26 N.J. Eq. 398 | New York Court of Chancery | 1875
The demurrer presents the following questions :
1. Whether the company, now known us the The New jersey . it hern Railroad Compon-, (í. -Merly as The Raritan and Delaware Bay Railroad Company,j had power, when the mortgage of the complainant was executed, to mortgage personal property not then owned by them, but which they might afterwards acquire.
2. Whether, if the mortgage covers the stock of the Long-Branch and Sea Shore Railroad Company, it is not necessary to its validity, as to that property, that it should have been filed in accordance with the provisions of the “ act concerning chattel mortgages.”
By' act of the legislature approved March 17th, 1854, (Pamjih. L., 1851, p. 530,) The Raritan and Delaware Bay Railroad Company were authorized to mortgage their road, lands, personal property, privileges, franchises and appurtenances. Under that power they executed a mortgage which ■was foreclosed, and their railroad and all their real and personal estate and franchises were purchased by Benjamin Williamson and George N. Titus, who afterwards, under the provisions of the “ act concerning the sale of railroads, canals, turnpikes and plank roads, (Nix. Dig. 791,) with their associates, became a new body corporaie and politic by the name of the mortgagors, The Raritan and Delaware Bay Railroad Company, and by virtue of the provisions of that act, became entitled to all the rights, liberties, privileges and franchises of the original corporation, among which was the power of mortgaging their property, given by the act of 1854. In the exercise of this power they executed the mortgage in suit, which was given upon all the real and personal property of the corporation then held, or acquired, or thereafter to be held or acquired, for use in connection with its road, and its branches, or any part thereof, or with the business thereof. The mortgage contains a covenant for further assurance, under the mortgage, of all the property and things mortgaged or in
The mortgagors had the right, and possessed the power to-acquire the stock in question. By the 5th section of a supplement (approved February 16th, 1870,) to the act of incorporation of The Earitan and Delaware Bay Eailroad Company, (Pamph L., 1870, p. 232,) they were authorized and empowered to unite with such company or companies as-were or might be incorporated by this state, whose railroad or railroads, or branches, might connect with the railroad or branches of the mortgagors ; and, to that end, with the consent of two-thirds of their own stockholders, and the same proportion of the company or companies with which they should-propose to unite, to consolidate the capital stock of such company or companies with their own, the assent of the stockholders to the consolidation- to be certified to the satisfaction of the governor, and. filed in the- secretary of state’s office.
By a supplement approved February 16th, 1870, {Pamph, L., 1870, p. 228-,) to-the act of incorporation of the Sea Shore-Company, power was given to that company and the mortgagors, to consolidate their respective capital stocks on the-like terms with those provided in the above mentioned 5th
The bill, as before stated, alleges that the demurrant, while president of the Southern Company, fraudulently possessed himself of this stock, and charges that when he took it, it was with full notice of the complainant’s mortgage, and of the legal and equitable lien thereunder upon, and rights in, the stock. The question raised by the demurrer on this head is, whether the mortgagors, whose power to mortgage the real estate then owned by them, and the personal property which they then .owned and had in possession, is not questioned, had the power to mortgage personalty thereafter to be acquired. The acquisition of the stock, under the authority of the act of the legislature, was, as before stated, the means by which the road of the Sea Shore Company was acquired. The mortgage covers the real property so acquired;, and if the means of acquirement, the stock, only be considered, it covers them. The
The demurrant objects that the complainant’s mortgage is not valid as to the stock, because it wras not filed according the provisions of the “act concerning chattel mortgages.” A mortgage of capital stock of a corporation is not within that act. Such stock is not goods or chattels within the meaning of the statute. It is obvious that the act has reference to pledges of personal property of a kind which is capable of visible possession. The Massachusetts act, requiring the recording of chattel mortgages, provides that “ no mortgage of personal property shall be valid against any other person than the parlies thereto, unless possession of the mortgaged property be delivered to and retained by the mortgagee, or unless the mortgage he recorded by the clerk of the town where the mortgagor resides. In Marsh v. Woodbury, 1 Metc. 436, it was held that it applied only to goods and chattels capable of delivery, and not to the defeasible or conditional assignment of a chose in action. See, also, Winsor v. McLellan, 2 Story’s C. C. R. 492. But, as between mortgagor
Nor can the demurrant avail himself of the objection which-he urges in favor of creditors of the Southern Company as against the mortgage. The mortgage is as to the stock, even if it be conceded that the stock is within the act concerning chattel mortgages, good as against everybody but those who-are hindered or defeated. Any person, therefore, who would contest it, must establish his position before the court as one of'those in aid of whom the statute was framed. National Bank of the Metropolis v. Sprague, supra.
The demurrer will be overruled, with costs.