Lane v. Lutz. the action. The case would have been different had the plaintiff, after obtaining his judgment, issued an execution and levied upon the property itself. That would have been the case of a judgment creditor levying an execution upon specific property of his debtor, and raising the question affecting the title or right of a third person to or in the thing itself. There was, therefore, no lien acquired in this case upon the property by the filing of the complaint in October, 1854, and when the Husson mortgage was off the files in the register's office. It was entirely immaterial in this equitable proceeding to reach the assets of Lutz, Doll & Germann, as affecting the rights of Husson, whether or not his mortgage was on file when the suit was commenced. The statute, it is true, declares that a chattel mortgage shall be absolutely void as against the creditors of the mortgagor when the property is left in his possession, unless filed. This does not mean creditors at large. The creditor must have attached the mortgaged property or acquired a lien on it in some legal way before the question can be raised. If he be a judgment creditor, as in this case, his execution must be levied. Here there was no levy. Lambrecht was, at the time the execution was returned unsatisfied, the owner of the chattels and in possession, subject to Husson's mortgage. By instituting an equitable proceeding to collect his debt the plaintiff acquired no lien, nor was he in a position of a creditor entitled to allege that Husson's mortgage, from not being filed when he commenced the proceeding, was absolutely void as against him. If, however, he was in a situation to raise the question of the invalidity of Husson's mortgage as against him, on the ground that it was not filed in October, 1854, it is clear to my mind that a creditor, as in this case, with full notice of a prior mortgage, seeking to collect his debt out of specific property, by a proceeding in equity, stands in the same position as a subsequent purchaser or mortgagee. He takes only the equities of his debtor. There is, however, another reason why the plaintiff is not entitled to have the proceeds of the sale applied in payment of his judgment in preference to Husson's mortgage. On the face of his complaint it had been shown that the transfer to Lam Lane v. Lutz. brecht was made subject to Husson's mortgage, the validity of which was nowhere questioned, Husson not being a party. The court must either have given a judgment simply setting aside the conveyance, or do, what it undoubtedly possessed the power of doing, set it aside and take the property and dispose of it equitably. Accordingly, a judgment was given declaring the conveyance to Lambrecht to be void, and ordering the appointment of a receiver to take and sell the property, subject to the incumbrances upon it at the time of the transfer-Husson's mortgage being the only lien. In this judgment the plaintiff acquiesced and has never appealed from it. If he had appealed he could not have altered it, as Husson, the mortgagor, was not a party. Husson's right to be paid his mortgage is, therefore, res adjudicata. There is yet another reason for postponing the payment of the plaintiff's judgment to that of the mortgage of Husson. The order of the court was to sell the property, subject to the incumbrances, including this mortgage, and if Husson had not consented it could not have been sold in any other way. To have effected a sale of it, subject to incumbrances, would have required it to have been sold in bulk. Before the sale the plaintiff, Husson, and others interested, fixed a price at which it was to be sold in bulk, and if so sold it was agreed that the Husson mortgage was to remain; but if the sale was in parcels, and the property scattered, the mortgage was to be first paid from the proceeds of sales. An ineffectual attempt was made to sell in bulk, there being no bidders, when it was sold in parcels under this understanding and agreement. I think the plaintiff is estopped by the agreement from insisting that Husson's mortgage is not entitled to priority of payment out of the proceeds of the sale. To allow him, after the sale has taken place on the faith of the agreement, to repudiate it, and when Husson cannot be put in the same position he was in before the sale, would be unreasonable and unjust. It would enable the plaintiff to perpetrate a wrong and a fraud upon him. It is to be remembered that had Husson not consented, the sale must have been subject to his mortgage. It is immaterial whether the plaintiff knew that the mortgage had not been filed. There was no fraud on Husson's part, and the plaintiff Lane v. Lutz. knew the law on the subject as much as if he had been expressly told what it was, and was bound to make inquiry or search if he thought it important. At all events, it was too late to object after Husson had allowed the sale to take place under the agreement, and could not be replaced in his former position. The judgment should be affirmed. HOGEBOOM, J.-The reasons rendered by the referee at the special term for the disposition of the case made in the court below appear to me to be cogent and conclusive, and I do not deem it necessary to enlarge upon them. I content myself with a brief reference to some of the propositions advanced by the counsel for the appellant. 1. It is said that the commencement of this action operated to confer upon the plaintiff a specific lien upon the property in question, and that the mortgage of Husson was entirely inoperative against the plaintiff because it was not filed. It is not necessary to discuss either of these propositions, because the decision in favor of Husson is placed upon a ground entirely distinct and independent of these and consistent with the assumption that both of these prepositions may be entirely correct. 