Case Information
*1 OFFICE OF THE ATTORNEY GENERAL OF TEiAS AUSTIN
ifonorble ical h 1. l3ud.l Chiet of
Cert flaate OS Title Dlvlubn ‘p Dqsartmt of Publia Gaf’ety .T’. , cwip %abry ‘\ NlMAll, TWA8
h6r six:
rtwnt krur CIrElfla*te on by the t&et li&n eation IB aoo~aaled by rtt wrtLfyln& that tw II ha* bwa regomesae4 ao- o? the eoatraot betwea e ~mrtt(DItjpr even thorrs,h than be a awend lbm agaiu&8 & vshitis. *((L) Gkould the Deparoleent rcrwlre a re- Aewe algned by the reeoa& l&err Bsldw, er ir th6 tmidavic of r6powei0omi oertitxra to by tb first 116s holder SutiicrZIJIc avldonw to jurtify 18*utanoe of t&6 Pitls. ibat lnlorrnation ahould thlsis De- “(b)
&ksrt&?ult re;ruirr under 8UOh a sltution before we imy fsrrue a Certtfioate~o~ Title to the holder of the oar under reportmxslon.w
In your firet queutlon you rap0 ooaoerned with the type of infor~tlon whioh should be reqzlred by your Dopartnmnt rmrn a applleant who hae puroheamd a motor ve- hlole at t3 judicial foreclosure sale barore you issw a aertlrieate in the nase or said puraheser. Tour attmtlon fa oellad hotion 33 of the CertLt1oet.t of Tlt;lo &et whiah has been lnoorporated Into Vornon*s Xwototed Penal Code a8 irtlole 14364..
"sec. a&i. #'henever the ovmsrahip ot a mtor vohlale rogllrtersd or lloeased with- ln this State ie transferred by operation of law, as upon inhsrftaace, dalee or be- quest, hankruptep, rsoslv8rahlp jtadlciail sale, or ally othw lavoluntary &mlzu
0r ouwrahlp, the Departaeat shku tiarrua a new oertlriovlte of title upon being provided rrlth certltied wpy or the probate pr0043ea- inge, if say (U a0 adminlrtratlola ia neu- wafmry, than upan arribilrlt shssiag au& fuot and all of the heirs rt lau and rpeol- flo&lon by the heir8 as to la whoas nam the oertltlaate shall iabuaf, or order, or bill of aale fraiz ofiloer rmakln& the judlcli~l sale, exoept hmeiver, that where foraalomre lo had uader tbr term of a Slen, attidavlt ot the gemon, flna, aszsoaletlon, or oorparatics or authorl%ed aGent, of the fact of reyosaeeslon enb dlvestlturo of tltle in awordume withthe terrs of the lien, shall be auitlaiegt to authorize the lseuanue OS a new cerki.U.eate or title in the ntune of the puraherer at suoh eale, cind sxoept further in the that oaas the foreclosure of any Canetltutlonal or Statutory lima, tha aifldavit OS the holder or YUO~ Uen, or it a crorporation, its *tint, oif act 0t tbc tmatLoa 0r ouch lien :m& ths dlveotltura at title by matson these& 5.n eccordanaa with law, .~hsll be etU'ficlsnt to authorize thn lasurrnce of a new osrtlfioats of title U the ~~JISU ef the purohaaer."
In above QUO ted ertfoin ths Luglnlatum hu ryeai?loallg provfded thet your Department q iesae e Cartlflicate OS Title In the 0-e OS the purohfieer at Y judicial forealoare sale uipon ~esentutlon or the bU+l of sale from the of?laormklngtht4 judlclfil 8ale.
