11 Or. 406 | Or. | 1884
By the Court,
The plaintiff took from the defendant, Nelson, a bill of sale, intended to operate as a mortgage of certain property belonging to him, and which the plaintiff left in his possession and which the defendant, Betts’ Spring Co., attached after such bill of sale had been filed and recorded. Thereafter, the plaintiff commenced suit to foreclose, and the defendant, Betts’ Spring Co., answei;ed claiming the lien of said attachment was to be preferred to any lien or rights accruing under such bill of. sale. After issue joined, the matter was referred to a referee, who, after taking the evidence, reported to the court his findings of fact and conclusions of law. These findings were set aside by the court below and a decree rendered adjudging the lien of the plaintiff under such bill of sale to be prior to that acquired by the attachment, and from which decree the defendant, Betts’ Spring Co., appeals to this court.
As grounds of error, it is alleged, (1) that the bill of
It is clear, as between the parties, the bill of sale was in
A bill of sale as such is not entitled to record, and a record so called of a bill of sale is an absolute nullity. The instrument in question was entitled to record only as and because it was a mortgage; and if the record is notice at all it is notice as a mortgage. Mr. Jones in his work on Chattel Mortgage says: “A bill of sale absolute upon its face, but executed as a security and intended to operate as a mortgage, is within the operation of a statute making void a mortgage not recorded, in case the property be not delivered to and retained by the mortgagee. (Jones on Chattel Mortgages, sec.'275.) In Khun v. Graves, 9 Iowa, 305, it is held that a bill of sale of personal property, in which there is no stipulation that the vendor shall retain the possession, is, if filed for record, notice to subsequent purchasers
In Howell’s Annotated Statutes of Michigan, it is said that sec. 6193 (which is almost identical with sec. 46, Or. Code, p. 522,) was designed to provide a system applicable to every instrument or conveyance intended to operate as a mortgage of goods and chattels, and to this extent it supersedes and takes the place of sec. 6190 (which is of similar purport to sub. 40 of sec. 766, Or. Code, p. 262.) That under see. 6193 the question of good faith and want of any intent to defraud creditors of the mortgagor and purchasers in good faith, cannot arise. And that as to them nothing short of a change of possession or filing of the instrument as the section requires can save it. (Cooper v. Brock, 41 Mich., 491-2.) And in that state it has been held that a bill of sale, or other conveyance of goods and chattels, although absolute in terms, if given as a security, is a mortgage. (Fuller v. Parrish, 3 Mich., 211; Parsell v. Thayer, 39 Mich., 467; Hurd v. Brown, 37 Mich., 484.) And unless filed as a mortgage or followed by an immediate change of possession, it will be void as against creditors and subsequent purchasers. (Hurd v. Brown, supra.) The instrument was entitled to record according to its real character. (James v. Morey, 14 Am. Dec., and note of authorities, 573.) Being intended to operate as a mortgage, it was filed as such with the proper officer of the county, and filed by him in his office for the purpose of imparting the notice designed by the statute. A chattel mortgage is recorded by filing it in the office, and there is no law for recording any other instrument in that way. When, therefore, the clerk received it, and placed it on file in his office, it became the record of a chattel mortgage. This filing or registration was equivalent to change of possession of the property, or
The only remaining question is as to the validity of a chattel mortgage to secure future advances, which includes the two last grounds upon which error is claimed. Upon this subject, Mr. Herman says: “In respect to the validity of mortgages for existing debts and future advances, there can be no doubt, if any principle of the law can be-considered settled by the decisions of the courts,- that a mortgage made to secure future liabilities and contingent debts, described with reasonable certainty, in the absence of all fraudulent intention, is valid; and this, whether the matter of future advances appears on the face of the instrument, or note, is proved solely by the testimony of witnesses.” (Herman on Chattel Mortgages, sec. 53, 111, and authorities cited in note.) The fact is, this whole subject has been considered by this court, and the principle decided covers the case at bar. In Hendrix v. Gore, 8 Or., 409, the court say: “The true principle to be deduced from all these cases seems to be, that when a mortgage is given in good faith to secure a present indebtedness and future advances, whether the object be expressed in the mortgage or not, it is valid to the extent of the lien therein expressly created. It is always better, however, that the mortgage should be drawn so as to show the trne object and purpose of the transaction, for suspicion is engendered by misrepresentation, but disarmed by a statement of the truth.” (Sheries v. Carg., 7 Cranch., 34.) The effect of the omission is to render the transaction more liable to suspicion and to put
Judgment affirmed.