Cornell University Law Library The Moak Collection PURCHASED FOR The School of Law of Cornell University And Presented February 14, 1893 IN nEnoRY OF JUDUE DOUGLASS BOARDMAN ^ FIRST DEAN OF THE SCHOOL By his Wife and Daughter A. M. BOARDMAN and ELLEN D. WILLIAMS Cornell University Library KFN5267.T45 A treatise on the law of mortgages and c 3 1924 022 799 559 Oiarmii ICam Bcl^anl Klilitarg Cornell University Library The original of this bool< is in the Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/details/cu31924022799559 €[)attel Ulcrtgagcs mh Conditional 0ale0. A TREATISE ON THE LAW OF MORTGAGES AND CONDITIONAL SALES OF PERSONAL PROPERTY IN THE STATE OF NEW YORK. APPENDICES OF STATUTES AND OF FORMS. ABNEE C. THO MAS, COUNSELLOR X^^iW. NEW TOEK : BAKEE, yOOEHIS & CO., LAW PUBLISHEES, 66 Nassau Street. 1889. Copyright, 1877 and 1889, By ABNER C. THOMAS. PREFACE. The author's "Treatise on the Law of Mortgages of Eeal and Personal Property in the State of New York," was published in 1877. The collection of new material for a second edition was commenced shortly after, and proceeded to such an extent that it was found that more than a single volume would be required. It was there- upon thought best to treat mortgages of land separately from mortgages of chattels, and a bulky volume on Mort- gages of Eeal Property was published in 1887. This volume on Mortgages of Personal Property completes what may be termed a second edition of the earlier work. The general plan of arrangement has not been changed, but a division into sections has been made for more convenient reference — the old matter has been revised, and large addi- tions have been made. The character of the earlier book as an elucidation of the law of the State of New York has been preserved, but decisions of the courts of other States have been added, when they seemed to be in harmony with the rules laid down here. It was at one time proposed to attempt to con- sider the law of mortgages of Personal Property through- out the United States, and for that purpose a summary of the statutes of all the States was made, but it was found that these statutes differ in so many respects, and rest upon such diverse theories, and are so constantly being IV PEEFACE. changed, that to make any extended reference to them "would cause confusion. Even for purposes of use outside of this State, it was believed that a succinct and intelligible statement of the law as administered here, with an appen- dix of our statutes for comparison, and with copious refer- ences to the decisions of every State in the Union, would be more valuable than a labored attempt to reconcile stat- utes which are irreconcilable. Contracts of Conditional Sale have come largely into use as securities for purchase-money, and partake in many respects of the qualities of mortgages. Some care has, therefore, been taken to define the rights of parties under them. The general plan and scope of the work is quite fully set forth in the Table of Contents. Abneb C. Thomas. New York, April 10, 1889. TABLE OF CONTENTS. Rbpkrhncbs aeb to Sections. CHAPTEE I. MOBTQAGES OP PERSONAL PROPERTY, AND HOW THEY DiFPER PROM Pledges and Assignments fob Creditors. SECTIONS What constitutes a chattel mortgage 1-8 Chattel mortgages and pledges 9-13 Difierence between the rights of parties under chattel mortgages and under pledges 14-18 Assignments in trust for creditors 19-31 CHAPTER II. Rights of the Parties to a Mortgage of Personal Property as against each other. Right to possession 22-30 Actions at law by mortgagee 31-33 Actions at law by mortgagor 34 38 CHAPTER III. Conditional Sales of Personal Property. Distinguished from mortgages 39-41 Conditional sales as securities for purchase-money 42-56 Sales or mortgages by conditional vendee 57-63 Filing contracts of conditional sale 64-69 Statutes of other States as to conditional sales , 70-84 Suggestions as to further legislation 85 Yl TABLE OF CONTENTS. CHAPTEE IV. "Validity op Chattel Moetgages as between THE PaBTIES to THEM. SECTIONS What debts may be secured by chattel mortgages 86-93 Mortgages by infants 94-96 Mortgages by partnerships 97-99 Mortgages by limited partnerships 100-101 Mortgages by corporations 102-111 CHAPTER V. Extent op Lien. Description of the mortgaged property 113-131 Accretions to mortgaged property ■ 133-134 Confusion of goods 135-136 Mortgages upon fixtures 137-136 Mortgages of future property 137-143 Mortgage on growing crop 144-148 Mortgage on unplanted crop 149-153 Liens reserved in leases 154-159 CHAPTEE VI. Assignments op Chattel Mortgages and Tbanspees op the Moetgaged Pbopeety. Assignments of chattel mortgages 160-163 Remedies against the mortgagor for assuming to sell free from mortgage lien 164-170 Rights of successive mortgagees of the same property as against each other 171-176 Priority of chattel mortgages, independent of recording acts . . . 177-179 Priority of chattel mortgages against liens for valuable services rendered to the property 180-185 TABLE OF CONTENTS. Vll CHAPTEE VII. FOEECLOSUKE AND EeDEMPTION. SECTIONS Foreclosure by action 186-195 Foreclosure by sale without judicial deciee 196-310 Enforcing the personal liability of the mortgagor for de- ficiency 311-313 Redemption 313-319 Accounting on redemption 330-336 CHAPTEE VIII. Validity of Chattel Mortgages as against Ceed- iTOES and Puechasees, Independent of the Statute Eequiring them to be Piled. The continued possesion of mortgagor a badge of fraud 337-342 Overstating the claims of the mortgagee ii badge of fraud 343 -244 Preferences by insolvent mortgagor 345-246 Validity as affected by right of mortgagor to sell free from lien . 347-263 When a mortgage may be void only in part 363-368 Who may dispute the validity of a chattel mortgage 369-380 CHAPTEE IX. Filing of Chattel Moetgages. When, where and how chattel mortgages should be filed 381-299 Refiling of chattel mortgages 300-308 When filing is unnecessary 309-317 Lex loci 318-331 Who may take advantage of omission to file a chattel mortgage. 332-333 CHAPTEE X. Taking Moetgaged Chattels upon Execution, 334-353 Till TABLE OF CONTENTS. CHAPTEE XI. MOKTGAGES OF ShIPS AND VESSELS. SECTIONS RecordiDg of mortgages of ships and vessels 354-3S9 Mortgages on canal boats 360-364 Liability of mortgagees of ships for supplies and repairs 365-366 Liens for supplies and repairs 367-369 Bottomry and respondentia bonds 370-374 APPENDIX. PAGE Statutes, ...... 257 FoBMs, . . ' . . 271 liNDEX TO CASES CITED. Rbperbnoes akb to Sections. Abbett V. Godwin, 143 Acke'rman d. Hunsicker, 93 Ackley v. Finch, 3, 36 Adams «. Beadle, 138, 153 V. Davidson, 335 ». Wildes, 112, 135 -Adamsorn). Peterson, 33, 113 Addington v. Ethridge, 348 JEtna Insurance Co. v. Aldricli, 331 Aldrich v. jEtna Insurance Co. 855 v. Reynolds, 153 Allen V. Fox, 330 V. Groodnow, 140 V. Vose, 39 American Cigar Co. •». Foster, 141 Amerman ». Wile, 107 Ames, Ex parte, 133 Anderson v. Brenneman, 310 V. Case, 173 V. Hunn, 243, 373, 277, 278 Andrew v. Dietrich, 43 Andrews v. Fillmore, 245 Anthony v. Wood, 340 Apperson v. Moore, 149 Applewhite e. Harrell Mill Co. 309 Archer ». Hubbell, 310 Argus V. Wasson, 149 Armington v. Houston, 58 Armory «. Delamine, 36 Arnold v. Morris, 18, 98 Ashmead v. Kellogg, 165 Astor ®. Westchester Gaslight Co, 108, 110 Atchison v. Mallon, 208 Atkins V. Moore, 33 Atkinson v. Graves, 114, 116 Atwater «. Mower, 6 Aultman v. Guy, 388 ». Mallory, 58 Austin «. Dye, 61, 63 Bacon v. Bonham, 315 Bailey v. Burton, 273, 335 0. Godfrey, 39 «. Harris, 58 ® Manufacturing Co. 345 Baker v. Baker, 319 V. Thrasher, 40 Baldwin v. Little, 248 Ball ®. Slafter, 255, 356, 333 Ballard v. Burgett, 61, 63 D. Winter, 330 Ballene v. Barrett, 350 Ballou V. Cunningham, 26, 197, 199, 211, 333 Baltes V. Ripp, 36, 335 Bank ». Danforth, 330 V. Ewing, 348 Bank of Carroll ». Taylor, 33 Colorado ®. Goodrich, 347 Lansingburgh «.Crary, 128, 138, 144, 145, 149 Montg. Co.'s Appeal, 93 Rochester v. Jones, 3 Rome V. Hazleton, 350 Selina ». Brewer, 347, 248 Bannon «. Bowler, 331, 245, 347 Bardwell v. Roberts, 3 Barker ». Bucklin, 213 V. Buel, 166 Barnard ». Eaton, 137, 256 Barnet v. Fergus, 247, 364 Barr v. Cannon, 117 V. Reitz, 338 INDEX TO CASES CITED. [References are to sections.^ Barrett v. ITart, 29 V. Pritchard. 43, 48, 54, 56 Barroilliet v. Battelle, 157 Barrow v. Paxton, 6, 11, 330, 283 Barrows ». Turner, 284 Bartlett v. Drake, 95 Baskins v. Shannon, 271, 373, 377 Bates V. Wiggin, 3 Bayaud e. Fellows, 195, 310 Bayne v. Patterson, 339 Baxter v. Gilbert, 313 «. Smith, 325 V. Spencer, 25 Bcale V. White, 141, 180 Bean i>. Edge, 63 Beard v. State, 144 Beaver v. Lane, 63, 63 Beck !). Burdett, 379, 280 Beckman ». Sikes, 153 Beers v. Waterbury, 90, 308 Belknap v. Wendell, 131 Bell V. Prewitt, 119 V. Shrieve, 143 Belmont v. Lane, 271 Bement v. Plattsburgh & Mont. R. R. Co. 317 Benedict v. Renfro Bros. 247, 348, 253 V. Smith, 335, 311 Benjamin v. The Elmira, Jefferson & C. R. R. Co. 338 Bennett v. Earll, 330 Berry i>. Mutual Ins. Co. 314 V. O'Connor, 345 Berson v. Nunan, 283 Best V. Staples, 355, 356, 357 Betsey, The, 372 Betsinger v. Schuyler, 158 Bevans v. Bolton, 284 BienmuUer v. Schneider, 309 Bier v. Kibbe, 21 Birkbeck v. Tucker, 366 Bishop ». Bishop, 137 V. Cook, 289 Bissell V. Hopkins, 2, 6, 230, 283 V. Pearce, 177, 181, 183, 297 Black V. Robinson, 149 V. Hair, 202 Blackwell, Thompson & Co. v. Walker, 71 Blaine «. Ship Charles Carter, 372 Blake v. Crowley, 186, 188, 191 Blakely v. Patrick, 114 Blakeslee v. Rossman, 247, 254, 259, 264 Blancbard v. Cooke, 141, 142, 251 V. Fearing, 366 Blancke v. Rogers, 136 Blandy ». Benedict, 275 Blodgett !). Blodgett, 6 Bonesteel v. Flack, 48 Bool V. Mix, 94 Boot Co. V. Ladd, 273 Booth !). Kehoe, 314, 315 V. Packet Co. 325 Bowens v. Benson, 25 Bowns V. Carter, 19 Boyce ». Smith, 335 Boynton i>. Libby, 58 Brachman «. Louis, 330 Brackett v. Harvey, 253, 256 Bradley v. Copley, 847 V. Kingsley, 208 Bradshaw v. Warner, 58 Bragelman v. Dane, 5, 23, 26, 39, 206, 226 Braley v. Byrnes, 273, 335 Breese v. Bange, 313, 314 Brennan v. Whitaker, 130, 13G Brett V. Carter, 351 Brewster®. Baker, 3, 41, 44 V. Silliman, 230 Brierly v. Kendall, 36 Briggs B. Mette, 308 V. Oliver, 186 Bringholft'«. Munzenmayer, 130 Biistol B. Burt, 173 Britton v. Criswell, 347, 249 V. Lorenz, 19 Broadhead v. McKay, 33 Brock V. Barr, 116 Brockenbrough v. Brockenbrough, 247, 257 Brockway ®. Wells, 17 Brooks V. Bondsey, 306 Brothers v. Mundell, 325 Brough i>. Brown, 222 Brown v. Allen, 140 V. Bates, 343 ». Bement, 6, 11, 26 V. Brabb, 323 B. Cook, 25, 27, 176, 386, 347, 349 V. Deway, 40 ». Guthrie, 19, 30 V. Hayes, 58 V. Keifer, 90, 93 INDEX TO OASES CITED. XI [References are to sections.] Brown v. Piatt, 8, 259 M. Rich, 349 «. The Propeller W. T. Graves, 368 ®. Thompson, 351 V. Thurber, 54 V. Webb, 259 Brownell v. Curtis, 275 V. Hawkins, 9, 11 Brunswick v. McClay, 283 Brunswick, &c. Co. ». Hoover, 59 Brush V. Evans. 313 Bryant «. Pennell, 153 V. Woodruff, 36 Bucher v. Marquette & Pacific Roll- ing Mill Co. 108 Bucknal v. Roisten, 139 Buffalo & State Line R. R. Co. ». Supervisors of Erie, 386 Buffalo Steam Engine Works v. The Sun Mutual Insurance Co. 202 BuUene v. Barrett, 247, 349, 364 BuUis V. Drake, 231 v. Montgomery, 336 Bunacleugh v. Poolman, 2, 11, 13, 36, Sis B'urdette. Hunt, 116, 119 Biirdick v. McVanner, 11, 16, 36 Burns v. Campbell, 3, 37, 30, 85,135, 140, 149 V. Munger, 363 V. Winchell, 36 Burnside v. Twitchell, 129 Burroughs, In re, 364 Burtis V. Bradford, 311 Bush V. Garner, 150 Buskirk v. Cleveland, 154, 158 Butler V. Lee, 375 ». Miller, 33, 26, 37, 171, 172, 331, 335, 344 V. Page, 137 Butt V. EUett, 149 Button «. Rathbone, 373, 831 Butts V. Privett, 24 V. Screws, 43 Byan v. Baldwin, 15 Byram ». Gordon, 393 Byrd v. Daniel, 319 Cadwell v. Pray, 140, 141 Caffrey V. Woodin, 140 Cahoon v. Meyers, 283 Caldwell «. Trowbridge, 117 Call V. Gray, 114 V. Seymour, 43 Cameron v. Marvin, 391, 309 Camp V. Camp, 336 Campbell v. Birch, 16, 36, 161, 171 V. Leonard. 335 v. Parker, 13 V. Wheeler, 306 Campbell Printing Press Co. v, 01- trogge, 67 Caring v. Richmond, 135, 353 Carow V. Kelly, 273 Carpenter v. Black Hawk Gold Mining Co. 103, 109 ». Blote, 90 ». Le Count, 309 V. Longan, 163 «. Simmons, 347 V. Snelling, 6 11. Town, 37, 38, 217, 347 «. Walker, 134 Carr ». Hilton, 275 Carson v. Byeis, 30 Carter «. Pately, 170 Carty ». Penstemaker, 335 Case V. Allen, 185 «. Boughton, 311, 333, 223 V. Finch, 187 V. Jewett, 389 Cass V. Gunnison, 119 Caswell V. Keith, 5 Ceas V. Bramley, 3 Central Gold Mining Co. v. Piatt, 109 Chadbourne ®. Rahilly, 177 Chad wick ». Clapp, 18 V. Lamb, S3, 24, 29 Chamberlain «. Clemence, 328 V. Martin, 197, 198, 199 V. Smith, 59 Champliu v. Butler, 5, 365 V. Johnson, 26, 335 Chandler ». Bunn, 384 Ohapin i). Cram, 143, 294 V. Sbafer, 94, 164, 231 Chapman «. Hunt, 20, 188 V. Weimar, 142 Charter v. Stevens, 16, 26, 34, 173, 186, 196, 199, 293, 306 Chase «. Denny, 141, 143 V. Ingalls, 58 V. Peck, 18 Xll INDEX TO CASES CITED. IReferences are to sections.] Chatham National Bank v. O'Brien, 249 Cheatham s. Hawkins, 351 Chicago Lumber Co. v. Fisher, 358, 335, 340 Childs «. Kendall, 376 Ohisholm ». Chittenden, 137 Crow V. Red River County Bank, 353 Ohynoweth v. Tenney, 153 Circassian, The, 368 Citizen's Bank v. Rhutasel, 119 City Bank of Rochester v. West- bury, 350, 358 Claflin ». Carpenter, 146 Clapp «. Campbell, 176 Clark v. Baker, 38 V. Gilbert, 326 ». Griffith, 217 V. Hay ward, 76 ». Henry, 5, 6 V. Houghton, 99 V. Hyman, 351 V. Voorhees, 114 V. "Whitaker, 30 Clayton i>. Heister, 58 Cleaves i). Herbert, 248 Cllne V. Libby, 39 Clove V. Lambert, 137 Clow V. Woods, 330 Cobb V. Baswell, 330 Cochran «. Flint, 136 Codman i>. Freeman, 137 Coe V. Oassidy, 5, 39, 199, 309, 313, 334, 335 V. Manseau, 309 Coggell V. Hartford & N. H. R. R. Co. 43, 48, 54, 58 Cole V. Berry, 58 V. Kerr, 151 V. Maun, 44, 48, 55, 68 V. Seymour, 58 Coles V. Clark, 38, 37, 165, 173, 283, 344 Colo. Iron Works Co. ». Renfro Bros. 149 Collins «. Myers, 347 CoUman v. Collins, 183 Coman v. Lakey, 103, 107 V. Thompson, 158 Comer v. Cunningham, 63, 63 Comins e. Newton, 122 Comstock V. Scales, 153 Conderman v. Smith, 188, 149 Conkey ®. Hart, 38 Conkling v. Secor Sewing Muchine Co. 105, 108 V. Shelley, 253 Connah v. Hale. 173 Oonover «. Van Mater, 389 Conroe e. National Protection lus. Co. 286 Cook V. Corthell, 140, 142 !). Halsell, 264 V. Lion Fire Ins. Co. 5 Cool V. Roche, 384 Cooper V. Brock, 388 ». Douglas, 137, 139 Coray v. Burton, 95 Corbin v. Kincaid, 116, 138, 177, 343, 391, 331 Corcoran v. Webster, 128 Corliss 1). Van Sagin, 137 Corse ». Patterson, 58 Cortelyou ®. Lansing, 3, 1 1 Cotton V. Marsh, 348 V. Willoughby, 144, 149 Coty ». Barnes, 6 Cowper V. Theall, 376 Ooykendall v. Ladd, 316 Craig V. Tappin, 311, 332 Crampton v. Flatt, 57 Crandall v. Brown, 285 Crawford v. Kirksey, 331 Cray o. Currier, 117 Cressey e. Sabre, 153 Crippen v. Fletcher, 335 ». Morrison, 186 Crisfield «. Bogardus, 333 V. Neal, 116 Crocker v. Atwood, 38 Crosby ». Baker, 123 Oroswell «. Allis, 113, 114 Crowningshield v. Kittredge, 263 Cudworth v. Scott, 134 Culver «. Sisson, 211 Cummings «. Harris, 181 Cunningham «. Tucker, 355 Curd V. Wunder, 385 Currie v. Knight, 324, 326 Curtis V. Leavitt, 20 V. Phillips, 120 Cushman v. Jewell, 51 Cutler V. James Goold Co. 33, 330, 3i0 «. Thurlo, 366 INDEX TO CASES CITED. Xlll [He/erences are to sections.] Dabncy v. Green, 5 Dahill V Brooker, 38 Daly V. Proetz, 307 Dane v. Mallory, 36, 331, 332 Daniel v. Morrison, 351 Darling v. Wilson, 134 Darwin v. Handley, 357 Davenport v. Foulke, 347, 348, 364 V. Ledger, 39 ». McChesncy, 315 V. Shauts, 134, 136 Davidson «. Westchester Gaslight Co. 110 Davis ». Banks, 31 ®. Marx, 140, 143 V. Scott, 30 Dean ®. McGhie, 365 Decker v. Boice, 177, 339 De Courcey v. Collins, 388, 330 Deering ». Cobb, 143 Deeter v. Sellers, 98 Defreeze v. Trumper, 307 Dehority v. Paxson, 123 Delaware v. Ensign, 249, 271, 377 Delop V. Windsor, 330 Denike v. N. Y. & R. Lime, &c. Co. 108 Dennison v. Sohuler, 180 Deshon v. Bigelow, 58 Despard «. Walbridge, 5 Despatch Line a. Bellamy Manfg. Co. 4 Devlin v. O'Neill, 54 Dibble v. Hathaway, 67 Dice V. Irvin, 245 Dikeman v. Puckhafer, 37, 189, 390 Dillaway «. Butler, 316 , Dillenbeck v. Jerome, 36 Dillingham ii. Bolt, 304, 308, 337 Divver v. McLaughlin, 36, 93, 360 Doak V. Brnbaker, 340 Doane v. Eddy, 830 ®. Garrettson, 340 Dodds V. Johnson, 349 11. Neal, 114 Dodge V. Potter, 113, 389, 290 Dolan V. Van Demark, 309 Dolson V. Saxton, 351 Domestic Sewing Machine Co. v. Anderson, 49 Donnell v. Byerm, 364 «. The Starlight, 369 Dorthy v. Servis, 333 Downard v. Grofl, 153 Doyle V. Stevens, 341 Draco, The, 372 Dresser Mfg. Co. v. Waterston, 43, 56 Drug Co. ». Robinson, 348, 249 Dudley ». Hawlev, 36, 81 Duflfus V. Bangs, "30, 145, 158 Duke of Bedford, The, 373 Duke V. Strickland, 148 Dunbar «. Rawles, 58 V. Spear, 87 ». Stone, 58 Duncomb v. N. T., H. & N. R. R. Co. 15 Dunham?). Whitehead, 20, 344 Dunning v. Stearns, 17, 112, 116, 133, 125 Durant v. Einstein, 16 Durfee 1). Grinnell, 335 Dusenbury ». Hulbert, 107 Dutcher v. Swart-yood, 143, 350, 359, 369 Dyer v. Thorstad, 68 Earl V. Burch, 274 V. Camp, 37 Eastman v. Foster, 180 Baton V. McKahan, 8 Eaves v. Estes, 138, 134, 136 Bbling 1). Husson, 336 Edgell V. Hart, 121, 137, 159, 347, 361, 264 Edgerly v. Bush, 320 Edmistou e. Brucker, 303 Edson V. Newell, 331 Edwards v. Cottrell, 304 Eggleston v. Mundy, 335 Eggert 11. Thoren, 117 Ehler u. Turner, 399 Elder v. Miller, 116 V. Rouse, 811 Elliott ». Wood, 15, 303 Ellis V. Martin, 116 Ellsworth V. Phelps, 353 Elson V. Barrier, 384 Ely V. Carnley, 398, 308 Enders v. Williams, 351 Erie Railway Company v. Ramsey, 310 Eslow «. Mitchell, 34 Estabrook ®. Messersmith, 375 Eureka Iron, &c. Works v. Bresna- han, 103 XIV INDEX TO OASES CITED. {^References are to !iections.'\ Evans ». Graham, 39 V. Harvester Works, 339 ». Merriken, 134 Everett v. Brown, 119 Everinan v. Robb, 157 Ewing V. Cargill, 348 V. Markley, 381 Exeter, The, 373 Fairbanks ». Bloomfleld, 24, 35, 313, 335, 374 V. Eureka, 58 V. Phelps, 43, 173 Fales V. Roberts, 58 Fanshawe v. Lane, 100 Farmers' Bank ». Cowan, 36, 313, 335 Farmers' Loan & Trust Co. v. Com- mercial Bank, 153 ». Fisher, 153 V. Hendrickson, 317, 338 ». Long Beach Imp. Co. 137, 141, 142 Farmers' & Mech. Bk. ». Lang, 11 Farrell ». Hildreth, 39, 337 Farrer v. Chaufletete, 173 Farrington v. Caswell, 343 Fellows ». Van Hyring, 86, 397 Fenn ». Bittleson, 165 Ferguson «. Clifford, 330 V. Lee, 36, 343 ». Union Furnace Co. 3, 3, 6, 330 Feurt V. Rowell, 383, 384, 320 Field V. Doyon, 170 Filkins v. Cruice, 39 Finch V. Blount, 37 Fink B. Ehrman Bros. 350 First National Bank ». Anderson, 259 ®. Perry, 340 First Nat. Bank of Alexandria ». Turnbull, 140 First National Bank of Cincinnati V. Kelly, 10. 309, 374 First National Bank of Madison ». Damin, 5, 90, 187, 309 Fish «. Thomas, 366 Fisher «. Piiedman, 38 ». Syfers, 247 Fitch V. Humphrey, 301 V. Newberry, 183 Fitzgerald ». Andrews, 23, 336 Flagg ». Mann, 18 Flanders v. Chamberlain, 198, 333 Fleeman v. McKean, 60, 63, 63 Fletcher ». Nuedeck, 176 «. Powers, 130, 351 Floyd 0. Morrow, 140 Flower v. Cornish, 375 Folger v. Weber, 355 Folsom V. Clemence, 291 Fonda v. Gross, 348 Fontaine v. Beers, 355 Forbes v. Marsh, 43, 58 V. Parker, 383 Ford «. Cobb. 138, 131, 135 V. David, 313 11. Ransom, 6, 34, 34, 310 V. Sutherlin, 130 ». Williams, 249, 353, 344 Forepaugh ». Pryor, 186 Forman ». Proctor, 134 Portman v. Goepper, 128, 130 Foster ». Gillespie, 335 V. Napier, 37 Fowler ». HoflEman, 125 ». Hunt, 114 ». Merrill, 134 Fox ». Burns, 36 ». Davidson, 247 ». Hanburg, 97 V. McGregor, 181 France ». Haynes, 303 ■e. Thomas, 140 Frank v. Batten, 54, 56, 66 V. Playter, 331 Prankland v. Moulton, 139, 136 Frapnall's Ad'x v. State Bank, 343 Fraser ». Gilbert, 303, 325 Freeman v. Rawson, 347 V. Schroeder, 177 French v. Powers, 198, 203 Frick ». Hilliard, 43 Frisbee v. Langworthy, 348 Prisbey ». Thayer, 369 Fromme «. Jones, 283 Frost V. Mott, 331, 371, 277 D. Shaw, 339 «. Warren, 243, 250, 253, 367 ». Williard, 133, 125 Fryatt v. Sullivan Co. 131, 135 Fulgham «. Morris, 188 FuUam ». Stearns, 134 Fuller V. Acker, 36, 27, 333 ». Day, 36 V. Paige, 125 INDEX TO CASES CITED. XV \^Iieferences are to sections.^ Funk V. Pane, 134 Furlong v. Cox, 29 Furniss v. Brig Magoun, 373 Gage «. Parry. 7, 19, 30 ». Whittier, 170 Galen ®. Brown, 113, 335 Ganson «. Madigan, 119 Garauflo v. Cooley, 153 Gardenier ». Tubbs, 343 Gardner «. Finley, 137 V. McEwen, 116, 139, 159, 350, 367 Garllck «. James, 14 Gauss', Sons v. Doyle, 350 «. Orr, 347 Gay V. Bidwell, 351 Geery v. Geery, 369, 376 George s. Grant, 100, 101 «. Stubbs, 58 V. Toll, 297 Gibbons v. Luke, 53 Gibson v. Cranage, 39 «. Soper, 95 V. Warden, 4, 99, 375 Giddey v. Uhl, 115 Gifford V. Ford, 6 Gilbert v. McCorkle, 345 Gill V. Penney, 334 Gillespie v. Brown, 393 Gillett «. Balcom, 153 Gilson V. Gilson, 18 Glass V. Ellison, 343 Globe Works «. Wright, 180 Glover ». McGiloray, 3 Goddard v. Gould, 138 Gold B. Marshall, 5 Golden v. Cockril, 114 Goldsmith ».Willson, 335 Gomez v. Kamping, 39, 41, 46 Goodell v. Dewey, 303 v. Fairbrother, 58 Goodheart «. Johnson, 364 Gooding v. Kiley, 138, 393 V. Shea, 36 Goodrich v. Downs, 363, 364 ■D. Willard, 176. 181 11. Williams, 137 Goodwin ». Kelly, 40, 340, 310 V. May, 58 Goodwyn ». Goodwyn, 331 Goodyear v. Brooks, 186 Googins ». Gilmore, 33, 351 Gordon v. Hardin, 3-S5 V. Harper, 347 Gould V. Browne, 385, 396 V. Marsh, 161, 163 Goulet V. Asseiar, 166, 173, 335, 336, 347, 349, 351 Grace ». Wade, 336 Graham v. Newman, 161 Granite State, The, In re, 369 Grant v. Skinner, 39, 64, 66 Graser ». Stellwagen, 97, 99 Grassmuck v. Bauer, 336 Griffin ». Wertz, 334 Griffith 0. Douglass, 137, 141 Griffiths V. Wheeler, 113 Grimble «. Ferguson, 316 Grimes v. Farrington, 345 Grimstone v. Carter, 39, 40 Grinnell v. Cook, 184 Griswold «. Morse, 303 V. Sheldon, 137, 338, 331, 361, 390 Greeley v. Reading, 359 Green ». Clarke, 36 V. Green, 95 Greenbaum v. Wheeler, 354 Greenpoint Sugar Co. ». Kings Co. Mfg. Co. 104 «. Whitin, 104, 105, 106, 107, 108 Greggs v. Sanford, 1 33 Gregoi-y «. Thomas, 16, 36, 338 ». Whedon, 336 Grove i>. Wise, 31 Grover v. Wakeman, 363 Grubbs v. BUyson, 343 Quyer, Assig't of. In re, 7 Haak «. Linderman, 59 Haggerty v. Palmer, 19, 43, 63, 63 Hale V. Omaha Nat. Bk. 18, 173 V. Sweet, 337, 379, 341 V. Wigton, 209 Hall V. Ditson, 303, 318 V. Sampson, 34, 39, 34, 335, 337, 343 V. Tuttlr, 5, 383. 335 Hallowell v. Milne, 58 Halstead v. Swartz, 16, 36, 27, 317, 318 Halsey ». Christie, 331 Hamill v. Giliespie, 313, 334 Hamilton v. Austin, 153 XVI INDEX TO CASES CITED. [Seferences are to sections. ] Hamilton ®. Browning, 161 V. Langley, 156 V. Maas & Bro. 116 B. Rogers, 125, 126 Hammond v. Danielson, 180 «. Solliday,' Rec'r, 335 Hampton ». Levy, 333 Hanes s. Tiffany, 275, 823 Hanford i>. Artcher, 88, 281, 336, 378, 335 Hangen v. Hochmeister, 94, 95 Hanmer ». Wilsey, 37, 38 Harding ». Coburn, 119 Harkneas v. Russell, 43 Harlan ii. Ely, 304 Harman v. Hoskina, 248. 264 Harrington v. Brittan, 283 Harris v. Haynes, 134 V. Kennedy, 113 V. Lynn, 307 0. Woodard, 58, 119 Harrison ®. Burlingame, 315 Hart 0. Carpenter, 58 0. Sheldon, 134 ■i>. Ten Efclr, 135, 186, 196, 303, 219 Hartley n. Tatham, 163 Hasbrouck «. Lounsbury, 47 V. Vandervoort, 9 Haskins v. Kelly, 13, 309 V. Patterson, 9, 11, 198 Hathaway «. Brayman, 24, 29, 172, 337 i>. Howell, 289 Hauselt v. Harrison, 309, 323 Haviland v. Johnson, 45 Hawk V. Ridgway, 35 Hawkins v. Hastings Bank, 99, 253 Hayman v. Jones, 323 Haynes «. Hunsicker, 234 V. Seppig, 325 Headrick v. Brattain, 151 Healy v. Butler, 273 Hefflin ®. Bell, 58 Heflin ». Phillips, 390 Henry v. Davis, 17 V. Ferguson, 313 «. Root, 96 Herring o. Hoppock, 43 V. Willard, 43 Hersee v. Porter, 853 Herzford v. Davis, 67 Hesketh v. Stevens, 365, 366 Heyerford ». Davis, 41 Heyland v. Badger, 383 Hickox V. Lowe, 5 Hicks V. Williams, 384, 391, 358 Higgins B. Whitney. 38 HiilB. Beebe, 161, "338, 385 ». Gilman, 393 ®. Grant, 5, 39 V. Townsend, 51 v. Wentworth, 134 Hillman v. Baumbach, 35 Hinman v. Judson, 31, 216 Hintermister «. Lane, 63 Hlrschorn v. Canney, 58 Hisey «. Goodwin, 248 Hitchler v. Citizens' Bank, 348 Hoagland ». Shampanore, 177, 339 Hodgson V. Butts, 365 Hodson V. Wagner, 58 Hoit V. Remick, 384 Holbrook ». Baker, 231 Holly v. Brown, 133 Holmes «. Grant, 39, 40 Holroyd d. Marshall, 140, 151 Horton v. Davis, 355 V. Williams, 343, 347, 264 Hotchkiss B. Hunt, 35 Houck V. Condon, 335 Howard v. Chase, 38 V. Odell, 866 V. Rohlflng, 351 Howe V. Tefft, 855 Howland v. Willett, 37, 189, 335, 336 Hoyle «. Plattsburgh & Montreal R. R. Co. 386, 317 Hoyt V. Thompson's Ex'r, 330 Hubbard ». Harrison, 161 Hubbardston Lumber Co. v. Covert, 385, 388 Hubbell V. Allen, 247, 358 ». East Cambridge Sav. Bank, 134 Huber v. Ely, 312 Hudgins v. Wood, 295, 315 Huebner ». Koebke, 29 Huerstal ». Muir, 153 Huggans ®. Fryer, 29, 197, 199,311, 233 Hughes B. Corey, 351 V. Graves, 134 ». Shull, 343 Hull B. Camley, 166, 173, 335, 336, 345, 346, 347 V. Oarnley, Executrix, 336 INDEX TO OASES CITED. XVll IReference^ are to uctions.^ Hulsen v. Walter, 26, 171, 173, 173, 186, 296 Hunt V. Bay State Iron Oo. 139, 130 Hunter ». Bosworth, 153 Hurst V. Bell, 33, 149, 150 Husted 1). Ingraham, 18 Hutchinson v. Ford, 149 Hutchings v. Hunger, 51 Hyslop «. Clarke, 19 Ingalls «. Herrick, 231 Isenberg v. Fansler, 309 Ivins V. Hines, 119 Jackson ». Rutherford, 6 «. Willard, 842 V. Kasseall, 181, 184, 185 1). Turner, 187 Jaffray v. Greenbaum, 351, 309 V. Thompson, 809 James v. Morey, 5 J). Oakley, 86 Jamieson v. Bruce, 33 Jaqueth v. Merritt, 337, 338 Jardine, Ex parte, 131 Jehneri). Aultman, 116 Jencks s. Smith, 145 Jenkins i>. Eichelberger, 330 Jenks «. Groflfe, 251 Jennings v. Mcllroy, 335 Jerusalem, The, 373 Johnson v. Crofoot, 2, 24 'v. Curtis, 231 V. Murphy, 211 V. Phifer, 258 V. Stagg, 314 V. Thomas, 231 Jonas 1). Workman, 113 Jones V. Goodwillie, 33 V. Graham, 832, 826, 331 V. Guaranty & Indemnity Co. 109 V. Howell, 328 «. Huggeford, 251 V. Richardson, 137, 141, 143 V. Taylor, 320 V. Thurloe, 181 Jordan v. Farnsworth, 7 Jorgensen v. Tait, 176 Judson V. Easton, 36 Kalk V. Fielding, 343 Kanaga v. Taylor, 284, 330 Kane v. Drake, 381 B Kaysing v. Hughes, 343 Keeler «. Keeler, 139 Keenan v. Stimson, 383, 330 Keller i). Paine, 5, 330, 333, 334, 386, 319 ■V. Smalley, 375, 328 ». West, Bradley & Gary Mfg. Go. 99 Kelley v. Reid, 113, 116, 117 Kellogg «. Lovely, 134 11. Olsen, 33 Kelly V. Boylan, 317 V. Brensing, 371 V. Reid, 114 Kelsey «. Lyon, 133 Kennedy «. National Union Bank, 140, 369, 826 Kenny «. Planer, 45 Kenyon ®. Tramel, 113 Kerr ». Dildine, 143 V. HUl, 153 Ketoham v. Brennan, 58 Kilbourne v. Fay, 324 Kimball ». Sattley, 144 King V. Aultman, 113 «. Bailey, 335 1). Bates, 58 V. Richards, 183 i>. Van Vleek, 11,, 315, 316 V. Walbridge, 203 «. Wilcomb, 138, 145 Kingsland v. Dunn, 57 Kinsey v. Bailey, 138, 131, 134 KirkbrJde, Re, 364 Kirkland v. Brune, 315 Klee ». Reitzenberger, 347, 348 Kleins «. Katzenberger, 350 Knaggs V. Green, 96 Knapp ®. Alvord, 13 V. McGowan, 30, 243 Kohler v. Hayes, 42, 58 Kreuzer v. Cooney, 125 Krone v. Phelps, 114 KrophoUer v. St. Paul, M. & M.Ry. Co. 208 Kuhn V. Graves, 5 La Belle Wagon Works «. Tidball, 30 Laflin v. Griffiths, 183 Lambert v. Miller, 316, 318 V. Paulding, 341 Lampson v. Arnold, 345 xvm INDEX TO CASES CITED. \^References are to sections.^ Lamson ®. Moffatt, 141 Lane v. King, 153 n. Lutz, 324, 336 Lang V. Brevard, 383 v. Lea, 247 Langdon ». Buel, 3, 13, 36, 161 V. Gray, 86 B. Phelps, 368 Langton v. Horton, 366 Langworthy v. Little, 330 Lansing ». Groelet, 196 Lathe ®. Schoff, 319 Latimer v. Wheeler, 337 Laubenheimer b. McDermott, 87 Lawrence e. Hodges, 355 Lazarus v. Andrade, 140 Leathern ». Amer, 140 Lee V. Huntoon, 235, 389, 388, 306 Le Flore «. Miller, 53 Leigh ton v. Stuart, 114 Leinkauf «. Caiman, 103 Leitch !). Hollister, 30 Leland v. CoUver, 140, 141, 251 B. The Medora, 373 Lempke ®. Peterson, 173, 178 Leser ». Glaser, 350 Leslie o. Hoffman, 86 Levin v. Russell, 309 Levy ». Welsh, 139 Levfis, Ex parte, 373 Lewis V. D'Arcy, 29, 340 «. Graham, 9 ®. Palmer, 36, 328 D. Stevenson, 331 Lichtenberg v. Herdtfelder, 376 Lister e. Simpson, 351 Livor 11. Orser, 37, 336, 339 Lockwood, &c. Co. ». Crawford, 303 Loeb ». Milner, 38, 313 Loeschigk «. Baldwin, 30 London, &c. Loan Co. ■». Drake, 145 Lonsdale «. Fairbrother, 89 Lord V. Tonkers Gas & Fuel Co. 105, 309 Lormer v. AUyn, 143 Louisville R. R. Co. v. Letson, 386 Lovell V. Osgood, 292 Low «. Pettengill, 389 Lowe B. Wing, 331 Lulu, The, In re, 369 Luckett v. Townsend, 11 Lucking v. Wesson, 216 Ludden ». Hazen, 48, 54 Ludwig ». Kipp, 187, 140 Lund ®. Fletcher, 251, 264 Lyle «. Palmer, 333 Lyman ®. Bowe, 336 Lyon ®. Cobum, 33, 171, 172, 344 McOafErey ». Woodin, 187, 156 McCarty v. Blevina, 134 McOhesney, E. M., In re, 369 McClelland e. Remaen, 19, 20, 97 McClenny ». McClenny, 830 McClure ». Roman, 93 McConnell ». Blood, 134 i). Scott, 37, 90 McOord V. Cooper, 117 McCormack v. Hartley, 307 McCoy V. Artcher, 207 «. Boley, 251 V. Lassiter, 3, 11 McDowell B. Stewart, 338 McParland ». Farmer, 58 McGee v. Fitzer, 141 McGill 9. Sell, 58 Mclntyre v. Scott, 866 McKibbin v. Martin, 388 McKinster ®. Babcock, 90, 91 McLean e. Walker, 11 MoLeod V. Jones, 30 McNeal e. Emerson, 30 V. Finnegan, 328 McNeil V, Tenth National Bank, 10, 14 McRea «. Central Nat. Bank, 131 McVay ». English, 291 Mabbett v. White, 97, 99 MacCabe v. Blymyre, 320 Machette v. Wanless, 87 Mack v. Phelan, 113, 331 Mackie v. Cairns, 363 Madonna, D'Idra, The, 373 Maguire v. Card, 368 ». Park, 134 Maier v. Davis, 178 Manhattan Co. v. Laimbeer, 390 Mann ®. Flower, 347, 278 Manning v. Cunningham, 69 ». Monaghan, 38, 166, 396, 327, 831, 335, 336, 346, 348, 850, 351 Manson ». The Phoenix Ins. Co. 316 Manufacturers' Bank of Milwaukee ». Ruger, 5 INDEX TO OASES CITED. XITL [^References are to section).