counsel in Johnson's testimony, as well as in Kinter's, and great stress is laid upon the fact that Darragh said he believed the mortgage was fraudulent. But, upon a careful reading of all the testimony, we think the complainants have not established the claim in their bill that the mortgage was given without consideration, or that Kinter did not pay to Johnson the amounts he claims both before and at the time of the execution of the mortgage. Neither is the testimony of Darragh contradicted that he paid to Kinter the amount of Kinter's claim when the mortgage was assigned, except by inferences drawn by counsel from the circumstances surrounding the case. Johnson had the right to prefer Darragh & Co., and put the amount of their claim in the mortgage. It was no fraud upon the other creditors, and, if it was actually made a part of the consideration of the mortgage, Darragh & Co. had the right, when advised of it, to accept its terms, and, doing so, the other creditors whose liens were subsequent to Darragh & Co. have no right to complain. We do not see how the taking of the deed to Annie P. Darragh affects this controversy, even as a circumstance to throw any suspicion upon the validity of the mortgage. The decree of the court below must be affirmed, with costs. The other Justices concurred. 78 36 84 387 78 36 114 614 78 36 115 410 JOHN FULLER ET AL. V. CHARLES H. RHODES, PRINCI- Chattel mortgages-After-acquired property-Future indebtedness -Garnishment. In this case it is held that a chattel mortgage executed by the principal defendant, and duly filed, to secure existing and future indebtedness, and covering future acquired property, and also all notes and accounts due or to become due the mortgagor, which the mortgagees were authorized to collect, was notice to the plaintiffs, and to all other persons, of the rights of the mortgagees in the property covered by said mortgage; and that under it they are entitled to receive from the garnishee defendant the sum of $600 due the mortgagor on book account, arising largely from the purchase of posts, wood, and ties which were owned by the mortgagor at the time he executed the mortgage, it appearing that the mortgagees intended to retain their lien on said property to secure the payment of the indebtedness secured to them by said mortgage. Error to Bay. (Cobb, J,) Argued October 18, 1889. Decided November 15, 1889. Garnishment. Plaintiffs bring error. Affirmed. The facts are stated in the opinion. Shepard & Lyon, for appellants, contended: 1. No title passes under a chattel mortgage, even though default is made in its conditions, but a foreclosure and sale is necessary to transfer the title; citing Van Brunt v. Wakelee, 11 Mich. 177; Lucking v. Wesson, 25 Id. 443; Haynes v. Leppig, 40 Id. 602. 2. The provision in the mortgage relative to the notes and accounts amounted simply to a power, and until acted upon by the mortgagees, and the proceeds reduced to their possession, such notes and accounts were liable for the payment of the debts of the mortgagor; citing Holmes v. Hall, 8 Mich. 66; Dalton v. Laudahn, 27 Id. 529. 3. The mortgage, if not fraudulent at its inception, became such by the fraudulent use made of it by the mortgagees. It made a debtor with ample property to pay his debts practically insolvent, and the mortgagees endeavored to control the property for his benefit in such a manner as to defeat the claims of creditors. Edgar A. Cooley (J. L. Stoddard, of counsel), for defendants, contended: 1. Where it is not claimed that there was no evidence tending to support findings of fact, a bill of exceptions becomes immaterial, and should not be examined; citing Scotten v. Sutter, 37 Mich. 526; Johnson v. Crispell, 43 Id. 261; Farrington v. Sexton, Id. 454; Kane v. Stowe, 50 Id. 317; Kundinger v. Railway Co., 51 Id. 185. 2. The court will only ascertain whether the conclusion of law is a correct deduction from the facts found, or, more properly speaking, whether, upon the facts found, the plaintiffs are entitled to a judgment; for, unless the facts found entitle plaintiffs to a judgment, they have failed to make a case, and judgment must pass for the garnishee defendant, as no additional facts can be presumed; citing Mitchell v. Chambers, 43 Mich. 150, 158; Johnson v. Crispell, Id. 261; Randall v. Randall, 37 Id. 563, 570; Leitelt v. Parker, 48 Id. 297; Robinson v. Smith, 63 Id. 350. 