
    Oscar Talcott v. John Q. Crippen.
    
      Mortgagee’s good faith — apparent ownership — Damages.
    1. If a bill of sale of a shingle-mill is taken as security for its owner’s debts but the mill is left in his possession a copy of the bill must be filed at once or the property cannot be protected by it against other creditors of the owner (How. St. §' 6193) whose good faith alone will not protect the unrecorded transfer.
    2. Where replevin against an officer who had taken the property under , an attachment was brought by a person to whom a bill of sale had been given as security but not put on file, it was held proper for defendant to show that part of the debts on which the attachment issued accrued after the bill was given and in reliance upon the vendor’s continued possession and apparent ownership.
    3 Where malice is in no way an element in a litigation over the right to personal property the rule of damages, is the same whether the action is of contract or of tort.
    4 Evidence as to prospective profits is inadmissible to fix the measure of damages in a case where the loss of such profits is involved if it appears that they could not be made except .under the most favorable circumstances, that the chances against them were numerous and that it was doubtful if the business was profitable at all as conducted.
    Error to Montcalm. (Y. H. Smith, J.)
    Feb. 1.
    Feb. 8.
    Replevin. Defendant brings error.
    Reversed.
    
      T. F. Shields and Webster, Steere da Miller for -appellant.
    
      Lemuel Olute for appellee.
   Cooley, C. J.

Plaintiff replevied of defendant a shingle-mill. On the trial plaintiff deduced title under a bill of sale from Spaulding S. Ackles, bearing date April 6, 1882, and purporting to make an absolute transfer of the title. Ackles at the time was in possession and was operating the mill. He was indebted to the plaintiff, according to his testimony, in a considerable amouut, and, as he testifies for the plaintiff, he transferred the mill to the plaintiff as security for the debt. In immediate connection "with this he says he considered it a genuine sale. Plaintiff on his own behalf testified that Acides, after the bill of sale was given, was left to operate the mill till he had performed an outstanding contract, and whatever profits would accrue from it he was to pay to plaintiff on his indebtedness. Plaintiff himself took possession about July 1, 1882. The bill of sale was filed in the office-of the township clerk, August 10, 1882. Plaintiff says that he filed it because, in a casual conversation with a lawyer, he was advised that it would be safer to do so. The defendant is sheriff of the county and he seized the mill on attachments against Acides on August 11, 1882. The demands for which the attachments issued were created between February 9,1882, and August 3,1882.

In submitting the case to the jury the circuit judge failed to bring out the distinction between transfers of chattels by absolute sale and those by way of security, and he charged the jury at the plaintiff’s request, that if they found he took the mill from Acides for the purpose of paying him for money that Acides owed him, and to indemnify him for liabilities which he agreed to pay for Acides, and without any intent to hinder, delay or defraud the creditors of Acides, their verdict should be for the plaintiff. This could only be true if the sale was absolute; for the statute provides that every mortgage, or conveyance intended to operate as a mortgage, of goods and chattels, which shall hereafter be made, which shall not be accompanied by an immediate delivery, and followed by an actnal and continued change of possession of the things mortgaged, shall be absolutely void as against the creditors of the mortgagor, and as against subsequent purchasers or mortgagees in good faith, unless the mortgage, or a true copy thereof” shall be duly filed. IIow. St. § 6193. Good faith in the mortgagee does not protect the unrecorded transfer which conies under this statute. Haynes v. Leppig 40 Mich. 607; Fearey v. Cummings 41 Mich. 383; Cooper v. Brock 41 Mich. 491; Sut ton v. Rowley 44 Mich. 113; Anderson v. Brenneman 44 Mich. 198; Wallen v. Rossman 45 Mich. 333. There was abundant if not conclusive evidence to go to the jury on the theory that this bill of sale was nothing but a mortgage, and this seems to have been the theory of the plaintiff himself when he began his proofs.

The defense offered evidence -to show that a portion of the demands for which the attachments were sued out was contracted after the giving of the bill of sale, and in reliance upon the possession and apparent ownership of Acides. This was not received, but we think it should have been. The use of any such credit as the apparent ownership of Acides would give him, ought to have been anticipated by the plaintiff as a possible occurrence, and it might well be argued to the jury that plaintiff should have given some degree of notoriety to the transfer. The fact that persons continued to trust Acides without knowledge of any transfer, when they would have refused if they had known of it, is a circumstance bearing strongly upon the plaintiff’s good faith.

The plaintiff delayed the replevy of the mill for three months, and he claimed on the trial to recover as damages the profits he might have made in the interval. The defense objected to the proofs offered, and referred to the decisions in Allis v. McLean 48 Mich. 428 and McKinnon v. McEwan 48 Mich. 106, as authority against them. These cases are said not to be applicable, because they were suits upon contract, while the present is a suit sounding in tort. A distinction is undoubtedly to be taken between actions upon contract and actions of tort, in all cases where malice, express or implied, is an element; but where parties are in good faith litigating disputed rights, and there is a choice of remedies, the rule of damages ought not to depend upon the form of l’emedy the party has selected. This plaintiff elected to retake the property in an action sounding in tort; he might have waited until a sale and sued in assumpsit for the proceeds; but in either case the facts in controversy would have been the same, and the measure oí damages ought to be by the same rule. The real question is, by what rule shall we with most certainty .arrive at a knowledge of what they actually were. It was •shown in the two cases just referred to that estimates of profits are generally so unreliable as to be worthless as a means of ariving at the actual damages; and in Allis v. McLean it is said (p. 432) that “ the profits of running a sawmill are proverbially uncertain, indefinite and contingent. They depend on many circumstances, among which are •capital, skill, supply of logs, supply and steadiness of labor ; and one man may tail while another prospers, and the same man may fail at one time and prosper at another, though the prospective outlook seems equally favorable at both times. Estimates of profits seldom take all contingencies into the account, and are therefore seldom realized; and if damages for breach of contract were to be determined on estimates •of probable profits, no man could know in advance the extent of his responsibility. It is therefore very properly held in cases like the present that the party complaining of a breach of contract must point out elements of damage more certain and more directly traceable to the injury than prospective profits can be.”

It was said, however, that this language is not applicable to the present case, because Acides when he sold to the plaintiff had an unfulfilled contract for cutting shingles, upon which it was possible to estimate the profits with reasonable certainty. This contract was transferred to the plaintiff, [and] he was allowed to show, by the testimony of Acides and others, that the profits in filling it would be ten dollars a day. He was also permitted to give similar testimony without regard to that contract. We have looked through the evidence, and are of opinion that no better, case could be taken for an illustration of the worthlessness of this standard for the estimation of damages. It conclusively appears from it that the estimated profits could only be made under the most favorable circumstances; that the contingencies which stopped operations or rendered them unprofitable were numerous; and finally that it was very doubtful whether the business in the hands of Acides had been profitable at all. And it is a significant [fact] that the plaintiff, after delaying so long to retake the property, had not in the following May, when the suit was tried, got it into operation again. lie had then, as he says, arranged ■with a party to put it in condition for use and pay five dollars a day for the use of it, but with allowance of lost time for stoppages, which appear when Ackles run it, to have been frequent.

We think.the estimates of profits were not proper evidence.

The judgment must be reversed and a new trial ordered.

The other Justices concurred.  