^ Manufacturers' Nat. Bank of N. Y. V. Kober, 336 Maples «. Miller, 153 Marbourg i>. Manufacturing Co. 243 Markham v. Jaudon, 10 Marquette Mfg. Co. v. Jaffrey, 68 Marsden v. Cornell, 38, 36, 37, 305, 337, 362 Marsb v. Armstrong, 307 «. Burley, 231 11. Lawrence, 3, 6, 330, 335 V. Russell, 308 Marston v. Vultee, 349 Martin v. Baumel, 338 V. Hill, 320 ■V. Mathot, 54, 59 V. Niagara Falls Paper Mfg. Co. 109 V. Ogden, 350, 351, 324 V. Rothschild, 383 V. Thompson, 148 Martindale v. Booth, 238 Marvin Safe Co. v. Norton, 79 Marx V. Davis, 143 Mason v. Franklin, 343 Masten v. Webb, 331 Matthews v. Sniffen, 131 Mattingly ». Darwin, 113 Mattisons. Baucus, 33, 37, 171,173, 335, 336, 840, 344 Mayer v. Clark, 331 V. Taylor, 153 Maxwell s. Inman, 397 Meade v. Smith, 234 Meadow ». Wise, 343 Mech. & Traders' Bk. ». Farmers' & Mech. Bk. 33 Meech i;., Bennett, 308 V. Patchin, 337, 338, 331 Mehrin ». Oaks, 390 Melin «. Reynolds, 116 Merchant v. Belding, 98 Merrill i>. Ressler, 156 Mervine v. White, 6 Metcalf V. Fosdick, 156 «. McLoughlin, 165 Metzner «. G-raham, 353 Meyer «. Evans, 351 V. Gage, 351 Michelson ■». Fowler, 385 Millar «. Allen, 165, 174 Millchamp v. People, 167 Miller v. Chapel, 395 ■». Hart, 120 Miller «. Jones, 357 V. Lockwood, 231, 343, 353, 267 V. McCormack Co. 149 11. Pancoast, 335 11. Plumb, 137 ti. Smith, 94, 95 Millett V. Strenger, 97 Milliman «. Neher, 187, 149, 154 Miln V. Spinola, 865, 366 Minn. Linseed Oil Co. v. Maginnis, 149 Mitchell V. Badgett, 157 V. Steelman, 355 V. West, 331 V. Winslow, 140 Mittnacht v. Kelly, 248, 262, 363 Mobley b. Letts, 247 Moffett !). Tuthill, 210 Moline Plow Co. v. Braden, 69 Monnot v. Ifert, 93 Monroe o. Hamilton, 315 Montgomery v. Chase, 143 11. Merrell, 153 V. Wright, 330 Moody V. Wright, 137 Moore v. Byrum, 149 V. Murdock, 5, 6 V. Wood, 145 Morgan v. Spangler, 335 Moriarty v. Gullickson, 390 Morrill v. Sanford, 388 Morrow v. iieed, 118, 809 i>. Tumey, 3 Morse «. Powers, 30 Mosely v. Shattuck, 58 Moses V. Walker, 331 Mowry v. White, 126, 153 Mumper v. Rushmore, 240 Murphy v. G-alloupe, 342 Murray v. Burling, 173 V. Judson, 30 Muse v. Lehman, 148 Mustard v. Wanefard's Heirs, 95 Nash V. Ely, 340, 310 V. Weaver, 64, 66 National Bank of Metropolis v. Sprague, 303 Nat. Bank of Texas v. Lovenberg, 249 Neidig «. Eifler, 2 Nelson v. Drake, 103 XX INDEX TO CASES CITED, [References are to teciiom.] Nelson v. Neill, 387, 388 V. Wheelock, 97 Nestell B. Hewitt, 138, 156 New Albany Ins. Oo. v. Wilcoxson, 349 Newell V. Warner, 115, 367, 303, 308 v. Warren, "383, 300, 361 Newman v. Tymeson, 173, 331 Newsam ®. Finch, 37, 336 N. Y. National Exchange Bank «. Jones, 333 Niagara Oo. National Bank v. Lord, 331, 338, 323 Nicholas v. Hampton, 364 Nichols V. Barnes, 116, 148 V. Mase, 33, 330 V. Mead, 336, 344 Nicker v. Nelson, 5 Nicklin v. Betts Spring Co. 5, 93 Nitchie i). Townsend, 300, 302 Nixon V. Stanley, 305 Noble V. Holmes, 273 Noland v. Wickliam, 339 Norman v. Craft, 179 Norris ». Sowles, 330, 335 Northwestern Ins. Co. «. Ferward, 370 Noyes v. WyckofiF, 318 Odell V. Gallup, 136, 187 Offutt V. Flagg, 330 Ogden «. Lathrop, 14. Oil Oo. V. Maginnis, 310 Olcott V. Tioga R. R. Co. 15, 199, 303, 311, 233 Omaha Bank v. Sunderland, 5 Ombony «. Jones, 145 Orcutt V. Moore, 147 Ormsby v. Nolan, 119 Orton «. Orton, 347, 364 Osbom V. Alexander, 306, 308, 331, 341 V. Gantz, 50 Oster V. Mickley, 168 Ostrander «. Fay, 353 Otis V. Sill, 137, 139, 336, 383, 309 V. Wood, 16, 26 Overstreet v. Manning, 326 Paget «. Percbard, 260 Palmer v. Kelly, 51 Pancoast v. American Heating & Power Co. 333 Parker v. Baxter, 50, 63 ». Parshall, 37, 317 ». Jacobs, 143 Parks V. Webb, 157 Parish v. Wheeler, 31, 315, 333 Parr «. Brady, 351, 330 Parshall v. Eggart, 3, 9, 333, 291 Parsons Savings Bank v. Sargent, 118 Partridge v. White, 131 Patch i>. Wheatland, 99 Patchin ». Pierce, 36, 34, 196, 302, 317 Pate V. Harper, 323, 339 Patrick v. Meserve, 170 Patten v. Kavanagh, 99 Patterson v. Berry, 371 «. Gillies, 308 Paulding v. Ohromo Steel Co. 108 Payne ». Batterson, 63, 66 Pease s. Odenkirchen, 384 Pecker v. Silsby, 338 Peckham «. Haddock, 18 Pelser v. Peticolas, 350 Pennington «. Jones, 117 People B. Bristol, 1 35, 390, 325 People ew rel. Stokes b. Risley, 167 Perkins v. Emerson, -355, 856 Perry v. Pettingill, 123 V. Dow, 170 V. Shenandoah Nat. Bank, 347 Peters o. Parsons, 57 Petring B. Chrisler, 356, 359 Pettibone «. Drakeford, 314, 216 V. Stevens, 311 Pettis V. Kellogg, 119 Phelps V. Murray, 347 Philbrook v. McBwen, 333 Philips V. Both, 143 B. Hawkins, 343 Phinney v. Day, 137 Pickert v. Canal Boat Independence, 361, 363 Pickett B. Pope, 33 Pierce v. Benjamin, 38 B. George, 131, 136, 139 V. Goddard, 131, 135 Pierson v. Manning, 333 Pike V. Colvin, 340 Piser V. Stearns, 43 Place B. Langworthy, 347 Piatt V. Stewart, 284, 294 Polls B. Lord Clinton, 317 INDEX TO CASES CITED. XXI [References are to sections.'] Pond V. Hudson R. R. Co. 386 Porter v. Parmley, 14, 26, 166, 171, 313, 236, 341, 296, 309, 346 Potter V. Cromwell, 184 Potts V. Hart, 350, 264, 375, 847 V. N. J. Arms & Ordnance Co. 180 Powers «. Dennison, 137, 136 V. Blias, 335 V. Freeman, 143, 384 Pratt V. Harlow, 331 V. Maynard, 170 V. Stiles, 200, 315, 219, 220 Preble v. Conger, 92 Prentice v. Nutter, 114 Preston v. Briggs, 186 V. Southwick, 393 Price V. Brayton, 153 V. Furman, 95 V. Jones, 58 V. McComas, 112, 114. Prout V. Root, 343 Puffer V. Reeve, 63 Pulver J). Richardson, 37, 303, 211, 323 Purington ®. Arkburst, 41 Purviance v. Southerland,,99 Putnam v. Gushing, 133 V. Fitzgerald, 333 V. Osgood, 247, 250, 253, 264 Pyle v. Pennock, 134 V. Warren, 331 Quinn v. Schmidt, 89 Quirk V. Rodman, 40, 46 Quiriague v. Dennis, 144 Ramsey v. Glenn, 830, 325 Randall v. Cook, 230 1). Dunbar, 198 ». Shaw, 345 Rankin v. Rankin, 175 Ransom v. Schmela, 336 Rathbone o. Boyd, 86 Rathbun v. Waters, 51 Raulett V. Blodgett, 347 Raw lings v. Hunt, 149 Rawls V. Deshler, 63 Ray «. Birdseye, 841 Redman v. Hendricks, 335 Reed e. Gannon, 241 V. Pelletler, 247 Reeves v. Cappen, 13 Renfro Bros. v. Goetter, 350 Reynolds v. Ellis, 140, 158, 159, 27?, 295 V. Shuler, 33, 173 Rhutasel v. Stephens, 113, llfi, 117 Rice V. Cobb, 366 V. Dewey, 137, 168 V. Nolan, 889 Rich V. Levy, 243 V. Milk, 24, 39, 196 V. Roberts, 288 Richards «. Holmes, 203, 303 Richardson v. Alpena L. Co. 114 Richmond i. Curdup, 357 Rickerson v. Raeder, 169 Rider o. Edgar, 148 Ridgway v. Kennedy, 58 Riggs ». Armstrong, 89 Riley v. Mallory, 95 Rinchey v. Stryker, 371, 273, 277 Rindskopf v. Lyman, 335 Ring V. Franklin, 366 V. Neale, 176 Robbins v. Parker, 250, 257 Roberts «. Chisten, 333 V. Crawford, 170 Robinson v. Baker, 183 V. Cropsey, 5, 39, 40 V. Elliott, 247, 248, 253, 259 V. Ezzell, 144 V. Holt, 126 ». Kruse, 148 V. Mauldin, 140 V. Preswick, 132 ». Wilcox, 27, 217 V. Williams, 91, 93 Robson V. Mich. Cent. R. R. Co. 141 Rochester Savings Bank v. Averill, 106, 108 Rockwell V. Humphrey, 5 Rodgers v. Highland, 134 Rogers v. Abbott, 92 V. Whitehouse, 58 Rose V. Story, 59 Ross V. Wilson, 351 Roth V. Wells, 341 Rountree v. Britt, 116 Rowan u. Sharp Co. 140 Rowland «. Plummer, 315 Rowley i>. Bartholomew, 119 Roy V. Goings, 39 Rudderow v. Huntington, 207 XXll INDEX TO CASES CITED. [Eeferences are to seeiioni,] Rugg i>. Barnes, 173 Rump V. Schwartz, 303 Runyon v. Grroshon,351 Russell V. Butterfleld, 38, 34 11. Walker, 161 t). Wmne,116, 343, 350, 358, 363, 363 Rust v. Morse, 164 Ryan v. Hook, 358, 364 Sage V. Browning, 338 Salisbury v. Philips, 311 Saltus V. Everett, 43, 183 Sanborn v. Benedict, 149 Sands «. PfeiflFer, 134 Sanders v. Voorhees, 1 14 Sanger v. Eastwood, 338 Sargent v. McGile, 58 «. Metcalf, 58 ■0. Usher, 183, 185 Sawyer «. Fisher, 58 V. Gerrish, 6 V. Pennell, 394 Sayre «. Hewes, 335, 337 Saxton 13. Hitchcock, 39, 40 «. Williams, 335 Seaman v. Nolen, 247 Scarfe v. Morgan, 181 Scharfenburg ». Bishop, 140 Schemerhorn v. Vanderheyden, 313 Schroeppell d. Shaw, 333 Scott v. Alfred, 351 o. Delahunt, 180, 181, 183, 369 V. Henry, 316 Scranton v. Clark, 307 Scruggs V. Barruss, 97 Scudder v. Union Nat. Bank of Chi- cago, 318 Seay v. McCormick, 119 Self V. Sanford, 335 Senter v. Mitchell, 149 Severance «. Leavitt, 331 Sexton V. Monks, 335 Shattuck V. Knight, 347, 348 Shaw V. Glen, 333 ■11. McOandless, 355 Shearer v. Babson, 170 Sheldon v. Dodge, 19 V. Warner, 340, 338 Shepard v. Philbrink, 153 Sheppard v. Earles, 307 Sherman v. Clark, 39 Sherman ». Willett, 153 Shireman v. Jackson, 58 Shirras v. Craig, 91 Shuart v. Taylor, 33, 138, 172, 344 Shuler ». Boutwell, 393 Shurtleff ». Willard, 357 Simerson v. Branch Bank, 343 Simmons v. Jenkins, 113, 135, 143, 350 V. Osgoodby, 341 Simons v. Pierce, 138, 130 Simpson ». Mitchell, 357 Sims V. Mead, 93, 116 Singer Co. v. Graham, 58 Single ». Phelps, 153 Sisson V. Hebbard, 138, 131, 134, 135 Skinner v. Oettinger, 371 Skowhegan Bank v. Parrer, 130 Slee V. Man. Co. 17, 40 Smith V. Acker, 331, 383, 335 V. Beattie, 5, 17, 20, 39, 335 V. Cooper, 250, 356, 306, 308 i;. Ely, 353 v. Hague, 153 V. James, 36 11. Jencks, 138, 144, 148 ®. Kenney, 343 V. Lozo, 58 V. Lynes, 50, 63, 63 V. McLean, 112, 119, 284, 330 11. Moore, 304 V. Newland, 51 11. Post, 39, 331, 340, 366, 310 V. Smith, 171 V. Taber, 140, 155, 156, 158 v. Worman, 87 Smithurst ». Edmunds, 140, 342, 353 Snead v. Watkins, 181 Snedeker v. Waring, 137 Snowden v. Craig, 130 Somerville v. Horton, 357, 263 Southard v. Benner, 350, 369, 376, 333 V. Pinckney, 375 Southbridge Savings Bank v. Exeter Machine Works, 136 Southworth v. Isham, 113, 133 Sowden «. Craig, 136 Spalding v. Barnes, 34 Sparks v. Wilson, 3 Sperry v. Baldwin, 331, 353 INDEX TO OASES CITED. [References are to seeiions.] XXlll Sperry v. Ethridge, 27 Spielman «. Kliest, 314 Spieis V. Boyd, 347 Spiney «. Grant, 119 Spring V. Short, 276 Stadtfeld ». Huntsman, 59 Stafford v. Roof, 94 ®. Whitcomb, 170 Stamps V. Oilman, 36 State V. D'Oench, 247 V. Emmons, 98 «. Plaisted, 94 «. Tasker, 247, 264 «. Williams, 144 Steam Navigation Co. v. Weed, 102 Seams v. Marsh, 9 Stedman v. Vickery, 251 Steele v. Benham, 236, 241 Steffin V. Steffin, 158 Stein ». Munch, 247, 259 Steinart v. Deunster, 347 Stephens o. Pence, 130, 140 ®. Tucker, 118 Stevens v. Hayt, 290 V. The Buffalo & N. T. City R. E. Co. 317, 325 Sterling v. Rogers, 211 Stewart v. Beale, 158, 279, 313, 335, 326, 338, 341 V. Cole, 323, 324 V. Piatt, 275, 384, 288, 333 V. Slater, 335 Stiles «. Hill, 20 Stimson v. Wrigley, 242, 369 Stix 0. Sadler, 345 Stookham v. Allard, 301 Stoddard v. Denison, 3, 14, 36, 199, 200, 211, 213, 318, 219, 321, 323 Stonebraker «. Ford, 114 Storms V. Smith, 183 Stow V. Tifft, 107 Street v. Sinclair, 30 Strong V. Taylor, 44, 48, 54 Strickland v. Barrett, 33 Stuart V. Alexander, 335 Sullivan v. Miller, 373 Sumner v. Blakeslee, 130 V. Cottage, 58 v Dalton, 241 V. Woods, 68 Sunderlin «. Wyman, 397 Sutphen v. Cushman, 5 Sweet D. Lawrence, 360 Sweetzer v. Jones, 134 Swift V. Hall, 398 V. Hart, 300, 305 Sword V. Lone, 130 Talman v. Hawxhurst, 331 V. Smith, 36, 196, 199, 331, 341 Tallman v. Jones, 36 Tarbell «. Bradley, 98 Tennessee Nat. Bank v. Ebbert, 347 Thayer v. Willett, 371 Theriot «. Prince, 269, 301, 335 Thomas e. Bacon, 158 ®. Hillhouse, 134 V. Vinton, 128, 136 Thompson v. Blanchard, 3, 170, 331 !). Thornton, 335 V. Van Vechten, 86, 87, 269, 373, 291, 325, 838, 355 Thornton v. Cochran, 30 Thorpe v. Cowles, 134 0. Fowler, 58 Thrash v. Bennett, 3 Thurber v. Blanck, 340 v. Jewett, 311 V. Minturn, 130 Tibbetts v. Moore, 131, 134 Tiffany ■v. Warren, 87, 177 Tifft V. Barton, 88, 348 V. Horton, 138, 131, 134, 135, 136 Titcomb v. McAllister, 6 Todd V. Campbell, 5 Tolbert «. Horton, 112 Tompkins ». Tysen, 13 Tomlinson v. Garfield, 149 Tootle, &c,, Co. B. Caldwell, 245 Topping V. Lynch, 235 Town V. Griffith, 289 Towle V. Raymond, 181 Treat v. Gihnan, 1 74 Trident, The, 372 Trull ». Fuller, 136 Tryon v. Mansir, 339 Tucker ». Bofington, 365 Tueslay «. Robinson, 36 Tuite V. Stevens, 375 Tupley o. Butterfleld, 97 Turner v. Kerr, 5 Twyne's Case, 228 XXIV INDEX TO CASES CITED. ISeferences are to sedions.J Tyler v. Safford, 329 V. Strang, 5, 309, 313 V. Taylor, 37 Ulrich, Matter of, 250 Underbill v. Reinor, 844 Union Bank v. Emerson, 127 Vail B. Hamilton, 105, 108 Van Antwerp v. Newman, 166, 846 Van Buskirk v. Purinton, 183 V. Warren, 30 Vanderpool v. Van Allen, 139 Van Btten v. Hurst, 373 Van Bvera v. Davis, 119 Van Hassel v. Borden, 297 Van Heusen v. Radcliff, 131, 155, 267, 373, 338, 338 Van Hoozer v. Cory, 138, 149 . Van Loan ». Willis, 217 Van Pelt «. McGraw, 133 Van Slyck v. Newton, 87 Varnum v. The State, 149 Veazie ®. Somerby, 180 Victor Sewing Macbine Co. v. Har- dus, 49 Virgin, The, 373 Voorhees b. McGinnis, 127,128, 131, 134, 185, 186 Voorhis «. Freeman, 134 Wade ». Rusher, 273 Wadswortb v. Barlow, 7 Wagner ». Jones, 273, 336 Wait ». Green, 60, 61, 63 Waite i>. Matthews, 835 Wainwrigbt v. Crawford, 389 Wakeman v. Barrows, 275 V. Grover, 19 Walden v. Murdock, 234 Walker «. Henry, 87, 306 V. Hyman, 58 ». Miller, 375 V. Mitchell, 63 V. Snedeker, 93. 333 V. Vaughn, 140^ 335 V. White, 365 Wallach ». Wylie, 243 Waller v. Roseman, 384 Walshe v. Young, 95 Wangler v. Franklin, 58 Warner ». Comstock, 397 V. Jafiray, 319 Warren v. Carlton, 331 V. Van Buskirk, 319 Waters v. Grower, 203 Watkins B. Wyatt, 151 Watson V. Thompson Lumber Co. 386 Wattson V. Campbell, 821 Wayne v. Sherwood, 5, 6 Weber v. Uling, 119 V. Sampson, 366 Weed ®. Covin, 311 Weeden d. Hawes, 263 Weis V. Levy, 839 Wells V. Chapman, 39 «. Connable, 313 V. Langbein, 347 ■D. Maples, 136 V. Sobelewitz, 335 ». Wilcox, 116 Werner v. Bergman, 39 West V. Crary, 213, 317 Westcott «. Gunn, 267, 391, 335 Wheeler «. Becker, 113, 116, 140 r>. Lawson, 276 V. McFarland, 173, 177 v. Newbold, 14 ». Nichols, 340 Wheelock ». Lee, 210 Whetherell v. Spencer, 328 White V. Cole, 325, 370 V. Graves, 247 V. Smith. 115 Whiter i>. Hamilton, 140, 156 White's Bank v. Smith, 355 " Whitman v. Conner, 318 Whitney ». Eaton, 58 41. Heywood, 284 ». McOonnell, 58 V. Union Trust Co. of N. T. 102 Whitney Arms Co. i>. Barlow, 102 Whittle V. Skinner, 9 Wilbraham v. Snow, 36 Wilcox «. Jackson, 126, 309 Wiles v. Clapp, 291, 337, 338, 335 Wiley V. Shars, 116 Willards). Rice, 113, 135 Willett «. Stringer, 98 Willetts V. Brown, 18 Willey V. Snyder, 116 Williams e. AUsup, 180, 369 V. Briggs, 141 INDEX TO OASES CITED. XXV l^Heferences are to sections.'] Williams v. Crook, 143 V. Winsor, 140, 251, 375, 823 Williamson v. N. J. Southern R. R. Co. 140, 315, 325 V. Steele, 114, 118 Willis v. Jeflferson, 186 Williston «. Jones, 360, 269 Winner v. Morrell, 33 Wilson ». Brannan, 196 «. Carson, 320 «. Esten, 333 V. Leslie, 391 V. Little, 10, IB V. Prouty, 148 V. Voight, 247, 359 Wilt V. Franklin, 334 Wineburgh «. Schaer, 350 Wingler v. Sibley, 251 Winner ». Hoyt, 19 Winslow V. Merchants' Ins. Co. 117, 121, 134, 137 V. Tarbox, 366 Winsor «. McLellan, 323 Winstead v. Huhne, 263 Winter v. Lanphere, 134 Wintermute v. Light, 138, 144, 145 Wisner b. Ocumpaugh, 140, 157 Wisser «. O'Brien, 836 Wood V. Dudley, 11 V. Franks, 89, 90 V. Lester, 18, 137, 138 V. Lowry, 260, 388 V. Rowcliffe, 131 Woodburn ®. Chamberlain, 87 Woodlief V. Harris, 38, 116 Woodside v. Adams, 885, 343 Woodward v. Wilcox, 189 Woodworth v. Bennett, 308 Worrall v. Smith, 360 Worthington v. Hanna, 38 Wray ». Fedderke, 177, 373, 337 Wright V. Tetlow, 332 Yates V. Kinney, 144 V. Olmsted, 248, 262 Yeatman v. Savings Institution, 823 Yenni ». McNamee, 336 Young Mechanic, The, In re, 180, 369 I Zimmer «. Wheeler, 346, 328, 331 I Zipcey v. Thompson, 319 Mortgages of Personal Property. CHAPTEE I. MORTGAGES OP PERSONAL PROPERTY, AND HOW THEY DIPPER PROM PLEDGES AND ASSIGNMENTS POR CRED- ITORS. "What Constitutes a Chattel Mobtgage. § I. General principles.— The rules which govern the rights and remedies of parties to mortgages of personal property are, of necessity, different in many respects from those which apply to mortgages of real estate. A lien upon land may be preserved by properly recording the instru- ment by means of which it is created, and the principal subject of the transfer is indestructible, and suffers but little from age ; but a lien upon personal property, more particularly when unaccompanied by possession, is with difficulty protected as against the fraud of the person hold- ing the apparent title, and the chattel upon which the lien is given is often perishable, and likely to be destroyed by use, or to have its value diminished by lapse of time. The law of mortgages upon real estate provides, therefore, for the complete protection of the interest of the mortgagor, and in guarding his rights it is full of nice distinctions and of rules which delay the mortgagee in any attempt which he may make to gain possession or to extinguish the equity of redemption. The law of chattel mortgages is, on the other hand, simple in its general provisions, and while the mortgagor is thought worthy of its care, the remedies af- forded for the prompt enforcement of the rights of the mortgagee sometimes savor of harshness. 1 A MOETGAGES OF PEBSONAl PKOPBETY. § 2. Definition. — A chattel mortgage is a transfer of per- sonal property as security for a debt or obligation, in such, form that upon failure by the mortgagor to comply with the terms of the contract, the title of the property will be in the mortgagee ; or, as was said by Chancellor Kent, it is " an absolute pledge, to become an absolute in- terest if not redeemed at a fixed time."* In its most com- mon form it is a sale upon condition, vesting the legal right in the mortgagee, subject to an absolute right of redemp- tion by the mortgagor upon performance of the condi- tion ; and a chattel mortgage has thus been defined.^ It is essential that the contract shall provide that the title shall vest in the mortgagee upon the non-performance of the agreement which the mortgage is made to secure, but it would seem that any agreement which accomplishes this end would justly be termed a chattel mortgage.* The title must vest by the contract, for a mere executory agreement to sell chattels cannot be construed as a chattel mortgage, even though the purchaser be put into possession, and the object of. the agreement be merely to furnish security for the purchase price.* § 3. Parol mortgage.— As between the parties, a chattel mortgage made entirely by parol, will be valid,^ and it may also be good as against third parties if possession of the property is delivered to the mortgagee.* ' Cortelyou v. Lansing, 2 Gaines s. c. 16 Barb. 213; Neidig v. Eifler, 18 Cas. 200. Abb. 353. ^ Parshall v. Eggart, 52 Barb. 367 ; * Per Paige, J., in Bank of Eochea- Stoddard v. Denison, 38 Huw. 296; s. ter v. Jones, 4 N. T. (4 Comst.) 497, 0. 1 Abb. N. S. 309. 506 ; Ferguson v. Union Furnace Co. 9 ' Bunaoleugh v. Poolman, 3 Daly, Wend. 345 ; Ackley v. Finch, 7 Cow. 236; Ferguson v. Union Furnace Co. 290; Ceas v. Bramley, 18 Hun, 187; 9 Wend. 345; Langdon T. Buel, 9 Wend. Glover t. McGiloray, 63 Ala. 508 ; Mc- 80; Marsh T. Lawrence, 4 Cow. 461; Coy v. Lassiter, 95 N. 0. 88; Sparks Bissell v. Hopkins, 3 Id. 166; Thomp- v. Wilson, 22 Neb. 112. In Alabama a son V. Blanohard, 4 N. T. (4 Comst.) mortgage must be in writing subscribed 303 ; Johnson v. Crofoot, 37 How. 59; by the mortgagor. Code, 1886, § 1731. s. 0. 53 Barb. 674. « Bardwell v. Roberts, 66 Barb. 433. * Brewster v. Baker, 20 Barb. 364; PAKOL MORTGAGES. 6 In some cases delivery of the property has been held essential to a verbal chattel mortgage,^ but it will be found that in such cases the reliance has been upon the pro- visions of the statute of frauds. Where that statute re- quires a delivery to accomplish an absolute sale, a delivery is also necessary to effectuate a parol contract of defeasible sale or mortgage.^ An oral agreement between the mortgagor and mort- gagee, after the execution of the mortgage, that it should embrace a horse furnished to the mortgagor by the mort- gagee, and stand as security for the price thereof, was held valid as a parol mortgage, at least between the parties and without prejudice to the rights of creditors and pur- chasers without notice.' And an oral mortgage of a crop to be grown has been sustained.* § 4. No seal required. — Since a chattel mortgage made without writing is valid between the parties, and against third persons with notice, it is quite clear that no seal to a mortgage of personal property is required in any case.' ,5 § 5. Absolute transfer with parol defeasance. — An as- signment, absolute on its face, whether it be in writing or not, may be shown by parol to be intended as a mortgage.' A bill of sale, absolute on its face, is as between the parties and as to third persons with notice, a mortgage, if shown to have been made as security for a debt ; and such 1 Ceas V. Bramley, 18 Hun, 181. Co. 12 N. H. 205 ; 31 Am. Dec. 203 ; ' Bardwell v. Roberts, 66 Barb. 433; Gibson v. Warden, 14 Wall. 244. Ceas T. Bramley, 18 Hun, 187. In *Champlin v. Butler, 18 Johns. 169; some States an agreement not in writ- Hall v. Tuthill, 8 Wend. 376; Wayne Ing to convey personal property as se- v. Sherwood, 14 Barb. 633; Tyler v. eurity is a valid oral mortgage between Strang, 21 Id. 198; Despard v. Wal- the parties. Bates v. VViggin, 36 Kans. bridge, 15 N. Y. 374 ; Smith v. Beat- 44; Morrow v. Turney, 35 Ala. 131; tie, 31 Id. 542; Bragelman v. Dane, Sparks V. Wilson, 22 Heb. 112. 69 N. T. 69; Manufacturers' Bank of 3 Burns v. Campbell, 71 Ala. 271. Milwaukee v. Ruger, 59 Wis. 221 ; * Thrash v. Bennett, 57 Ala. 156. ' Rockwell v. Humphrey, 57 Wis. 410 ; * Despatch Line v. Bellamy Manf. Caswell v. Keith, 12 Gray, 351. 4 MOETGAGES OF PEESONAL PEOPEETY. bill of sale is governed by the rules affecting chattel mort- gages as to transfer of possession and filing.'' The test by which tq distinguish between a conditional transfer of chattels and a mortgage is as to whether it was intended as a security, and this may turn upon the question whether a debt which furnished the consideration for the transfer was cancelled by it.^ If a conveyance is taken as security it is a mortgage or pledge, but if taken .in payment, or part payment, thus ex- tinguishing the debt in whole or in part, it is a sale.' § 6. Examples of chattel mortgages.— An agreement upon which a chattel was delivered by a debtor to a person who was his surety, such surety to have the use of the chattel and to become the owner- of it if the debtor made default, has been held to be a chattel mortgage, though the whole contract was by parol.* So, if one gives his note for purchase-money of a chattel, and sells it to a third person upon the oral condition that such third person pay the note, it is a chattel mortgage as between the payee of the note and the purchaser.' A bill of sale made to secure a debt, and stating that on payment of the debt, by a portion of the property or otherwise, the remaining articles shall be released to the seller, is a mortgage.® A tenant gave to his landlord a bill of sale of certain goods in his house. ' Coe V. CasBidy, 72 N. Y. 133; affi'g » geller v. Paine, 34 Hun, 167; Todd 6 Daly, 242; NicHer T. Nelaon, 6 Pacif. v. Campbell, 32 Penn. St. 250; Robin- Rep. 51; Cuok T. Lion Fire Ids. Co. 1 son v. Cropsey, 2 Edw. Ch. 138; Clark Pacif. Rep. 784; James v. Morey, 14 v. Henry, 2 Cow. 324; Smith v. Beat- Am. Dec. 513, and note ; Dabney v. tie, 31 N. Y. 642; Hickox v. Lowe, 10 Green, 4 Am. Dec. 503 ; 4 Henning & Cal. 197 ; Moore v. Murdock, 26 Cal. Mumford (Va.), 101; Enhn v. Graves, 515; Sutphen v. Cushman, 35 lU. 186; 9 Iowa, 805 ; Gold v. Marshall, 76 Va. Turner v. Kerr, 44 Mo. 429. 668 ; First National Bank of Madison ^ Ferguson t. Union Furnace Co., 9 T. Damm, 63 Wis. 249; Nicklin v. Betts Wend. S45. Spring Co. 11 Oreg. 406; Omaha Bank 'Wayne v. Sherwood, 14 Barb. T. Sunderland, 10 Neb. 34. ,633. = Coe V. Cassidy, 6 Daly, 242; affi'd, « Bissell v. Hopkins, 3 Cow. 166. 72 N. Y. 133; Hill v. Grant, 46 N. Y. 496. MOBTGAGES OP PEESONAl PEOPEETY. 5 with a proviso that the transfer should be void if the rent were punctually paid, and this was held to be a mortgage.^ A bill of sale of three horses for the consideration of $210, and an agreement by the vendee to deliver the horses to the vendor in fourteen days, upon payment by him of $210, was adjudged to be a mortgage.* So an absolute assign- ment of a mortgage, with an agreement to sell the same to the assignor on receiving the amount intended to be se- cured, by a certain day, is a mortgage.* A bill of sale whereby a debtor conveyed personal prop- erty to his creditor as security, and which provided that the property should remain in the debtor's possession, and that he should have thirty days in which to redeem, was de- clared to be a mortgage.* A valid mortgage of chattels may be created by a writ- ing which uses the word "mortgage" only, without any other words of conveyance, and the mortgagee may take possession on default without any further express author- ity contained in the instrument.^ A paper as follows : " Turned out and delivered to A, one white and red cow, which he may dispose of in fourteen days to satisfy an execution," the cow being left in posses- sion of the debtor, was held a mortgage.^ So an agreement whereby a tenant " turned out his black cow as security for said rent," and gave his landlord the right to take the cow on default, but kept possession in the meantime.' Where the owner of a mare, which had been served by the stallion of another, executed a written agreement to pay $20 in twelve months if the mare proved with foal, "colt holden for payment," this was held a mortgage of the colt.« ' Barrow v. Paxton, 5 Johns. 258. ' Mervine v. White, 50 Ala. 388. ^ Brown v. Bement. 8 Johns. 96 ; * Atwater v. Mower, 10 Vt. 76. Titoomb v. McAllister, 77 Me. 353 ; ' Coty v. Barnes, 20 Vt. 78. Carpenter t. Snelling, 97 Mass. 452. ^ Sawyer v. Gerrish, 70 Me. 254 3 Clark V. Henry, 2 Cow. 324, 331. 35 Am. R. 323. ^ Blodgett T. Blodgett, 48 Vt. 32 ; Cifford V. Ford, 5 Vt. 532. 6 MOETGAGES OF PEBSONAL PEOPEETY. But a parol agreement by a debtor, that certain personal property belonging to him "should stand good for his in- debtedness," not accompanied by a delivery or change of possession, has been held not to convey the legal title, but to create an equitable lien which will not support an action of detinue.^ A bill of sale containing the following clause : " This, bill of sale is given for the security of money advanced," was held to be a mortgage. The court remarked : " The mere fact that an instrument does not contain terms of de- feasance cannot be at all decisive in determining the ques- tion whether it shall be considered a mortgage or not. If,, from the entire transaction,, either standing alone or read in the light of the surrounding circumstances, it appears to have been given as a security, it must be considered as a mortgage, and the law will apply thereto the rules appK- cable to mortgages." ^ § 7. Delivery of mortgage. — A chattel mortgage can only take effect from delivery. A delivery to a town clerk for record without the knowledge of the mortgagee is not,, necessarily, a valid delivery to the mortgagee,' but is evi- dence of such delivery,* and, if in pursuance of a promise to the mortgagee, may be held to constitute a delivery to him.' Where two merchants, being insolvent, on the request of a friend of a creditor, and of a surety on their note, made a chattel mortgage to the creditor and an assignment of ac- counts to the friend, without the knowledge of the mort- gagee, and the friend did not deliver them to the mortgagee until after the mortgagor had executed a general assign- ' Jackson v.. Rutherford, 1Z Ala. ' Wadsworth v. Barlow, 68 Iowa, 165. 599. 'Per Mason, J., in Moore v. Mur- ■'Jordan v. Farnsworth, 81 Mas8> dock, 26 Cal.. 514.. See also Ford v. (lo Gray), 517. Ransom, 39 How. 429 ; Biasell v. Hop- ^ In re Assignment of Guyer, 69^ Wns, 3 Cow. 166; Marsh v. Lawrence, Iowa, 585. 4 Cow. 461. CHATTEL MOETGAGES AND PLEDGES. 7 ment, it was held that the mortgages were inferior to the assignment.^ § 8. Acceptance by the mortgagee. — A chattel mort- gage is a contract, and therefore requires the assent of the mortgagee to make it valid.' But such assent will, in gen- eral, be presumed, and if an agent of the mortgagee, with- out his knowledge, accepts a mortgage for him, the subse- quent ratification of the agent's acts by the mortgagee will be sufficient to give force to the instrument.^ Chattel Mortgages and Pledges. § 9. Possession in pledgee indispensable to pledge. — The contract which most nearly resembles a chattel mort- gage is the contract of pledge, and chattel mortgages and pledges have frequently been confounded with each other. A pledge is a bailment of personal property as security for some debt or engagement.* Its first requisite is that possession shall be given to the pledgee,^ who holds the possession merely to protect his qualified interest, the title remaining in the pledgor. The pledgee has a lien and the right to detain the chattel until the lien is satisfied, but the pledgor retains the ownership. Where property is delivered to a creditor as security for a debt, there being no other specific agreement, it is pledged and not mortgaged.^ If a power be given to the creditor to sell, this does not alter the nature of the contract ; the sale would be made by the pledgee as the agent of the pledgor, who would still remain the owner of the property, while in the case of a chattel mortgage the title would vest in the creditor.' ' Gage T. Parry, 69 Iowa, 605. Brownell v. Hawkins, 4 Barb. 491; '^ Eaton V. McKahan, 91 lud. 109. Hasbrouck v. Vandervooit, 4 Sandf. ■'' Brown V. Piatt, 8 Bosw. 324. 36; Lewis v. Graham, 4 Abb. 106; ^ Story, Bailm. § 286. Hasbins v. Patterson, 1 Edm. Select » Parshall v. Eggart, 52 Barb. 36Y; Cas. 120. Whittle v. Skinner, 23 Verm. 5itl. ' Brownell v. Hawkins, 4 Barb. 6 Stearns v. Marsh, 4 Den. 227; 491. 8 MORTGAGES OF PERSONAL PROPERTY. § 10. 'Character of delivery to constitute pledge. — While tlie nature of a pledge requires that there should be a delivery, it is not necessary that there should be an act- ual manual delivery of the very article pledged, but the in- terest put in pledge must be put, by actual delivery or by written transfer, into the hands or within the power of the pledgee, so as to be made available to him for the satisfac- tion of the debt. Goods at sea, or in the hands of a com- mon carrier for transportation, may be passed in pledge by a transfer of the muniments of title, as by a written assign- ment of the bill of lading.* This is equivalent to actual possession, because it is a delivery of the means of obtain- ing possession. The capital stock of a corporate company can alio be pledged by a delivery of the certificates of stock, and a transfer upon the books of the company.^ In cases where the assignment of the interest of the debtor is essential to put the creditor in possession, and thereby to consummate a pledge, transactions will occur which are really pledges, but which can only with difficulty be distinguished from chattel mortgages. The test in such cases would seem to be as to whether, by the terms of the contract, the debtor has a legal right to the restoration of the pledge, on the payment of the debt at any time, although after it falls due, and before the creditor has exercised the power of sale.^ § II. Mortgagee holds defeasible title. — As between the parties to a chattel mortgage, delivery of possession is not material, and in this respect it differs from a pledge,'' but the great mark of distinction between the two classes of contracts is that a mortgagee holds a title while a pledgee takes merely a right of possession.' The fact that the ' First National Bank of Cincinnati ■• Barrow v. Paxton, 5 Johns. 258. V. Kelly, 57 N. Y. 34. ^ Farmers & Mech. Bk. v. Lang, 81 « Wilson V. Little, 2 K.T. (2 Comst.) N. Y. 209 ; rev'g 22 Hun, 312 ; Cortel- 443; Markham v. Jaudon, 41 N.Y. 235, you v. Lansing, 2 Gaines Gas. 200; Bar- 241. rowT. Paxton, 6 Johns. 258 ; Brown v. s McNeil V. The Tenth National Bement, 8 Id. 97 ; McLean v. Walker, Bank, 55 Barb. 59. 10 Id. 472 ; Ilaskins v. Patterson, 1 CHATTEL MORTGAGES AND PLEDGES. - 9 creditor holds an authority from the debtor to dispose of the property in order to satisfy the debt, does not make the transaction any the less a pledge,^ and if there is nothing in the agreement to create a forfeiture of the right to redeem the property, or to defeat the right to it, except by a lawful sale under a power conferred, then it is a pledge and not a mortgage.^ On the other hand the contract will lose noth- ing of its character of a mortgage if, in addition to a pro- vision for a forfeiture of title in case of default, there is a power included in it by means of which the mortgagee may extinguish the equitable right of redemption of the mort- gagor by a sale.^ A mortgage is a pledge and more, for it is an absolute pledge to become an absolute interest if not redeemed at a certain time.* Where an insurance policy was assigned as security for the payment of a note held against the assignor by the assignee, the court said that, while such a transaction is ordinarily a pledge, in this case the written assignment de- clared it to be a sale coupled with a defeasance and it must, therefore, be considered a mortgage passing the legal title subject only to a right to redeem.^ § 12. Use of words "pledge" or "mortgage" not conclusive. — No special form of words is necessary to cre- ate a chattel mortgage, and even the use of the word " pledge " will not necessarily give the transaction that character. In Langdon v. Bvsl (9 Wend. 80), the words of the instrument were, " for the securing the payment of the said note, I hereby pledge and give a lien upon the engine to the said Langdon, and if the same are not paid, I consent that he shall hold the same as security and to save himself Edm. Select Gas. 120 ; Wood v. Dudley, ^ Bunaoleugh v. Poolman, 3 Daly, 8 Ver. 435; Story's Eq. § 1030 ; 4 236; Edwards on Bailments, 251, 252. Kent's Com. 138; McCoy v. Lassiter, ^ Burdick v. McVanner, 2 Den. 170. 95 N. C. 88. * Per Reed, J., in Lnekett v. Town ' Brownell v. Hawkins, 4 Barb. 491. send, 3 Tex. 119 ; 49 Am. Dee. 723. = King T. Van Vleck, 40 Hun, 68. 10 MOBTGAGES OF PERSONAL PKOPEETY. harmless ; it being understood that I keep possession of the same until the time arrives for the payment of the notes ; and if the same are not paid, Langdon may take the same." This the court held was not a pledge but a mortgage, and that, upon the failure to perform the condition, Langdon ac- quired an absolute title to the chattel. So in Bunacleugh v. Poolman (3 Daly, 236), the defendant gave a watch to his creditor, and signed an agreement in writing that he would " give up all claim to the watch " if the debt intended to be secured were not paid by a specified time, and the contract was held to be a mortgage and not a pledge. On the other hand the use of the word " mortgage " may not be inconsistent with the contract of pledge. Thus, an instrument in the following form has been held to create a pledge and not a mortgage, for the reason that it vested no title in the pledgee : " By these presents I hereby acknowl- edge owing to B. the sum of £3,000, and in guarantee of said sum and all interest that may accrue thereon, I hereby give to said B. this guarantee mortgage on the British barque ' Trait d'Union,' her apparel, etc., all being my property as per register." § 13. Transactions held to be pledges. — In Wilson v. Little (2 N. Y. [2 Comst.] 443), stock in an incorporated company has been assigned and transferred to secure an ob- ligation for the payment of money, in which it was recited that the stock had been " deposited as collateral security," with authority to sell the same at the broker's board, or at public auction, or at private sale, and the transaction was held to be a pledge and not a chattel mortgage. Reeves v. Cappen (5 Bing. N. C. 142) was a case in which the debtor " made over " to the creditor " as his property," a chro- nometer, until a debt of £50 should be repaid, and it was held to be a valid pledge. In the first of these cases it was quite plain, taking the whole transaction together, that the assignment was for the purpose of enabling the creditor to enforce his lien by a sale, and in the second, a continuing right of redemption was provided for. In neither case did CHATTEL MORTGAGES AND PLEDGES. II it appear to be tlie intention of the parties, that if the debt was not paid when due, the title of the property was to vest in the creditor. In Kna'pp v. Alvord (10 Paige, 205), the owner of a stock of goods, upon going abroad on account of ill health, put the whole into the possession of a person who was liable as indorser for him, with authority to sell and apply the pro- ceeds to the payment of the note for which such person was responsible ; the transaction was declared to be a valid pledge, and not to fall within the rule which requires a chattel mortgage to be filed. In Tompkins v. Tysen (16 Barb. 456), a mortgage for $1,000 was made to a broker without consideration, for the purpose of being negotiated for the benefit of the mortgagor ; the broker loaned $500 to the maker of the mortgage on the faith of the security in his hands, and it was determined that he held the mortgage as a pledge for a debt due at once, and that he was not obliged to wait until payment became due by the terms of the mortgage. The money was loaned upon the mortgage, and not upon the land. Haslcins v. Kelly (1 Abb. N. S. 63 ; s. c. 1 Eobt. 160), a chattel mortgage was assigned as secu- rity for a debt, and the transfer was adjudged to be a pledge. So, in Campbell v. Parlcer (9 Bosw. 322), the assignment of a bond and mortgage as security, by an instrument absolute upon its face, was held to be a pledge. DiFFEBENCE BETWEEN THE EIGHTS OF PARTIES UNDEB CHAT- TEL Mortgages and Under Pledges. § 14. Right to sell. — After default, a chattel mortgagee may lawfully sell the property, without notice to the mort- gagor and as his own, for he holds a transfer of the title. He will not incur any liability at law for doing this,^ and, only in equity can he be made to account.^ A pledgee can- not sell the pledge until after the pawnor's default in re- ' Porter v. Parmly, 43 How. 445, = Stoddard t. Denison, 38 How. 296 453. s. c. 1 Atb. N. S. 309. 12 MOETGAGES OF PERSONAL PBOPERTY. deeming ; if tlie pledge is for an indefinite period, the pawnor must be called on to redeem, and if notice to redeem cannot be given to the pawnor personally, the disposition of the pledge must be authorized by judicial proceedings.* The sale must be public, and even after notice and in pursu- ance of a custom, a private sale cannot be made without express authority from the pawnor.^ The pledgee cannot lawfully sell without taking all of these precautions to enable the pawnor to protect him- self, and if he attempts to do so, the pawnor may have his action to recover the value of the pledge without tendering the amount of the debt.^ § 15. Right to purchase. — A pledgee of personal prop- erty has no right to purchase on the sale made by him to •enforce his lien,^ but a mortgagee of chattels may purchase on his own sale and thereby foreclose the right of the mortgagor to redeem.