276 F. 123 | E.D. Mich. | 1921
Lead Opinion
One of the referees in bankruptcy has certified to this court for its opinion the question whether a certain written contract, under which a cash register was furnished by the claimant to the bankrupt before the filing of the voluntary petition in bankruptcy herein, which cash register came into the possession of the trustee, should be construed as evidencing a pure conditional sale, with absolute reservation of title until payment of the purchase price, or as an absolute sale with reservation of title merely as security for the payment of such .purchase price. As the contract was not filed for record in accordance with the statute governing the filing of chattel mortgages, such contract is void as to the creditors of the bankrupt, if it is to be construed as a contract of absolute sale with retention of title as such security only, or, in other words, as a chattel mortgage, but otherwise is valid.
The contract involved was in words and figures as follows:
“City, Detroit; County, Wayne; State, Mick.
“Tbé National Cash Register Company, Dayton, Ohio: Date, Aug. 25, 1920. Please manufacture and ship, freight prepaid, to 1736 E. Forest St., Detroit, Wayne county, Mich., or to the nearest railroad station, Detroit, Mich., of your No. 730 registers, mahogany finish, denomination of keys — for use on — ■ counter, novelty business, for which undersigned agrees to pay you one hundred fifty dollars ($150.00), as follows: $15 cash, cash on arrival of register; $135 in 9 monthly payments of $15, and undersigned to give you his promissory*125 note for $135, payable in similar payments as collateral security for such payment. Five per cent, discount for cash settlement on arrival of register, but no discount allowed on credit for exchange registers, or on autographic registers. Upon refusal of undersigned to accept the register when tendered, or to make any cash payment, or to execute and deliver the note, or make any payment provided for therein, you, or any person authorized by you, if you so elect, may immediately repossess the register, and retain, as rental for use of said register, all payments theretofore made. Should the register get out of order from ordinary use within one year from shipment, you will, without charge, repair it, provided undersigned pays the transportation charges on it to and from the factory, or nearest agency able to make the repairs, or .traveling expenses of repairman. Undersigned to pay for any repairs made without your authorization, and to pay all taxes on the register, and, in event of default, to reimburse the company to full extent of taxes paid by it.
“The register shall remain your property until the price is paid in full.
“This contract covers all agreements between the parties and shall not be countermanded.
“Sign here: [Signed] Aboud Nader.
“Aboud Nader
“Print purchaser's name plainly on this line/'
On the delivery of said register by the claimant to the bankrupt, the latter executed and delivered to the former the note mentioned in said contract, which was in the following words and figures:
“Promissory Note.
“City, Detroit; County, Wayne; State, Mich.
“Date, 9 — 28—1920.
“For value received, I promise to pay to the order of the National Cash Register Co., Dayton, Ohio, XT. S. A'., one hundred thirty-five dollars (§335.00) at N. C. R. office, Detroit, in payments, payable as below:
Collection No. Date Paid.
.1 month alter date S15.G0 11 — 80.20
..2 “ “ “ 15.00 12 — 6—20.
“ “ 15.00 1 — 3—21..
“ “ 15.00 ^
“ “ 15.00 VI
“ “ 15.00 Ci
“ " 15.00 -5
“ “ 15.00 00
‘‘ “ ¡5.00 S5
“It is agreed that default in the payment of any of the above payments shall, at the option of the holder hereof, render the unpaid balance of this note immediately due and payable.
“This note represents monthly payments only — not price of register.
“Register No. 1845482, style and finish 730 Mali, business novelty.
“Notice to Agents: Write name of customer plainly on this line:
Sign here:
“Aboud Nader. [.Signed] Aboud N. Nader.
“No. 1730 E. Forest Street,
“City, Detroit, Mich.”
Only the first three monthly installments called for in said note were paid by the bankrupt, who owed on said contract and note to the claimant a balance of $90 at the time of the adjudication in bankruptcy.
The question, therefore, certified by the referee, is answered accordingly.
Rehearing
On Petition For Rehearing.
Since the filing of the opinion of this court in connection with this matter, the petitioner has filed a petition for a rehearing on the grounds (1) that said opinion failed to refer to the recital in the stipulation herein to the effect that “it was the purpose and intention of the parties to enter into a conditional sale contract, and it was the intention of both parties that the title to the register should not pass J:o the said Aboud Nader until the full purchase price had been paid by him,” and that such opinion also failed to refer to an alleged agreement between the parties to tire effect that the contract in question constituted a conditional sale; and (2) that this court erred in holding in its said opinion that “there is an absence of any showing that the cause of action in question accrued in reliance upon prior decisions of the state court establishing a settled rule of property which was abrogated by the later decision of that court to the extent of impairing a vested right.” Both of these contentions of petitioner have received careful consideration.
2. It is further urged in substance by petitioner that this court did not in its former opinion give proper weight to the contention of petitioner that the case of National Cash Register Company v. Paul, 213 Mich. 609, 182 N. W. 44, was so inconsistent with the settled rule of property established by prior decisions of the Michigan Supreme Const, in reliance upon which the contract in question was entered into, that the decision in the case last cited should not be followed by this court. Careful consideration of the contention and argument of petitioner in this connection is convincing that the present case, even upon the record as it now stands, is not one calling for the application of the principle thus invoked by petitioner and alluded to in the final paragraph of my prior opinion herein. It is true, as was pointed out by the Circuit Court of Appeals for this circuit in John Deere Plow Co. v. Mowry, 222 Fed. 1, 137 C. C. A. 539, and lay this court in Re American Steel Supply Syndicate, Inc., 256 Red. 876, that (in the language of this court in the case last cited) “until recently the decisions of the Michigan Supreme Court on this subject seemed to furnish no such clear and definite rule as would be controlling in this court.” In view, however, of the recent decisions of the Michigan Supreme Court in the cases of Atkinson v. Japink, 186 Mich. 335, 152 N. W. 1079, and Young v. Phillips, 202 Mich. 480, 168 N. W. 549; Id., 203 Mich. 566, 169 N. W. 822, cited and followed by this court in Re American Steel Supply Syndicate, Inc., supra, and in Re Robinson Machine Company (D. C.) 268 Fed. 165, and cited by the Michigan Supreme Court in its opinion in National Cash Register Company v. Paul, supra, which decisions, together with others mentioned in the Iasi cited case, were rendered before the making of the contract involved herein, I am not prepared to hold that the decision in National Cash Register Co. v. Paul is so inconsistent with previous decisions of the Michigan Supreme Court that 11 ought not to be followed by this court.
Nor can I agree with the intimation suggested, rather than urged, by petitioner that the decision in National Cash Register Company
The careful thought and attention which I have devoted to the petition for a rehearing leave me fully satisfied that such petition should be, and it hereby is, denied.