In this amneotlcua you am alno advired thet the it suoh foreolcrure wan purchiielrr at th Soreclomure sala, o? the ilrst and prior lien a&abut aaid Inrtorvehlole, taken title to the ame free of all aubaoqurnt liem whloh previouely existed prior to said sale egafxut said motor vehlole. That a foreeloaure sale bee euoh stfwt la the rule o? law of the eourta of this State. well e8tabllehe4 The Ccm-i.~loa of kppea1.s in the ease o? Sabine Uotor Com- p&uy v. $. c. zugilrh rut0 wrb#euy; 291 3.g. 1086, etated as P0llowa:
0* I I St goes without stqlng thrt a woper aotion in oourt cuts 0rr*tp,,~ftit3 or the sxmtgagar or hla ass&w. In answer to your flxist question, therefore, you
are eclrfeed that when bill Cat rala of the offinir r&U- in& the motor vehiole rt the foreolomre 061s irr ?unsLshed your Department as regulnd b$ Beetian 35 of the Certiiloate of Title irct you are alrtborised ieaue a Certi?laata o? Title ln the narPr o? the purehanr at the ?oreo&mtg& sale without noting thereon any of'the Uene wbiahwcrs eeoord iat ha ootut aotloa to the lie,n whlah me ?oreolo6ed In your mooad question pu are oenoenmd with a situation where the'mortg8&ee reposoe6m~s Q oar under tlia 8x~eias temfs or the mmtgage vilthmt reoouTam to’ jgd~oial prosedun. In euah a sltwtlon ~0'0~ are uaeuthorlued to leaue u new Certif'ioarte ot Title in the bdl~ul af the nkopt- gag- beoalue mid mortgage by sare repoastssioz~ o? fbr motor vehlole doea not auguire title to the sanm. It Ii a ,~ll eettled luw of thi8 Stat8 that prior to mpo5ses810n the mortmgoor has title to the sortmed property. As stated by the Corrpnfealon of ~~pepla irr the OZISO of Gablncs Wtos Cola- pany .v. ;i’.c. fin&s& kuto Cemmny, augra,
*In Texas, the la@ title to mxtgqed property rwdw In the mart&a&ax.*
St i8 also u well aettlod rule of lo* inthLrs St&e that wheathe mrtga2ee re~aseaeee @opmrfy he bolde the Babe be mortgagee and Pot (~a ounef. The @t&prei~ Court 3.8~ Terraa in the caee of Barling Y. Creaoh, al S.S. 337, stated as fol- lovte :
n* t . ohs lnstrunante being ahattel xartgaam, t’he vendor had the rights of a ~~~@gtte under a ahsttel ~rort&age oontaln- in& the stlpulatlons or right to take POfBSe8- slon, uhloh would ba to take powss88ton of the proyerty it he da&aid hlmself insecure, or the debt aot being paid, and to hold or dlspose of the proserty La the aharaoter of aortg4sDPgoe. ulld sot k&s ovaer. * * +* (mlder- sooringi oura. I
The lan&iage of the Eiarling aam, aupra, wee aogied intc~ the opinion OP the Su~eae court of &ate ot Texa6 ia the ease or sin&m ivg. co. '1. Rio%, 71 S&G. 275.
Thla lina authority was reaiflrrtsd by tha COJIU&+ don of ~ppeale in the Sablna w&or Comar~r ease, eupra, aoL the Court atate& UI) followa:
*+ * * But, Eden titer saoh e ~rnkmre~ it would have beon neoesecuy to handle ~tbb onra 88 nrortgagees and 8Qt a6 QvJmFS, until the title h&d passedd, either under ~?meolooure or in aooord with the parer of aale ooatained~.
in the awrtgage. * * ** T&m above Gtwted rule wa6 amI.8 aaaouneed inthe on80 0r -;&da t. Bowera, e;L S.W. (2-d) 590. The Court stated ae rob
.* to aat a8 “A mortgagee la not satitZsd
the om8r of propcrrty In Its di*imsltiaa, but must aat aaoarding tb in baa 110 right to take ;looeeraloa of tha gmop- siartgeae. [*] [*] * aI& asart*gee tb parer0 given ertp na hla OWIZ and ~pgraprlrrte it.”