^ § 16. Right of redemption. — Both a pawnor and a maker of a chattel mortgage have a right to redeem, but this right in the case of a pledge is a legal right, while in the case of a mortgage it is recognized only in courts of equity. If the mortgagor of chattels desires to redeem, his only remedy is to commence an action in the nature of a suit in equity.* In the case of a pledge, an action to re- deem is not only unnecessary but improper, for if the pawnor desires to redeem he need only tender the amount due, and if this be refused, he can bring a possessory action ' Rarlick v. James, 12 Johna. 146; 646, 565; affi'g 40 Barb. 179; Elliott McNeal v. Tenth National Bank, 55 v. Wood, 45 N. Y. 71, 18; affi'g 53 Barb. 59. Barb. 285. 2 Wheeler v. Newbold, 16 N. Y. (2 « CampbeU v. Birch, 60 N. Y, 214 ; Smith), 392; affi'g s 0. 5 Duer, 29. Halstead v. Swartz, 1 N. Y. Sup. (T. L. 1885, eh. 30, § 1; as amd. L. « Code, 1883, § 1275. 1887, ch. 29, §§ 2, 3. ^ Sayles' Civ. Stat. Art. 3190a. 2 Marvin Safe Co. v. Norton, 19 Vroom, 410. 62 CONDITIONAL SALES OF PERSONAL PBOPEETY. attaching creditors or subsequent purchasers without no- tice, unless the vendor takes a written memorandum, signed by the purchaser, witnessing such lien and the sum due, and records the same in the towii clerk's office of the town where the purchaser resides — if a resident of the State, otherwise where the property is — within thirty days after the property is delivered. Such property may not be re- moved from the State without the consent of the vendor or his assignee. Such liens must be discharged upon due pay- ment by a proper entry on the margin of the record, or on the instrument creating the lien, to be also recorded on the margin of the record, or by a duly-executed and recorded release. Failure to discharge on payment renders the vendor liable to pay all damages occasioned thereby. Upon condition broken the property may be sold in substantially the same manner as in case of chattel mortgages. It is made a penal offense, punishable by fine in double the value of the property, for any person in possession of such property before default, with intent to defraud, to sell such property without the consent of the holder of the lien, or to conceal, or aid in concealing, such property with like in- tent ;' and to sell or dispose of such property, with like in- tent, without giving notice of the lien or bill of sale to the purchaser, is punishable by fine not exceeding two hundred dollars, or imprisonment in the State prison not more than one year.^ § 83. Virginia. — In Virginia every sale or contract for the sale of goods or chattels, wherein the title is reserved until the same be paid for in whole or in part, or the trans- fer of title is made to depend on any condition, and posses- sion be delivered to the vendee, shall be void as to credit- ors of, and purchasers for value without notice from, such vendee, unless such sale or contract be evidenced by writ- ing, executed by the vendor, in which the said reservation or condition is expressed, and until and except from the ' ReT. Laws 1880, § 1992; Laws ' Rev. Laws 1880, § 4168. 1884, No. 93, No. 101. SUGGESTIONS AS TO FUBTHEB LEGISLATION. 63 time the said writing is duly admitted to record in the county or corporation in which said goods and chattels may be, or, if they consist of locomotives, cars, or other, rolling stock, equipments or personal property of any de- scription to be used in the operation of any railroad, until and except from the time the said writing is duly admitted to record in the clerk's office or corporation court of the county or corporation wherein the principal office in this State of the company operating the railroad is located, or in the clerk's office of the Chancery Court in the city of Brichmond, if said principal office is within the corporate limits of the said city, and a copy of said writing be filed in the office of the Board of Public Works, and each loco- motive, car, or other piece of rolling stock, be plainly and permanently marked with the name of the vendor on both sides thereof, followed by the word " owner." ^ § 84. West Virginia. — In West Virginia, if any sale be made of goods and chattels, reserving the title until the same is paid for, or otherwise, and possession be delivered to the buyer, such reservation shall be void as to creditors of, and purchasers without notice from, such buyer, unless a notice of such reservation be recorded in the office of the clerk of the county court of the county where the property is ; or, in case said goods and chattels consist of engines, cars, or other rolling stock or equipment to be used in or about the operation of any railroad, unless such record be made in the office of the Secretary of State, who shall record the same in a book kept for that purpose, and be entitled to a fee of five dollars for so doing.^ Suggestions as to Further Legislation. § 85. Resemblances between conditional sales and mortgages. — There is a strong resemblance between the relations of the parties to a sale on condition of payment, and the status of parties to an ordinary mortgage of per- ' Code. § 2462. ^ Code 1887, ch. H, § 3. 64 CONDITIONAL SALES OF PERSONAL PEOPEETY. sonal property. In the case of a conditional sale the right of possession and of acquiring ownership by payment is given by the vendor, while the title is retained. In the case of a mortgage the title is transferred, while the right of possession and of acquiring title is retained. The method of bringing about the result is different, but for many pur- poses the result is the same. So far as the rights of cred- itors of the person holding the possession and apparent ownership is concerned, and independent of the recording acts, the courts have laid down rules quite similar for both classes of contracts. This is particularly noticeable with respect to the distinctions applicable to mortgages of prop- erty with authority to sell, and of conditional sales with similar authority. In the recording acts governing the two classes of transactions, the legislature has not seen fit to treat them alike. It is believed that, in this respect, the law is defective, and that it would be better if exactly the same rules should apply to both. The equitable right to redeem, which is protected in the mortgagor of chattels, does not exist in the purchaser on condition, and in this re- spect it is also believed that legislation is to be desired. A wonlan who has purchased a sewing-machine on what is known as "the installment plan" certainly has some equity after making the bulk of her payments, and a rule of law which permits a forfeiture to be summarily enforced against her invites oppression. The courts are astute to defeat at- tempted injustice, but it would be easier and better to do this under a reasonable statute, rather than to require it to be done by indirection, and by straining technical rules. The use of conditional contracts of sale as securities for purchase-money of chattels is becoming exceedingly com- mon, and it is recommended that such contracts be declared to be mortgages, with all of the incidents of such securi- ties, and subject to exactly the same rules as to record. CHAPTER IV. VALIDITY OP CHATTEL MORTGAGES AS BETWEEN THE PAR- TIES TO THEM. What Debts may be Secueed by Chattel Moetgages. § 86. A valid debt necessary.— A chattel mortgage can have no force or effect unless it be made to secure a valid debt. A mortgage given for money knowingly advanced for the purpose of compounding a felony, is void.' So, also, a chattel mortgage will be void if given to secure a debt tainted with usury, and a mortgagee may be held liable for conversion if he enforces it.^ But a usurious contract may be ratified by the borrower, and if a chattel be sold sxibject to a mortgage, the mortgagor cannot thereafter maintain an action to cancel the mortgage on the ground of usury.^ If the mortgage be given to secure in part a valid debt, and in part money advanced upon an illegal contract, it will be good as to the honest debt, though void as to the resi- due, and in this respect it is unlike a mortgage given to de- fraud creditors.^ § 87. Pre-existing debt.— As between the parties to the mortgage a pre-existing debt is as good a consideration for the lien as an advance of money at the time,' but a present ' Fellows V. Van Hyring, 23 How. * Langdon v. Gray, 52 How. 387; 280. Rathbone v. Boyd, 30 Kans. 486. * Leslie v. Hoffinan, 1 Edm. Select ' Walker v. Henry, 85 N. Y. 130 Gas. 475; Thompson v. Van Vechten, Machette v. Wanlese, 1 Colo. T. 226 27 N. Y. 568. Smith v. Worman, 19 Ohio St. 146 ^ James v. Oakley, 1 Abb. 324. Laubenheimer v. McDermott, 6 Pacif. R. 344. 66 MORTGAGES OF PEESONAL PROPERTY. consideration is necessary in order to constitute the mort- gagee a bona fide purchaser and to make his lien superior to equities of third parties, as for example, the rights of a former owner from whom the property had been obtained by fraud,* or the lien of a prior mortgagee whose mortgage has not been filed.^ § 88. Evidence of debt. — The recital of the debt is, as against the mortgagor, prima /aci'e evidence of an obligation, but where the property is left in the possession of a mort- gagor the law declares it to be prima facie fraudulent as against creditors,* and for this reason the mortgagee, in an action against a creditor of the mortgagor, who has levied upon the property under an execution, should offer proof to rebut this presumption. It is only on proof of a good con- sideration that the cause goes to the jury on the question of fraud in fact.* § 89. The description of the debt should be made as nearly accurate as possible, since a mis-statement or over- statement may raise a presumption of fraud which will re- quire to be rebutted, but parol evidence is admissible to ex- plain mistakes, to connect an obligation with the security not correctly described in it, or to show that the purpose of the mortgage was to secure advances thereafter to be made, or liabilities contemplated to be incurred.^ § 90. Mortgages for future advances.— The form, inter- pretation, validity and priority of a mortgage for future ad- vances given upon personal property, are determined by the same rules which control as to mortgages of real estate. These rules are fully set forth in the author's treatise on 1 Thompson v. Van Veohten, 27 N.Y. < Tifft v. Barton, i Den. 111. 668; Van Slyck V.Newton, 10 Hun, 554; 'Thomas on Mortgages (2d ed.), Woodburn v. Chamberlain, 17 Barb. §§ 96 to 99 ; Qulnn v. Schmidt, 91 HI. 446. 84; Lonsdale v. Fairbrother, 10 E. I, ' Tiffany v. Warren, 37 Barb. 571; 327; Eiggs v. Armstrong, 23 W. Va. 24 How. 293. 760 ; Wood v. Franks, 67 Cal. 32. 3 Hanford T. Artcher, 4 Hill, 271. WHAT DEBTS SECURED BY CHATTEL MORTGAGES. 67 the law of mortgages of real property and will, therefore, be only summarized here.^ Like a mortgage upon real estate, a chattel mortgage may be given as security for future advances, and it will be valid to the extent of the advances actually made in good faith before any creditor or third party acquired any title to or lien upon the chattels.^ It is not necessary that the pur- pose of the mortgage shall appear upon its face, and the consideration stated in the mortgage may be a present abso- lute indebtedness for a certain amount, when the real object of it is to secure the mortgagee for a contingent liability or for future advances.' The extreme limit of the intended ad- vances must, however, be specified, since the mortgage will not be good for any greater amount than is named, as against subsequent purchasers without notice.* § 91. Parol evidence is admissible to show that the debt intended to be secured is one still to be contracted, even though this should be in apparent contradiction to the terms of the mortgage, which recites a note or other pres- ent debt.^ And if the mortgage recites that its purpose is to secure future obligations or balances, the amount of these can also be determined by parol, and the mortgage will be sufficiently certain.^ The burden of proving the honesty of the mortgage must always rest upon those claim- ing under it, but a wide margin of inaccurate statement as to the purpose of the security is allowed if the actual trans- action can be shown to be just and fair.' § 92. Priority of mortgage for future advances.— If the advances to be made are rendered obligatory by a ' Thomas on Mortgages (2d ed.), Bank of Madison v. Damin, 63 Wis. §§192 to 203. 249. ' Carpenter v. Blote, 1 E. D. Smith, ■• Beers v. Waterbury, 8 Bosw. 396. 491. ' McKinster T. Baboock, 26 N. Y. 3 McKinster y. Babcock, 26 N. T. 378, 380. 378; Brown v. Keifer, 71 N. Y. 610; « Robinson y. Williams, 22 N. Y. Wood y. Franks, 7 Paeif. R. 60; Mc- 380. Connell y. Scott, 67 111. 274 ; First Nat. ' Shirras y. Craig, 7 Cranch. 34. 68 MOETGAGES OF PERSONAL PBOPEBTY. covenant entered into at the time, the lien attaches forthwith, as for instance if it be made to secure a note or indorsement executed by the mortgagee, or to secure him for becoming surety for the mortgagor. In such a case the lien of the mortgagee for his indemnity takes precedence of a subsequent attachment* or other charge upon the property. But as to advances which are op- tional on the part of the mortgagee, the lien of the mort- gage does not become established until they are actually made.' In the latter case, if notice is given to the mort- gagee of a junior lien, he cannot thereafter increase his rights in the property by voluntary payments to the mortgagor and thereby prejudice the junior lienor.* No- tice to charge the mortgagee with the existence of a jun- ior lien must, however, be actual notice, and it cannot be implied from the mere filing or recording of the mortgage. He may rest upon the filing of his own mortgage, and may continue his advances to the extent of the amount named in it, and is not called upon to watch the record for subse- quent liens.* § 93. Extending lien for newr advances. — Where the mortgagor retains possession of the property, the opera- tion of the mortgage cannot be extended by parol so as to affect the rights of creditors and subsequent purchasers ; and when the debt which the mortgage _ was originally made to secure is paid, the lien of the mortgage will be gone.' But where, the possession of the mortgaged chattels is delivered to the mortgagee, the transaction will be gov- erned by some of the rules which control in cases of pledge. ' Rogers v. Abbott, 128 Mass. 102; ^ Robinson v. Williams, 22 W. T. Preble v. Conger, 66 111. 370. 380. ' Brown v. Kiefer, 71 N. Y. 610 ; •• Aokerman v. Hunsicker, 85 N. Y, Niotlin v. Betts Spring Co., 11 Oreg. 43; 39 Am. E. 621; rev'g 21 Hnn, 53. 406; 50 Am. Rep. 477; The Bank of ' Diver v. McLaughlin, 2 Wend. Montg.Cc's Appeal, 36 Penn. St. 172; 696; Walker v. Snediker, Hoff. 146; McClnre v. Roman, 82 Penn. St. 460. Monnot v. Ifert, 83 Barb. 24; Sims v. Mead, 29 Kans. 124. MORTGAGES BY INFANTS. 69 and not only will it be permissible for the mortgagee to bargain by parol for a lien in making new advances, but the presumption will be that his lien was intended to ex- tend to secure the new debt as well as the old, and his pos- session will not be disturbed until both are paid.^ Mortgages by Infants.^ § 94. A mortgage made by an infant is voidable, but not void,' and if no possession be delivered under it, the mortgagee would be a trespasser in taking possession of the property without the consent of the mortgagor..'' The mortgagor has a right to avoid the mortgage at any time before he arrives at age, and within a reasonable time thereafter, by any act which evinces that purpose ; ^ and an unconditional sale of the property, without recognizing the mortgage, is such an act.* § 95. Restoring consideration on avoiding mortgage. — Where the consideration for a chattel mortgage executed by an infant is money, or, in general, anything but the very property mortgaged or articles necessary for his use, there is no obligation resting upon the mortgagor to restore the /jonsideration as a condition for disaffirming the mortgage. If such consideration or any part of it still remains in the hands of the mortgagor, this may qualify the rule, but otherwise the mortgage may be repudiated without restor- ing, or offering to restore, the consideration or any part of it.' The principle on which this exception to the general ' Story's Eq. Jur. g 1034. fer, 49 N. Y. 407; Miller v. Smith, 26 2 See Thomas on Mortgages (2d Minn. 248; Si Am. E. 407. «d.), § 134, ei seg. « Chapin v. Shafer, 49 N. Y. 407; 3 Chapin v. Shafer, 49 N. Y. 407; State v. Plaisted, 43 K H. 418. Hangen v. Hochmeister, 49 N. T. ' Green v. Green, 7 Hun, 492; affd, Super. Ct. (J. Knaggs v. Green, 4 N, W. Rep.. 7 Hun, 492, 495. Y60. M0ETGAGE8 BY PARTNERSHIPS. 71 sell and pay debts.' The power of a partner to dispose of the property of the firm extends to assignments of it as security for antecedent debts as well as for debts thereafter to be contracted on account of the firm. And an assign- ment of all the property of the firm, executed by one of its members to a third party in trust, to convert it into money and pay a debt of the firm with the expenses of the assign- ment, and to pay over the balance of the net proceeds to the firm, is valid.^ One partner has authority to sell and transfer all the copartnership effects directly to a creditor of the firm, although the latter is at the place of business and might be consulted ; nor is the validity of the sale af- fected by the insolvency of the firm at the time, and the preference which the purchasing creditor will thus acquire over the others.' § 98. To secure individual debts.— One partner has no power to mortgage copartnership property for his indi- vidual debt, and such a mortgage would be operative to the extent only of the interest of the mortgagor, and subject to the equities of the other partners and of part- nership-creditors.* It would impose no actual lien on the property, since the interest of an individual partner con- sists only of his share of the surplus remaining after the payment of the debts and settlement of the accounts of the firm ; and it is not until that interest is ascer- tained and set apart as the share of the mortgagor that his mortgage is available against any specific property.^ A mortgage made to secure a person who, at the re- quest of a member of the partnership, executes an under- I Millett V. Strenger, 17 Abb. Pr. Kern.) 442; Graser v. Stellwagen, 26 152; Collyer on Part. §§ 396, 398; N. Y. 315; Fox v. Hanburg, Cowp. Tupley T. Butterfield, 1 Mete. 515; 445. Nelson v. Wheelock, 46 111. 25. * Merchant v. Belding, 49 How. •■' McClelland v. Remsen, 5 Abb. N. 344 ; Deeter t. Sellers, 102 Ind. 458 ; S. 250; 3 Keyes, 454; affi'g 36 Barb. The State v. Emmons, 99 Ind. 452. 622; 14 Abb. 331; 23. How. 175; ' Tarbel v. Bradley, 7 Abb. N. C. Scruggs V. Burruss, 25 W. Va. 670. 278. ' Mabbett v. White, 12 IST. Y. (2 72 MORTGAGES OF PEESONAL PBOPEETl. taking to relieve partnership assets from a levy under an attachment, is valid against the property, though the foun- dation of the attachment be a debt of the one member of the firm who signed the mortgage.^ Where a mortgage on firm property was executed by one member of a partnership to the other, and subsequently the interest of the mortgagee was sold on execution, it was held that the purchaser acquired not only his interest as a partner but also his title under the mortgage.^ § 99. Form of executing mortgage by partner. — In or- der to bind the partnership the partner must assume to do so. This may be done by signing the firm name or by signing the individual names of all the partners,* or by re- citing in the body of the paper that he acts for all ; * but a paper signed by the name of one member of a firm, of co- partnership assets, transfers only his interest in them.^ Since a chattel mortgage requires no seal, the addition of a seal or seals to a chattel mortgage executed by one partner will not invalidate it.' Mortgages by Limited Partnerships. § 100. The statute of this State relating to limited partnerships provides that every sale, assignment or trans- fer of any of the property or effects of such partnership made by such partnership when insolvent, or in contempla- tion of insolvency, or after or in contemplation of the in- solvency of any partner, with the intent of giving a prefer- ence to any creditor of such partnership or insolvent part- ' Arnold v. Morris, 7 Daly, 498. '' Gibson v. Warden, 14 Wall. 244. « Willett V. Stringer, 17 Abb. Pr. 'Clark v. Houghton, 78 Mass. (12 152. ■ Gray), 38. 3 Mabbett v, White, 12 N. Y. 442 Hawkins v. Hastings Bank, 1 DiU.462 Graser v. Stellwagen, 25 N. Y. 315 * Patten v, Kavanagh, II Daly, 348; Purviance v. Sutherland, 2 Ohio St. 478; Keller v. West, Bradley Kelley y. Held, 57 Miss. 89 ; Rhu- 2 Dunning v. Stearns, 9 Barb. 630. tasel v. Stephens, 68 Iowa, 627; Cald- 3 Gardner v. McEwen, 19 N. T. 123; well v. Trowbridge, Id. 150 ; McCord Russell V. Winne, 37 N. Y. 591. v. Cooper, 30 Ind. 9, * Burnett V. Hunt, 26 Me. 419. s Ciay v. Currier, 62 Iowa, 636. ' Winslow V. Merchants' Ins. Co., 4 Mete. 806 ; 88 Am. Dec. 368. DESCRIPTION OF MORTGAGED PROPERTY. 87 § Ii8. Insufficient description cured by delivery. — When a chattel mortgage fails duly to describe the property, the defect is cured, as against parties who have not acquired any right or interest, by the subsequent delivery of the property to the mortgagee.^ § 119. Parol evidence to aid description.— If the de- scription contained in the mortgage is sufficient to give the means of ascertaining the precise thing mortgaged, the instrument is valid, and parol evidence may be used in rendering it certain.^ But it is not permissible, as against third persons, to prove by parol what property was intended to be mortgaged when the mortgage itself fails to point out how the chattels are to be identified.^ For example, a mortgage which describes crops intended to be conveyed as " my entire crop of corn, cotton, seed, fodder, peas, potatoes and cane, that I may raise the present year on my place," may be aided by evidence showing the lands cultivated by the mortgagor during the year, and the quantities of the respective crops raised by him.^ So, a mortgage of "all goods now in the store occupied by me," may be supple- mented by parol proof of what goods were in the store at the time of the execution of the mortgage.' But a mort- gage of " our open buggy, with fills, new, made by Taylor Bros., Emmetsburg, and bought of them," without stating any other means of ascertaining the property, is not suf- ficient to charge a third party with notice, not being within the rule that the description must direct the mind to evi- dence whereby the precise thing conveyed may be ascer- ' Parsons Savings Bank V. Sargent, Iowa, 316; Van Evera v. Davia, 51 20 Kans. 5'76 ; Williamson v. Steele, 3 Iowa, 637; Cass v. Gunnison, 68 Mich. Lea (Tenn.), 527; Stephens v. Tucker, 108. 13 N. J. Law, 600 ; Morrow v. Reed, ■• Seay v. McCormick, 68 Ala. 549. 30 Wis. 81. " Bnrditt v. Hunt, 25 Me. 419 ; 43 5 Everett v. Brown, 64 Iowa, 420 ; Am. l^ec. 289 ; Harding v. Coburn, 12 Smith V. McLean, 24 Iowa, 322 Meto. 333; 46 Am. Dec. 680; Bell v. 3 Citizens' Bank v. Rhutasel, 67 Prewitt, 62 III. 361. 88 MORTGAGES OF PEESONAL PEOPEETY. tained, and parol evidence to cure the description is not admissible.^ Parol evidence has sometimes been permitted to remove an ambiguity. Thus, where property was described as " all the staves I have in Monterey, the same I had of Moses Fargo," and it appeared that the mortgagor had no staves in Monterey, but had a quantity in the adjoining town of Sandisfield, near the boundary of Monterey, which he had of Moses Fargo, it was held that the first part of the de- scription might be rejected as false, and that the remainder was sufficient.^ So where a mare with four white legs was described as having two white feet, parol evidence was ad- mitted to identify the animal.' A mortgage of one "bay mule " has been sustained to cover a black mule by show- ing that the mortgagor owned but one,* and a mortgage of " one horse " sufficiently describes the animal if the mort- gagor owns no other.^ Parol evidence has also been received to show the mean- ing attached by the parties to the terms used by them. Thus, where the mortgage was of " one portable saw-mill," parol evidence was admitted to show whether the mortgage covered a steam-engine used in connection with said mill.* And the meaning of the word "team" has been permitted to be shown by parol.' § 120. Construction of description. — Each description of mortgaged property must be construed by itself, and the question in each case is as to the intention of the parties. A mortgage upon a building used for sugar refining, " and also all the machinery and effects in said sugar refinery," and filed as a chattel mortgage, was held to cover the stock of sugar.** "All appendages " in and about a mill includes ' Ormsby v. Nolan, 69 Iowa, 130 ; * Harris v. Woodard, 96 N. C. 232. Rowley v. Bartholomew, St Iowa, 374; ^ Spiney v. Grant, 96 N. C. 214. Ivins T. HineB, 45 Iowa, 73. ^ 'Weber v. lUing, 66 Wis. 79. ' Pettis V. Kellogg, 61 Mass. (7 ' Ganson v. Madigan, 15 Wis. 144. Gush.) 466. 8 Thurber v. Minturn, 62 How. 27. ' Rowley v. Bartholomew, 37 Iowa, 374. DESCEIPTION OF MORTGAGED PROPERTY. 89 platform scales.^ "All tlie desks, chairs, trunks and office furniture" in a certain office was held to embrace an iron safe.^ A mortgage of personal property used in and about a hotel, "together with all other goods, effects, furniture, chattels, property, things of every nature now used, at- tached, situate and being in and about the hotel," was held to include a schooner-rigged sail-boat which was in the water near the hotel, and was used with it, although four other schooner-rigged sail-boats were specifically men- tioned in the mortgage.' Pictures, pianos, and billiard- tables may be household furniture within the meaning of a mortgage of all the furniture in and belonging to a certain house.* A mortgage on "goods, wares and merchandise" then in stock in a certain store-room was held to cover bar- rels of salt kept for sale as part of the stock, and stored in a shed used in connection with the store, and also barrels of kerosene oil which had been temporarily removed from the store.' But a chattel mortgage, given by a merchant, of "goods in store," will not be held to include a safe kept in his store, not for sale, but for his private use.* A mortgage of " groceries " contained in a " country and village grocery store" does not include pails, shovels, and the like, al- though such goods are usually kept in such a store.' The words "growing and standing grain" do not include grain severed from the earth, and " standing in shocks." ^ § 121. If a schedule be annexed to a chattel mortgage and referred to in it, the schedule is part of the mortgage, and both papers must be construed together.' But the omission to affix a schedule, even though a schedule is ' Miller t. Hart, 32 Hun, 639. <• Stephens v. Pence, 56 Iowa, 25'7. "- Stowhegan Bank v. Fairer, 46 « Curtis v. Phillips, 5 Mich. 1 1 2. Me. 293. ' Fletcher t. Powers, 131 Mass. aVeazie v. Somerby, 87 Mass. (5 333. Allen), 280. ' Ford v. Sutherlin, 2 Mont. 440. * Sumner v. Blakeslee, 59 N. H. " Edgell t. Hart. 9 N. Y. (5 Seld.) 242. 213. 90 MORTGAGES OF PERSONAL PROPERTY. mentioned in the mortgage, does not impair the validity of the instrument. Thus, where a mortgage was made of all the chattels of the mortgagor on certain premises, adding that " an inventory whereof was to be made and annexed," but no inventory was annexed, it was held to be valid as a lien upon all of the property on the premises at the time of its execution.^ If there be a schedule annexed to the mortgage, the presumption will be that it was so annexed before the instrument was executed.^ A mortgage of the goods and chattels in the mort- gagor's store, in a certain town, " a schedule of which is hereto annexed," covers only such of the goods then in the store of which a schedule was made.' When the schedule is in conflict with the mortgage, the latter must control, as the annexing of the schedule neither limits nor enlarges the generality of the description in the mortgage, but is annexed for greater certainty and exact- ness in the description of the property, so that it may easi- ly be identified.* AOOEETIONS TO MORTGAGED PROPERTY. § 122. Goods afterwards manufactured. — A mortgage lien will attach to a manufactured article composed wholly or in part of the mortgaged property, and will thus extend to cover not only the labor which has been expended upon it, but also the new materials.^ Where a debtor mortgaged a number of unfinished prunihg-shears, and afterwards finished the shears, and thereby added greatly to their value, it was held that, in the 1 Van Heusen v. Radclifif, 11 N. Y. 4 Met. 306; Jardine, Ex parte, 10 L. R. (3 Smith), 580; Winslow v. Merchants, Ch. App. 322. Ac, 4 Mete. 806. ' Dehority v. Paxson, 97 Ind. 253 ; 2 Belknap v. Wendell, 21 N. H. 178. Dunning v. Stearns, 9 Barb. 630 ; 8 Partridge v. White, 59 Me. 664; Frost T. Willard, 9 Barb. 440; Greggs Wood V. Rowcliffe, 6 Exch. 407. v. Sanford, 24 111. 17; Crosby v. Baker, ■"Matthews T. Sniffen, 10 Daly, 6 Allen, 286; .Sc/iarfe Ames, 1 Lowell, 200; Winslow v. Merchant's Ins. Co., 561. ACCRETIONS TO MOETGAGED PROPERTY. 91 absence of fraud, the mortgagee could hold against an at- tachment by another creditor.^ And a mortgage of leather, cut and prepared for the manufacture of shoes, covers shoes subsequently made of it by the mortgagor.^ So a rifle having a skeleton stock, at the time when a mortgage there- of is executed, is not so substantially changed by having a new wooden stock and a new and different kind of lock sub- stituted for the original ones, by way of repairs, as to au- thorize an attaching creditor of the mortgagor to hold it against the mortgagee, provided he is able to identify it by parol evidence.' § 123. If the mortgaged chattels be repaired, or other property be united to them in such a way as to be acces- sory to them, the lien of the mortgage will cover the whole. In this respect a chattel mortgage resembles a mortgage of real estate, which attaches to all erections and fixtures which become a part of the soil by annexa- tion. So where a sloop was mortgaged, and subsequently her old sails were replaced by new ones, the mortgagee, on taking possession, was held to have acquired a prop- erty in the new sails by right of accretion. If the mort- gagor could have removed the new sails before the actual possession of the mortgagee under the mortgage, still, after such possession was taken, his right to do this was gone.* § 124. Natural increase of animals.— When domestic animals are mortgaged during gestation, their offspring are, as between the parties, covered by the mortgage.' > Ferry v. Pettingill, 33 N. H. 433. v. Blevins, 5 Yerg. (Tenn.) 195; Hughes » Putnam v. Gushing, V6 Mass. (10 v. Graves, 1 Litt. (Ky.) 317; Evans v. Gray), 334. Merriken, 8 Gill & J. 39 ; Forman v. 3 Comins v. Newton, 92 Mass. (10 Proctor, 9 B. Mon. (Ky.) 124; Fowler Allen), 518. v. Merrill, 11 How. (U. S.) 375. * Sonthworth v. Isham, 3 Sandf. In Colorado, by statute, a mort- 448; Holly v. Brown, 14 Conn. 255. gage of live stock may cover and bind ' Funk V. Pane, 64 Wis. 35 ; Kel- the increase, or any part thereof, there- logg v. Lovely, 46 Mich. 1.31 ; McCarty after to be born ; but it must be so pro- 92 MOETGAGES OF PEESONAL PEOPEETY. In the absence of fraud, this lien also prevails against execution and attachment-creditors and purchasers with notice.^ But as against a bona fide purchaser, acquiring his title after the usual period of nurture is passed, such offspring will not be covered by the mortgage.' Confusion of Goods. § 125. Rule as to admixtures.— In Dunning v. Stearns (9 Barb. 630) a lien reserved upon a quantity of ashes was held valid on the potash manufactured therefrom. The mortgagor mixed the ashes with other ashes of his own, and it was determined that the ashes which he thus mixed, would, by the law on the subject of the confusion of goods, become accessorial to the mortgaged property, and come under and be subject to the lien and operation of the mortgage.' If the mortgagee had consented to the admixture, it was said that the effect would have been to make him tenant in common of the mixture.* The rule of law and equity is strict and severe on such occasions. If a party having charge of the property of others, so confounds it with his own that the line of dis- tinction cannot be traced, all the inconvenience of the con- fusion is thrown upon the party who produces it, and it is for him to distinguish his own property or lose it.' Tided in the mortgage. Laws of 1877, 124; Fowler v. Merrill, 11 How. (U. p. 76, amdg. Gen. St. 1883, § 1 65. S.) 375, 396 ; Funk v. Pane, 64 Wis. 1 Thomas t. Hillhouse, 17 Iowa, 36. 67; Rodgersv. Highland, 69 Iowa, 504. ' Willard v. Rics, 11 Met. (Mass.) 2 Rodgers v. Highland, 69 Iowa, 493 ; 45 Am. Dec. 226 ; Adams v. 504; 34 Alb. L. J. 397; Winter y. Wildes, 107 Mass. 125; Fowler v. Hoff- Landphere, 42 Iowa, 471; Thorpe v. man, 31 Mich. 224; Simmons v. Jen- Cowles, 55 Iowa, 408 ; Kellogg T. Love- kins, 76 111. 479 ; Kreuzer v. Cooney, ly, 46 Mich. 131 ; 41 Am. R. 151; Dar- 45 Md. 582. ling V. Wilson, 60 N. H. 59 ; 49 Am. R. < Hamilton v. Rogers, 8 Md. 301. 305 ; Cudworth v. Scott, 41 N. H. 456 ; « Pet Kent, Ch., in Hart v. Ten Eyck, Evans v. Merriken, 8 Gill &. J. (Md.) 2 Johns. Ch. 62, 108. 39 ; Forman v. Proctor, 9 B. Mon. (Ky.) CONFUSION OF GOODS. 93 The rule that a man may lose his own property by mix- ing it with the property of another, applies only to cases where the property of one cannot be distinguished from that of the other after the admixture.' Confusion does not impair a mortgage lien on articles which can be identified.^ When a dealer in hats mortgaged to plaintiff a quantity of hats, and thereafter mingled the mortgaged hats with others, belonging to himself, so that they could not be distinguished, in an action against the consignee of the mortgagor, it was held that he was liable for the value of the whole, including some hundreds of hats in excess of those mortgaged.' New printing material purchased after the giving of a chattel mortgage on the establishment, to supply the wear, decay, and destruction of the old, and which has been so commingled with the old as not to be readily distinguish- able, will be included in the mortgage, and become part of the mortgaged property by accretion.