3. Fraud is a question of fact, and even where there is evidence tending to show fraud, unless the trial court finds that there was in fact fraud, it cannot be presumed to exist; nor has this Court any jurisdiction to review the findings in respect thereto; citing Johnson v. Crispell, 43 Mich. 261. LONG, J. Plaintiffs in February, 1888, brought an action of assumpsit against defendant, Charles H. Rhodes, in the circuit court of Bay county, and on February 29, 1888, a writ of garnishment was issued out of that court in the cause, directed to the Michigan Central Railroad Company as garnishee. Disclosure was made by the railroad company, admitting an indebtedness of $600. Afterwards a second disclosure was filed by the garnishee, also admitting the indebtedness of $600, but disclosing that the moneys were claimed by W. I. Brotherton & Co., on the ground that they had a chattel mortgage bearing date December 9, 1887, upon the property sold to the garnishee by the principal defendant, and upon the proceeds thereof. The cause came on to be heard before the court without a jury, and W. I. Brotherton & Co. appeared, and took charge of the defense, and contested the right of the plaintiffs to recover from the garnishee. The circuit court, at the request of the plaintiffs, made written findings of fact and conclusions of law, as follows: "That on December 9, 1887, Charles H. Rhodes was, and for many years had been, a resident of Bay City, in Bay county, and engaged in the business of making, buying, and selling railroad ties, wood, posts, and other forest products; that said Rhodes procured said ties partly from his own lands, and partly by purchase, and had at all times considerable quantities thereof on hand, and in process of manufacture, at different points along the Michigan Central Railroad and its branches, from Kawkawlin, in Bay county, north to the Straits of Mackinaw, and on December 9, A. D. 1887, he had a considerable quantity of such ties on hand; that all the ties so purchased or manufactured by said Rhodes were by him sold to the said garnishee defendant in this cause, the Michigan Central Railroad Company, and those which he acquired by purchase were hauled out of the woods to points along the line of said railroad, and there inspected from time to time by the inspectors of said garnishee defendant; and such inspection was the basis, not only of the settlement between said Rhodes and said garnishee defendant, but also of the final settlement between said Rhodes and his vendors, but he usually paid for them on estimates made previous to such inspection; and when such payment was made the ties were marked with his mark, and were, as between himself and his vendors, treated and considered as his property, the estimates being subject to correction when the inspection should be afterwards made. "That on December 9, A. D. 1887, said Rhodes was indebted to W. I. Brotherton & Co., a copartnership composed of W. Irving Brotherton, Henry N. Watrous, Orville A. Watrous, and Henry W. Jennison, and doing business at Bay City, in the sum of six thousand four hundred and eighty-nine dollars and ninety-four cents ($6.489.94), and on that day, and in order to secure the payment thereof, and of such indebtedness as he might afterwards incur to them, said Rhodes executed and delivered to said W. I. Brotherton & Co. a mortgage, a copy of which is appended hereto, and made a part hereof; and on the 22nd day of the same month said mortgage was duly filed in the office of the recorder of said Bay City, said city having no officer known as city clerk. "That, after the making of said mortgage as aforesaid, said Rhodes continued to purchase from W. I. Brotherton & Co., from time to time, supplies to use in the prosecution of the work of getting out such ties and other forest products, and also from time to time made payments in the manner hereinafter shown, to apply on his indebtedness to them;, so that on February 29 his indebtedness to them amounted to nine thousand three hundred and five and 86-100 dollars ($9,305.86), and it now amounts to nine thousand three hundred and twelve and 6-100 dollars ($9,312.06). "That said Rhodes had an account at the Bay City Bank, in Bay City, and was, at all times, allowed to check against said account, and said bank from time to time made advances to him on said account, to enable him to carry on his business, and the following course of dealing was established between said Rhodes and said bank, viz.: Said bank paid at maturity all papers given by said Rhodes to said W. I. Brotherton & Co., and all paper given by him to other persons, in the prosecution of his said business, and checks drawn by him for money used in said business, and said bank relied upon the monthly sales of ties and timber, hereinafter mentioned, to make said account good and repay advances. "That once in each month said garnishee defendant paid for all the ties and timber purchased of said Rhodes during the preceding month, and, whenever the amount of any monthly payment about to be made was tained, said Rhodes ordered the same to be paid to said bank, and it was so paid, and was by said bank placed ascer |