On Ghe other hand, tha Court8 at this State have long rsoognlsed rhe foreolosure OS ii lien by repossession and sale aab private sale under the t ema of the aortgmget Chief Jwtioe &inoe In the Singer IQcg. Co, aaee, suwa, rtat- ea as rollaws, ln this oonnsation:
“ee are or the epialar that c ha qtmsticm should be aaswred la the aftirmtlva. Clear- ly, unless the sti$u&tIon la t&e mrtgotga, whloh surparted ta give to appellantthe right take poevewloa Ipaohine upon of aerring default or piryaent be h8lQ cf m &feat, U..to agent oomitted ao won& by u pmoeable seicare zzb;h8 proparty ror the4 pumas0 of payiag the
. ‘ii38 0tipdati04i fo v8ua tw8r8 it ti oontrpry to pub110 polloy. ’ l * Tin pro- goeItIoa that auch a otiyuLation la vdia, and that th martguges mag take peaceable pos- session of the grope&J wit bout the ooaneat, and even cmerthe~ prote8t, of the amtgtagor, la staotainad by the great weight of authority. * * am
In thn above guotcrd oa8e, the Su~~em Court was urrlrming a aIm&u holding 0r aaid court In the oaam or lit~llng I. Cfeeoh, oupra.
The Tetrakmia Court of Oiril Appea]r reatilraed the ValIAIty of maah B g~~vlsioa Ia a mortgage 1nthe aase Jetme Frsnoh Mniw k Grgn Co. v. Zlli~tt, 166 a.%. 20. The Court state6 ae follo*e:
“3~ th4 teras 0r tha mortgage omexi8g titan pianos, Elliott was authexiEe-4 te take poonesnloa thereof *uhwevex thy may or t%m be round, and uell the name at pxfvate or pub&lo aale to the hi&ant In t&o bidder,’ event ti5s Eopkiae rra6e default in tha pay- --meat or the debt it wuured, or in the avant,
at any time beiare the ladobtadnes8 mtare&, zlllott *reit urisare or %numare.* It I8 The above quot.4 rule wud aSfrhwd by ths i3oaumant Court ai in the OLIBB or Iuncik vutor co. t. uelia, 847 civil ~ppalsr tha Court state8 ae follow*: ki.*J;. aa. In thI3 aonaeotloa, The trial. aoun erred la hi6 ooltstxua-
tioa or tka mortga&e. The jWovlsIon& of the mortgage authorleln~ agpsllaatto seize MA WU ths truak at grlvate sale and wlth- out noties are mtvIolatlve of any At&tUt@ of this state, nor against the pdalla polisy es expretwed In the, deaI~Ion~ oi this state, of our ooilrte. It Is aald in Al C.J. 706:
?lThs inortgage ltseli may diepease with notloo, as whom it prwldss thet the mort- gagee may 8d.l et private sole.*
"Ths rule 18 anaouaasd as tollaus, In Jaw 011 Chattel AWrtgages (6th &id*) 0 792:
'?'fi e paver or sele doer llot req.alrs the gfvlng et any notiae oi sale, the rrort&agee aun tmdcs a valid sale either at public or private snle, and need not &ire i3ny noti 0r it un.ha b O~OOW 89 t0 Q.
&at OsTerthslrss ths s$l,d,,t,o bs bInding, avmt be a fair one.*
The ralldlty of such a provlalon in a wtms wns also reafflnwl la th6 oy8es OS Piduty ilnlon Fire Iwtua~oe co. 0. 35116w-sattexrleld co., 10 S.w. (34) 163, Court or Civil kppsals of Texas, kaarillo, ad the ease of CaSpb8ll v. aistexn See6 di Oral8 Ccuupnn yr 109 S&i. (24) 997, court 0r Civil dppcrsla or nwiw. a8 imtoalo.