* "Where goods of the mortgagor's wife and after-acquired goods of the mortgagor became mingled, either wilfully or through want of proper care, with the mortgaged goods, the whole became thereby subject, prima foxie at least, to the lien of the mortgage.' If a mortgagor, having added new purchases to the mortgaged stock, refuses on demand to identify and sepa- rate the new from the old, when the mortgagee is rightfully taking possession, though there be no such confusion of goods as absolutely to destroy their separate identity, yet if they could not be separated without the aid of the mort- gagor and the same mischief would thereby be produced as by a confusion of goods, the same doctrine will be ap- plied.* ' Per Cady, .T., in Frost v. Willard, * Fowler v. Hoffman, 31 Mich. 215. 9 Barb. 440. 447 ^ Burns v. Campbell, 70 Ala. 271. ^ Caring v. Richmond, 28 Hun, 25. « People v. Bristol, 35 Mich. 28 ; 5 Willard v. Rice, 11 Met. (Mass.) Fuller t. Paige, 26 111. 358. 493 ; 45 Am. Dec. 226. 94 MOETGAGES OF PEBSONAL PBOPEBTY. § 126. Against junior liens. — As between the mortgagor and tlie mortgagee, if tlie former is in possession, the duty rests upon him not to impede and hinder the enforcement of the lien by confusing the mortgaged property with sim- ilar chattels, and the penalty of an extension of the lien is imposed to prevent a possible loss to his creditor from his wrongful or negligent conduct. But if the mortgagee con- sents to such admixture he cannot thereby gain an advan- tage over junior liens, and such consent will be implied if the mortgage itself, or the dealing of the parties, imports an agreement to a course of business by which confusion would naturally be occasioned.^ In such case a junior at- tachment may be allowed to share ratably in the confused goods, if the portion covered by the mortgage can be deter- mined.'^ And if the admixture is made in such a way that the rights of the mortgagee cannot be demonstrated, he will be made to lose his entire lien, and the attaching creditor will be permitted to take the whole rather than to permit the mortgagee to make a profit from his own wrong.' The burden of establishing the portion of the mixture which is subject to the lien rests upon the mortgagee who consented to the confusion, and in the absence of evidence the attach- ing creditor will take the entire property.^ Mortgages upon Fixtubes. § 127. Chattels permanently annexed to land become part of the freehold, and pass as such to a subsequent grantee or mortgagee of the real estate.^ And a mortgage on the land attaches to such chattels when so affixed.' On ' Hamilton v. Rogers, 8 Md. 301. •• Wilcox v. Jackson, 1 Col. 521. Bnt where confusion took place after ° Vooriiees v. McGinnis, 48 N. Y. the commencement of an action to fore- 2'78; Snedeker v. Warring, 12 N. Y. close the first mortgage, priority of 110; Bishop v. Bishop, 11 N. Y. 123; lien on all of the property was awarded Miller v. Plumb, 6 Cow. 665; Union to the prior mortgagee. Odell v. Gal- Bank v. Emerson, 15 Mass. 159; Clove lup, 62 Iowa, 253. v. Lambert, 18 Ky. 224. ' Mowry v. White, 21 Wis. 417. " Gardner v. Finley, 19 Barb. 317; 3 Robinson v. Holt, 39 N. H. 557. Rice v. Dewey, 54 Barb. 455; Corliss MORTGAGES UPON FIXTURES. 95 the other hand it is quite competent to use personal prop- erty with real estate in such a way as to preserve it as per- sonalty, and the distinctions on this point are numerous, and not always clearly defined. In a general way it may be stated that the question of the conversion of chattels into realty by annexation depends upon the character, purpose and intent of such annexation.^ § 128. Fixtures treated as personal property by agree- ment. — The owner of a parcel of unincumbered real estate, upon which are chattels owned by him, may grant or en- cumber all or any part of it. He may stipulate, in creating a lien upon the land, for permission to remove any speci- fied part of the buildings or trees upon it, or even to carry away the soil itself. And, in like manner, he may sell or mortgage parts of it capable of severance from the soil, while, at the same time, he retains the absolute title to the land.^ Such agreements are not only binding as between the parties, but they are also valid as against grantees or subsequent mortgagees with notice. If the prescribed legal formalities in the way of filing and registration are com- plied with, they are also valid against subsequent credit- ors.' To this extent the act of the parties, in treating the property as personalty, will, as between themselves, make it such.* A chattel mortgage in the usual form, executed in view of the fact that the chattels are, or are about to be, an- nexed to land, is sufficient evidence of an agreement that they are to be treated as personal property.^ V. Van Sagin, 29 Me. 115; Phinney v. 14 Barb. 662; Gooding v. Riley, 50 N. Day, 76 Me. 83; Butler v. Page, 48 H. 400; Adams v. Beadle, il Iowa. Mass. (7 Mete.) 40; Powers v. Denni- 439; 29 Am. R. 487. son, 30 Vt. 752. ' Sisson v. Hibberd, 10 Hun, 420; 'See Thomas on Mortgages (2d ed.), affi'd, 75 N. Y. 542; Ford v. Cobb, 20 § 166, et seq. N. T. 344; Tifft v. Horton, 63 N. Y. 2 Fortmau t. Goepper, 14 Ohio St. 377; Kinsey v. Bailey, 9 Hun, 452; 658. Corcoran v. Webster, 6 N.W. Rep. 513; 3 Sisson V. Hibberd, 76 N. Y. 542. Eaves v. Estes, 10 Kans. 314; 15 Am. ^ Voorhees v. McGinnis, 46 Barb. R. 345. 242; 48 If . Y. 278; Godard v. Gould, 96 MOBTGAGES OF PERSONAL PROPERTY. Thus, a mortgage of growing trees would create a valid lien upon them, and, upon the forfeiture of the condition of the mortgage they would, in law, be severed from the land.^ And where a mortgage of real estate was executed subsequently to the making of an agreement by which a third person became a partner with the mortgagor in the business of nurserymen, it was held that such third person might enforce the partnership right to nurse the trees and shrubs planted, until fit for market, as against a purchaser with notice under the foreclosure of the mortgage.^ And the priority of the lien of a chattel mortgage upon a frame building subsequently removed by the mortgagor to and upon other lands, is not defeated or affected by a subsequent mortgage upon such other lands, given by the same mort- gagor to a mortgagee having full knowledge of such prior chattel mortgage.' § 129. Agreement to treat property as personal not binding on mortgage of land. — But an agreement between the owner of mortgaged real estate and a third person, by which property originally personal is treated as a chattel and a lien granted thereon, will not divest the lien of the mortgage on the land, whether such mortgage be executed before or after the annexation. And if a mortgage is exe- cuted on real estate to which chattels have been or are subsequently annexed, and, after such annexation and real estate mortgage, the chattels are mortgaged as personal property, the question as between the mortgage of the land and the mortgage of the chattels will be as to whether, when the chattel mortgage was executed, the property cov- ered by it was real or personal estate." ' Bank of Lanaingburgh v. Crary, Bavb. 157 ; Huut v. Bay State Iron 1 Barb. 542. Co., 97 Mass. 279 ; Burnside v. Twitcb- = King V. Wilcomb, 7 Barb. 263. ell, 43 N. H. 390 ; Frankland v. Moul- But see Thomas v. Vinton, 121 Mass. ton, 5 Wis. 1; Pierce t. George, 108 T 39 Mass. 78; Keeler v. Keeler, 31 N. J. Eq. = Simons v. Pierce, 16 Ohio St. 215. 181. ■• Vanderpool v. Van Allen, 10 MORTGAGES UPON FIXTUEE8. 97 § 130. Mortgage of fixtures to be recorded as mort- gage of real property.— As against subsequent purchasers and mortgagees with notice, a chattel mortgage previously executed on personal property affixed to the freehold will be a prior lien, independent of the character of its annexa- tion and the difficulty of removal,^ but it by no means fol- lows that notice may be given by filing the mortgage as a lien upon personalty. The character of property, as real or personal, depends upon principles of law, and not upon the conventions of parties, and a person intending to pur- chase or to acquire a lien by mortgage upon property which the law pronounces real estate is not put upon in- quiry for chattel mortgages upon it.^ If the holder of the chattel mortgage is to retain his lien in such a case, he must record it as a mortgage on land,' or he must rest upon the facts and establish that the property included in it is legally personal. § 131. Mortgaged chattels affixed to land. — If per- sonal property is mortgaged as such, and is afterwards so annexed to real estate as to become part of it, it cannot be removed to the prejudice of the owner of the title, or of a mortgagee of the land. This principle has been illustrated as follows * : " A man employs a carpenter and a mason to build a brick house for him upon his lot, and pays them in full the price agreed upon. The mason puts his brick in the walls; the carpenter places his joists and timbers in the proper places in the house. The house is finished, and is occupied by the owner. It then appears that the maker of the brick held a chattel mortgage upon them, executed by the mason, and that the sawyer of the timber held a chattel mortgage upon it, executed by the carpenter. Are 1 Simons v. Pierce, 16 Ohio St. 216. 513; Brennan t. Whitater, U Ohio ''Hunt V. Bay State Iron Co., 97 St. 446; Fortman v Goepper, 14 Ohio Maas. 2V9; contra, Sword v. Low, 122 St. 565; Potts v. N. J. Arms and Ord- 111. 481 nance Co., 11 N. J. Eq. 395. 'Eastman v. Foster, 8 Mass. 19; ^ Per Gray, C, in Voorhees v. Mc- Snowdcn v. Craig, 26 Iowa, 156; Ginnis, 48 N. Y. 278, 28'7. Bringholff v. Munzenmaier, 20 Iowa, 7 98 MOBTGAGES OV PERSONAL PEOPEETY. these articles, now a part of the house, still held upon the chattel mortgages, so that the creditors can despoil the house to obtain their possession, or compel the owner to pay their value? I take it they are not. Their character of personal property is ended. They have become a part of the house ; they are real estate ; will pass under a deed of the land; may be subjected by a mortgage of the land, or may be held by the owner of the house.' The remedy of the party is against those who wrongfully converted the personal into real property."' If mortgaged chattels are so annexed to the land as to be capable of removal without destroying them, and with- out serious damage to the freehold, they may be removed by the mortgagee for the satisfaction of his lien upon them.' 1 § 132. If chattels affixed to land become bound by a mortgage of the real estate, they cannot be removed ex- cept by consent of the mortgagee, who may restrain their removal or destruction by injunction, even as against the owner of the equity of redemption, if such removal will render his security inadequate or precarious.^ The mort- gagee may also maintain an action against a wrong-doer who removes such fixtures, and that either before or after foreclosure, and whether he is in possession or not.' § 133. A curious question was presented in Kelsey v. Lyon (97 N. Y. 629), which was an action for the conversion of certain machinery in a planing-mill. Plaintiff claimed ' Fryatt v. Sullivan Co., 6 Hill, Hun, 420 ; Tifft v. Horton, 53 N. Y. 1 16 ; Pierce v. Godilard, 22 Pick. R. S11 ; McRea v. Central National Bank, 569. 66 N". y. 489; Kinsey v. Bailey, 9 ^ Per Bronson, J., in Fryatt v. Sul- Hun, 452. livan Co. , siipj-a / Ford V. Cobb, 20 N . * Robinson v. Preswick, 3 Edw. Y. 344; Sisson t. Hibbard, 1& N. Y. 246. 542; Pierce v. George, 108 Mass. 108; ' Laflin v. Griffiths, 85 Barb. 58; Tibbetts v. Moore, 23 Cal. 208. Van Pelt v. McGraw, 4 N. Y (4 Comst.) ' Ford V. Cobb, 20 N. Y. 344; Sis- 110. son V. Hibbard, IB K. Y. 542; affi'g 10 MORTGAGES UPON FIXTUEES. 99 title under a chattel mortgage from one Matthias. Matthias had a mortgage upon the premises upon which the planing- mill was located. The mortgagors executed to him a bill of sale of the personal property in the mill, not including the machinery in question, which they considered as part of the lealty, and put him in possession of the real estate. He sub- sequently foreclosed his mortgage, and bid in the property. Thereafter he executed the chattel mortgage. The real estate was afterward sold upon foreclosure of a prior mort- gage held by defendant, who became the purchaser and en- tered into possession. Finch, J., said : " The plaintiff's title to the machinery was derived from the chattel mort- gage of Matthias, and is dependent upon it. If that ma- chinery was so annexed to the realty as to become parcel of it, Matthias acquired title by the foreclosure of his real es- tate mortgage, but subject, nevertheless, to the prior mort- gage, the foreclosure of which cut off and destroyed his lien and resulting title. The appellant avoids this difficulty only to encounter another. He argues that the machinery was personal property, but if " so, Matthias got no title by foreclosure of his real estate mortgage, aiid never acquired one in any other way." § 134. The intention of the owner in affixing chattels to the freehold is frequently held to be controlling. Thus, where a combined boiler and engine of six-horse power, standing on wheels six inches in diameter, the wheels rest- ing on the ground, and not in any way_ annexed to the building, was placed in a tub manufactory, and a prior mortgagee of the land claimed a lien upon the boiler and engine, and a subsequent holder of a chattel mortgage also claimed such- lien, it was held to be erroneous to direct a jury to find that the chattel mortgagee was entitled to them. It was said by the G-eneral Term of the Fifth De- partment that the court should have submitted the ques- tion to the jury as to whether it was the intention of the owner of the property to permanently attach and use the boiler and engine with the premises, and that if he did so 100 M0BTGAGE8 OF PEB80NAL PKOPERTY. they became fixtures, and subject to the lien of the mort- gage upon the real estate. The method of attaching them, whether by their mere weight, or by screws or nails, or masonry, was to be regarded as material only- as evidence bearing on the question of intention.* Where a chattel mortgage for the purchase-money of a steam-boiler was taken, and the boiler was afterward at- tached to the freehold, it was held that the chattel mort- gage itself could be resorted to as evidence of the intention of the parties to have it remain personal property.'* Boilers and engines not attached to the realty, although in a shed which would have to be removed in order to take away the former, and machines fastened to the floor by cleats, screws and nails, and connected by the belting to the shafting, are personal property' as between a mortgagee of the land and a mortgagee of the machinery. " The later de- cisions establish that machines may remain chattels for all purposes, even though physically attached to the freehold by the owner, if the mode of attachment indicates that it is merely to steady them for their more convenient use, and not to make them an adjunct of the building or soil." ^ § 135. Character of annexation. — The distinction be- tween cases where the chattels may continue to be personal property after being affixed to the land, aad where they may not, seems frequently to rest upon their essential char- acter, and whether they can be removed without serious damage to the freehold, or substantially destroying their ' Hart V. Sheldon, 34 Hun, 38. Cit- ^ Kinsey v. Bailey, 9 Hun, 462 ; ing Tifft V. Hortcm, 53 W. Y. S11 ; Eaves v. Estes, 10 Kan. 314 ; Titbetts Voorheea v. McGinnis, 48 N. Y. 278; v. Moore, 23 Cal. 208; Davenport v. Potter V. Cromwell, 40 N. Y. 287 ; Shauts, 43 Vt. 546 ; Sisson v. Hibbard, Winslow V. Merchants' Ins. Co., 4 Met. 76 N. Y. 542; aflB'g 10 Hun, 420. 306 ; Sands v. Pfeiffer, 10 Cal. 258 ; ' Carpenter v. Walker, 140 Mass. Hill V. Wentwortb, 28 Vt. 428; Harris 416 ; 33 Alb. L. J. 318; McConnell v. v. Haynes, 34 Vt. 220; Sweetzer v. Blood, 123 Mass. 47 ; Hubbell v. East Jones, 35 Vt. 317; Fullam v. Stearns, Cambridge Sav. Bank, 132 Id. 447; 30 Vt. 443 ; Voorhis v. Freeman, 2 Maguire v. Park, 1 N. E. Rep. 750. Watts & Sergt. (Pa.) 116; Pyle v. Pen- nock, Id. 390. MORTGAGES UPON FIXTURES. 101 own quality and value.^ If they can be so removed they will continue personal if the rights of third persons require, even though, as between the mortgagor and mortgagee, they would pass with the land ; but if they cannot be removed without substantial injury to the real estate or to them- selves, they cease to be personal, and become real estate, li- able to the burdens which rest upon the land, and subject io be transferred with it. If the rights of third persons are invaded by this change of the character of the property, they must seek their remedy against those who wrongfully converted the personal into real property.' § 136. Examples. — Where a chattel mortgage was execu- ted on fixtures prepared to be attached to a building, as es- sential parts of it, and which were thereafter so attached, the lien of the chattel mortgage was held to be subordinate to a mortgage afterward given on the land.' But where an en- gine was built for a mill, and before it left the owner's shop a mortgage was taken on it with a stipulation that it might be removed at any time, it was held that the engine contin- ued to be personal property as against a previous mortgage of the land.* In a similar case where the mortgage on the Teal estate was executed after the machinery was affixed to the real estate, the mortgagee of the land having no notice of the chattel mortgage, it was held that the machinery was bound by the mortgage of the land.' And where a boiler was sold under an agreement that the title to it should remain in the vendor until payment, and it was then placed by the vendee in a machine-shop and so annexed to the 1 Ford v. Cobb, 20 N. Y. 344; Tiffl 11 Am. R. 310 ; Voorhees v. McGinnis, Horton, 53 N. Y. 377 ; 13 Am. R. 637 ; 48 N. Y. 278 ; Frankland v. Moulton, B Sisson V. Hibbard, 76 N. Y. 542 ; affi'g Wis. 1 ; Trull v. Fuller, 28 Me 545. 10 Hun, 420. ■'Eavea v. Estea, 10 Kana. 314; 15 2 Voorhees v. McGmnis, 48 N. Y. Am. R. 348 ; Tifft v. Horton, 53 N. Y. 278; Fryatt v. The Sullivan Co., 5 377; 13 Am. E. 537; Crlppen v. Mor- Hill, 116; Pierce v. Goddard, 22 Pick. riaon, 13 Mich. 23, 559. = Bremen v. Whitaker, 15 Ohio St. 3 Pierce v. George, 108 Mass. 78 ; 446 ; Pierce v. George, 108 Mass. 78. 102 MORTGAGES OF PEESONAL PEOPEETY. realty as to become part of it, it was held that the lien of a subsequent mortgage of the real estate attached to it.^ Machinery so attached to the mortgaged premises as to become part of it, becomes subject to a mortgage there- on even against a partner of the mortgagor who paid half of the cost under an agreement with the mortgagor that it should be treated as personalty.'* If one erect a building for his own use upon the land of another by virtue of a parol license from the owner with privilege of removal, the lien of a subsequent mortgagee of the land will attach to it.' And the lien of a prior mort- gagee will also attach to it.^ In a case, where machinery was attached to a building in such a way as to show that it was designed to be permanent, and such annexation was made by the owner with the con- sent of the owner of a chattel mortgage thereon, such chat- tel mortgage, though duly filed and recorded, was held to be inoperative as against a subsequent bona fide mortgagee of the real estate.^ Where a person, being in possession of machinery be- longing to another, affixed it to and used it in connection with his saw-mill, which had previously been mortgaged, in a way so that it was capable of being removed without material injury to the building, and the owner of the machin- ery having no actual knowledge of the mortgage, and not consenting to the annexation any further than his assent could be inferred from the nature of the property and the use for which it was designed, it was held that the lien of the mortgage on the land did not extend to the machinery.* Where the owner of a sash and blind factory purchased and placed in it a moulding-machine and a planing-machine to be used therein, which rested on the main floor of the building, one of which was bolted to the floor for greater ' Southbridge Savings Bank v. Exe- ' Powers v. Dennison, 30 Vt. 762. tor Machine Works, 127 Mass. 542; ■• Preston v. Briggs, 16 Vt. 124. Davenport v. Shauts, 43 Vt. 546. But ' Bremen v. Whitaker, 15 Ohio St. see Sowden v. Craig, 26 Iowa, 166. 446. = Thomas v. Vinton, 121 Mass. 139. « Cochran v. Flint, 57 N. H. 514. MOBTGAGES OF FUTURE PBOPEETY. 103 firmness in use, and the other of which was of sufficient weight to be steady without fastenings, and executed a mort- gage on the real estate and afterward executed a chattel mortgage upon the machines, it was held that the machines were not subject to the mortgage of the real estate, but passed under the chattel mortgage.'' Mortgages op Future Property. § 137. Where mortgagor has no present right or title. — A mortgage is an executed contract, although conditional and defeasible ; it can, therefore, only bind and affect prop- erty existing and capable of being identified at the time it was made.'' It is necessary, in order that the instrument shall be a mortgage, that the title of the property shall pass under it, and it is plain that that only can be mortgaged which the mortgagor may lawfully assign and transfer. An instrument which purports to mortgage property to which the mortgagor has no right or title, either actual or poten- tial, .but in which he expects he may acquire some title or right at a future day, is void as a mortgage, and will not take effect as a lien, though it may be valid as an executory agreement which, as between the parties, may be enforced in equity as a covenant to assign when the property is ac- quired.' 1 Blancke v. Eogera, 26 N. J. Eq. Ludwig v. Kipp, 20 Hvm, 265 ; MoCaf- 663 ; see Wells v. Maples, 15 Hun, 90. frey t. "Woodin, 65 N. Y. 460 ; Wood ^MilMman v. Neher, 20 Barb. SI; v. Lester, 29 Barb. 145; Codman v. Barnard v. Eaton, 2 Cash. 295; Cod- Freeman, 57 Mass. (3 Cush.) 306; man T. Freeman, 3 Id. 306; Jones v. Moody v. Wright, 54 Mass. (13 Met.) Richardson, 10 Mete. 481; Winslow v. 11; Griffith t. Douglass, 13 Me. 532; Merchants' Ins. Co. 4 Id. SOY ; Edgell v. Case v. Finch, 58 Wis. 56. In Georgia Hart, 9 N. Y. (5 Seld.) 213, 217; the Code (§ 1954) provides that amort- Farmers' Loan & Trust Co. v. Long gage may cover a stock of goods or Beach Imp. Co. 27 Hun, 89. other things in bulk but changing in ' Otis v. Sill, 8 Barb. 102; Griswold specifics. Chisholm v. Chittenden, 45 V. Sheldon, 4 N. Y. (4 Comst.) 581 ; 6a. 213 ; Goodrich v. Williams, 60 Ga. / Cooper V. Douglass, 44 Barb. 409 ; 426. 104 MORTGAGES OP PERSONAL PEOPEETY. § 138. When mortgagor has potential right.— But a thing may be the subject of a sale, and therefore also of a conditional sale or mortgage, if it has a potential or possi- ble existence, as the product or increase of that which is in existence, and the right to it when it shall come into exist- ence is a present vested right. Trees, grass and corn, grow- ing and standing upon the ground, fruit upon the trees, or wool upon the sheep's back, are grantable, provided they are potentially in the grantor. So growing hops and grow- ing turnips are grantable, and one may grant all the wool of his sheep for seven years, but not of the sheep which he shall thereafter purchase.^ So a mortgage of all grain growing on land, and corn and potatoes planted thereon, and hay and fruit growing, and the interest of the mortgagor on all cheese to be made on his farm, was held to be valid.^ If a person who has hired land for the purpose of raising a crop of wheat upon it, under an agreement by which he and the lessor are to share in the crop, executes a mort- gage upon his interest, this will bind his interest in the " fallow " and in the wheat afterwards put in under the agree- ment,' So growing grass or growing plants may be mort- gaged either by the owner of the soil,^ or by a person hav- ing a right to the use of the soil for the purpose of cultiva- tion.^ A mortgage of a flock of sheep with its increase for the following year creates a valid lien upon such increase.* § 139. Examples. — Where a mortgage was made of the scythes, iron, steel and coal then owned by the mortgagors, " and all scythes, iron, steel, and coal, which may be pur- chased in lieu of the aforesaid property," it was held void as 1 Per Allen, J., in Van Hoozer v. ' Smith v. Jencks, 1 Den. 580; Win- Cory, 34 Barb. 9 ; Neatell v. Hewitt, termute v. Light, 46 Barb. 21S. 19 Abb. N. C. 282. See as to agreement for a lien upon ' Conderman t. Smith, 41 Barb. emblements and wood to be cut con- 404. tained in a mortgage of the real estate, " Shuart v. Taylor, 1 How. 251. Wood v. Lester, 29 Barb. 146. * Bank of Lansingburgh v. Gary, ° Corbin v. Kincaid, 33 Kans. 649 ; 1 Barb. 542. 1 Pacif. E. 145. MOETGAGES OF FUTURE PEOPEETY. 105 to the subsequently acquired property, which was allowed to be sold under an execution against the mortgagor.^ So, a mortgage of all goods then in a certain store, or which might thereafter be purchased and put into the store, was adjudged to be void as to the property not purchased when the mortgage was made.' In Levy v. Welsh (2 Edw. 438), which was in a court of equity, the lien of a mortgage which was given upon the stock of goods which the mortgagor had in his store, or might thereafter acquire or bring into it, was, in a contest between creditors, allowed to be valid on the property in the store when the lien was created, and on such as had been purchased and paid for from the proceeds. The extension of the legal lien of the mortgage to the produce of the spe- cific goods mentioned invested in others, could hardly have been justified at law, though it seems that in equity such produce may be followed.^ In Cooper v. Douglass (44 Barb. 409) an assignment by a mariner of the earnings and proceeds of future voyages, not begun or contemplated nor in any way specified or defined in the contract, was held to be inoperative as against a sub- sequent pledge or assignment to a third person of the earn- ings and proceeds of a particular voyage. § 140. Agreement for a lien, valid in equity. — The va- lidity of a contract by which a lien may, as between the par- ties, be created on property not to be acquired,, was sus- tained after an elaborate examination of authorities in Mc- Caffrey V. Woodin (65 N. Y. 459 ; rev'g 62 Barb. 316), and this case has been followed and approved.* The conclusion reached by the court was that a clause in a lease giving the lessor a lien as security for rent on the personal property to 1 Otis V. Sill, 8 Barb. 102. 113 ; Kennedy v. National Union Bank, 2 Gardner v. McEwen, 19 N. Y. 2i? Hun, 494; Whited t. Hamilton, 16 123 ; affi'g s. c. 6 Duer, 225. Hun, 216 ; Smith v. Taber, 27 W. Dig. 3 Bucknal v. EoiBtori, Prec. in Ch. 3V9 ; Reynolds v. Ellis, 103 N. Y. 115 ; 285. Ludwig V. Kipp, 20 Hun, 265. * Wianer v. Ocumpangh, 71 N. Y. 106 MORTGAGES OF PEESONAL PROPEETY. be put on the premises, such lien to be enforced on the non- payment of the rent by taking and sale, as in the case of a chattel mortgage, was, in substance, a chattel mortgage, which, while at law it did not pass title to property not then in existence or not then acquired, gave the lessor an irrevocable license to seize such property and after such seizure the title passed ; and that in equity it transferred the beneficial interest which attached immediately upon the coming into existence of the acquisition of the property.^ § 141. Until the mortgagee has taken possession his rights in property not in existence at the date of the mort- gage are of so purely an equitable nature that they will not prevail against purchasers,^. or even as against attachments or executions of creditors ; ' and it has been said that it is only when no rule of law is infringed and the rights of third persons are not prejudiced that courts of equity will, in certain cases, give effect to mortgages of subsequently acquired property.^ ' See al80 to samp effect Holroyd v. Marshall, 10 H. of L. Cas. 191; L. T. Rep. (N. S.) 112; Leatham v. Amer, 38 L. T. Rep. (N. S;) 785 ; Lazarus v. Andrade, 43 L. T. Rep. (N. S.) 30 ; 22 Alb. L. J. 293; Mitchell v. Winslow, 2 Story, 639 ; Rowan v. Sharp Ce. 29 ConQ. 282; Walker y, Vaughan, 33 Conn. 57*7; Wheeler v. Becker, 68 Iowa, 723; Scharfenburg v. Bishop, 36 Iowa, 60 ; Brown v. Allen, 35 Iowa, 306 ; Stephens v. Pence, 56 Iowa, 257; France v. Thomas, 86 Mo. 80; Cad- well V. Gray, 41 Mich. 807 ; Leland T. CoUver, 34 Mich. 418 ; First Nat. Bank of Alexandria v. Turnbull, 32 Gratt. (Va.)695; 34 Am. R. 791 ; Robinson v. Mauldin, 11 Ala. 977 ; Floyd t. Mor- row, 26 Ala. 353 ; Burns v. Campbell, 71 Ala. 271 ; Williams v. Winsor, 12 R. 1. 9; Cook v. Corthell, 11 E. I. 482; Smithurst v. Edmonds, 14 N. J. Eg; 408 ; Williamson v. N. J. Southern E. Co. 29 S. J. Eq. 311; Davis v. Marx, 55 Miss. 376 ; Allen t. Goodnow, 71 Me. 420. ' Lamson v. Moffat, 61 Wis. 153. " Farmer's L. and T. Co. v. Long Beach Imp. Co. , 27 Hun, 89 ; Jones v. Richardson, 61 Mass. (10 Mete.) 481; Chase v. Denny, 130 Mass. 566; Blanchard v. Cooke, 144 Mass. 207, 223; Griffith v. Douglas, 73 Me. 532; 40 Am. E. 395. ^Beale v. White, 94 TJ. S. 882; Williams v. Briggs, 11 E. I. 176. Pur- chasers with notice were held bound in Leland v. Collver, 34 Mich. 418; Amer. Cigar Co. v. Foster, 36 Mich. 368; Eobson v. Mich. Cent. E. E. Co., 37 Mich. 70 ; Gadwell v. Pray, 41 Mich. 307; McGee v. Fitzer, 37 Tex. 27. ' ' MORTGAGES OF FUTURE PROPERTY. 107 § 142. After the mortgagee takes possession his right, which was, previous to such possession, a mere equity, becomes a legal lien, and he can hold as against all subsequent charges upon the property.' A claim to an equitable lien under an agreement im- posing a charge upon property to be acquired, cannot pre- vail against a judgment for the purchase -price of such after-acquired property.^ A chattel mortgage, if intended to cover after-acquired property, must express that intention, since it will not be presumed and cannot be shown by extrinsic evidence.^ The description must also be definite and certain.^ The words "stock of goods and all books of account and rights of credit arising out of said business" will not cover accounts subsequently accruing upon the sale of the goods by the mortgagor.^ § 143. Lien on substituted property. — In a few cases a lien of a mortgage has been allowed as against property substituted for the chattels described in it. For instance, a mortgage upon a gray horse has been enforced against a roan horse received in exchange for it.^ And stock pur- chased by a mortgagor in renewal of other stock sold by him has been held subject to the lien of the mortgage, there being a provision contained in the mortgage to the effect that the mortgagor would account to the mortgagee for the proceeds of all sales.' These decisions can be justi- fied, as between the parties, on the ground that it is equi- table that a mortgagee should be allowed to have a charge ' Chapman v. Weimar, 4 Ohio St. •• Williams v. Crook, 63 Miss. 9. 481 ; Blanchard v. Cooke, 144 Mass. " Lormer v. Allyn, 64 Iowa, 726. ZOT; Chase v. Denny, 130 Mass. 666; 'Marx v. Davis, 56 Miss. 746; Parker v. Jacobs, 14 S. C. 112; 37 Davis v. Marx, 65 Miss. 376. Am. B. 724 ; Cook v. Carthell, 11 R. I. ' Kerr v. Dildine, 6 N. T. St. Eeptr. 482. 163; Abbett v. Goodwin, 20 Me. 408; ^ Farmer's Loan and Trust Co. v. Deering v. Cobb, 74 Me. 332 ; 43 Am. Long Beach Imp. Co., 27 Hun, 89. R. 696. * Mont^majr v. Chase, 30 Minn. 132; Philips v%oth, 58 Iowa, 499. 108 MORTGAGES OP PERSONAL PROPERTY. upon the consideration of property whicli was sold so as to destroy his lien thereon,^ but such a charge is an equitable ^ and not a legal lien, and cannot prevail against the claims of creditors, unless possession is taken under it.' The lien of a mortgage cannot, as against hona fide pur- chasers, be extended by parol to cover property not origi- nally included in it.^ Mortgage on Growing Crop. § 144. A growing crop-may be mortgaged by the per- son having the right to the use of the soil and to gather the crop when ripe, whether he has such right as the own- er of the soil or as a lessee, and the validity of such mort- gage will be determined, as between the mortgagee and the creditors or subsequent grantees of the crop from the mort- gagor, by the rules controlling mortgages of personal prop- erty.' § 145. Removal of crop by mortgagee. — The execution of a mortgage on crops or other emblements is an election to treat them as personalty, and involves a license to the mort- gagee, upon default, to enter upon the land and take them away, with as little injury to the mortgagor as possible.* It may be questioned as to whether this right of removal would survive the existence of a lease under which the mortgagor 1 See note, \1 Alb. L. J. 359, and 46 Barb. 278; Cotton v. WUIoughby, cases cited. 83 N.C. 75; 35 Am. E. 664 ; Robinson •' Simmons T. Jenkins, 76 111. 479; v. Ezzell, 72 N. C. 231; State v. WU- Bell T. Shrieve, 14 111. 462. liams, 32 Minn. 637; Kimball v. Satt- 8 Jones T. Richardson, 10 Met. (61 ley, 65 Vt. 285; 46 Am. R. 614; Yates Mass.) 481, 487; Chapin v. Cram, 40 v. Kinney, 19 Neb. 276; Beard t. Me. 669; Dutcher v. Swartwood, 15 ■ State, 43 Ark. 284; Quiriague v. Den- Hun, 31 ; Powers v. Freeman, 2 Lans. nis, 24 Cal. 154. 127; Simmons V. Jenkins, 76 111. 479. * Dnffus v. Bangs, 43 Hun, 62; * Powers v. Freeman, 2 Lans 127. King v. Wiloomb, 7 Barb. 263; Winter- ^ Bank of Lansingburgh v. Crary, mute v. Light, 46 Barb. 278; Bank of 1 Barb. 542; Smith v. Jencks, 1 Den. Lansingburgh v. Crary, 1 Barb. 548; 580; 1 N.Y. 90; Wintermute v. Light, Jencks v. Smith, 1 N. Y. 90. MORTGAGE ON GEOWING CEOP. 109 had possession at the time of the executing of the mortgage, but if the mortgagor is removed by summary proceedings, to which the mortgagee is not a party, before the expiration of the lease, the judgment and warrant in the summary proceeding do not destroy the rights of the mortgagee, and he has a reasonable time after the removal of the tenant to enter and take away the mortgaged property.