Opinion of the Court. GRIMES DRY GOODS COMPANY v. MALCOLM. ERROR TO THE CIRCUIT COURT OF APPEALS FOR THE EIGHTH CIRCUIT. No. 60. Argued and submitted October 21, 1896. — - Decided November 30, 1896. In Arkansas a conveyance of personal property of the grantor to the grantee in trust accompanied by delivery, conditioned that, as the grantor is indebted to several named persons in sums named, if he shall within a time named pay off and discharge all that indebtedness and interest, then the conveyance shall be void, otherwise the grantee is to sell the property at public sale, after advertisement, and apply the proceeds to the expenses of the trust, the payment of the debts named, in the order named, and the surplus, if any to the grantor, is, under the decisions of the Supreme Court of that State, a deed of trust in the nature of a mortgage. The submission of special questions to the jury under the statute of Arkansas is within the discretion of the court. What the mortgagor in such an instrument said to a third party, after execution and delivery, respecting his intent in executing the instrument, is not admissible to affect the rights of the mortgagee. All the evidence in the case being before this court, and it being clear from it that the trial court would have been warranted in peremptorily instructing the jury to find for the defendant, the plaintiff suffered no injury from the refusal of the court to permit the jury to retire a second time. THE case is stated in the opinion. Mr. G. B. Denison and Mr. N. B. Maxey, for plaintiff in error, submitted on their brief. Mr. A. G. Moseley for Waples, defendant in error. MR. JUSTICE HARLAN delivered the opinion of the court. This action was brought by the plaintiff in error, a Missouri corporation, in the United States court for the Indian Territory, Second Judicial Division, to recover from Malcolm, one of the defendants in error, the sum of $1845, alleged to be due the plaintiff on open account for goods, wares and merchandise Opinion of the Court. sold and delivered by it to Malcolm. The plaintiff alleged that $1200 of the account was due, and that the remainder thereof was to become due; also, that Malcolm had sold, conveyed or otherwise disposed of his property or suffered or permitted it to be sold with the intent to cheat or defraud his creditors or to hinder or delay them in the collection of their debts. A writ of attachment based upon affidavit was issued and levied upon one storehouse and fixtures, one stock of general merchandise and one gin house and saw mill as the property of Malcolm. Malcolm filed an affidavit controverting the grounds of the attachment. By leave of the court the appellee Waples interpleaded, alleging that at the time of the filing of the suit and of the levying of the attachment, he was rightfully in possession and control of the attached property in virtue of an instrument of writing executed by Malcolm on the 19th day of January, 1891, at Durant, in the Indian Territory, at which time Malcolm was in rightful possession and control of the property; that at the time of the execution and delivery of that instrument Malcolm delivered to him, Waples, actual possession of such property; that when the property was seized he notified the United States marshal of his claim to it, and demanded possession; that said instrument "was and is a mortgage with power of sale; that the same was intended by said defendant, John Malcolm, as a security for certain debts therein enumerated, and was so accepted by interpleader." The above instrument recited that Malcolm does " bargain, sell and deliver" to Paul Waples certain described personal property, including the property attached in this case, "to have and to hold the same unto the said Paul Waples, and his successors in this trust forever." The condition of the conveyance is recited to be: "Whereas I am indebted to the Leeper Hardware Company, $2552.23; and to Waples Platter Company, two notes aggregating $745.00, not including interest or attorney's fees and an open account for $259.39; and to Lingo, Waples & Company, two notes aggregating $399.20, not including interest or attorney's fees; and to Waterman, Starr & Company, $224.95; and to Burton, Lingo & Company, Opinion of the Court. $184.00; and to John R. Garr estate, $142.90, and to various other parties, named in Schedules A' and 'B,' hereto annexed and made a part hereof, in the sums set opposite their respective names. Now if, at any time within sixty days from this date, I pay off and discharge all of the indebtedness described aforesaid, including interest, then this conveyance shall be null and void, and of no further force or effect, and said goods, merchandise and property shall be restored to me. But if I fail to pay all of said indebtedness, with accrued interest, if any, within sixty days aforesaid, then said Paul Waples, or his successors, shall have the right, and it shall be his duty at the expiration of said sixty days, after first advertising the time, terms and place of sale for ten days previous to the day of sale, to sell all of the aforesaid property then on hand at public outcry, for cash." It was further provided in that instrument that Waples should take exclusive possession of the personal property in person or by his agents or employés, and should have the right to sell the merchandise in the due course of business for cash only. The money realized from the sale of the property, or any portion thereof, was to be