You em (11~0 a4vIsecL that unksss tha tsms or ths mortgage expressly prwlds far the earn, ie aot aeoessary it for nation to be glveu to seoond or subsequent lfen holders egfnst the 8ami prop8rty in a ouee of rorealtrsure by ths prior lien holdor at a private asis under the terms of ths mort@prge. See Campbell v. &stem %ed & oraln Coppcoy, and X4mpehire v. Greffes, 143 G.B. 147, SUwem Court supa, er Texas.
It may be a&ad t&e& ssottio 38 of Certltisato Title hot rNwgnIeestkrs *auuty 02 8 roroawbuxe by 0 mortgagee by pxlvats sale w&&r terms of ths arrrtgiags and Inthla sonnsatlon pmvidee as follows:
N4 * * that where foreoloaws ls had uader the texts or a lken, ths aitkdavlt 02 that permn, firm, assoolWlon, Qp arperatlea
or 4utbmlzed agsnt, vi t&s f&at vi r4pv6- 666SiVtI and diV46titlll.6 Of title in 86vOrd- MO4 with tht t6l7ilSVft&# UM&, 6hal1b6 &uiiiCi8ltt to t!iUthOri60 the i86U6666 Of a %WW 06rtiiht6 Of titb a tbs nUW5 Or the ~UW&666X &it 6UCh 8d10, ' * *" YOU -0, thFdOr6, 6dVi66d that th4 abVV6 QUf3t.d
&fit016 r6QUlte6 M atti&'it irOP th4 XiWt@&66 I#hVMD& the 6ti6 tUld6r t6rPU Or th6, &QFt&+gS to 6 third party WhG iS &pjdying for & C6rtiflvat6 Of Tit16 iIl hi6 -PI. that tk0 fhBrt6Mt rtot t6QUir6 YGU 63-6 rlU%hW 6dVi66d -6% e re&as6 rigzled by the 6666n6 Ii66 hold6r olluie the s6aond 1%6n hQld6r'8 liell 4&lill6t t&6 m%vr V6hi616 uUd6r th6 OOII- struotion of th6 Court8 of tbia Statcr hao b66nout oft by prfVltat6 fOF6Q~OSlUZ6 6616. b6 @*rfoU6l~ 6trt4dl th6 CQlWt6 b&N6 h6ld that the ~~6ba66r at a judiOf& foS66~UE6 66&S aaqulrsd tit14 fr46 vf au ini6Xivr 1i6P6 a&d.tWtthe Th4 6&66 Zti6 hati b.Olh 6XteS&cd by tW CotA't8 Of property, thio St4t6 t0 fOr66l@MrO 66ti6whi6bar6 64le8 Ord6 piVat Th6 3t2~6I66 CVutt 6f by th6 SU.U’t$&&W ptt6r i6&?068666iOR. Texao lo the aP64 of E6mp6hlr6 v. Or66V68, ~UPP. 6t6t6d 6a tOlbW6, hl thi6 CQllh6~tiVIl~ “Ths OUltcurtiOrr Of ~lail!tltf’S 6OlUU6l rlglat Qf xeaeapt~nn Tao thQ 6freet th4t ‘t&e is nQt cut dr by a. vi CL unior 1i6ahold6r d Janiarllsabold6r ir proab 9$6tow&ieBth6
not tt purtq is not ooond 06 w thla, and neat sugported by au%hority' 41* r6amn. Ttu i6 thUiB t6WlY 6tSCOa in ihHL60 Oa ?&Wt- a6 &a&66, I l&97: ‘9h6 JXlZOba6W (U&W ihO- albmre pzwudl.a~bymleum%erthr jwwmr &.VM in th0 TM&&&i&S) t&B* t&6 Wt&#i@+t"8 tit16 &lve&44 of all lnaumbr~ee8 1pa4e atno.