^ § 146. A mortgage of growing timber, made by a pur- chaser of it, is a mortgage of personal property to take ef- fect when it is severed from the realty.^ § 147. The owner of a farm who leases it under an oral agreement by which the lessee is to "carry on the farm at the halves," and who does not occupy the land during the term, has no such interest in the crop as will authorize him to mortgage it.' But the tenant's interest may be mortgaged/ § 148. Lien on crop after it is harvested. — The lien of a mortgage on a growing crop continues after it is har- vested,^ and if the mortgagor thereafter makes a sale of it he may be held as for a conversion.* Such lien is not lost by a tortious removal by a third person.' Where ten acres of growing wheat was mortgaged, and the mortgage was duly recorded, and afterwards the mort- gagor, without the knowledge of the mortgagee, harvested, threshed, removed and sold the wheat, and the purchaser converted it to his own use by mixing it with other wheat, it was held that the title to the wheat was vested in the ' DuflFas V. Bangs, 43 Hud, 52 ; " Parks t. Webb, 48 Art. 29S. Moore v. Wood, 12 Abb. 393; Ombony * Smith v. Jencks, 1 DeB. 580; 1 N. T. Jones, 19 N. T. 234; London, Smith V. Taber, 46 Hun, 313. 'Eev'g s. o. 62 Barb. 316. LIENS BESERYED IN LEASES. 115 it did, it was inoperative upon any property which at the time of its execution was not, actually or potentially, owned by the plaintiff. This objection was not considered by the majority of the court, it being held unnecessary to do so.^ The following language was used by Gray, C: " If a party borrow of another a sum of money, and in consideration thereof to secure its payment, should covenant with the lend- er that in the event of his failure to pay at stipulated time, it should be lawful for the lender to enter upon the premises of the borrower and enforce the payment of the money bor- rowed by taking and selling his personal property thereon, in the manner of conducting sales under a chattel mort- gage, such a covenant as between the parties to it, would not be in contravention if any statute or rule of public policy. The right, in. default of the payment of the rent, to re-enter upon the demised premises and enforce its payment by seiz- ing and selling his personal property thereon was more than a mere revocable license. It was an agreement under which, in consideration of this covenant, he was permitted to enter upon and enjoy the benefits of her property, and as irrevo- cable as her covenant authorizing him to enter, or his cov- enant to pay the rent." * § 157. Similar agreements. — In Wisner v. Ocumpaugh (71 N. T. 113) a similar agreement was enforced against a spec- ial partner of the lessees, who was thereafter interested in the business carried on in the premises as assignee of the lessees under the lease. The court held that the plaintiff stood in no better position than the lessees. Where the plaintiff leased a lot to the defendant for ten years at a monthly rent, payable monthly, it being stipula- ted that the tenant, at the end of the term, was to have two- ' Agreement for a lien on future " See also Whited v. Hamilton, 16 crops held a chattel mortgage and not Hun, 275; Smith v. Taber, 21 W. Dig. a mere executory agreement for an equi- 379; Metcalf f. Fosdick, 23 Ohio St. table lien. Nestell v. Hewitt, 19 Abb. 114; Hamilton v. Langley, 52 Mich. N. C. 282. See also Merrill v. Eess- 549. ler, 33 Northwestern Kep. 117. 116 MOETGAGES OP PERSONAL PROPERTY. thirds of the appraised value of a house to be by him erected, and the lease also contained the following clause : " And it is further agreed that the brick house now being built shall always be and remain, as the same is hereby de- clared to be mortgaged as security for the payment of the monthly rent herein stipulated "; it was held that this was a mortgage and that it might be foreclosed on the non-pay- ment of the first or any month's rent.^ A clause in a lease reserving a lien on the " crops grown annually on the land as security for the rent " was held valid.'' A lease executed by a lessor and lessee reserving a lien to the lessor on the crop to be produced on the land is a chattel mortgage, as also is a written agreement, properly executed, stipulating that the amount due for rent shall be paid before the removal of the crop.^ § 158. As against third persons. — "Whether a provision in a lease, giving a lien, is construed to be a chattel mortgage or an agreement creating an equitable charge, it must be judged in testing its validity as against third persons, by the same rules which control mortgages of personal property.* If no possession is taken it must be filed as a mortgage so as to give notice of the claim of lien,' and, even if filed it must stand the other tests of validity prescribed for mort- gages.' Filing of the lease is constructive notice of the lien to purchasers from the lessee.' § 159. Privilege to tenant to sell may invalidate lien.— In Reynolds v. BUis (103 N. Y. 115 ; affi'g 34 Hun, 47) a clause had been inserted in a lease of a building intended to ' Barroilhet V. Baltelle, 1 Cal. 450. 119; Thomas v. Bacon, 34 Hun, 88; ' Everman v. Eobb, 52 Miss. 653 ; Stowart v. Beale, 1 Hnn, 405 ; affi'd, 68 24 Am. E. 682. N. Y. 629 ; Bnskirk t. Cleveland, 41 ' Mitchell V. Badgett, 3S Ark. 387. Barb. 610; Dnfifus v. Bangs, 43 Hun, * Reynolds v. Ellis, 103 N. T. 116 ; 52 ; Smith v. Taber, 27 W. Dig. 379. affi'g 34 Hun, 47. ' Reynolds T. Ellis, svpra. 5 Retsinger v. Schuyler, 46 Hun, ■" Smith v. Taber, 46 Hun, 313. 349 ; Steffin v. Steffin, 4 Civ. Proc. R, LIENS BESEBVED IN LEASES. 117 be used for purposes of trade, in the following form: "And it is further agreed that the lessor shall have a lien as secu- rity for all the rent and interest, gas-bills and water-rates aforesaid, or for any damage to building due from lessee, upon all goods, wares, chattels, implements, fixtures, tools, and all other personal property, which are or may be put on the demised premises, belonging to the lessee, or to any one holding or claiming the demised premises, or any part there- of under him as assignee, under-tenant or otherwise'; and such lien may be enforced: on the non-payment of any of said rent, interest, water-rent or gas bills by the taking of such property and the sale thereof in the same manner as in case of a chattel mortgage on default thereof ; such sale to be made upon six days notice posted upon the de- mised premises, or served upon said lessee. Such lien, how- ever, shall not be enforced against any property, which, be- ing a part of stock in trade, shall have been sold in the regu- lar course of trade." This lease was not filed as a chattel mortgage and no possession of the chattels was taken by the lessor. The lessee made a general assignment for the bene- fit of creditors and the action was brought for the purpose of subjecting the proceeds of the chattels to the payment of rent. The court held that it was not material to inquire as to whether the paper should be characterized as a chat- tel mortgage or as an agreement creating an equitable lien. In either character it was void as against creditors, both at common law and under the statute. " While its object may have been to give one creditor priority over another cred- itor, it also involves a secret trust in favor of the owner of the goods, and forms the very cover for fraud which the statute condemns, by declaring that every assignment of goods and chattels by way of mortgage or security, or upon any condition whatever, unaccompanied by delivery and fol- lowed by an actual and continued change of possession, shall be presumed to be fraudulent, as against the creditors of the vendor." ^ The lessee was a retail merchant and the 1 2 R. S. 136, § 6. 118 MORTGAGES OF PERSONAL PEOPEETY. permission reserved to him to sell the goods in the regular course of business, with no restraint as to the disposition of the proceeds, while valid between the parties, rendered the paper void upon its face as against creditors.^ ' Edgell T. Hart, 9 N. T. 21 3 ; Gardner v. McEwen, 19 Id. 123. CHAPTEE VI. ASSIGNMENTS OP CHATTEL MORTGAGES AND TRANSFERS OF THE MORTGAGED PROPERTY. Assignments op Chattel Mortgages. § i6o. Chattel mortgages may be assigned, and the principles which gOYern the rights of the parties under an assignment are, in general, those which apply to assign- ments of mortgages of real estate.'' § i6i. Assignment of debt. — Like a mortgage of real estate, a chattel mortgage is collateral to the debt which it is made to secure; an assignment of the debt carries the mortgage,^ and an assignment of the mortgage without the debt is a nullity.' But the mortgage is incident to the debt, and not to the mere evidence of the debt; and the re- tention of the note or bond which is the evidence of the debt, by the assignor, does not conclusively establish that he did not intend to transfer with the mortgage the debt recited in it.* The presumption is in the opposite direction, for when a thing is granted everything possessed by the grant- or passes, as incident, which is necessary to make the grant effectual.' § 162. After default has occurred in the condition of a chattel mortgage, the mortgagee is the legal owner, and can 1 See Thomas on Mortgages (2d ^ Hamilton v. Browning, 94 Ind. ed.), § 298, «< scg. 242; Hubbard v. Harrison, 38 Ind. ' Laugdon v. Buel, 9 Wend. 80 ; 323. Gould V. Marsh, 1 Hun, 566; Russell < Hill v. Beebe, 13 N. Y. (3 Kern.) V. Walker, 73 Ala. 315; Graham v. 656. Newman, 21 Ala. 497. ' Campbell v. Birch, 60 N. Y. 214. 120 MOBTGAGES OF PEESONAL PBOPEETY. make a valid transfer of the property itself. If, therefore, he should, after that time, assign the mortgage, retaining the debt, his assignee would still acquire his rights in the mortgaged property.^ Especially would this be the case if the assignment were made at the request of the mortgagor, to secure a new debt.^ § 163. When assignment is subject to equities.— An as- signee of a chattel mortgage, like an assignee of almost any other kind of chose in action, takes subject to all the equi- ties existing at the time of the assignment, in favor of the debtor against the assignor, and any demand which the debtor might, at any time, have applied or set o£f against the assignor, he may apply or set off against the assignee.* Negotiable instruments, by an exception to the general rule, made to facilitate dealings between merchants, are valid in the hands of a purchaser for value and before maturity, as against almost any defense. An assignment or transfer of a promissory note, secured by a mortgage, transfers both, and the bona fide purchaser of the note takes the mortgage free from all equities.* Eemedies against Moetgagob fob Assuming to Sell Feeb EBOM MOETGAGE LlEN. § 164. Title of purchaser. — In sales of personal prop- erty ,a warranty of title is always implied, though the rule is different as to real estate.^ When a mortgagor in posses- sion of chattels sells them to an innocent purchaser he is bound to assure to him the title. If the mortgage has been regularly and properly filed, and is in other respects valid, the mortgagee may pursue the property in the hands of the purchaser, who will be compelled to look to his vendor; 1 Campbell v. Bireh, 60 N. Y. 214. 4 N. Y. Sup. (T. A C.) 128 ; Carpenter 'Campbell v. Birch, 1 Lans. 178; v. Longan, 16 Wall. 271; Contra, Oater 8. 0. affi'd, 60 N. Y. 214. t. Mickley, 35 Minn. 245. ' Hartley v. Tatham, 1 Keyes, 222. = Chapin v. Shafer, 49 N. Y. 407, * Gould v. Marsh, 1 Hun, B66; s. 0. 413. BEMEDIES AGAINST MORTGAGOR. 121 but whether it has been properly filed or not, the mort- gagee may proceed against the mortgagor for a fraudulent concealment of the lien and a conversion of the property.^ § 165. Conversion. — If any person shall have acquired the rights of the mortgagor, as by a sale subject to the mortgage, a sale by any such person absolutely would render him liable to the mortgagee as for a conversion. In such a case the act of the assignee would be the same as if it had been the act of the party himself, and an absolute sale by him would be an explicit repudiation of the stipulation under which he held possession, instead of an exercise of the rights given to him by it.^ An auctioneer who sold the mortgaged chattels and re- mitted the proceeds to the mortgagor, was held liable to the mortgagee for their value, though he had no actual knowledge of the mortgage, and was guiltless of any willful fraud.* But a teamster who innocently removes the prop- erty from one place to another is not liable for conversion, though the mortgage contains a clause prohibiting such re- moval.* A mortgagor of personal property who again mortgages the property, without giving notice of the existing mort- gage, and afterwards gives the second mortgagee posses- sion, or permits him to take possession, is guilty of con- version, and is liable to the first mortgagee in trover.' § 166. Sale of interest of mortgagor. — The rule is dif- ferent where the sale is the act of the law or of one of its olficers. An assignment in bankruptcy or for the benefit of creditors only passes the interest of the mortgagor, and this is the effect of a sale by a sheriff under an execution. Such a sale, therefore, does not amount to a conversion of ' Rust V. Morse, 2 Hill, 665. * Metcalf v. McLougUin, 122 Mass. 2 Fenn v. Bittleson, 2 AVels. Hurl. & 84. Gor. 162; b. 0. 8 Eng. L. & Eq. 485. ^ Millar v. Allen, 10 R. I. 49; Ash- 3 Coles V. Clark, 67 Mass. (3 Cash.) mead v. Kellogg, 23 Conn. YO. 399. 122 MOBTGAGES OF PERSONAL PROPERTY. the property ; it is an act under the agreement by which the mortgagor is assured a right of possession, and, as such, is lawful.^ But an assignee for the benefit of creditors who assumes to sell free from the mortgage, is liable to the mortgagee to the extent of the value of his lien.^ § 167. Misdemeanor to sell or secrete property. — A mortgagor who, having theretofore executed a mortgage of personal property, or any instrument intended to operate as such, sells, assigns, exchanges, secretes, or otherwise dis- poses of any part of the property upon which the mortgage or other instrument is at the time a lien, with intent there- by to defraud the mortgagee, or a purchaser thereof, is guilty of a misdemeanor.* The consent of the mortgagee to a sale by the mort- gagor is a defense to a prosecution for a misdemeanor under this statute, unless the permission is given to sell for the benefit of the mortgagee, and the sale is made by the mortgagor with intent to convert the proceeds to his own use.* § 168. Sale with consent of mortgagee. — Knowledge by the holder of a mortgage of real estate that the mort- gagor is selling the mortgaged premises, or even his con- sent thereto, will not discharge the land from the lien, be- cause the mortgagee will not be presumed to intend to con- tradict the notice of his claims as shown by the public records.^ But it cannot be assumed that the same rule would apply to mortgages of chattels. The mortgagee of chattels is, at law, the owner of them, and if he should as- ' Goulet v. Asseler, 22 N. Y. 225 ; » Penal Code, § 511 ■ Laws 1S1\, c. Hull V. Carnley, 11 N. T. (1 Kern.) 77. See People, ex rel. Stokes v. Ria- 601 ; s. 0. 17 K T. 202 ; Manning v. ley, 38 Hun, 280. Monaghan, 23 Id. 639 ; s. 0. 28 Id. 685; •> MlUchamp v. People, 14 W. Dig. Porter v. Parmley, 52 Id. 185; Van 252. Antwerp v. Newman, 2 Cow. 643. ' Kice v. Dewey, 54 Barb. 466. « Barker v. Buel, 59 Mass. (6 Gush.) 619. BEMEDIES AGAINST MORTGAGOR. 123 sent to an absolute sale to a third person, he would be treated as having authorized the mortgagor to make the sale as his agent. If both mortgagor and mortgagee unite in inducing an innocent person to purchase, concealing from him the existence of the mortgage, it is not believed that they could use the filing as a means for perpetrating a fraud. In transactions concerning real estate the records are commonly resorted to for information concerning the title, and the primary object of the records is to furnish such information. In dealing with personal property, on the contrary, possession is the evidence of ownership most usually relied on ; and, while the statute allows a mort- gagee to rebut the presumption of fraud arising from a want of possession in him, on condition that the mortgage be filed, the filing is not such a notice to the world as would excuse the mortgagee from omitting to mention his claims to a person intending to purchase the property. § 169. Knowledge of purchaser. — Even the fact that the purchaser had knowledge of the mortgage will not al- ways protect a mortgagee who has been a party to the sale. In JRickerson v. Boeder ^ the purchaser of mortgaged chattels paid to the mortgagee a portion of the price, under an agreement that the latter should release his claims; the mortgagee, in effect, consented to this, agreeing to look to the debtor personally for the balance, and it was held that the purchaser took the property discharged from the mort- gage. § 170. Parol consent of mortgagee. — The consent of the mortgagee to a sale by the mortgagor may be by parol,^ even though the mortgage, by its terms, prohibits a sale without the written consent of the mortgagee ; ' and an ac- ' 1 Keyee, 492; 4 Abb. App. Dec. Whifcoomb, 90 Mass. (8 Allen), 518; 60. Patrick v. Meserve, 18 N. H. 300; 'Roberts v. Crawford, 54 N. H. Gage t. Whittier, 17 N. H. 312. 532; Carter v. Fately, 61 Ind. 42'7; 'Shearer v. Babson, 8.3 Mass. (1 Perry v, Dow, 56 Vt. 569; Pratt v. Allen), 486. Maynard, 116 Mass. 388; Stafford v. 124 MORTGAGES OF PERSONAL PEOPEETY. ceptance of the proceeds of the sale, or even a portion of them, -will estop the mortgagee from thereafter seeking to enforce his lien.^ The consent of the mortgagee to the sale by the mort- gagor can be implied from a course of dealing by which the mortgagee stands by and allows the mortgagor to treat the property as his own, and to traffic with it.^ Eights op Successive Mortgagees of the same Peopeety as against each othee. § 171. Nature of title of second mortgagee. — A second mortgage of chattels must be judged by the same rules which control in the case of a first mortgage, as against every one but the prior mortgagee,^ but in considering the relations between the holders of successive mortgages upon the same personal property, various interesting questions will arise. The only legal rights which remain in a mortgagor of chattels after the execution of the mortgage, are the right of possession, if that has been reserved by him, and the right to defeat the title of the mortgagee by the perform- ance of the condition.* After default in the performance of the condition, he has neither the right of possession nor legal title ; he has in fact only a right of action in equity to compel the mortgagee to allow him to redeem. Both the legal rights which exist before default, and the equita- ble claim which remains afterwards, may be sold or mort- gaged, but the purchaser or mortgagee will take only the rights which the mortgagor had to transfer, and subject to the title of the prior mortgagee. If the subsequent mort- gage be made while the mortgagor's right of possession remained, the junior mortgagee would acquire that right. ' Field T. Doyon, 64 "Wis. 560. * Mattison v. Baucus, 1 N. Y. (1 ^ Thompson v. Blanchard, 4 IS. Y. Comst.) 295 ; Butler v. Miller, Id. 496, (4 Comst.) SOS. 500 ; Lyon v. Coburn, 1 Cush. 278. 2 Smith T. Smith, 11 Shepl. 555. BIGHTS OP SUCCESSIVE MORTGAGEES. 125 but if it be made after tbe mortgagor's right of posses- sion had ceased, he would only gain a right to equitable relief upon bringing an action, since the prior mortgagee would, after that time, have a perfect legal right to take the property into his possession and sell and dispose of it as his own.^ A second mortgage of chattels made after default has occurred upon the first, does not pass any legal title, and if made before default, all of the legal rights which it does confer are subject to be destroyed by a breach of the condition. § 172. Examples.— In Rugg v. Barnes (2 Gush. .591) a portion of the mortgaged property was taken possession of by the first mortgagee, after default, and the remainder was sold by the sheriff on an execution against the mort- gagor ; the second mortgagee made a demand on the sheriff before the sale, and after the sale had been made he sued ihe sheriff for a conversion. It was held that when the plaintiff made his demand and at the commencement of the action, he had a mere right of redeeming the first mort- gage and not the right of possession, and that the action would not lie. In Hale v. Omaha National Batik (7 J. & S. 207; s. c. ^ffi'd, 64 N. Y. 550) the defendant held a chattel mortgage subject to an equitable lien belonging to the plaintiff, which equitable lien arose out of a clause contained in a lease. The mortgagee sold the property and the senior equitable incumbrancer brought an action, but it was held that he could not recover. The decision, both by the Superior Court and the Court of Appeals, was put upon the ground generally that a sale by the second mortgagee, without notice being taken of a prior mortgage, would not amount to a trespass, since the rights of the prior lienor could re- ceive no legal injury. The court below regarded such a sale as being similar in principle to a sale of mortgaged property under an execution, where this would be the ' Hulsen v. Walter, 34 How. 388; Porter v. -Parmly, 43 How. 445, 453; Campbell v. Birch, 60 N. Y. 214. 126 MORTGAGES OP PERSONAL PROPERTY. rule.' If the analogy be carried out, it would result in holding that if the condition in the prior mortgage shall have been forfeited at the time of the sale by the second mortgagee, the parties promoting such a sale would be liable as trespassers or for a conversion, for the law is well settled that this is the case where a sale under an execution against the mortgagor is made after default.^ In LempJce v. Peterson (reported in New York Daily. Eeg- ister, February 17, 1876 ; affi'd, 1 City Ct. E. 15) the fol- lowing opinion was rendered by McAdam, J. : " The chattel mortgage to the plaintiff was properly filed, and the plaint- iff's title to the mortgaged property became absolute upon the mortgagor's default in payment. After the plaintiff's title under his mortgage became absolute, the mortgagor executed a second mortgage upon the same property to the defendant, who directed its foreclosure. As to the plaintiff, the sale under the forolosure ipso facto consti- tuted a conversion of the mortgaged property, and fur- nished him with a good right of action.' The defendant's admission upon the trial put the value of the mortgaged property at $582, the amount of the plaintiff's mortgage debt, and the plaintiff is entitled to judgment for this amount^ with interest." § 173. After default in the payment of the mortgage debt, the legal title to the mortgaged property passes im- mediately to the mortgagee and, for this reason, the mort- gagor cannot thereafter charge the property by a second mortgage.* Under such circumstances, the subsequent mortgagee would take no interest in the property, and ' Hathaway v. Brayman, 42 N. T. ^ Citing Hulaen v. Walter, 34 How. 322; Hull V. Carnley, IMd. 202; Gou- 386; Bristol v. Burt, 1 Johns. 264; let V. Asseler, 22 Id. 225 ; Fairbanks Murray v. Burling, 10 Id. 112 ; Rey- V. Phelps, 22 Pick, 535. nolds v. Shuler, 5 Cow. 323 ; Connah 2 Shuart v. Taylor, 1 How. 251, v. Hale, 23 Wend. 462; Farrar v. 264 ; Mattison v. Baucus, INT. (1 Chauffetete, 5 Den. 527. Comst.) 296 ; Butler v. Miller, Id. 496 ; < Hulsen v. Walter, 34 How. 385. Lyon V. Cobum, 1 Cush. 2*78 ; Coles v. Clark, 3 Id. 399. EIGHTS OF SUCCESSIYE MOBTGAGEES. 127 would only acquire tlie right to an equitable remedy by bill to redeem.^ A foreclosure sale by a second mortgagee, after default upon the first mortgage, operates as a conversion in re- spect to the first mortgagee.' But a consent of the first mortgagee to the sale makes it lawful, and the junior mort- gagee would, in that case, be liable only for money had and received, to the extent of the prior lien.^ § 174. A mortgagor who mortgages to another with- out notice of the existing mortgage is liable for conversion at the suit of the first mortgagee, though the first mort- gage, by reason of a lack of filing, may be without force as against the property.* A doubt has been suggested as to whether a second mortgagee could be defeated in his action for conversion against a sheriff who levies upon the property before the title and right of possession of the first mortgagee becomes absolute, and in such case the defendant would be per- mitted to mitigate the damages to the extent of the amount secured by the prior mortgage.' § 175. Injunction. — A junior mortgagee cannot have an injunction to restrain a sale under the prior mortgage upon the ground that the prior mortgage does not cover all the chattels mortgaged in the second mortgage, for the reason that he has an adequate legal remedy in his right to pursue the chattels, by virtue of his mortgage, in whose hands soever they may pass by the sale.* § 176. Junior mortgagee. — The mortgagee may main- tain an action for conversion against a mortgagor, or a vendee of the mortgagor with notice, who refuses to sur- 1 Charter v. Stevens, 3 Denio, 33. ' Anderson y. Case, 28 Wis. 605. '^ Lempke v. Peterson, 1 City Ct. R. ^ Millar v. Allen, 10 R. I. 49. 15 ; Hulaen v. Walter, 34 How. 385 ; " Treat t. Gilman, 49 Me. 34. Wheeler v. McFarland, 10 Wend. 318; « Rankin t. Rankin, 67 Iowa, 322. Anderson v. Case, 28 Wis. 505 ; New- man V. Tymeson, 66 Wis. 31. 128 MORTGAGES OF PEESONAL PEOPERTY. render the mortgaged property to him after his right to possession becomes established.' This rule applies to the iirst mortgagee alone, since the legal title and right to pos- session is in him, and a junior mortgagee not in possession of the property, cannot maintain an action in the nature of trover for its conversion.^ Peioeity op Chattel Mortgages, Independent op Ee- ooRDiNG Acts. § 177. Where two liens are claimed on the same chat- tel under agreements made with the o-wner, the order of time in which the agreements were made will in general, and independent of the recording acts, determine their priority. If a chattel be first pledged and then mort- gaged, the pledgee can resist the mortgagee's demand for possession, both before and after default, until his own claims are satisfied ; ' and, on the same principle, a pledgee of a chattel which has previously been mortgaged, will hold subject to the rights of the mortgagee.* So, also, as between two mortgages, neither of which has been filed, the second mortgagee, having notice of the prior incumbrance, will take subject to it.' Where two mortgages are given to different persons, at the same time and on the same property, with a mutual understanding that one is to be considered the prior, the agreement is binding, notwithstanding the second mort- gagee first files his mortgage." And the assignee of the 1 Brown v. Cook, S E. D. Smith, * Bissell t. Pearce, 28 N. Y. 252. 123 ; Fletcher v. Neudeck, 30 Minn. ' Tiffany v. Warren, Z1 Barb. 571 ; 126 ; Jorgensen v. Tait, 26 Minn. s. 0. 24 How. 293. 327. ' Freeman v. Schroeder, 48 Barb. 'King T. Neale, 114 Mass. Ill; 618; Wray v. Fedderke, 43 N. T. Clapp v. Campbell, 124 Mass. 50; Supr. Ct.(llJ. A S.) 33S ; Wheeler v. Goodrich v. Willard, 2 Gray (Mass.), McFarland, 10 Wend. 318; Corbin v. 203 ; Clapp v. Glidden, 39 Me. 448. Kincaid, 33 Kans. 649 ; Chadbourno v. 3 Tiffany v. Warren, 37 Barb. 571 ; Rahilly, 28 Minn. 394. s. 0. 24 How. 293. PRIORITY OF CHATTEL MORTGAGES. 129 junior mortgage without notice of the agreement, and rely- ing on the apparent priority acquired by filing, is still postponed to the prior lien.^ § 178. If one gives a mortgage of chattels belonging to another, the oral consent to a ratification of such mort- gage by the owner, cannot a£fect the rights of one taking a mortgage of the same chattels from the owner without no- tice of such ratification.'' § 179. Exempt property. — When the mortgagor re- serves "his personal property exemption allowed by law, and to be selected by him," the title to the whole passes to the mortgagee until such selection, and the giving of a sec- ond mortgage on a part of the property is not such a selec- tion as to let in the second mortgagee to priority on that part.' Priority of Chattel Mortgages as Against Liens for Valuable Services Eendered to the Property. § 180. Repairs. — In a case where a lien is acquired for valuable services rendered in repairing the chattel, where the repairs are necessary for the preservation of the property, and the law gives the lien, the mechanic may lawfully retain possession and enforce his lien by action, if the charges for repairs are not paid, even against a mortgagee claiming under a prior mortgage. So where a mortgagor of a vessel is permitted to have the uncontrolled use and possession of her, he has the power to confer a lien on her for repairs nec- essary to keep her seaworthy and to preserve her as a secu- rity for the mortgagee's debt, and the lien thus acquired will be superior to the lien of the mortgage.* 'Decker v. Boice, 83 If. T. 215; < Scott v. Delahunt, 5 Lans. 372; Hoagland v. Shampanore, SI N. J. Eq. affi'd, 65 N. Y. 128; Williams r. AUaup, 585. 10 Com. BeDch, N. S.417; 100 E. C.L. ^ Maier v. Davis, 51 Wis. 212. 416 ; /« re The Yonng Mechanic, Ware ' Norman v. Craft, 90 N. C. 211. (2 ed.), 535; 2 Curtis C. C. 404; Beale 130 MORTGAGES OF PEBSONAL PEOPEBTY. § i8i. Inn-keepers and stablers. — An inn-keeper has a lien upon a horse committed to his keeping by a guest, for the price of his provender and stabling, even though the horse be stolen and the thief brings it to him.'' So a sta- bler has a lien upon a mare sent to his stable to be covered by a stallion.' In these cases the law, for special reasons and for the benefit of the property, gives a lien which will prevail against the owner, and which will therefore be para- mount to a prior mortgage. But neither stablers who are not inn-keepers,^ nor agist- ers of cattle,* have any liens independent of agreement, and if such a lien be granted by the owner the claim will be under the contract, and therefore subordinate to any valid lien previously made.' In Bissell v. Pearce (28 N. T. 252) a mortgage was made of four horses, and the mortgagor had hired them to be kept through the winter at a certain price by the defendant. The mortgagor had taken three of the horses and left the other in pledge until the keeping of all the horses was paid for. The defendant refused to de- liver this horse to the mortgagee until his charges were paid, and it was held that this refusal amounted to an unlaw- ful conversion. Mabvin, J., in giving the opinion of the court, notices that "the defendant was a farmer, and the law, in the absence of any special agreement, gave him no lien upon the horses for the price or value of keeping them," and the decision is placed upon the ground that the mortgagor had no right to pledge the property or create a lien upon it to the prejudice of the mortgagee's rights.' T. White, 94 U. S. 382; Hammond v. 270; 1 Horn. & Hurl. 292. And one Danielson, 126 Mass. 294; Globe Works who keeps and trains a horse at the V. "Wright, 106 Mass. 207; White v. owner's request has a common law lien. Smith, 16 Vroom (N. J.), 105; see Den- Towle v. Raymond, 58 N. H. 64. nison v. Schuler, 47 Mich. 598; 41 Am. ' Fox t. McGregor, 11 Barb. 41, R. 734. " Goodrich v. Willard, 7 Gray, 183 ; ' 2 Pars, on Cont. (5th cd.) 156; Cummings v. Harris, 3 Vt. 245. Jones T. Thurloe, 8 Mod. 172 ; Snead v. ' Jackson v. Kasseal], 30 Hun, 231. Watkins, 1 Com. Bench, N. S. 267. « See Scott t. Delahunt, 66 N. Y. ' Scarfe v. Morgan, 4 Mees. 2 R. S. isl, § 1. ' 2 R. S. m, % 4. CONTINUED POSSESSION BY MOETGAGOR. 157 all conveyances of sucli property made by a debtor for the purpose of defrauding his creditors, or preventing the ap- plication of his property to the payment of his debts were void as against such creditors. They were considered as no conveyances as against them, but mere tricks or con- trivances to keep the property out of their reach. But as those who alleged the fraudulent purpose of a conveyance were bound to prove it, and as direct proof could seldom be obtained, the party seeking to establish the fraudulent design or purpose was obliged to resort to circumstantial evidence, or the proof of facts and circumstances indicating that the conveyance was not real, but a mere sham made to defeat creditors. Among the strongest and most promi- nent of these facts and circumstances was the continued possession and use of the property by the vendor after the pretended conveyance ; not that such possession was fraud- ulent in itself, but it was a sign or indication that he still owned the property which he had pretended to convey. This fact when proved, and all other circumstances tending to the same conclusion, were but items of evidence to be explained by other evidence, and all submitted to the jury. In this conflict and confusion of circumstances the truth was sometimes lost, and conveyances made to defraud cred- itors were suffered to escape with impunity. To facilitate the detection of the fraudulent purpose with which such conveyances were made, several statutes were passed, both in England and this State.^ •Per Mullett, J., in Griswold v. itiye statute : California, Connecticut, Sheldon, 4 N. J. (4 Comst.) 