Eckman & Vetsburg v. Munnerlyn

Citations

• 32 Fla. 367

Syllabus

<p>1. A mortgage covering a stook of merchandise, under which the mortgagor is permitted by agreement or understanding of the mortgagee to sell the goods at discretion, or in the usual course of business, is fraudulent and void as to existing creditors of the mortgagor, and it makes no difference whether the agreement or understanding in reference to the sale of the goods be expressed in the mortgage itself or not. If it was so agreed or understood at the time the mortgage was executed, whether in writing or parol, the security is thereby rendered void as to the creditors of the mortgagor.</p> <p>3. Where the mortgagor of a stock of merchandise is permitted by the mortgagee to sell the same in the usual course of trade, without accounting for the proceeds, it will justify the creditors of the mortgagor in suing out an attachment against him on the ground that they have reason to believe that he will fraudulently part with his property before they can obtain judgment against him. The issue in such case being not that an intentional fraud existed, but whether or not the affiant in the attachment proceedings had reason to believe that the defendant would fraudulently part with his property before judgment could be obtained against him.</p>