appropriated first to the payment of the reasonable expenses "of executing this trust"; next to the payment of the claims of certain parties named; then to the payment of creditors, first those named in Schedule A, then those named in Schedule B, each set to be paid in full, and if not enough to pay all, then to be paid pro rata; the balance, if any, left in the hands of Waples was to be paid to Malcolm. The plaintiff filed a reply, controverting all the allegations of Waples' pleading, and denying that Waples was in possession and control, and entitled to possession and control, of the attached property or that the instrument referred to was or is or was intended to be a mortgage with power of sale. It averred that, as to it, "the said instrument and all acts done by said Malcolm and said Waples in connection with the execution thereof, and all acts done by either of them or by any person under and by virtue of it, are and ever have been fraudulent and tended to hinder and delay plaintiff in the collec Opinion of the Court. tion of their debt, and was contrived and intended with the. fraudulent intent to cheat, hinder or delay the plaintiff and the creditors in the collections of its and their debt, and was and is void." The reply further alleged "that the said instrument was and is a deed of assignment, and as such is in violation of the law governing voluntary assignments, and was and is wholly void, and the said interpleader never acquired any rights under the same, and it never gave him any right to the possession of the property attached in this action, and that said Waples never had, and has not now, under and by virtue of the said instrument, any right to take or hold possession of the said property, and has no right to recover the same in this action." Judgment was taken by the plaintiff against Malcolm for the amount of the debt due from him, and the cause having been tried between the plaintiff and Waples, as well as upon the issue raised by the attachment, the jury found for Malcolm on the latter issue and for Waples as to the property in controversy. Judgment upon that verdict having been entered, a writ of error was prosecuted to the United States Circuit Court of Appeals for the Eighth Circuit, and the judgment of the court in the Indian Territory was affirmed. 19 U. S. App. 229; 58 Fed. Rep. 670. The fundamental question in this case is whether the instrument of January 19, 1891, executed by Malcolm is a deed of trust in the nature of a mortgage, or a deed of assignment for the benefit of creditors. This instrument was before the Circuit Court of Appeals of the Eighth Circuit in RainwaterBoogher Hat Co. v. Malcolm, 10 U. S. App. 249; 2 C. C. A. 476; 51 Fed. Rep. 734, 737; and that court held it to be a deed of trust in the nature of a mortgage- the legal equivalent of a mortgage with a power of sale- upon the authority of the decisions of the Supreme Court of Arkansas construing the statute of that State regulating assignments for the benefit of creditors; which statute became a part of the law of the Indian Territory under the act of Congress of May 2, 1890, c. 182, 31, 26 Stat. 81, 94. By the statutes of Arkansas relating to assignments it is Opinion of the Court. provided: "Sec. 305. In all cases in which any person shall make an assignment of any property, whether real, personal, mixed or choses in action, for the payment of debts before the assignee thereof shall be entitled to take possession, sell or in any way manage or control any property so assigned, he shall be required to file in the office of the clerk of the court exercising equity jurisdiction a full and complete inventory and description of such property, and also make and execute a bond to the State of Arkansas in double the estimated value of the property in said assignment, with good and sufficient security, to be approved by the clerk of said court, conditioned that such assignee shall execute the trust confided to him, sell the property to the best advantage and pay the proceeds thereof to the creditors mentioned in said assignment according to the terms thereof, and faithfully perform the duties according to law." Act February 16, 1859, § 1, as amended by act February 23, 1883, Mansfield's Digest, 1884, p. 219. If the instrument executed by Malcolm was, within the meaning of the statute, an assignment for the benefit of creditors, then Waples' possession of the property was unauthorized, for he did not comply with the provisions of the statute by filing the inventory and giving the bond required. In Richmond v. Mississippi Mills, 52 Arkansas, 31, the court said: "We do not hold that the giving of one or more mortgages, the confession of judgments or other means adopted to give security or preference, constitute necessarily or even ordinarily an assignment. But we do hold that where one or more instruments are executed by a debtor, in whatsoever form or by whatsoever name, with the intention of having them operate as an assignment, and with the intention of granting the property conveyed absolutely to the trustee to raise a fund to pay debts, the transaction constitutes an assignment." The doctrines of that case were affirmed in Fecheimer v. Robertson, 53 Arkansas, 101, 104, the court saying: "The confidence of the mortgagors that no surplus would result to them in this case is apparent from the deeds, as also from the testimony. The purpose was to devote the property to the payment of debts. This may be accomplished by either a |