581, 695. Delaware, Florida, Illinois, Iowa, Ken- It was formerly the English doctrine tucky, Neyada, Oregon, Pennsylvania, that an absolute transfer of chattels, Vermont. The modern English view not accompanied by delivery and actual is similar to that of New York as stated change of possession was absolutely in the text, and treats an omission of and conclusively fraudulent against the immediate delivery and continued pos- creditors of the, vendor. (Twyne's session by the vendor as evidence of Case, 3 Rep. 806 ; Smith's Leading fraud, capable of being explained. Cases, and note.) This rule is still in (Martindale v. Booth, 3 B. & Ad. 498, force in the following States, either by 505.) A majority of the American reason of judicial construction, or pos- courts hold the same rule, and it is be- 158 MORTGAGES OF PERSONAL PROPERTY. § 229. The Revised Statutes enact that every sale made by a vendor of goods and chattels in his possession •or under his control, and every assignment of goods and ■chattels by way of mortgage or security, or upon any con- dition whatever, unless the same be accompanied by an immediate delivery, and be followed by an actual and con- tinued change of possession of the thing sold, mortgaged, or assigned, shall be presumed to be fraudulent and void as against the creditors of the vendor, or the creditors of the person making siich assignment, or subsequent pur- chasers in good faith ; and shall be conclusive evidence of fraud, unless it shall be made to appear, on the part of the persons claiming under such sale or assignment, that the same was made in good faith, and without any intent to defraud such creditors or purchasers. The term "cred- itors," as used in the statute, is to be construed to include all persons who shall be creditors of the vendor or as- signor at any time while such goods and chattels shall remain in his possession or under his control. Nothing contained in the statute is to be construed to apply to contracts of bottomry or respondentia, nor to assignments or hypothecations of vessels or goods at sea or in foreign ports.^ § 230. Before the Revised Statutes a distinction was made between an absolute sale and a mortgage of goods. In the case of an absolute transfer, the want of an actual and continued change of possession was considered a badge of fraud, since it was inconsistent with the pretended nature of the transaction ; but in the case of a mortgage, the fact that the possession of the vendor was consistent ■with the face of the deed was sometimes held to take lieved to be adopted in the following Rhode Island, Tennessee, Texas, Vir- States: Alabama, Arkansas, Georgia, ginia, Wisconsin. See May on Fraud. Indiana, Kansas, Louisiana, Maine, Conv.; Bump on Fraud. Conv. ; Note, Maryland, Massachusetts, Michigan, Twyne's Case, in Smith's Leading Minnesota, Mississippi, Missouri, Ne- Cases. brasta, Nevr Hampshire, New Jersey, ' 2 R. S. 136, §§ 5, 6, 7. Kew York, North Carolina, Ohio, CONTINUED POSSESSION BY MORTGAGOR. 159 the case out of the rule.^ But this distinction no longer exists.^ § 231. The whole effect of the statute is to change the burden of proof, and to throw it on the party claiming to sustain the suspected sale or assignment, by making the fact of unchanged possession, which before was a mere sign of fraud, strong presumptive evidence of the alleged fraud, to be rebutted only by proof that the sale or assign- ment was made in good faith and without any intention to defraud creditors or purchasers.* If any evidence of good faith be given, the question of fraudulent intent be- comes one of fact, and it must thereafter rest with the jury to determine whether the presumption created by the con- tinued possession of the person executing the transfer has been met and overcome.* It is not incumbent for the mortgagee to prove any- thing more than that the mortgage was given in good faith for a valuable consideration, and it is not required that he shall also show a valid excuse for leaving the property in the possession of the mortgagor.' 1 See Barrow v. Paxton, 5 Johns. 439 ; Pyle v. Warren, 2 Neb. 252 ; 258; Biasell v. Hopkins, 3 Cow. 166; Marsh v. Hurley, 13 Neb. 261; Bannon Marsh V. Lawrence, i Id. 461; Fer- t. Bowler, 34 Minn. 416; Mayer v. guson V. Union Furnace Co., 9 Wend. Clark, 40 Ala. 259; Crawford v. Kirk- 345. ■,„ sey, 55 Ala. 282; Goodwyn v. Good- 2 Doane v. Eddy, 16 Wend. 623 ; wyn, 20 Ga. 600 ; Kane y. Drake, 27 Randall v. Cook, 11 Wend. 53. It does Ind. 29 ; Ingalls v. Herrick, 108 Mass. not exist in Pennsylvania. Jenkins v. 351. Eichelberger, 4 Watts, 121; Clow v. < Thompson v. Blanchard, 4 N. Y. Woods, 5 S. Wright V. Tetlow, 99 Mass. 397. ' Walker v. Snediter, HofJ. 146. ButseeKellerv. Fame, ICZN. Y. 83; * Wilt v. Franklin, 1 Binn. (Pa.) rev'g 34 Hun, 167. 502. 2 Parshall v. Eggart, 62 Barb. 867. DELIVEEY AND CHANGE OF POSSESSION. 161 In KeUer v. Paine (107 N. Y. 83 ; rev'g 34 Hun, 167) a mortgage was executed, in Pennsylvania, of a canal-boat then lying in New York. The agent for the mortgagee took the very next train, and used great diligence to take an early possession, but an attachment was levied only about an hour before his arrival, and it was held that the attach- ment took precedence. In other States the same rule applies to mortgages which controls absolute sales, and the duty of taking "im- mediate" possession has been held to be performed by dili- gence in trying to take possession. In Wcdden v. Murdoch (23 Cal. 540), 300 cattle roaming at large on the plains, twenty and twenty-five miles in extent, were sold by a bill of sale. The vendor and vendee went on to the plains, and the vendee took possession of fifteen or twenty head. The range was pointed out ; nothing else was done. The next day a creditor attached. The cattle were not caught and Ipranded until some months after- wards. This was held, considering the nature of the prop- erty, a sufficient "immediate delivery" to satisfy the stat- ute. In Wilt V. Franldin (1 Binn. [Pa.J 502) Keeley assigned his property for the benefit of creditors. The assignee re- sided twenty-three miles from the place of the assignment, and did not hear of it until four days afterwards. No de- livery of the goods was made on the day of the assignment. Two days before the assignee heard of the assignment a creditor of Keeley levied an execution upon the goods. The assignee took possession of the goods soon after the assignment. The execution-creditor contended that, there having been no delivery prior to his levy, he was entitled to the first lien, under 13 Elizabeth. It was held that the assignee's title was superior to the judgment-creditor's, upon the ground that every necessary step had been taken to effect an actual delivery at the earliest possible moment. In Haynes v. Hunsicker (45 Penn. St. 441) lumber piled at a saw-mill was sold. The vendee marked the piles with his name, but the roads were in such condition that he 11 162 MOBTGAGES OF PERSONAL PKOPEETY. could not move the lumber. It was held that the vendee was entitled to the property, and it was said : " In every sale of personal property there must be such a delivery and change of possession attending the transfer as the nature of the property is capable of, followed by removal and ac- tual possession as soon as the bulk and condition of the thing, and the circumstances of the case, will permit." In Meade v. Smith (16 Conn. 346) a bill of sale was exe- cuted in the city of New York, at 9.30 a. m., of property at Greenwich, Connecticut. The vendee reached Greenwich at 4 p. M. of the same day, but in the meantime, and about noon, the property had been attached by a creditor of the vendor. It was held that the vendee was entitled to the property. § 235. The possession must also be actual and con- tinued. — Thus, where a debtor made an assignment in trust, and the assignee, after a mere symbolical delivery, per- mitted the assignor and his clerk to continue in possession of the goods, selling them as before the assignment, and apparently for the benefit of the assignor, it was held that these facts, unexplained, were evidence that the assignment was in fraud of creditors.' The change of possession must also extend to the entire mortgaged property,^ or at least to so much of it as not to suggest any fraudulent design ; but leaving a trifling amount of household furniture, which was included in a mortgage, was held not to vitiate an in- strument in other respects valid, made upon a fair consid- eration and followed by a change of possession of all the property of moment.* The words "actual and continued possession" in the statute mean an open, public change of possession, which is to continue and be manifested continually by outward and visible signs, such as render it evident that the posses- sion of the judgment-debtor has ceased.* Possession must ' Adams v. Davidson, 10 N. Y. 309. " Lee T. Huntiion, Uoff. 447. ' Benedict v. Smith, 10 Paige, 126. '' Topping v. Lynch, 2 Robt. 484. DELIVEKY AND CHANGE OP POSSESSION. 163 ibe taken in fact, and cannot be taken by words and inspec- tion.^ § 236. Constructive change of possession not suf- ficient. — An actual change of possession cannot be accom- plished by any mere form of words, and the making of a fictitious paper, showing an apparent change of ownership when none in fact is made, is not a compliance with the statute, but if held effectual would work a complete evasion. Where the owner of a quantity of petroleum in barrels procured his superintendent to sign a paper purporting to be a storage receipt for the petroleum, which he took to a bank and indorsed, and transferred as security for a loan, this was held not to be such a change of possession as the statute requires, and the transaction was adjudged to be void as against creditors.^ So, too, where an assignment was made, for the benefit of creditors, of a quantity of goods in the store of the assignor, and the assignee went in the evening and tried the key which had been given to him, in the lock, but did nothing further towards taking posses- sion, and early the next morning the sherifi' took posses- sion under an execution, it was held that the property had not passed into the actual possession of the assignee prior to the levy.* The assignee had a valid transfer of the title ; he had a symbolical delivery and constructive possession ; but actual possession had not departed from the assignor when the levy was made.* On a like principle, where a mortgage was made of the furniture in, a hotel, and it was agreed between the parties to the mortgage, on an occasion when a demand was made for payment and for the prop- erty, that a partner of the mortgagor in the hotel, and in the use of the property, should be and remain in possession of said property for the mortgagee, and where the mort- gagor and his partner continued in the actual use of the property until after it was seized under an execution ' Craudall v. Brown, 18 Hun, 461. " BuUia v. Montgomery, 50 N. T. ' Yenni v. McNamee, 46 N. Y. 614. 352. ■* BuUis V. Montgomery, supra. 164 MORTGAGES OF PEBSONAL PSOPERTY. against the mortgagor, it was held that there had been no' actual change of possession.^ Saying there was a change, when in fact there was none, made none in law, as to this statute. So where the mortgagor was left in possession as the mortgagee's agent, to manage the property for him, it was held that there was no actual change of possession.^ § 237.— In Hale v. Sweet (40 N. T. 97) the mortgagee sued the sheriff for seizing a canal-boat under an execution against the mortgagor, and the trial judge directed a verdict for the defendant. It was proved on the trial that the plain- tiff (the mortgagee) built the boat ; that he sold one-half to Jones (the judgment-debtor) and took a mortgage thereon to secure a portion of the purchase-money ; that it was agreed between the plaintiff and Jones that the boat should be run on their joint account, each to furnish half of the team, and that Jones should act as master. This agreement had not been terminated at the time of issuing the execu- tion by the plaintiff. The boat was run by Jones, pursuant to the agreement, until about three weeks before the issuing of the execution, when the plaintiff employed him to take charge of the boat and run it; he went on board and thereafter ran the boat as captain and controlled her until the close of navigation. Jones collected the freight earned after he went on board, discharged hands from the boat, and the clearances continued to be taken in his name as captain. It was held that this evidence, taken as a whole, failed to show that the plaintiff had taken possession of the boat to the exclusion of Jones, and that the judge properly directed a verdict for the defendant. § 238, When constructive change of possession suf- ficient. — It often happens that the subject of the sale is not reasonably capable of an actual delivery, and then a con- structive delivery will be sufficient ; as in the case of a ves- ' Porter v. Parmley, 52 N. Y. 185. Artcher, 4 HUl, aTl ; Steele v. Ben- ' Camp y. Camp, 2 Hill, 628; Otis ham, 84 N. T. 634, rev'g 21 Hun, 411. V. Sill, 8 Barb. 102 ; Hanford v. DELIVERY AND CHANGE OF POSSESSION. 165 sel at sea, of goods in a warehouse, of a kiln of bricks, of a pile of squared timber in tlie woods, of goods in the pos- session of a factor or bailee, of a raft of lumber, of articles in the process of manufacture, where it would be not indeed impossible, but injurious and unusual to remove the proper- ty from where it happens to be at the time of the transfer. In such cases it is only necessary that the vendee should assume the control of the subject, so as reasonably to indi- cate to all concerned the fact of the change of ownership. When nothing of the kind has taken place it is the duty of the court to pronounce a mere symbolical delivery to be in- sufficient ; but when there is evidence of such assumption and control, it is for the jury to say whether it was honajide or merely colorable, and whether it was enough to give notice to the world. The question in such case is, did the vendee do all that he might reasonably be expected to do in the case of a real and honest sale ? ' § 239. Actual removal not indispensable.— An actual re- moval of the property from the premises in which it was at the time of the making of the mortgage, is not essential to a change of possession. Removal is an evidence, and a strong one, of that change, but not an indispensable evi- dence. The exercise of ownership and control by the mort- gagee, and, above all, the absence of any such control by the mortgagor, appears to be the true test by which to de- cide the validity of the transfer. Removal may be insuf- ficient, because the control of the mortgagee may be after- wards resumed ; and certainly the change of possession may be as entire and continued, and the exclusion of the mortgagor as absolute and unequivocal, without a removal as with it. All that the statute prescribes is, that the change should be notorious, and the possession and control of the mortgagee undisputed and unshared.^ ' Per Sharswood, J., in McKibbin v. Niagara County Nat. Bank v. Lord, 33 Martin, 64 Penna. St. 352 ; Barr v. Hua, 55Y. Reitz, 53 Penna. St. 256; Keller v. « Per Hoffman, V. C, in Lee v. Hun- Paine, 34 Hun, 167, and casea cited; toon, Hoff. 447, 457. 166 MOBTGAGES OF PERSONAL. PBOPERTY. § 240. Property in possession of third person. — The want of an actual change of possession is only a badge of fraud when the property is in the possession of the person making the transfer, or under his co-ntrol ; if it is in the pos- session of a third person, an immediate delivery is unnec- essary.^ The statute does not require that the mortgagee shall take the actual possession of the property at the time himself ; it is enough if he removes it out of that of the mortgagor ; and if he finds it in the custody of a third per- son, when the sale of mortgage is made, there is nothing in the language, or in the object or policy of the act against permitting it to remain with him till such time as he may choose to take the personal charge of it. Leaving the prop- erty in this position is certainly not within the mischief of leaving it in the possession of the vendor or mortgagor.^ If the property is in the custody of a third person, such third person should, if practicable, be notified of any change of ownership and made the agent of the grantee if any title or right is to be based on a change of legal posses- sion.* § 241. Mortgagor and mortgagee both in apparent pos- session. — ^When the mortgagor and mortgagee both occupy and enjoy the place where the mortgaged chattels are, the question as to what is a sufficient change of possession to repel the presumption of fraud, may become a delicate one. As between a husband and wife it will often be difficult to say who has possession of the chattels in the premises jointly occupied by them,* and the same will be true where a mortgage is made by a merchant to one of his clerks or em- ployees who, both before and after the execution of the in- strument, is in custody of the property.' 1 Smith V. Post, 1 Hun, 516 ; 3 T. 4 ols, 32 Me. 238; Doak v, Brubaker, 1 C. 647; Goodwin v. Kelly, 42 Barb. Nev. 218. 194; Nash T. Ely, 19 Wend. 523; Mum- ' Sheldon v. Warner, 26 Mich. 108. per V. Rushmore, 79 N. Y.. 19. * See Reed v. Gannon, 50 N. Y. 351 ; ' Per Nelson, Ch. J., in Nash v. Ely, Talman v. Smith, 39 Barb. 390 ; Sum-- 19 Wend. 523, 524^ Wheeler v. Nich- ner v. Dalton, 68 N. H. 295. ' Doyle V. Stevens, 4 Mich. 87. DELIVERY AND CHANGE OF POSSESSION. 167 When a firm of whicli the mortgagor is a member, is using mortgaged chattels, an agreement between the mortgagor and mortgagee, after default in payment, that a partner of the former shall retain possession of the prop- erty for the latter, the property remaining and being used as before, does not work a change of possession. Where a mortgage was assigned to the wife of the mort- gagor who gave to her husband a power of attorney to carry on the business for her, and he retained the apparent actual possession of the property as before, it was held that there was no such possession in the mortgagee as the stat- ute requires.' But where mortgaged personal property was on a farm owned by the wife of the mortgagor, and the mortgage was purchased by the wife, and the husband mortgagor left the farm and during his absence the wife hired a man to man- age the farm and take care of the property, a verdict in favor of the wife, establishing that she had taken actual possession of the property and was in such possession at the time of a levy, was sustained.' § 242. Judicial sales. — The statute, with its presump- tions founded upon non-delivery and absence of changed possession, draws no distinction between modes of transfer. Where the property of a judgment-debtor is sold upon exe- cution against him, it is the judgment, execution and sale by the sheriff which constitutes together the conveyance by which the title is transferred, and if he is permitted to re- main in possession, the transaction is presumptively fraudu- lent against creditors and conclusively so, if unexplained. To say that such transfer, because of its form and character, proves good faith against an assailing creditor, is to except from the operation of the statute one mode of conveyance, although the rule relates equally to all and makes no excep- tions.* ' Porter t. Parmley, 52 N. Y. 186. » Simmons v. Osgoodby, 16 W. Dig-. 2 Steele v. Benham, 84 N. Y. 634; 429. rev'g 21 Hun, 411. ■* Per Finch, J., in Stirason v. Wrig- 168 MOETGAGES OF PEESONAL PEOPEETY. OVEESTATING THE CLAIMS OF THE MOETGAGEE A BaDGE OF Feaud. § 243. If a mortgage be made for a larger amount than is due or owing from the mortgagor, and if that amount be put in with the fraudulent intent to magnify the claims of the mortgagee and to keep the creditors of the mortgagor at bay, this will render the mortgage utterly void as against creditors.* But the mere fact that the amount which is inserted in the mortgage is greater than the claims of the mortgagee will not, as a matter of law, ren- der the mortgage void, without proof of a fraudulent in- tent. A mortgage may lawfully be made in that form to secure future advances, even if the mortgagor be insolv- ent,' and will be valid for all advances up to the amount named, and if from the recitals in the mortgage it appears that this was the purpose of the parties, the fact that the amount of the mortgage exceeds the indebtedness at the time of its delivery, will not even be prima facie evidence of fraudulent purpose.' If no such explanation be con- tained on the face of the mortgage, the transaction will be suspicious, but the excessive amount will, at most, be a badge of fraud, to be passed upon by the jury.* If a larger amount than is due is inserted in the mort- gage, in pursuance of a secret agreement that the excess is to be repaid, this will render the instrument void as to creditors.^ ley, 86 N. Y. 332, SS*? ; Fonda v. Gross, '^ Knapp v. McGowan, 96 N. Y. 75, 15 Wend. 628; Gardenier v. Tubbs, 21 86. Wend. 169; Farrington y. Caswell, 15 ^ Miller v. Lockwood, 32 N.Y. 293; Johns. 430. See contra, Slmerson v. Hughes v. ShuU, 33 Kans. 127 ; Corbiu Branch Bank, 12 Ala. 206. v. Kinoaid, 33 Kans. 649; Kalk v. 'Anderson v. Hunn, 6 Hun, 79; Fielding, 50 Wis. 310; Mason v. Frank- KuFsell V. Winne, 37 N. Y. 591, 596; lin, 58 Iowa, 506 ; Kaysing v. Hughes, Wallach v. Wylie, 28 Kans. 138; Mar- 64 111. 123. boupg V. Manufacturing Co., 32 Kans. * Frost v. Warren, 42 N. Y. 204. 629; Horton v. Williams, 21 Minn. ° Smith v. Kenuey, 1 Mackey (D. 187; Rich t. Levy, 16 Md. 74. C), 12. PBEFEBENCES BY INSOLVENT MOETGAGOK. 169 § 244. Evidence of debt. — If a chattel mortgage be im- peached on the ground that the debt was fictitious or over- stated, the production of a promissory note of the mortgagor is prima faxde evidence in the first instance of the validity of the debt, and needs no confirmatory proof unless sus- picion is raised as to the hona fides of the transaction.' Peepebences by Insolvent Mobtgagob. § 245. Preferences allowed.— A mortgage will not be deemed fraudulent simply because it was intended to prefer the mortgagee to other creditors,^ and the owner of property may lawfully create a mortgage lien upon it, even while an action is pending against him.^ It has even been held that a debtor may prefer a creditor by chattel mortgage while he contemplates an assignment for the benefit of creditors, which shortly follows.' This proposition may be deemed doubtful as to transactions after the Act of 1887, which prohibits preferences in an assignment exceeding one-third of the value of the assigned estate ; ^ and if the mortgage and assignment are substantially the same act, though exe- cuted in two papers at somewhat different dates, it is not believed that the provisions of the statute can, in this way, be nullified. § 246. Evidence as to good faith.— The fact that a judgment was recovered against a chattel mortgagor by a third person at about the time of the execution of the mortgage, is competent evidence as bearing on the ques- tion of good faith.^ 'Dunham v. Whitehead, 3 Abb. Shaw, 28 Kans. 419; Tootle, attempt to clothe it with another form. But a common provision in mortgages is to reserve the possession and " use " to the mortgagor ; and a right to use property is sometimes equivalent to a right to destroy a mortgage lien upon it. Thus, a stock of goods in a store, kept by the mortgagor for the purpose of sale, can be used only by selling it, and a right to use such property has been held to be synonymous with a right to sell and to render the mort- gage void upon its face.^ But a right to use goods not con- sumable in use, and which could be used without a sale, does not imply a right to sell. For example, household and kitchen utensils in the possession of a householder,^ or farming implements in the possession of a farmer,' may Mo. 445; State T. D'Oench, 31 Mo. ' Mittnacht v. Kelly, 3 Keyes, 407 ; 453 ; Hubbell v. Allen, 90 Mo. 514 ; 46 How. 467 ; 5 Abb. N. S. 442 ; Daven- Raulett v. Blodgett, 17 N. H. 298; 43 port y. Foulke, 68 Ind. 382; 34 Am.. Am. Dec. 603; Putnam v. Oaa;ood, 61 B. 266; Shattuck v. Knight, 25 W. N. H. 192 ; Freeman v. Bawson, 5 Va. 590 ; Addington v. Ethridge, 12 Ohio St. 1 ; Collins v. Myers, 16 Ohio Gratt. (Va.) 436; Bank of Selina v. St. 547; Orton v. Orton, 7 Oreg. 478; Brewer, 71 Ala. 574 ; Benedict t. Ren- Tennessee Nat. Bank'v. Ebbert, 9 fro, 75 Ala. 121 ; Robinson v. Elliott, Heisk. (Tenn.) 163; Phelps v. Murray, 22 Wall. 531 ; Harman v. Hoskins, 56 2 Tenn. Oh. 746; Lang v. Lea, 3 Miss. 142. Rand. (Va.) 410; Brockenbrough y. Where a stock of liquors was mort- Brockenbrough, 31 Gratt. (Va.) 580 ; gaged by a retail trader in them, and Perry v. Shenandoah Nat. Bank, 27 the right to use was reserved, but it Gratt. (Va.) 756; Blakeslee y. Ross- was provided that a sale should forfeit man, 43 Wis. 116; Steinart y. Deun- the mortgage, it was held that this did ster, 23 Wis. 136; Place y. Lang^vor- not imply a right to sell. Cleaves y. thy, 13 Wis. 629; Shattuck v. Knight, Herbert, 61 111. 126. 25 W. Va. 590 ; Klee y. Reitzenberger, '' Klee v. Reitzenberger, 23 W. Va. 23 W. Va. 749; Fox v. Davidson, 1 749. Mackey (D. C), 102; Wells v. Lang- ^ Shattuck v. Knight, 26 W. Va. bein, 20 Fed. R. 183; 30 Alb. L. J. 590. 328. 172 MORTGAGES OF PERSONAL PROPERTY. be used by the mortgagor without either destroying or selling them. In the absence of a reservation to the mortgagor, in the mortgage of a stock of goods, of a right to continued pos- session and enjoyment, there is no necessary implication of a right to sell.^ § 249. Agreement for sale, not contained in mortgage. — If such an agreement do not appear upon the face of a mortgage, and be not necessarily implied by its terms, still it may have formed a part of the contract or contrivance of the parties. If this be the case, the mortgage will have the same effect as if the bargain had been put into the writing, and it will equally be void.^ But it will not be void upon its face, and if there be any dispute about the contract be- tween the mortgagor and mortgagee, the question of fact must be passed upon by the jury. The court cannot pro- nounce the mortgage void, as a matter of law, unless an agreement has been made, either in the mortgage itself or between the parties to it, the necessary construction of which permits such sales to be made.* ' But where it is proved, either by the language of the instrument or by clear and uncontradicted evidence, that it is made with intent that it shall operate in a manner which hinders, delays and defrauds creditors, then it is void, and it must be so adjudged.* § 250. Burden of proof. — Questions as to the validity of mortgages, because of such agreements, commonly arise be- tween the creditors of the mortgagor and the mortgagee. ' Yates V. Olmsted, 56 N. Y 632; Tex. 506; Britton v. Criswell, 63 Miss. Bank v. Ewing, 12 Tenn. 698; Hisey 395; Drug Co. v. Robinson, 81 Mo. 18; V. Goodwin, 90 Mo. 366; Drug Co. v. Bullene v. Barrett, 87 Mo. 185. Robinson, 81 Mo. 18; Hitchler v. Citi- 3 Chatham National Bank v. O'Brien, jiens' Bank, 63 Miss. 403 ; Baldwin t. 6 Hun, 231; Ford v. Williams, IS N. Y. Little, 64 Miss. 126 ; Ewing v. Cargill, (3 Kern.) 57T. 13 Smed. & M. (Miss.) 79. ■* Marston v. Vultee, 12 Abb. 143; ' Delaware v. Ensign, 21 Barb. 85; s. 0. 8 Bosw. 120; Dodds v. Johnson, 3 Nat. Bank of Texas v. Lovenberg, 63 N. Y. Sup. (T. & C.) 215. BIGHT OF MOETGAGOE TO SELL. 173 and it is therefore unusual to be able to produce direct proof of the unlawful agreement or intent. The possession of the mortgagor is, in itself, a mark of suspicion, and if he also sells the mortgaged property with the knowledge of the mortgagee, and retains the proceeds, this creates a fur- ther reason for doubting good faith.' The onus of remov- ing these presumptions of unfairness must rest upon those claiming under the mortgage, but if the unlawful agreement be not contained in the writing itself, an explanation which may show these facts to be consistent with an honest pur- pose is always permissible.^ It matters not whether the agreement, that the mort- gagor may continue to deal in the property for his own benefit, is contained in the mortgage or exists in parol out- side of it ; and where the agreement is in parol it matters not that it can be enforced between the parties to it or not ; for, whether valid or invalid, it is equally effectual to show the fraudulent purpose for which the mortgage was given, and the fraudulent intent which characterizes it. It is al- ways open to creditors to assail, by parol evidence, a mort- gage or a bill of sale of property as fraudulent and void as to them. While between the parties the written contract may be valid, and the outside parol agreement may not be shown or enforced, yet it may be shown by creditors for the purpose of proving the fraudulent intent which accom- panied and characterized the giving of the instrument. It is usually difficult to prove, by parol, an agreement in terms that the mortgagor may continue to deal in the property for his own benefit. Parties concocting a fraud- ulent mortgage would not be apt to put the transaction in that unequivocal form. But all the facts and circum- stances surrounding the giving of the mortgage, and the subsequent dealings in the property, with the knowledge and assent of the mortgagee, may be shown, and they may ' Potts v. Hart, 99 N. T. 169. v. MoEwen, 19 Id. 123; Williston v. ' Frost T. Warren, 42 N. Y. 204; Jones, 6 Duer, 504. Russell V. Winne, 31 Id. 891; Gardner 174 MOETGAGES OF PERSONAL PROPERTY. be sufficient to satisfy the court or jury in inferring the agreement.^ So, too, such a mortgage would be fraudulent and void, as to creditors, if it was the arrangement between the mortgagor and mortgagee that the former might con- tinue to deal in the mortgaged property for his own benefit so long as the latter consented thereto, thus leaving it in his power to assent that all the property should thus be sold, and thereby deprive the mortgage of its character as a security. The parties to a mortgage cannot thus play fast and loose with the mortgaged property, and thus hin- der and delay creditors.^ § 251. Conflicting decisions. — The courts of some of the States decline to follow the rule laid down in New York, so far as to determine that a chattel mortgage which permits the mortgagor to sell portions of the mortgaged property for his own benefit, is absolutely void. It is universally ad- mitted that such a provision offers facilities for fraud, anvi that fraud may be presumed from it, but in a number of jurisdictions it is held that the presumption is one of fact, and may be rebutted and explained by proof.' ■ Southard v. Benner, 12 N. Y. 424; 5 per Earle, J., in Potts v. Hart, 99 Smith V. Cooper, i1 Hun, 566; City jf. Y. 168, l'i'2. Bank of Rochester t. Westbury, 16 3 Martin v. Ogden, 41 Ark. 186; Hnn, 468; Butcher v. Swartwood, 15 Lund v. Fletcher, 39 Ark. 323; McCoy Hun, 31 ; Wineburgh v. Schaer, 5 y. Boley, 21 Fla. 803; Meyer v. Evans, Pacif. R. (Wash. T.) 299; 2 Wash. T. 66 Iowa, 179; Meyer v. Gage, 65 Iowa! R. 328 ; Kleine v. Katzenberger, 20 606 ; Jaifray v. Greenbaum, 64 Iowa, Ohio, 110; Leser t. Glaser, 32 Kans. 492; Clark v. Hyman, 55 Iowa, 14; 39 646; Matter of Ulrich, 6 Benedict, 483; Am. R. 160; Hughes v. Cory, 20 Iowa, Fink V. Ehrman Bros., 44 Ark. 310; 399; Howard v. Rohffins, 36 Kans. Z6l; Martin v. Ogden, 41 Ark 186; Gauss' Enders v. Williams, 1 Mete. (Ky.) 846; Sons v. Doyle, 46 Ark. 122; Putnam Ross v. Wilson, 1 Bnsh (Ky.), 29; Dan- V. Osgood, 61 N. H. 192; Simmons v. iel v. Morrison, 6 Dana (Ky.), 182; Jenkins, 76 111. 479; Peiser v. Peticolas, Stedman v. Vickery, 42 Me. 132;' Goo- 50 Tex. 638 ; 32 Am. R. 621 ; Renfro gins T. Gilmore, 47 Me. 9 ; Brown t. Bros. v. Goetter, 78 Ala. 311 ; Bank of Thompson, 59 Me. 372 ; Blanchard v! Rome T. Hazleton, 15 Lea (Tenn.), 216; Cooke, 144 Mass. 207, 226; Fletcher t. Ballene v. Barrett, 87 Mo. 88; Robbins Powers, 131 Mass. 333 ; Jones v. Hiig- V. Parker, 44 Mass. (3 Mete.) 117. geford, 44 Mass. (S Met.) 516; Wingler RIGHT OP MOKTGAGOK TO SELL. 175 § 252. Upon principle it is easy to defend either doc- trine. The whole law which permits a lien on property, the possession and use and apparent ownership of which rests in the debtor, and which excludes unsecured creditors from any remedy against chattels, the apparent ownership in which may have induced them to give credit, rests upon con- siderations of convenience alone. An arbitrary rule which requires that a mortgage shall not reserve to the mortgagor the legal right to convert the pledge to his own use, with- out at the same time leaving it open to the creditors of the mortgagor to reach it, has the merit of simplicity, and does not savor of harshness. On the other hand, a power to sell stock in trade, coupled with an obligation to replenish with new goods, might in some cases be honestly made, and any rule of evidence which assumes to define fraud is capa- ble of harsh application. § 253. Proceeds of sales to be applied on mortgage.— In Ford v. Williams (24 N. Y. 359) and in Miller v. Lock- wood (32 Id. 293), it was held that an agreement upon the mortgage of chattels that the mortgagor should keep pos- session of the mortgaged property, and retail the goods for cash only, paying over the proceeds toward the discharge of the debt which the mortgage was given to secure, is not fraudulent in law, but presents a question of good faith for the jury, and it was also held that when the transaction, though suspicious, was capable of a construction consistent with fairness and the absence of fraud, it must be passed upon by the jury. In GonJding v. Shdley (28 N. Y. 360) a similar arrange- ment was held not to be conclusively fraudulent, but in that case it was said that such an agreement makes the mort- V. Sibley, 35 Mich. 231 ; Leland v. 12 R. I. 9; Jenbs v. Goffe, 1 R. I. 511 1 CoUver, 34 Mich. 418; Gay v. Bidwell, Scott v. Alfred, 3 Tex. L. J. 593; Brett 1 Mich. 519 ; Lister v. Simpson, 38 If. v. Carter, 3 Cent. L. J. 286; 2 Lowell, J. Eq. 438; Parr v. Brady, 31 N. J. L. 459. See, also, articles on this con- 201; Rnnyon v. Groshon, 12 N. J. Eq. troversy, 2 South L. Rev. N. S. 731; %; Cheatham v. Hawtins, 76 N. C. 5 Idem, 617; 6 Idem, 96. 333; 80 N. C. 161; Williams v. Winsor, 176 MOBTGAGES OP PERSONAL PEOPERTY. gagor an agent of the mortgagee ; it was as if tlie mortgagee had taken possession and placed a third person in charge as agent to sell and account to him. The mortgagee therefore was charged with the amount of all sales made by the mort- gagor, under the authority contained in the mortgage. The doctrine of these cases has been approved in others,* and it has even been determined that a permission to sell on fixed, short terms of credit, notes to be taken which are to be applied on the debt, will not invalidate the mortgage.* But a permission to sell on credit, the amount to be deducted from the mortgage debt if and when collected, renders the mortgage void.* If sales have been made by the mortgagor under such an agreement, the proceeds must be applied on the mortgage debt whether paid to the mortgagee or not,* and a subsequent judgment-creditor is entitled to an account of sales which operate to reduce the lien.