2. It is said that Husson's mortgage being thus entirely void he was not in any way prejudiced by the sale. But as to this, it must be observed: First, that Husson was not a party to the action, and has had no opportunity to set up by answer or fully to establish by proof what facts he might wish to present by way of obviating the necessity for filing his mortage; second, Husson was undoubtedly prejudiced by the sale if it was not carried out in conformity with the stipulation to which he was a party, and on which he relied for the protection of his interests. 3. It is said that the alleged agreement, that Husson was to be paid out of the proceeds of the sale, was void as being without consideration, and being void could not operate as an estoppel against the plaintiff. First, this assumes what Husson has not had an opportunity fully to controvert, to wit, the invalidity of his mortgage. Second, the agreement was not with out consideration. Lane v. Lutz. Husson at all events made a claim under his mortgage, and the claim was sufficiently plausible and colorable to operate as the foundation of a sufficient consideration to make some equitable arrangement in regard to it. The plaintiff had not treated it as invalid, nor made Husson a party to a suit to set it aside, and the court had expressly directed a sale subject to it. The bounden duty of the receiver was to conform to the order of the court, from which plaintiff had taken no appeal, and the latter was not therefore in a situation to attack the mortgage of Husson. But, apprehending that the mortgage of Husson might embarrass the sale and cause a sacrifice of the property if sold in parcels, the plaintff made an explicit arrangement with IIusson, which the plaintiff expected to be advantageous to him, but which he now wishes to repudiate, that the property should be sold, discharged of the incumbrances which were to be paid out of the proceeds. I think the plaintiff is precluded from receding from his agreement by every consideration which enters into the idea of an equitable estoppel. 4. It is said that the plaintiff acted in ignorance of the fact that the mortgage was not filed, and therefore should be bound by the course of proceeding to which he assented. First, it is probably true, though it does not appear to be expressly proved, that plaintiff was ignorant of the filing of the mortgage, but there is no pretense or proof that Husson fraudulently concealed that fact from him. The plaintiff had an opportunity and was bound to acquaint himself with the fact, and his neglect to do so was his own misfortune. He must be bound by his agreement if he was not inequitably surprised or fraudulently entrapped into it by Husson. Second, there is no certainty that he would not have made precisely the agreement he did if he had been aware of the non-filing of the mortgage. He does not say that he would not. He had instituted proceedings without making Husson a party, having entirely a different aspect, which disabled him from setting aside that mortgage without entirely revolutionizing the framework of his proceedings. The court had made an order upon the assumption that Husson's mortgage was to be paid. The plaintiff had practically adopted that order, and if he had then Lathrop v. City of Buffalo. ascertained for the first time the non-filing of the mortgage he might perhaps have very rationally concluded that it was better to go on and take his chances for ultimate compensation out of the proceeds of a sale subject to the mortgage, which he probably supposed would protect his debt as well as the mortgage, than to retrace his steps, pay the costs, begin anew, make Husson a party to the new proceedings, and charge the invalidity of the mortgage, with the chances of possible, if not probable discomfiture. In every aspect which I have been able to consider the case I think the order of the court below was right, and should be affirmed. A majority of the judges concurred. LATHROP v. CITY OF BUFFALO. December, 1861. Where the statute recognizes two classes of local improvements, one of which it forbids to be made except on petition of a majority of those to be affected by the assessment, an assessment for a work including improvements of both classes cannot be made on a petition of a mere majority of all those affected by any part of the work. The certificate of the assessors should show that the petition is by a majority of those affected by that part of the work for which a petition is necessary. The charter of the city of Buffalo allowed assessments for paving and for crosswalks to be made in the discretion of the common council, but assessments for grading could only be made on a petition of a majority of those interested or liable to be assessed. Held, that an assessment for grading a street, and for paving, and crosswalks at intersections of other streets, made upon petition of a majority of all the persons affected by any of the work, was invalid, it appearing from the assessment that a majority of those affected by the grading were not petitioners.* * In the similar case of DOLAN, decided at the same time, one of the questions was whether the uniting two streets which were one continuous way, in the same proceedings, was a fatal defect within this rule, and on this question a majority concurred with the minority who dis sented upon the main question, in holding that it was not a fatal defect. See also Howell v. City of Buffalo, vol. 2, p. 412, of this series, and cases cited, |