were read at the trial. The jury found a verdict for the plaintiff in attachment, and assessed the damages, or value of property attached, as $11,012.69. A motion was made for a new trial by the claimant, which was overruled by the court, and exceptions taken to the ruling of the court, and brings the case here by writ of error. The grounds for the motion of a new trial are: 1. Because the verdict is against the evidence and instructions of the court. 2. Because the court erred in refusing to grant the fifteenth and sixteenth instructions asked by the claimant. 3. The court erred in modifying the instructions asked by the claimant. 4. The court erred in giving the first, second and third instructions asked for by the plaintiff in attachment. The first error assigned is the refusal of the court to grant a new trial to the plaintiffs in error; which we shall now proceed to consider. On the trial, the deed in trust executed on the 19th day of December, 1866, by William P. Baggett, to J. J. B. Hilliard, trustee for the parties, was read to the jury with a paper of even date, signed by Summers & Brannin and William P. Baggett; duplicates having been signed, one delivered to Baggett, and the other retained by Summers & Brannin. In this deed, certain real and personal estate is conveyed, transferred and sold to the said J. J. B. Hilliard, to secure the payment of a note for the sum of $40,000, executed and delivered by Baggett on the 19th December, 1866, to Summers & Brannin, and due and payable ninety days from date, payable Summers and Brannin v. Roos & Co. at the Caral Bank of New Orleans. In this deed, conveying real and personal estate to Hilliard, is included the stock of goods, wares and merchandise then in the store of the said Baggett, in the town of Brookhaven. It is further provided, that, in case Baggett failed to pay the said note at maturity, then the said J. J. B. Hilliard is to take possession of the personal estate, and sell that on ten days' notice, and the real estate on thirty days' notice; the cotton embraced in the deed in trust was to be immediately shipped by Baggett to Summers & Brannin. The concurrent paper above referred to is in substance, that there was a large unsettled balance between said Baggett and Summers & Brannin, growing out of various assignments of cotton by Baggett to them, and various advances of money by them to Baggett; and that they contemplated a continuance of like transactions between them up to the maturity of said note, and it being uncertain what may be the balance due them by said Baggett to them; and that the object of the said note and of said deed in trust is to secure the balance that may be due by Baggett to Summers & Brannin at the maturity of said note. It is further provided therein, that Summers & Brannin are to advance to the said Baggett $70 per bale, in cash and groceries for such cotton as he may, before the maturity of the said note, purchase or trade for, and consign to Summers & Brannin; it is further provided, that it was not to include any of the cotton embraced in the deed of trust, "or any of the cotton expected of Larkin." It is shown that Baggett owed Gartman & Strickland $1,000 for cotton, and "which Baggett is to make all reasonable efforts to pay out of his own means;" if he could not, Summers & Brannin are to advance the amount on the receipt of the cotton. Summers & Brannin obligated themselves to take up Baggett's acceptances in favor of his New York creditors to the amount of $8,000, about to fall due before the first of January, 1867, and Baggett's draft in favor of J. Bloom & Co., of New Orleans, for $3,500, and pay $500 or $1,500 for groceries, Baggett's purchases in December, 1866; all of which are to be placed to the debit of Baggett, on his account with Summers & Brannin. On the maturity of the said note of $40,000, the said Summers & Brannin are to state the account, and the balance due by Baggett, any thing, to them "will be the amount due them on said note." Summers and Brannin v. Roos & Co. The deed in trust was not recorded until the 30th of January, A. D. 1867. The contract explanatory of the deed in trust was not recorded. The first objection urged by counsel for defendants in error against the validity of the deed in trust in the record is, that it is fraudulent and void as to Baggett's creditors, because the deed did not express on its face that it was "to secure future advances." Counsel cite 4 Kent's Com. pp. 176, 177, for authority in support of this position. It is laid down in the text referred to "that a mortgage or judgment may be taken and held as a security for future advances and responsibilities, to the extent of it, when this is a constituent part of the original agreement; and the future advances will be covered by the lien, in preference to the claim, under a junior intervening incumbrance, with notice of the agree ment. The principle is, that subsequent advances cannot be tacked to a prior mortgage, to the prejudice of a bona-fide junior incumbrancer; but the mortgage is always good to secure future loans, when there is no intervening equity. "It is necessary that the agreement, as contained in the record of the lien, should, however, give all the requisite information as to the extent and certainty of the contract; so that a junior creditor may, by inspection of the record, and by common prudence and ordinary diligence, ascertain the extent of the incumbrance." "This is requisite to secure good faith, and prevent error and imposition in dealing." In the case of Brinkerhoff v. Marvin, 5 Johns. Ch. 320, Chancellor KENT, deciding the case, says: "A judgment or other security may be taken and held for future responsibilities to the extent of it." Referring to the case of Livingston v. McInlay, 16 Johns. 165, he says: "The superior court observed that, if it was a part of the original agreement, a judgment may be entered as a security for future advances beyond the amount then actually due; in like manner, a mortgage may be held as a security for future advances. The limitations to this doctrine, I should think, would be, that when a subsequent judgment or mortgage intervened, further advances, after that period, would not be covered." In thie case, the purposes of the judgments were expressly declared by concurrent receipts, and their validity (the j dgments) sustained by the chancellor. In this opinion, Chancellor KENT cites the case of Shirras et al. VOL. II.-83 Summers and Brannin v. Roos & Co. v. Craig et al., 7 Cranch, 34, as authority, and uses this language in reference thereto : "A mortgage should stand, to secure the real equitable claims of the mortgagee, whether they existed at the date of the mortgage, or arose afterward, and before notice of the defendants' equity." In the case of Shirras et al. v. Craig et al., at the time of the execution of the mortgage, Gardiner, the mortgagor, was supposed to be solvent; and the mortgage was executed in part to secure the payment of money actually due at the time and in part to secure sums to be advanced, and to indemnify some of the mortgagees for liabilities to be incurred. The mortgage was dated the 1st of December, 1801, and recorded on the 14th of September, 1802, and purported, on its face, to secure £30,000 sterling, due to all the mortgagees; it was really intended to secure different sums due at the time from particular mortgages, and advances afterward to be made, and liabilities to be incurred, to a certain amount. Chief Justice MARSHALL, delivering the opinion of the court, held the mortgage to be valid, and affirmed the decision of the vice-chancellor of Georgia, sustaining the mortgage. There have been repeated adjudications upon the doctrine announced in these decisions, recognizing and approving it, by many of the most enlightened tribunals of last resort in the Union. Collins v. Castile, 13 Me. 254; Craig v. Tappin, 2 Sand. Ch. 78; Bank of Utica v. Finch, 3 Barb. Ch. 293; 15 Ohio, 253; 23 Hen. (S. C.) 14; 30 Barb. 268; Robinson v. Williams, 22 N. Y. C. A. 380; 23 Conn. 123; 20 id. 427; Ball v. Fleming, 1 Beas. 13; 24 Pick. 274; 8 Bentham, 287; Mix v. Coles 20 Conn. 420; 36 Penn. St. 170. These authorities, we think, are conclusive against the objection raised by counsel against the validity of the deed in question; because it is not shown upon its face that it was intended to secure future advances, as well as advances already made. We are, under this view of the law, unable to concur with counsel for the defendants in error, in his construction of the text above quoted from 4 Kent's Com. pp. 176, 177. This refers clearly to the agreement entered into between the mortgagor and mortgagee at the time of the execution of the deed intended to secure future advances: in the use of the language, that "this agreement should give all the requisite infor mation as to the extent and certainty of the contract." The distinguished commentator only intended to show what it should contain, |