^ § 254. Sales for the use of the mortgagor. — The mort- gage will be void if the agreement permits the mortgagor to retain any part of the proceeds of the mortgaged prop- erty for his own use.' And where a written agreement per- mitted the mortgagor to manufacture the mortgaged mate- rials and sell the property with the approval of the mort- gagee, and to receive the price and retain a certain sum therefrom for each month, to enable the mortgagor to run the business, pay hands and support his family, the mort- > Front V. Warren, 42 N. Y 204; bell v. Allen, 90 Mo. 574; Hawkins v. Brackett v. Harvey, 91 N. Y. 214; Hastings Bank, 1 DUl. 462. Ostrander v. Fay, 3 Abb. App. Dec. ^ Brackett v. Harvey, 91 N. Y. 214 ■ 431 ; Oaring T. Richmond, 22 Hun, Sperry v. Baldwin, 46 Hun, 120. 369 ; Dolson v. Saxton, 11 Hun, 565, ^ City Bank of Rochester v. "West- 569 ; Robinson v. Elliott, 22 Wall; 524 ; berry, 16 Hun, 458. Benedict v. Renfro, 75 Ala. 121 ; Metz- " Smith v. Ely, 10 Bank. Reg. 558. ner v. Graham, 57 Mo. 404 ; Crow v. ' Ellsworth v. Phelps, SO Hun, 646 ■ Red River County Bank, 62 Tex. 362; Brackett v. Harvey, 91 N. Y. 215. Putnam v. Osgood, 52 N. H. 148 ; Hub- « Blakeslee v. Rossman, 43 Wis. 116. EIGHT OF MORTGAGOB TO SELL. 177 gage was adjudged fraudulent and void as against other creditors of tlie mortgagor. ^ § 255. Parties to mortgage cannot contradict the writing. — If by tlie terms of the mortgage or by necessary implication therefrom, permission is given to the mortgagor to sell the mortgaged property, it will not be competent for the mortgagee to establish by parol that a contemporaneous bargain provided for an application of the proceeds of sale on the mortgage. As between the parties the writing must, in the absence of mistake, be taken as expressing the con- tract.^ § 256. Lien on substituted property. — It has been said that a provision that mortgaged stock is to be replenished by the proceeds of sales, and that the new stock is to be sub- ject to the lien, will render the mortgage void.* But this is doubtful.* § 257. Mortgages of property consumable by use. — A mortgage of property of such a nature as to be necessarily consumed and destroyed by use, coupled with an agreement that the mortgagor may so use it, is no more useful as a security than it would be if the right to sell had been con- ferred upon the mortgagor, and it will be equally void.^ In States where the right to sell is only evidence of fraud, the right to use has the same effect, and the circumstance is to be weighed, with others, by the jury.* In jurisdictions where the right to sell is more closely scanned, the right to consume by use is regarded with greater strictness.' ' GreeDbaiim r, Wheeler, 90 111. ' Robbins v. Parker, 3 Mete. (Mass.) 296. Ill; Shurtleff v. Willard, 19 Pick. ' Ball V. Slafter, 26 Hun, 353. (Mass.) 202; Sommerville v. HortoD,4 ^ Smith v. Cooper, 27 Hun, 565 ; Yerg. (Tenn.) 541. Ball V. Slafter, 26 Hun, 353. * Brockenbrough T. Brockenbrough, * Brackett v. Harvey, 91 N. Y. 214 ; 31 Gratt. (Va.) 580. rev'g 25 Hun, 502 ; Barnard v. Eaton, 'Simpson v. Mitchell, 8 Yerg. 56 Mass. (2 Cush.) 294; Petring v. (Tenn.) 417; Sommerville v. Horton, Chrisler, 90 Mo 649. 4 Yerg. (Tenn.) 541 ; Darwin v. Hand, 12 178 MORTGAGES OF PEBSONAL PROPERTY. It has justly been said that all chattels are in greater or less degree, consumable in use, and that the right to mort- gage personal property at all is a right to permit such consumption, since an authorized consumption to a certain extent is necessarily implied in every chattel mortgage where the use is reserved to the mortgagor. For this reason a right to consume has not always been deemed so conclusive of a fraudulent intent as a right to sell.' § 258. Agreements subsequent to delivery of mort- gage. — A mortgage is either valid or fraudulent at the time it is made, and the dealings of the parties thereafter may be proved merely for the purpose of demonstrating the nature of the original contract. If, after a mortgage is ex- ecuted, and not in pursuance of any bargain then made, the mortgagee consents to waive his lien to a part of the prop- erty, and to permit a sale for the benefit of another credit- or, this will not invalidate his lien as to the remainder.* § 259. Validity as affected by possession of mortgagee. — It has been held that if the mortgagor, who has reserved the right to retain possession of the property and to sell it, voluntarily surrenders it to the mortgagee before the va- lidity of the mortgage has been questioned, this will cure the illegality.' Under such circumstances the mortgagee may be said to acquire the rights of a pledgee, under the act of delivery, subsequent to the mortgage ; though in some States it has even been adjudged that such posses- sion, if taken under the mortgage and pursuant to it, will have the same effect.^ But the better opinion seems to be that a mortgagee holding possession under a mortgage void at its inception because made to defraud creditors, ley, 3 Yerg. (Term.) 502 ; Richmond v. ' Brown v. Piatt, 8 Bosw. 324 ; Curdup, Meigs (Tenn.), 581. First National Bank v. Anderson, 24 1 Miller y. Jonea, 15 N. Bank Reg. Minn, 435. 150. •'Petring v. Chrialer, 90 Mo. 649; = Russell T. Winne, 37 N. Y. 591 ; Greeley v. Reading, 74 Mo. 309 ; Chicago Lumber Co. v. Fisher, 18 Neb. Brown v. Webb, 20 Ohio, 389, 834 ; Johnson v. Phifer, 6 Neb. 401. EIGHT OF MOBTGAGOE TO SELL. 179 has no better lien than he would if he were out of posses- § 260. Examples. — In WorraU v. Smith (1 Camp. 332), a debtor has made an assignment of his furniture and stock in trade as a publican ; a servant of the assignee was im- mediately put into the house, but the debtor was allowed to carry on the business as usual, and Lord Ellenboeough held the assignment fraudulent and void as to creditors. In Paget v. Perchard (1 Bsp. 205), Mrs. Spencer, who kept a public house, made a bill of sale of her liquors and furniture to the plaintiffs on the fourth of April, and the plaintiffs put a person in possession under the bill of sale the same evening. The property was taken the next day under an execution, and the plaintiffs brought trespass. But it appearing that the agent whom the plaintiffs had put into possession had permitted Mrs. Spencer to sell liquors in the usual way of her trade on the fourth of April, and to receive money, Lord Kenyon held the bill of sale a fraud upon creditors, and nonsuited the plaintiffs. In Divver v. McLaughlin (2 Wend. 596) one Stephens mortgaged his stock of goods as a grocer to the plaintiffs, and still went on with his business as usual until the prop- erty was seized on an execution in favor of the defendant, when the plaintiff brought trespass. The judge refused to nonsuit the plaintiff, and submitted the case to the jury, who found a verdict for the plaintiff. But the judgment was reversed on a writ of error, for the reason that the transaction was fraudulent in law, and should have been so ruled by the court. In Wood V. Lowry (17 Wend. 492), one Kellogg, a coun- try merchant, mortgaged his goods to the plaintiffs to se- cure the payment of a debt, and was permitted to continue his business in the usual way until the goods were seized by an execution-creditor. The plaintiffs brought replevin, ' Robinson v. Elliott, 22 Wall. 513; Colo. 614 ; Stein v. Munch, 24 Minn. Blakeslee v. Rosaman, 43 Wis. 116; 390; Dutcher v. Swartwood, 15 Hun, 44 Wis. 550; Wilson r. Voight, 9 31. 180 MORTGAGES OF PEBSONAL PKOPEKTY. and tlie jury, under tlie direction of the judge, found a ver- dict for the defendant. A motion for a new trial was de- nied, the court saying that no mortgage or bill of sale was ever upheld under such circumstances. It was added that, instead of leaving the matter as a question of fact to the jury, the judge would have been well warranted in instruct- ing them that the transaction was fraudulent and void in. law. § 261. Examples. — In Griswold v. Sheldon (4 N. Y. [4 Comst.] 581) Griswold and one Burdick were respectively merchants in the same town. Burdick hired Griswold's store, and purchased his stock of goods for $3,000, to se- cure which he gave back a chattel mortgage on the same goods and on his own stock of goods. The stock of goods which Burdick possessed before he purchased of Griswold were moved by him from the store which he had occupied to the one hired of Griswold, and there mingled with the goods so purchased. The goods were levied upon under a judgment recovered by Sheldon, the defendant, and Bur- dick brought trover. It appeared on the face of the mort- gage that Burdick hired the " store " in which the goods were placed for the purpose of using it as a store ; that he was to pay $1,000 on the plaintiff's debt "in goods and groceries, &c., from the store," at " current prices," to be delivered at such times and in such quantities as the plaint- iff might desire ; and he agreed " to keep a good and full assortment of goods, groceries, &c., during the time he re- mains in the store," and until the plaintiff's debt should be fully paid. The mortgagor continued in possession un- til the levy, selling the goods at retail for his own benefit. Under these facts four judges thought that the mortgage was fraudulent and void upon its face, and as a matter of law, while five thought that the. question of fraudulent in- tent should be submitted to the jury. In Udgdl v. Hart (9 N. T. [5 Seld.] 213 ; affi'g s. c. 13 Barb. 380) a mortgage was made of a stock of goods in a store, " and to include also all other articles of a like na- RIGHT OF MOBTGAGOE TO SELL. 181. ture which may be put or be in said store whenever the mortgagee should be entitled to enforce the mortgage ; said mortgagor not to sell any of the said goods on credit." It was held that the inhibition to sell on credit contained in the writing, by a necessary implication authorized the mortgagor to sell for cash; all the circumstances connected with the transaction, as well as the pleadings, showed that the intention of the instrument was that the mortgagor should continue to retail the mortgaged property and re- ceive the proceeds to his own use. In so far as the mort- gage attempted to include property not owned by the mortgagor at the time it was made, it was inoperative, and the agreement allowing the mortgagor to sell for his own benefit rendered it void. § 262. Examples.— In MUtnacht v. Kdly (3 Keyes, 407 ; s. c. 46 How. 457 ; 5 Abb. N. S. 442) the mortgage was of a stock-in-trade of a liquor store, " with the increase and de- crease thereof," and until default in the payment of the money secured, the mortgagor was " to remain and con- tinue in the quiet and peaceable possession of the goods and chattels and the full and free enjoyment of the same." It was held that these provisions could have no other meaning than that the mortgagee should all the time re- gain a lien on the whole stock by way of mortgage, the mortgagor making purchases from time to time and selling •off in the ordinary manner ; the intent being not to create an absolute lien upon any property, but a fluctuating one, which should open to release that which should be sold, and take in what should be newly purchased. This being the arrangement which appeared from the mortgage itself, it was adjudged to be void upon its face. In Russdl V. Winne (37 N. T. 591) the mortgage was of a lot of stone " and all other stones belonging to me, and 3II other goods and chattels now in my store." The mort- gagor was a dealer in stone and kept a small store ; there was nothing in the mortgage authorizing a sale, but the mortgagor continued after the mortgage to sell goods just 182 MORTGAGES OF PEESONAL PROPERTY. as he had done before that time, applying the proceeds to his own use, and there was some evidence to show that this was done with the knowledge and assent of the mortgagee. It was held that the circumstance that the mortgagor saw,. or most probably saw, sales taking place was, at most, a circumstance to be submitted to the jury as evidence of a prior agreement cotemporaneous with the execution of the mortgage, allowing such sales to be made for the bene- fit of the mortgagor. If such agreement were found by the jury to have been made, then the mortgage would be void. But if the sales were in violation of the rights of the mort- gagee, or even if they were consented to after the execution, of the mortgage, they would not make the mortgage void ; they would do no more than discharge the lien on the goods which he consented to be sold. In Yates v. Olmstead (56 N. T. 632) the mortgage con- tained this clause : " This mortgage is to be a continuing lien and security upon stock or goods to be hereafter brought into the store." No authority was reserved to the mortgagor to sell or deal with the stock while in his possession. The referee found that no such arrangement was made, and that the mortgagee had no actual knowledge of any such sales ; also, that the mortgage was given in good faith to secure plaintiff 's debt, and not with intent to hinder, delay or defraud creditors. It was held, reversing, the decision of the court below (65 Barb. 43), that the clause in the mortgage did not, as a matter of law, render it fraudulent. When a Mortgage may bb Void only in Part. § 263. Fraudulent intent. — If a chattel mortgage be void because it is executed and delivered with intent to hinder, delay and defraud creditors, it will be void in its entire extent. The evil intent will vitiate and destroy the whole transaction, and it will be a nullity as to the entire debt secured, and as to every portion of the property in - MAY BE VOID ONLY IN PART. 183 eluded in it. No rights, as against creditors, can be claimed under an instrument whicli originated in a conspiracy be- tween the parties to it to cheat and defraud.^ § 264. Reserving rights to mortgagor. — A mortgage which reserves to the mortgagor a right to treat the mort- gaged property, or any part of it, as his own, is void, be- cause such an agreement operates as a fraud upon credit- ors, and the rule in New York, and in most of the other States, is to treat the entire security as without force.^ But in some States the mortgage is held to be void only as to the portion of the mortgaged property which is affected by the power of sale.' § 265. Partnerships. — A mortgage executed by an in- solvent partnership, on partnership assets, in part to secure a valid firm debt, and in part to secure the individual debt of one partner, in the absence of any fraudulent purpose, is good, as against firm creditors, for the amount due by the firm,, and void as to the balance.* § 266. Innocent mortgagee. — A case may easily be sup- posed where a mortgagor executes and delivers a mortgage with intent to hinder, delay or defraud his creditors, while the whole purpose of the mortgagee is to get security for ' EusseU T. Winne, 3Y N. T. 591; ton v. Orton, 7 Oreg. 418; In re Eur- Mittnacht v. Kelly, 3 Keyes, 407; ». 0. roughs (U. S. Dist. Ct.), 5 N. Y. "Week- 46 How. 467; 6 Abb. N. S. 442; Good- ly Dig. 137 ; Hortou v. Williams, 21 rich V. Downs, 6 Hill, 438; Mackie t. Minn. 187. Cairns, 5 Cow. 547, 580; Grover v. ''Putnam v. Osgood, 51 N. H. 192; Wakeman, 11 Wend. 187, 225; Som- 52Br. H. 148; Nichols v. Hampton, 46 merville v. Horton, 4 Terg. (Tenn.) Ga. 253 ; Bullene v. Barrett, 87 Mo. 641; Weeden v. Hawes, 10 Conn. 50; 185; Donnell v. Byern, 69 Mo. 468- Crowninshield v. Kittredge, 48 Mass. State v. Taster, 31 Mo. 446 ; Lund v. (7 Mete.) 620; Winstead v. Hulme, 32 Fletcher, 39 Ark. 326 ; 43 Am. R. 270; Kans. 568. Barnet t. Fergus, 51 111. 362 ; Good- 2 Edgell v. Hart, 9 N. T. (5 Seld.) heart v. Johnson, 88 111. 68 ; Davenport 213; Potts V. Hart, 99 N. Y. 169; v. Foulke, 68 Ind. 382; Cook v. Hal- Goodrich v. Downs, 6 Hill, 438 ; sell, 65 Tex. 1 ; Ee Kirkbride, 5 Dill. Blakeslee v. Rossman, 43 Wis. 116; 116. Harman v. Hoskins, 66 Miss. 142; Or- * Walker t. White, 60 Mich. 427. 184 MOETGAGES OF PBESONAL PBOPEETY. an honest debt. In such a case the mortgagee will not be charged with the wrongful intent of the mortgagor, and the mortgage will remain a valid security in his hands.* If the mortgage be given to two persons to secure different debts, one of them being innocent, while the other shared in the fraudulent purpose of the mortgagor, the former would be protected, while the latter would not. Each creditor would stand in the same position as if he had taken a separate mortgage to himself, and the fact that the same mortgage provided for his separate debt would not infect the amount secured with the fraud which tainted the portion secured to the other party.^ § 267. Failure of title. — A distinction is to be noted be- tween a mortgage which is void for fraud, and one which fails to operate as a lien because the mortgagor had no power to mortgage a portion of the property included in it. Such a case will arise where the mortgagor has no title to a part of the mortgaged chattels, or where it is attempted to mortgage property not yet acquired, and the mortgage will then be valid to the extent of the title of the mort- gagor at the time when it was executed.^ So, if a mortgage be made of all articles named " except such as are by law exempt from levy and sale under execution," it is valid as to all of the articles which presumptively and in ordinary cases would be exempt from such levy and sale.* So, also, if a mortgage be given in good faith, it will be valid for the amount of the debt intended to be secured, though it will be without force for any greater amount.^ § 268. Invalidity of debt. — A mortgage to secure two debts, one of which is valid and the other void for usury, will operate to secure the valid debt.* 1 Smith T. Post, 1 Hun, 516. * Newell v. Warner, 44 Barb. 258. ' Smith V. Post, supra. " Westcott v. Gunn, 4 Duer, 107 ; ' Gardner T. McEwen, 19 N. Y. Miller v. Lookwood, 32 N. Y. 293 ; 123 ; Van Heusen v. EadcliflF, 17 Id. Frost v. "Warren, 42 Id. 204. 580. 6 Langdon v. Phelps, 52 How. 387. who may dispute validity. 185 Who may Dispute the Validity of a Chattel Mort- gage. § 269. What creditors are protected by statute. — The statute which makes continued possession a presumption of fraud, defines the term " creditors," as used in it, to mean " all persons who shall be creditors of the vendor or as- signor, at any time while such goods and chattels shall re- main in his possession or under his control." ^ Under this provision it was held, in WilUston v. Joiies (6 Duer, 504), that a creditor who seeks to impeach a mortgage on the ground of continuance in possession of the mortgagor, is bound to show that he was a creditor during the time that this possession continued. In this respect this statute dif- fers from the statute which declares chattel mortgages to be void as against creditors unless filed, for that statute protects all of the creditors of the mortgagor. They can- not question the rights of the mortgagee until they come with process of some sort, but when their claims are in such form as to give them a specific lien on the property of the mortgagor, the want of filing renders the mortgage void as against all creditors alike.^ The term "creditors," as used in the statute, includes "all persons who are creditors of the vendor or assignor at any time while the goods remain in his possession or under his control," ' and these creditors are all protected by the presumption of fraud arising from a delay in delivery. A creditor by simple contract is under the protection of the statute as much as a creditor by judgment, but until he has a judgment and a lien, or a right to a lien, upon the specific property, he is not in a position to assert his rights, by action, as a creditor.* • 2 R. S. 136, § 6. ner, 72 N. Y. 424, 426 ; Stimson v. 5 Laws of 1883, c. 279, § 1; Thomp- Wrigley, 86 N. T. 332, 338 ; Geery v. son T. Van Vechten, 27 N. Y. 668, 582; Geery, 63 N. Y. 256 ; Dutcher v. Swart- Theriot v. Prince, 1 Edm. Sel. Gas. wood, 16 Hun, 34; Frisbey v. Thayer, 219. 25 Wend. 396; Kennedy r. National » 2 R. S. 136, §§ 5, 6. Union Bank, 23 Hun, 494. * Per Allen, J., in Southard v. Ben- 186 MORTGAGES OF PEBSONAL PROPERTY. § 270. All creditors protected against actual fraud.— It does not follow that because a creditor cannot avail him- self of the presumption of fraud which arises from the con- tinued possession of property by the debtor after he has pretended to assign or mortgage it, that he may not attack such a transaction as fraudulent and void as to him. The presumption is a matter of evidence which may avail only a certain class of creditors, but the fact of the intent to hinder, delay and defraud, when proven by other evidence, will render the assignment or mortgage void as to all cred- itors indiscriminately. § 271. Execution-creditor may ignore void mortgage. — When a mortgage is fraudulent and void, the possession of the mortgagee is a trespass as to creditors,'' and a sale under it, or exercising or claiming any title under it, will be a conversion as to junior incumbrancers.' It cannot be impeached by a creditor at large, but when a creditor has an execution or attachment, or some other process which authorizes the seizure of the goods, he may take them as if no such mortgage had been made; and if the sheriff, acting under such warrant, is sued, he may show that the alleged mortgage is void as against the creditor.* § 272. Creditor must have execution or attachment.— When a conveyance is said to be void as against creditors, the reference is to such parties when clothed with their judgments and executions, or such other titles as the law has provided for the collection of debts.^ Before creditors can attack a transfer of their debtor for fraud, they must show a judgment as well as execution ; or where they pro- ' 2 R. S. 13Y. Skinner v. Oettinger, 14 Abb. 109; ^ Delaware v. Ensign, 21 Barb. 85. Patterson v. Berry, 10 Id. 82; Belmont ' Baskins v. Shannon, 3 N. Y. (3 v. Lane, 22 How. 365 ; Kelly v. Breus- Comst.) 310. ing, 33 Barb. 123. ' Einchey v. Stryker, 26 How, 15 ; ^ Per Denio, J., in Van Heuaen t. Frost V. Mott, 34 N. Y. 253; Thayer V. Radcliff, 11 N. Y. 580; Noble v.. Willett, 6 B08W. 344; s. 0. 9 Abb. 326 ; Holmes, 5 Hill, 194. WHO MAY DISPUTE VALIDITY. 187 ceed by attachment, they must show that the justice had jurisdiction, and that the process was regularly issued.' If a creditor seizes mortgaged chattels under an execu- tion, it is necessary for him to show a valid judgment, exe- cution and levy, and that the mortgage is fraudulent and void, and if he fails in any of this his levy will be wrongful. If he takes the property under an attachment, he must es- tablish, in addition to the fraudulent nature of the mort- gage, that his warrant was regular, and also that the debt existed for which the attachment was issued, unless this fact be proven by a judgment against the debtor. The mortgagee may prove that no debt existed until it is estab- lished by a judgment in the attachment suit. He may, therefore, defeat the attaching creditor on either of two grounds : 1. That there was no debt to justify the issuing of the attachment. 2. That he had a good title to the prop- erty in dispute when it was attached.^ The validity of a chattel mortgage may be brought in question by a creditor who has levied an attachment on moneys in the hands of an insurance company, the mort- gaged property having been destroyed by fire.^ § 273. Purchasers or junior lienors. — A hona fide pur- chaser of mortgaged property without notice of the lien may also show its fraudulent character, though he would not be suffered to do this if he purchased merely the equity of redemption. The same rule which would protect the owner of the entire title would also protect the owners of portions of it, as junior mortgagees * or other lienors. It is necessary that these liens be in themselves valid, for there would be no propriety in disturbing the apparent lien of ' Per Bronaon, J., in Van Etten v. Braley v. Byrnes, 20 Minn. 436 ; Hurst, 6 Hill, 311; Sullivan v. Miller, Healey v. Butler, 66 Wis. 9. 106 N. Y. 635 ; Button v. Rathbone, ^ Boot Co. v. Ladd, 32 Minn. 381. 43 Hun, 14*7. * Anderson v. Hunn, 5 Hun, 79 ; * Rinchey v. Stryker, 26 How. 75 ; BasMns v. Shannon, 3 N. T. (3 Corns.) 310. 188 MORTGAGES OF PERSONAL PROPERTY. one Toid incumbrance in order to benefit another which is equally void.' A purchaser of the mortgaged property under an execu- tion, when the sale is not made expressly subject to the mortgage, may file a bill to set aside the mortgage as fraudu- lent.2 If a junior mortgagee attacks a prior incumbrance as fraudulent, he must show a valuable consideration or an honest debt, and also that the mortgage was given to secure it.^ But if the consideration of the contract under which the claim is made is sufiicient to support a valid specific lien, it will not be a sufficient objection against it that it was given for a prior indebtedness.* So also a partner has such a lien on the partnership property as entitles him to a judg- ment setting aside fraudulent sales or incumbrances made by his copartner.^ A purchaser of the mortgaged chattels, or of any inter- est therein, or the holder of any subsequent lien thereon, providing that his claim has not, by the contract under which he claims, been limited to the equity of redemption, may resist the enforcement of the mortgage on any ground which would have constituted a valid defense for the mort- gagor. Thus a judgment and execution creditor of the mortgagor who has caused a levy to be made upon the mort- gaged chattels, may avoid the mortgage for usury.* § 274. Purchaser subject to mortgage. — Where a chat- tel mortgage is void as to creditors and subsequent purchas- ers in good faith, but good as between the parties, a credit- or who takes the mortgaged goods in payment of his claim, with knowledge of the mortgage, takes subject to the mort- ' Thompson v. Van Vechten, 27 N. Hill, 211; Wray v. Fedderte, 48 N. Y. Y. 568. Supr. (H J. & S.) 335. 2 Bailey V. Burton, 8 Wend. 339; « Anderson v. Hunn, 6 Hun, 19; Wagner v. Jones, 1 Daly, 375. contra, Thompson v. Van Vechten, 6 ' BasMns v. Shannon, 3 N. Y. (8 Bosw. SIS ; rev'g s. 0. B Abb. 458. Comst.) 310 ; Hanford v. Artoher, 4 ' Wade t. Easher, 4 Bosw. 5S1. 6 Carow V. Kelly, 59 Barb. 239. WHO MAY DISPUTE VALIDITY. 189 gage. He is not a purchaser of the whole but of the equity of redemption, and he has lost his character of creditor by the payment of the debt ; he cannot, therefore, attach the mortgage.' § 275. Legal representatives of mortgagor may dis- affirm mortgage under statute. — Ordinarily a man cannot be heard to allege his own fraudulent acts as grounds for re- lief in a court of justice, and what he cannot do his repre- sentatives are equally barred from doing. But it is pro- vided by Laws of 1858, c. 314, " that any executor, adminis- trator, receiver, assignee,^ or other trustee of an estate, or the property and effects of an insolvent estate, corporation, association, partnership or individual, may for the benefit of creditors or others interested in the estate or property so held in trust, disaffirm, treat as void, and resist all acts done, transfers and agreements made, in fraud of the rights of any creditor including themselves and others, interested in any estate or property held by or of right belonging to any such trustee or estate." Under this statute an action has been sustained by the administrator of a deceased mortgagor against the mortgagee for damages as for conversion of the mortgaged chattels, on the ground that there was an implied understanding that the plaintiff's intestate might sell portions of the property.' Independent of the statute, the right to impeach a mort- gage which is fraudulejit as against creditors of the mort- gagor, would not pass to the assignee of the mortgagor, under a voluntary general assignment.* The mortgage being valid between the parties would be binding on the assignee.** This rule does not apply if the mortgage is voidable by the 1 Earl V. Burch, 21 Neb. 702. MiUer, 11 Ala. 1081 ; Butler v. Lee, 11 « Reynolds v. Ellis, 103 N. Y. 116. Ala. 888; Stewart v. Piatt, 101 U. S. 3 Potts T. Hart, 99 N. Y. 168. T36. But see Blandy v. Benedict, 42 « Keller v. Smalley, 63 Tex. 612; OWo St. 295; Hanes v. Tiffany, 25 WilHams t. Winsor, 12 R. I. 9 ; Gibson Ohio St. 649. V. Warden, 14 Wall. 248 ; Brownell v. ' Flower v. Cornish, 26 Minn. 473; Curtis, 10 Paige, 217; Estabrook t. Mann v. Flower, 26 Minn. 600; Wate- Messersmith, 18 Wis. 651 ; Walker T. man v. Barrows, 41 Mich. 363. 190 MORTGAGES OF PERSONAL PROPERTY. mortgagor, and tlie assignee can assert any defense to the mortgage that would be available to his assignor, unless re- strained by the terms of the assignment.* An assignee in bankruptcy may attach a fraudulent mortgage, though none of the creditors have acquired a specific lien by judgment.^ § 276. Rights of creditor under judgment junior to general assignment. — A creditor of the mortgagor, who procures a judgment and execution after the execution and delivery by the mortgagor of a general assignment for the benefit of creditors, cannot maintain an action to set aside the prior chattel mortgage as void. The rule is well set- tled that a creditor's bill, filed for the purpose of removing a fraudulent obstruction, must show that such removal will enable the judgment to attach upon the property,' and if the mortgagor had executed a general assignment before the judgment, the benefit of declaring the prior chattel mortgage void would inure to the assignee, and not direct- ly to the judgment-creditor. The fact that the fund in the hands of the assignee may be increased for the payment of debts, by setting aside the mortgage, of itself confers no right on the creditor, to allege its invalidity either by an affirmative action or by way of defense in an action upon it.* The circumstance that an assignee could not avail him- self of an objection to the mortgage which would be avail- able to the judgment-creditor ; as, for example, the failure to file pursuant to the statute, will not aid the creditor. The fact will still remain that the creditor's rights in the property must be traced through the assignee for the ben- efit of all of the creditors, and that he has no individual ' Tuite V Stevens, 98 Mass. 805. ^ geery t. Geery, 63 N. Y. 252 2 Southard v. Benner, 72 IT. Y. 424; Southard v. Benner, 72 N. Y. 424. aflEi'g 1 Daly, 40; Southard v. Pinck- •» Spring v. Short, 91 N. Y. 538 ney, 6 Abb. N. 0. 184; Mann V. Flower, Wheeler t. Lawson, 103 N. Y. 40 25 Minn. 500 ; Carr v. Hilton, 1 Curtis, Liehtenberg v. Herdtfelder, Id. 302 280. Childa v. Kendall, 30 Hun, 227. WHO MAY DISPUTE VALIDITY. 191 interest in the property whicli will support an action to set aside the fraudulent lien upon it.^ § 277. How the question of the validity of a chattel mortgage may be contested. — If a judgment-creditor of the mortgagor shall contend that the mortgage is fraudu- lent and void, he may, if he elects to do so, treat it as a nullity, and by indemnifying the sheriff procure a levy and sale to be made. The question of the validity of the mort- gage will, in such a case, be tested in an action brought by the mortgagee for the value of the property or to reclaim possession of it ; unless the mortgagee shall see fit to sur- render his claims without a contest. If such an action be brought, the creditor will prevail if the mortgage be de- clared to be fraudulent.^ So a junior mortgagee may take possession under his mortgage, and in the action at law in which he shall seek to maintain his right to possession, or in which he shall endeavor to defend himself against a claim for damages, the question of the validity of the security may be litigated and determined.^ Belief against a fraudulent chattel mortgage may also be found by an action in the nature of a suit in equity, in which the instrument may be declared to be void, and in which, also, the remedies peculiar to a court of equity, in- cluding the appointment of a receiver, and the granting of an injunction may be obtained.* § 278. Election of remedies. — Any person who has an interest in or a lien upon the mortgaged property, has a right to appeal to a court of equity in order to prevent the enforcement of a void prior security by which his rights in or upon the property would be destroyed ; and the fact that he would have an action at law for damages, against « ' Cowper V. Theall, 40 Hun, 520. * Basbina v. Shannon, 3 N. Y. (3 ' Delaware v. Ensign, 21 Barb. 85; Comst.) 310. Rinchey V. Stryker, 26 How. 75; Frost * Anderson v. Hunn, 6 Hun, 79. V. Mott, 34 N. Y. 263. 192 MORTGAGE OP PEESONAL PEOPEETY. the holder of such void prior security, would not be any answer to his claim for relief. He would not be required to surrender a lien upon the property, or a title to it, and be compelled to rest upon the personal responsibility of the holder of the prior lien, which might or might not be available when an execution should be issued against him.' § 279. Actual levy not required.— As soon as an execu- tion, issued upon a valid judgment, is placed in the hands of the sheriff, and without any levy having been made thereon, the judgment-creditor acquires a valid lien upon all of the personal property belonging to the debtor and not exempt from execution, situated within the jurisdiction of the officer. Until the levy is made, the lien is liable to be defeated by the title of a purchaser in good faith, but, as between the plaintiff in the execution and all persons except a bona fide purchaser, the lien is as valid before the levy is made as it is afterward.* This lien is entitled to protection, and the assistance of a court of equity may be invoked to remove an obstruction which has fraudulently been placed in the way of its complete enforcement.^ A creditor may, therefore, maintain an action to set aside a mortgage upon chattels, as fraudulent and void, as soon as his execution is in the hands of the sheriff. He is not re- quired to procure the officer to run the risk of committing a trespass, if the mortgage is finally adjudged to be valid, neither is he compelled to wait until the execution has been returned unsatisfied.