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FARMERS & MERCHANTS NATIONAL BANK OF IVANHOE v. FRANK PRZYMUS

Minnesota Supreme Court1924-11-28No. No. 24,078
161 Minn. 85

Summary

Holding. The court affirmed the judgment in favor of the defendant farmer, finding that the jury's verdict was supported by evidence and that the trial court properly admitted collateral evidence to assess credibility where testimony on the mortgage's scope directly conflicted.

A farmer who could not read English executed a chattel mortgage to secure a debt, later followed by a second mortgage purporting to cover remaining cattle and future crops. The farmer claimed he did not knowingly agree to include the 1923 crop in the second mortgage, asserting the bank's vice president fraudulently inserted that provision without his knowledge or consent. The bank repossessed and sold the 1923 crop, but a jury found for the farmer, returning the grain or its value. The bank appealed, arguing the evidence did not support the verdict.

The court upheld the jury's decision because the testimony regarding what was agreed upon conflicted between the bank officer and the farmer, and resolving such factual disputes falls within the jury's province. The court also found it proper to admit testimony about statements the bank officer made regarding releasing mortgages for a modest sum, as this collateral evidence could illuminate the credibility of competing accounts when testimony on a vital issue is contradictory. The court affirmed the judgment but required the farmer to deduct only the threshing lien from the recovery, as the landlord's payment lacked evidentiary support as a valid claim against the grain.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

  • Whether fraudulent insertion of a crop provision in a chattel mortgage occurred
  • Whether a jury verdict is supported by conflicting testimony between parties
  • Admissibility of collateral evidence to assess credibility when testimony on vital issues contradicts
  • Validity of liens and claims against repossessed grain proceeds

Procedural posture

The bank brought a replevin action to obtain possession of the 1923 crop; the farmer denied knowingly mortgaging that crop; a jury returned a verdict for the farmer; the bank appealed from the judgment and the denial of its motion for a new trial.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion

majority opinion

Taylor, C.

Defendant operated a farm of 140 acres in Lincoln county for several years under an arrangement with the owners, the terms of which are not disclosed. In 1920 he was indebted to plaintiff in the sum of $480 and gave a chattel mortgage upon some cattle as security for its payment. In June, 1922, the debt remaining unpaid and some of the cattle having died, he executed a second mortgage to plaintiff covering the cattle that remained and the crops to be raised in the years 1922 and 1923. The mortgage recited that it was a renewal and was not intended to release any of the security included in the original mortgage. The crop of 1922 was covered by a prior mortgage for $2,900 given by defendant to the First National Bank of Ivanhoe, and including it in this mortgage added little, if anything, to the security. In February, 1923, plaintiff foreclosed its original mortgage on the cattle and applied the proceeds on the debt. The balance still due was somewhat in excess of $400.

In August, 1923, plaintiff brought this- action in replevin to obtain possession of the crop of 1923 for the purpose of foreclosing its mortgage thereon. Defendant interposed an answer asserting that the provision covering the crop of 1923 had been fraudulently inserted in the mortgage without his knowledge or consent. The grain was taken by the sheriff and delivered to plaintiff, and plaintiff forthwith foreclosed its mortgage and sold the grain thereunder. At the trial, the jury returned a verdict for defendant for the return of the grain or for its value which they fixed at the sum for which it had been sold.

Plaintiff contends that the verdict is not sustained by the evidence. All the transactions with defendant were conducted on plaintiff’s part by Frank R. Cluczny, its vice president, who seems to have been its active and managing officer. Tbe only testimony concerning tbe matter of giving tbe mortgage in controversy is that of Cluczny on one side and of defendant on tbe other. Tbe mortgage was prepared by Cluczny on a printed blank. Defendant could not read English, nor write except to sign his name. Tbey agree that tbe mortgage was to cover the cattle included in tbe former mortgage and also tbe crop of 1922. Cluczny saysthat defendant expressly agreed to include tbe crop of 1923 also, and executed tbe mortgage knowing that it covered tbe crop of that year. Defendant says that tbe crop of 1923 was never mentioned and no suggestion that it be included in tbe mortgage was ever made. He further says that tbe mortgage as read to him by Cluczny covered only tbe cattle and the crop of 1922, and that be executed it believing that Cluczny bad correctly stated its contents. Tbey flatly contradicted each other and each is corroborated to .some extent by other facts. It is not our province to determine tbe facts. That duty rested on tbe jury. Tbey bave accepted defendant’s version of tbe transaction, and we are unable to say that the evidence will not sustain their finding.

After plaintiff bad taken,possession of the cattle in February, 1923, under its original mortgage, defendant and tbe cashier of tbe First National Bank, wbicb held tbe mortgage of $2,900 on tbe crop of 1922, bad an interview with Cluczny concerning defendant’s affairs. At tbe trial tbey were permitted to testify that in this interview Cluczny stated that be was going to clean up with defendant, take bis loss and be done with it; and that be further stated that be would release all bis mortgages against defendant if tbey would pay him $150. Plaintiff insists that the admission of this testimony was error. It does not infringe the rule wbicb excludes evidence of an offer made in an effort to compromise a disputed claim, for here there was no disputed claim to compromise. See 5 R. C. L. 891. Where tbe testimony upon a vital issue is contradictory, evidence of collateral facts tending to show which statements are tbe more probable, reasonable or credible, may be admitted in the discretion of tbe court. Glassberg v. Olson, 89 Minn. 195, 94 N. W. 554; Sonnesyn v. Hawbaker, 127 Minn. 15, 148 N. W. 476; State Elev. Co. v. G. N. Ry. Co. 133 Minn. 295, 158 N. W. 399; Sullivan v. M. St. Ry. Co. supra, p. 45. Defendant insists that if plaintiff had held a mortgage on the crop of 1923 not then planted, it is not likely that Cluczny would have made such statements. The testimony had some probative value and admitting it was within the discretion of the court, its weight was for the jury.

We have examined the other rulings of which plaintiff complains and find no error, and none which require special mention.

It appears that out of the proceeds of the grain plaintiff had paid the threshing bill of $57.95 and the sum of $94.60 to defendant’s landlord. In the order denying plaintiff’s motion for a new trial, the court imposed as a condition that defendant should deduct the amount of the threshing bill from the amount of the verdict. Plaintiff insists that the court should also have deducted the amount paid the landlord. The thresher had filed a lien for his bill as provided by statute and had a valid claim upon the grain therefor. The record fails to show that the landlord had any interest in or claim upon the grain of any sort. With no evidence to establish a claim against the grain on the part of the landlord, the court could not allow this item.

Order affirmed.