the ar6aBion oi p0lw6f.* Aad, aah, In th6 664m aaatl6n: ‘A 66x6 ereraia64 xe&pl6rly UJl6.T a &IO-l’ Ir, OqtiVahSt t0 66l’iOb f QP6- clo6un,.by B 6ourt of 6Qtitj PropaTlJl pIUW4d.'*
Th6 Am&~@ COwt Of ab$l Applrab r64ffina*d this prQpV6itiGkl In the Fldrlity Elnion Fir6 ~UXX3U66 CQB- psa~ aa68, augxa, an4 stat64 a6 ra.m6at
*Under the pewr oi sale in the mart- @@I, the fiuanqe Qol~~y had the ri@ht t0 t&kite pv4a466ion of the Oar W&d 6611 it with- *8 lionoroSle ii&h L. Bwll, Bag;6 6
out nOtiC to mber ior the pUm666 OS &tying the id6bt6dO666 6&6&R6tth6 Cti, in ptWChU66r. &Uld 6UCh 4 6614 V66t6 title %oak Amor Co. v. iiilelia (Tex. Cit. ~@p.) 247 3.X. 668; Orrhoer V. Tadr, 11 'Tax. Civ.
xpp. Ire, 32 ii.%. 373; slngatr suing Maehi Cu. v. hiv6, 98 Tex. 174, 7L 3.W. 8'15, 60 L.ii.a. 143, 97 AR. St. R6p. 8011 f6Ue -Innah Piano Co. v. jstliott (Ter. Cit. Appp.) 166 S.
W. 29; Stat. Bxsbm56 Bank Y. Sd8h (Tax. Clv.
A&Q.) 166 2.K. 666.. The rule was again 6tut6d. by th6 36awnt Court ‘1. 86b6rt, or Civil Appeal6 iu th6 Q&66 Of &tfabt 8% 8.pi. (2d) 929. The CvLWt 6tut6d a6 fO~666:
"Th6 jU&Sl.Ut in taVQr Of 164r66Qtfl6 Trust Corporation ir afflrrasb. Ia t6kf.q pVU6U6iOii Of t&B PUtWbib it iOuOU6a gOU6r6 6iVOai by it8 a5Ftae. literary Shi6 BsthVd Vr fOreOlolllU6 6rt~Ui6hed 6Q-
pellan8*8 6666od lien. *bin6 Mittor Co. v.
‘A. C. kn&lsh &auto Co. tT6r. 0018. App.) 291 3.x. 1088."
81 WI&&’ Oi 6-r. it i8 the O&&iM Or thf6 ~rtW.&t that kh6r6 6 S6t't&8~U N$bO6666666 6 awtOrV6hiO16 end 60116 th4 661~ at a prlv*ite 8ale, which pro66dPr6.26 in acaOrbanO4 mith thO.t6m Of th6 'afst&aBQ, YotW ~~ptU%RWt to fnws a $6rtlfbate of Title ia th6 n6m6 ot 16 authorized the purahaur at 6uCh priYit6 fclr66kWAE6 68& WI&ah Wrtiti- Oata, 8WJ Bat ZlGt4 OE th6 46M6 tbs 666Qd Or ini6riCS Zi6lU Oi WhiCh 6‘ii6t6d ootlin66 under 23eetlon 35 at the CertlCiart8 auoh a aaae da inmreiatienthat rbarlldb6r6cyriT64 by ywr Departmtin lW~8666iQS 6@iIi6t 6ti fOf6a&6Pre h6 t&O 66&d aotor jWiQr VOhiOlO [0] t t Of prior th0 l.l6B. l-b6 &Jr Qt Tit16 Ot tb@ U!@l-t&lg66 ACt icS 80 &ifidaV%t ObaUbQ Uttoh aab pdVat6 Sal0 Utld6l'thO t6W63 6f th6 IlOl-t&V3136. r6~0684OSiOn
Moth- in thii5 Op$.XtiC# 6kdi b0 OCXI6tnt6d 66 W- z;&I~ 116n6 whiohWrr6, ~2?~@~ t0 t&4 l&HI that W66 fra?6-
. TQUU V6Ty frrnlf APPROVEDMAR 18, lg4' -%ccrc*LQ.&4
A~~cp,~~y GiBERAL 03 TEXAS
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