* § 280. Return of execution not required. — There is a substantial difference between an action to remove an im- pediment which has fraudulently been created in order to obstruct a specific lien, and an application to a court of equity to reach equitable assets of a debtor. In the first ' Anderson v. Hunn, 5 Hun, 79. * See the very elaborate opinion of 2 2 R. S. 366, §§ 13, 17; Hale v. Bockes, J., in Stewart v. Beale, 7 Hnn, Sweet, 40 N. T. 97. 405. » Beck V. Burdett, 1 Paige, 305. WHO MAY DISPUTE VALIDITY. 193 case, it is only necessary that the creditor shall have tried to enforce his lien, and that he has been met by the im- pediment. In the latter case the creditor can show no title to the rights of action of the debtor until he has ex- hausted his legal remedy. In the one case the application is for aid to enforce legal rights ; in the other it is for equitable relief entirely. The issuance of an execution gives a legal lien upon chattels, and equity will remove a fraudulent mortgage which prevents the lien from ripening intp a levy and sale. But the issuance of an execution, or even a formal levy, does not create a lien upon a mere chose in action, or a mere equitable interest in personal property which is not liable to be sold on execution, and in such cases the actual return of the execution unsatis- fied is necessary to entitle the creditor to the assistance of a court of equity to obtain satisfaction out of the equitable property of the defendant.* • Beck V. Burdett, 1 Paige, 306. 10 CHAPTER IX. FILfNG OF CHATTEL MORTGAGES. When, Where, and How Chattel Mortgages should be Filed. § 281. Statute.— It is enacted, by Laws of 1833, c. 279, that every mortgage or conveyance intended to operate as a mortgage of goods and chattels hereafter made, which shall not be accompanied by an immediate delivery, and be followed by an actual 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 and mortgagees in good faith, unless the mort- gage, or a true copy thereof, shall be filed as directed by said act. The instruments mentioned in the act are required to be filed in the several towns and cities of this State, where the mortgagor therein, if a resident of this State, shall re- side at the time of the execution thereof ; and if not a resi- dent, then in the city or town where the property so mortgaged shall be at the time of the execution of such instrument. In the city of New York such instrument must be filed in the office of the register of said city. In the several cities of this State, other than the city of New York, and in the several towns in this State in which a county clerk's office is kept, in such office ; and in each of the other towns in this State, in the office of the town clerk thereof. Such register and clerks are required to file all such instruments presented to them respectively for that purpose, and to indorse thereon the time of receiving the same, and also to deposit the same in their respective of- FILING OF CHATTEL MOBTGAGES. 195 fices, to be kept there for the inspection of all persons in- terested.^ § 282. Kings and Westchester counties.— By Laws of 1852, c. 83, the office of register of deeds for the county of Kings was created, and it is proyided that, " after such register shall have taken the oath of office prescribed by law, and have given the security required as aforesaid, all that part of the duty of the county clerk of the county of Kings, which in the city of New Tork is required to be done and performed by the register of deeds in said city and county, shall be done and performed by such register of deeds in and for the county of Kings, and such register shall be entitled to receive the same fees therefor as the county clerk of the county of Kings would be by law en- titled to receive for the performance thereof, except as hereinafter otherwise provided ; and thereafter the county clerk of the county of Kings is hereby relieved, discharged and prohibited from performing any such duties hereby devolved upon such register." A similar statute, creating the office of register of deeds for Westchester county, was also enacted in 1858.* Under the Kings County Act it has been determined that chattel mortgages executed by mortgagors residing in the city of Brooklyn should be filed with the register, but that where the mortgagor resides in the town of Flatbush the mortgage should be filed with the clerk of that town.^ § 283. Statute adds another ground to declare mort- gage void. — This statute does not repeal the statute con- cerning fraudulent conveyances. If a mortgagor of chattels retains the possession of them, the legal presumption still is that the mortgage is fraudulent ; the filing of the mort- gage does not rebut the presumption of fraud arising from the non-delivery of the propery, neither does it excuse the party claiming under the mortgage from showing affirma- tively that the mortgage was made in good faith, and with- ' Laws of 1833, c. 219, § 2 » Martin v. Rothschild, 42 Hun, ' L. 1868, ch. 293, § 6. 410. 196 MORTGAGES OF PEESONAL PROPEETY. out any intent to defraud creditors or purchasers.^ Tlie act of 1833 only adds another to tlie grounds on which a mort- gage of personal chattels may be void." Prior to the pass- ing of that act, a chattel mortgage might be good, although the possession of the property continued with the mort- gagor. It was open to explanation, and if the explanation was satisfactory to the court and jury, the mortgage was valid, notwithstanding there was no change of possession of the mortgaged property.' A further condition has been imposed by the act of 1833, to wit: that the mortgage shall be filed and refiled according to the terms of that statute.* § 284. Residence of mortgagor at time of execution of mortgage. — If the mortgagor is a resident of this State, the mortgage, or a true copy thereof, must be filed in the city or town where ihe mortgagor resided at the time when the mortgage was executed. The place of residence of the mortgagor at the time when the mortgage is filed is imma- terial;^ and if it be not filed at the place of residence of the mortgagor at the time of its execution, a subsequent filing in the town to which the mortgagor removes will not give vitality to it as against creditors and subsequent pur- chasers." The actual place of residence of the mortgagor will control, and an erroneous recital in the mortgage will not conclude the mortgagee.' > Otis v. Sai, 8 Barb. 102 ; contra, Coles v. Clark, 3 Cnsb. (Mass.) 399 Lee V. Huntoon, Hoff. HI. Forbes v. Parker, 16 Pick. (Mass.) 462 » Wood T. Lowry, IT Wend. 492; Harrington v. Brittan, 23 Wis. 641 Smith T. Acker, 23 Id. 663. Feurt v. EoweU, 62 Mo. 624; Berson 'Barrow v. Paxton, 6 Johns. 268; v. Nunan, 63 Cal. 560; Heyland v. Bissell V. Hopkins, 3 Cow. 166; Hall v. Badger, 36 Cal. 404; Fromme v. Jones, Tnttle, 8 Wend. 391; Smith v. Acker, 13 Iowa, 474; Cooper v. Brock, 41 23 Wend. 663. Mich. 488; Gaboon t. Myers, 67 Md. * Newell V. Warren, 44 N. T. 244, 578. 248; Wood v. Lowry, 17 Wend. 492; « Hicks v. Williams, 17 Barb. 523. Brunswick v. McClay, 7 Neb. 37. In ' Powers T. Freeman, 2 Lans. 127. many of the States registration of a 'Chandler v. Bunn, Lalor, 167; chattel mortgage is regarded as a sub- Stewart v. Piatt, 101 U. S. 731, 787; stitute for a change of possession. Piatt v. Stewart, 13 Blatcb. 481. Keenan v. Stimson, 32 Minn. 377; FILING OF CHATTEL M0ETGAGE8. 197 If a chattel mortgage is duly filed in the county where the mortgagor resides at the time when the mortgage is ex- ecuted, it will continue to be constructive notice, into what- ever county the mortgagor may remove with the property, and need not be filed there.^ It will not aid the mortgagee to show that the filing was done at a wrong place because of an honest mistake.' § 285. Non-resident mortgagor. — If the mortgagor be a resident of this State, it will make no difference where the mortgaged property may be situated;* but if he be a non- resident, the mortgage, or a copy of it, must be filed " in the city or town where the property so mortgaged shall be at the time of the execution of such instrument."* If the mortgagor is a non-resident, and the property is situated in more than one city or town, a filing in either place will render the mortgage valid as to the property sit- uated there, though it will be void as to property situated in a city or town where it was not filed.' § 286. Residence of corporation. — If a corporation be a mortgagor it will be deemed to have a residence at its place of business;* and a railroad is said to have a resi- dence in all the towns in which any part of its line is lo- cated.' 1 Hicks V. Williams, 11 Barb. 523; « Pond v. Hudson River R. R. Co., Cool V. Roche, 20 Neb. 550; Holt v. • 17 How. 543 ; Conroe v. National Pro- Kemick, 11 N. H. 285; Whitney t. tection Ins. Co., 10 Id. 403 ; LouisTille Hey wood, 6 Cush. (Mass.) 82; Barrows R. R. Co. T. Letson, 2 How. (U. S.) V. Turner, 50 Me. 12Y; Kanaga t. Tay- 479. lor, 1 Ohio St. 134; Smith v. McLean, ' Buffalo & State Line R. R. C». v. 24 Iowa, 322; Pease v. Odenkirchen, Supervisors of Erie, 48 N. T. 102; 42 Conn. 415 ; Elson v. Barrier, 66 Hoyle v. Plattsburgh Laws of 1833, c. 279, § 2. Watson v. Thompson Lumber Co., 49 * Hubbardston Lumber Co. v. Ark. 83. Covert, 36 Mich. 264. 198 MOBTGAGES OF PERSONAL PROPEETY. § 287. Joint-stock company.— It has been said that "it would be a most unreasonable construction of the act relat- ing to filing chattel mortgages, to hold that they must be filed in each town within the State in which one of the stockholders of a joint-stock company resides. The stat- ute is complied with if filed in the office of the town clerk of the town where the principal office of the company is located, or its business principally conducted."* § 288. Joint mortgagors residing at different places. — Where two or more joint mortgagors reside in different cities or towns of the State, the mortgage should be filed in each of their seTcral places of residence. The place where a copartnership carries on its business cannot be said to be the residence of the individual partners, and the statute cannot be satisfied by a filing at that place, or by a filing at the place of residence of one partner, or at the places of residence of any number of the partners short of the whole number.^ If there is more than one mortgagor, and one or more resides in the State, and others reside out of it, the mort- gage should be filed in the cities or towns where the resi- dent mortgagors reside, and also in the city or town where the chattels are located.' Where only one partner resides in the State, and his place of residence is also the place where the mortgaged property is situated, a filing of the mortgage at that place would be sufficient.* § 289. How filing to be done.— The papers are required to be filed in the office of the register and in the offices of the town clerks. It is not sufficient that they be delivered ' Per MuUin, P. J., in Nelson t. by any citation of authority, as to Neil, 16 Hud, 383. But see Stewart mortgages by unincorporated joint- V. Piatt, 101 TJ. S. 7S1. stock company. Nelson t. Neil, 15 1 Stewart v. Piatt, 101 U. S. 1S1 ; Hun, 388. Aultman y. Guy, 41 Ohio St. 598; " De Cource'y v. Collins, 21 N. J. Morrill v. Sanford, 49 Me. 566; Rich Eq. 367. T. Roberts, 48 Me. 548; 60 Me. 396. •• Hubbardson Lumber Co. v. Cov- But see a contrary ruling, unsupported ert, 35 Mich. 254. PILING OF CHATTEL MORTGAGES. 199 to those officials wliile absent from their offices. Where a mortgage was handed to a county clerk while absent from his office, to be filed therein, at ten o'clock on Saturday evening, and the clerk marked and indorsed it as filed at that hour, but did not in fact take it to or deposit it in the office until nine o'clock in the forenoon on the following Monday, the mortgage was held to be subsequent to a levy made at eight o'clock on Monday morning.^ If there be no clerk, or if he be absent, the mortgage may be filed with the person in charge of the clerk's office.^ The delivery to the recording officer must be absolute and unqualified. A request to the clerk to conceal the paper or to omit to record it until further notice, will ren- der the filing nugatory.' But if the filing is duly done by the mortgagor, as agent for the mortgagee, a subsequent request of the mortgagor to the clerk to prevent the mortgage from becoming known, such request being unauthorized by the mortgagee, will not affect him.* § 290. Duty of clerk. — If the mortgage be properly filed the mortgagee will be protected, even though the register or clerk shall omit to index it. He will not lose the priority of his lien on the mortgaged chattels because of the omis- sion to index, but the remedy of any person who shall be misled will be against the officer.^ So, the omission of the clerk to number the mortgage will not impair the mort- gagee's rights.' The mortgage is to be deemed properly filed, or recorded, if the statute so requires, when left with the proper officer and the legal fees are paid.' And when a chattel mortgage ' Hathaway V. Howell, 54 N. T. 91. 1 Daly, 489; s. c. 1 Abb. N. S. 32; 2 Bishop V. Cook, 13 Barb. 326 Dodge T. Potter, 18 Id. 193. ' Low V. Pettengill, 12 N. H. SSI Town T. Griffith, 17 K. H. 16S. * Case T. Jewett, 13 Wis. 498 Dodge v. Potter, 18 Barb. 193. See Griswold v. Sheldon, 4 W. Y. (4 Comst.) 581 ; Moriarty v. GuUickson, 22 Minn. 39. 6 Dodge V. Potter, 1 8 Barb. 193. Swift T. Hall, 23 Wis. 532. ' Mehrin v. Oaks, 61 Cal. 57 ; Hef- = Manhattan Co. v. Laimbeer, 108 lin v. Phillips, 78 Ala. 180. N. Y. 578, 690 ; Dikeman v. Puckhafer, 200 MOBTGAGES OF PBESONAL PBOPERTY. was duly filed with tlie town clerk, who received and prop- erly indorsed it without receiving or demanding any fees, he being himself the mortgagor, the fact that such clerk neglected to enter the same in his books was held not to in- validate it ; and the mortgagee, having done all that was re- quired of him by the statute, was protected.^ The payment or tender of the legal fees for filing is a condition for compelling the clerk, by mandamus, to re- ceive and file a mortgage.^ § 291. Effect of delay in filing. — The statute prescribes no time after the execution of a mortgage within which it must be filed ; it should be as soon as practicable after the mortgage is delivered,' but it may be filed at any time, sub- ject to the rights of intervening creditors and bona Jide pur- chasers.^ Delay in filing only subjects the mortgagee to danger of being cut off by the intervention of rights which did not exist when the mortgage was made.' An agreement not to put the mortgage on record unless the mortgagor should have trouble, does not, as a matter of law, avoid the mortgage as to creditors of the mortgagor.* § 292. The copy filed must be a "true copy." — A trifiing mistake might not vitiate, upon^ the principle that the law will not regard trifles. But the objects of the stat- ute must be considered, and any attempt at compliance not attaining those will be held a nullity. A compliance with the act will give to creditors and purchasers full informa- tion as to the property mortgaged, the amount of the debt or condition of the mortgage, and the extent of the interest of the mortgagor. When the paper fails to accomplish ■ People V. Bristol, 85 Mich. 28. Wiles v. Clapp, 41 Barb. 645 ; McVay « Stevens v. Hayt, 66 N. Y. 606; v. English, 30 Kans. 368; 1 Paoif. R. rev'g 7 Hun, 89. 796; Corbin v. Kinoaid, 33 Kans. 649; *,Par8halI v. Eggart, 52 Barb. 367. Cameron v. Marnn, 26 Kans. 612 ; Wil- ■■ Hicks V. Williams, It Barb. 528; son t. Leslie, 20 Ohio, 161. Thompson T. Van Vechten, 6 B08W. 873; ' Folsom v. Clemencc, HI Mass. rev'g s. u. 6 Abb. 458. 273. ' Westcott V. Gunn, 4 Duer, 107; FILING OF CHATTEL MOETGAGES. 201 these purposes, it falls short of the requirements of the statute, and whether it be caused by a mere clerical omis- sion or oversight, or by actual fraud, the mortgage will be void. This principle was maintained in a case where, by mete inadvertence, the amount of the debt had been er- roneously stated to be $646 instead of $546, in the copy which was filed, and such filing was held not to be a com- pliance with the statute.^ A mortgage which called for five days' notice was held sufficiently filed by a copy in which " twenty " was erroneously written instead of five.' A chattel mortgage having such defects as do not en- title it to record, although recorded, is inoperative.* § 293. Agreement forming part of mortgage. — A con- Teyance absolute on its face " intended to operate as a mortgage," the defeasance resting in parol, is sufficiently filed if a copy of it is left in the proper office. This is all "that can be done without making a writing to set out the ■entire agreement, and this is not required by the statute. If the contract is in two papers they should, doubtless, both be filed, but a subsequent paper, though declaring or modifying the original contract, need not be put upon the record.* When the mortgage refers to another paper for the terms of payment of the debt which it is intended to secure, it is not required to file more than the instrument by which the lien is created.^ Thus, where a chattel mort- gage in the usual form made the debt and interest payable in five years, " except in case default should be made in the performance of the conditions of a certain agreement, etc., in which case the principal and interest moneys shall be- come immediately due and payable ; " and the agreement thus referred to made the said mortgagor and his partner 1 Ely V. Carnley, 19 N. Y. 496; Hill v. Gilman, S9 N. H. 88; Gooding aflS'g 8. 0. 3 E. D. Smith, 489. v. Riley, 60 N. H. 400. ° Gillespie v. Brown, 16 Neb. 467. * Preston v. Southwick, 42 Hun, 3 Lovell V. Osgood, 60 N. H. 71 ; 291 ; Landon, J., dissented. * Byram v. Gordon, H Mich. 631. 202 MORTGAGES OF PEBSONAL PROPERTY. agree to pay the debt in montlily installments of fifty dol- lars ; it was lield not to be necessary to file any copy of such agreement.^ § 294. Schedule to be filed. — If the mortgage contains a schedule as an essential part of it, the schedule must be filed ; ^ but if it merely refers to a schedule without incor- porating it, the schedule can be kept from the record.' § 295. Lien clause in lease. — A lease of lands contain- ing a clause by which the lessee gives to the lessor a lien on chattels as security for rent, is to the extent of such clause, a chattel mortgage, and must be filed to render it valid against creditors of the lessee and purchasers from him.^ A mortgage on crops to be grown on the land of the mortgagor, the seeds of which are not sown, must be filed in order to be valid against creditors and purchasers.^ § 296. Filing after default. — Although, after default, the mortgagee's title to the mortgaged property becomes abso- lute, it is still necessary, until actual possession is taken by him, that the mortgage be filed, and that it be kept alive by refiling.* Any other rule would work a complete eva- sion of the statute. If it were unnecessary to file a mort- gage after forfeiture, mortgages could easily be drawn so as to be due at once, or in one day after date, and the neces- sity of filing would be completely avoided. The filing or refiling after a default being necessary to the protection of the mortgagee against creditors and others, is not a waiver of the forfeiture.' ' Shuler T. Boutwell, 18 Hun, 171. valid -without registration. Hudgins ' Sawyer v. Pennell, 19 Me. 167; v. Wood, 72 N. C. 256. Piatt V. Stewart, 13 Blatohf. 481, 495. « Miller v. Chapel (Minn.), 34 Alb. 2 Chapin V. Cram, 40 Me. 561. L. J. 154. " Reynolds V. Ellis, 103 N.Y. 115; « Gould v. Brown, 4 N. Y. Leg. affi'g 34 Hun, 47- Obs. 423 ; Manning v. Monaghan, 1 An assignment by a cropper of his Bosw. 459 ; Porter v. Parmley, 62 N. half of the crop, less the land-owner's Y. 185. advances, is not a mortgage, and is ' Hulsen v. Walter, 34 How. 385. PILING OP CHATTEL MOBTGAGES. 203 § 297. Legal force of certified copy. — It is permissible to file the original mortgage, but filing a true copy will answer the same purpose. This being the case, it is prac- tically much better to keep the original off from the files, since the certificate of the clerk that a certain paper is a true copy of an original chattel mortgage is no proof of the existence of the mortgage ; nor is it evidence that the paper purporting to be a copy of such mortgage is a copy.^ A certified copy of a chattel mortgage is not admissible in evidence until the existence of the original is proved,^ and it is then evidence only of the fact that such instrument or copy and statement was received and filed according to the indorsement of the clerk or register, and of no other fact ; and in all oases the original indorsement by the clerk or register, made in pursuance of the act, upon such instru- ment or copy, is received in evidence only of the facts stated in such indorsement.' § 298. Discharging mortgage of record. — By a statute passed in 1879,^ it is enacted that "whenever any mort- gagor, or any person obtaining title to mortgaged prop- erty, shall present to any recorder, county or town clerk, in whose office a chattel mortgage executed by said mort- gagor on such property may be filed, a certificate from the mortgagee therein named, or the holder or owner thereof, that such mortgage is paid or satisfied, it shall be the duty of such recorder, or either of the clerks above mentioned, to file such certificate in his office and discharge such mort- gage, by writing in the book kept by such recorder, or either of such clerks, and opposite the entry therein of such mortgage, the word "discharged," with the date thereof. ' Bisaell v. Pearce, 28 N. Y. 252 ; 3 ^a^s 01, 1833, 0. 2*79, § i. See Sunderlin v. Wyman, 10 Hun, 493 ; Van Hassel v. Borden, 1 Hilt. 128 ; Maxwell T. Inman, 42 Hun, 265. George v. Toll, 39How. 49Y; Warner ' Fellows V. Van Hyring, 23 How. v. Comatook, 55 Mich. G15. 230. "L. 1879, ch. 11}. 204 MORTGAGES OF PEBSONAL PEOPEETY. § 299. Affidavit required in some States. — In some of the States, it is necessary that an affidavit as to the bona fides of the mortgage shall be annexed to the mort- gage as recorded or to the copy as filed. The persons by whom these affidavits are to be made, and the form and contents of the affidavits, are set forth in the respective statutes. These States are Arizona,' California,^ Delaware,^ Idaho,* Maryland,' Montana,* Nevada,' New Hampshire,' New Jersey,' Ohio," Utah," Vermont,'^ and Washington Territory.*' Befcling op Chattel Mobtgages. § 300. Necessity of annual refiling. — As the statute concerning the filing of mortgages stood prior to 1873, every mortgage filed in pursuance of the act ceased to be valid as against creditors or subsequent purchasers, or mortgagees in good faith, after the expiration of one year from the filing thereof ; " unless, within thirty days next preceding the expiration of the said term of one year, a true copy of such mortgage, together with a statement exhibiting the interest of the mortgagee in the property thereby claimed by him, by virtue thereof, shall be again filed in the office of the clerk or register aforesaid, of the town or city where the mortgagor shall then reside." " ' Arizona, Act of March 9, ISSY. Supplement, 1886, to Revision of 18'7'7, "California, Civil Code, g§ 1164, Mortgages, § 1 1 ; Ehler v. Turner, 85 2967. N. J. Eq. 68. 3 Delaware, L. 1877, eh. 477, § 4. lo Ohio, R. S. §§ 4150, 4151, as am'd < Idaho, Rev. Stat, of 1887, § 3387. by L. 1886, §§ 4152 to 4155. « Maryland, Rev. Code of 1878, art. " Utah, L. 1884, ch. 21, as am'd, L. 44, §§ 85, 36, 64. 1886, ch. 89. « Montana, Compiled Stat. 1887; i^ Termont, Rev. Laws 1880, Gen. Laws, § 1638. §§ 1965 to 1970; L. 1882, No. 70; ' Nevada, Stat. 188*7, ch. Ivii, L. 1886, No. 91. amending Gen. St. 1885, § 2634. la Washington Territory, Code 1881, ' New Hampshire, Gen. Laws 1878, § 1987. ch. 187, §§ 2 to 12. " Laws of 1833, u. 279, § 3. 'New Jersey, L. 1885, p. 318; KEFILING OF CHATTEL MOBTGAGES. 205 Under this provision it was held that a new copy must be filed within thirty days preceding the expiration of the first year, and so on, from year to year if the mortgagee wished to continue his lien.* Each refiling was con- sidered as a new filing, subject to the same rules as the original filing,^ and the time for the second refiling was com- puted by the lapse of one year from the second filing, and not two years from the first.^ None of the decisions which established this rule were by the Court of Appeals, but it was generally conceded to exist, and the practice of suc- cessive refiling became general. In NeweU v. Warren (44= N. T. 244 ; rev'g s. c. 44 Barb. 258) the Court of Appeals gave the statute another con- struction, by holding that only one refiling was necessary. When thus refiled the mortgage became a completed secu- rity, and no further filing was necessary to make it a con- tinuing security. It is evident that the statute did not, by its terms, require any further filing, and it is remarkable that for nearly forty years the profession construed the en- actment by the practice under it, rather than by the lan- guage used by the Legislature. This decision was rendered in December, 1870, and the Legislature, in 1873, amended the act of 1833 by enact- ing that "every mortgage filed in pursuance of this act, shall cease to be valid as against the creditors of the per- son making the same, or against subsequent purchasers or mortgagees in good faith, after the expiration of one year from the filing thereof, unless within thirty days next pre- ceding the expiration of each and every term of one year after the filing of such mortgage, a true copy of such mortgage, together with a statement exhibiting the interest of the mort- gagee in the property thereby claimed by him by virtue thereof, shall be again filed in the office of the clerk afore- said of the town or city where the mortgagor shall then re- ' Nitchie v. Townsend, 2 Sandf. ' Siteliie v. Townsend, 2 Sandf. 9. 299. ' Swift V. Hart, 12 Barb. 630. 206 MOETGAGES OF PEESONAL PROPERTY. side/ if the mortgagor shall be a resident of this State ; and if not such resident, then in the office of the clerk or register of the town or city where the property so mort- gaged was at the time of the execution of such mortgage." ^ § 301. Another copy to be filed.— The statute requires the paper to be " again filed." This seems to imply, in lit- eral significance, a refiling — a second filing of the same paper — that is, the filing again of the paper previously filed. This is not considered necessary ; a true copy can be filed in the first instance and another true copy, or the original mortgage, can be filed at the proper time by way of refiling.^ Where the mortgagee, thirty days before the expiration of a year from the first filing of the mortgage, procured the clerk to indorse upon it " refiled and renewed," with the date, this was held not a sufficient statement under the act.* So a memorandum written with pencil on the back of the copy filed, as follows : " No interest to date," was held not to be a compliance with the law. It was also objectionable as being easily obliterated or changed.^ § 302. Calculations of time for successive refiling. — There can be no doubt of the necessity of successive refil- ings under the present statute. The first refiling must be made within thirty days next preceding the expiration of a year after the first filing ; the second refiling within thirty days next preceding the expiration of two years after the first filing, and so on. The time must be calculated in each case from the original filing, and not from the last refiling, and in this respect the statute makes a change in the former practice. Sunday should be counted as one, though it be the last of the thirty days.' The statute must be strictly > Laws of 1873, c. 601. ' Theriot v. Prince, 1 Edm. Sel. "^ As amended by Laws of 1879, oh. Gas. 219. 418. "Nitchie v. Townsend, 2 Sandf. ' Stockham v. AUard, 2 Hun, 67. 299. * Fitch V. Humphrey, 1 Den. 168. REFILING OF CHATTEL MOETGAGES. 207 complied with, and a filing before tlie commencement of the thirty days would be just as nugatory as one after the ex- piration of that time.^ § 303. Fraction of a day. — Where a chattel mortgage was filed at 7.30 a. m., and on the same day of the next year at 5 p. M., an execution was issued and levied upon the prop- erty, the mortgage not having been renewed, it was held that the year expired at 7.30 a. m., and that the lien of the execution was prior.^ § 304. Place for refiling. — The refiling was, by the stat- ute of 1873, required to be " in the office of the clerk afore- said of the town or city where the mortgagor shall then re- side." If the mortgagor should be a non-resident, or if he should leave the State, and- if, during the thirty days next preceding the close of the year, he did not reside in it, it would be impossible for the mortgagee to comply with this provision. No other place for refiling the mortgage was named, except the place of residence of the mortgagor ; the statute declared that if it be not refiled at the residence of the mortgagor, it shall cease to be valid, and the conclu- sion necessarily was that the mortgage would cease to have any force as against creditors and subsequent purchasers, as well when the refiling is rendered impossible as when it is omitted for any other reason.' But this defect in the law was remedied by an amendment to the statute, passed in 1879,* which directed that the mortgage " shall be again filed in the office of the clerk or register aforesaid of the town or city where the mortgagor shall then reside, if the mortgagor shall be a resident of this State, and if not such - resident, then in the office of the clerk or register of the town or city where the property so mortgaged was at the time of the execution of such mortgage." ' Newell V. Warner, 44 Barb. 258; ' Lookwood, &q. Co. t. Crawford, rev'd on other grounds, 44 N. Y. 244; 29 Kans. 286. ISTational Bank of the Metropolis v. ' DiUingham v. Bolt, Z1 N. Y. 198; Sprague,.20 N. J. Eq. 13. Smith v. Moore, 1 1 N. H. 65. * Laws of IStO, oh. 418. 208 MOBTGAGES OF PEESONAL PEOPEETY. § 305. Refiling after the expiration of the year.— It was said in Swift v. Hart (12 Barb. 530), that the refiling of a chattel mortgage more than a year after the filing ia equivalent to an original filing under the statute, as against a creditor whose execution is levied within a year after the refiling. But in Marsden v. Cornell (5 N. T. Sup. [T. & C] 27 ; 2 Hun, 449 ; s. c. affi'd, 62 N. T. 215), the doctrine of Svnft V. Hart was overruled, as tending to render inopera- tive the express provisions of the statute. After a mort- gage has once been filed the statute declares that it shall " cease to be valid " after one year, unless it be refiled with a proper statement of the mortgagee's interest. It is the mortgage itself which ceases to be valid, and not merely the registration of it, and it cannot have its validity restored by a new filing. If such a construction were permitted, the statement required by the act might be entirely omitted, and the mortgage might, nevertheless, be kept on foot by virtue of the misnomer of calling a refiling an original filing.^ § 306. New mortgage for old consideration. — If, instead of filing a copy of the original mortgage with the statement required by the statute, the mortgagee procures and files a new mortgage, he thereby runs the risk of the execution being put into the hands of the sheriff, after the first mort- gage has become void by the expiration of the year and be- fore the new one is filed. But although the original mort- gage ceases to be in operation in consequence of the omis- sion, the new one, if otherwise valid, is not thereby affected. Instead of the copy and statement coming from the mort- gagee, there is a new instrument expressing the amount com- ing from the mortgagor or from both parties. The statute has this meaning and no other, that if the mortgagee would ' In Nixon v. Stanley, 33 Hun, 247, ruled or questioned, so far as I can find, the doctrine of Swift t. Hart (supra) after a very careful examination of all is followed, and the court said: " The in- the cases." The attention of the court terpretation given to the statute in this had evidently not been called to Mars- case (Swift V. Hart) has not been over- den v. Cornell (supra). REFILING OF CHATTEL MORTGAGES. 209 keep his security in force and retain priority as of its origi- nal date, he must file the copy and statement as prescribed. This is in his power when the mortgagor will not or can- not give a new mortgage. But the statute does not prohibit a fresh mortgage to take effect from its date or filing, although the consideration and the property should be the same.* If an execution is put into the hands of the proper sher- iff after the expiration of the year and before the execution and filing of the new mortgage, it forthwith becomes bound by the execution,'' and the mortgagee is not protected by the provision to the effect that " the title to personal property acquired before the actual levy of an execution, by a pur- chaser in good faith, and without notice that the execution has been issued, is not affected by an execution delivered, be- fore the purchase was made, to an ofiicer, to be executed."^ The taking of a new chattel mortgage for the old debt, with- out parting with any new consideration, does not constitute the mortgagee a " purchaser in good faith " so as to come within the protection of the statute.^ Where the mortgagor endorsed on the original mort- gage : " This mortgage is hereby renewed for one year from this date," and thereupon refiled it, this was held to amount to the execution and filing of a new mortgage.' § 307. Intervening mortgage.— When the first mortgage is discharged and a new note, maturing at a later date, is se- cured by another mortgage on the same property, a mort- gage subsequent to the original one, although unknown to the first mortgagee, will take precedence of the substituted mortgage.* But the holder of the later lien may attack the intervening mortgage for actual fraud.' ' Lee V. Huntoon, 1 Hoff. Ch. 44*7; * Osborn v. Alexander, 40 Hun, Walker v. Henry, 85 N. Y. 134; Oa- 323. born T. Alexander, 40 Hun, 324 ; affi'g ' Smith v. Cooper, 22 Hun, 11. 17 Abb. N. C. 132, n. ' Daly v. Proetz. 20 Minn. 41. ^ Code of CIt. Proc. § 1406. ' McCormick v. Hartley, 107 Ind. 3 Code of CiT. Proc. § 1409. 248. 14 210 MOBTGAGES OF PEESONAL PEOPEBTT. § 308. Statement of mortgagee's interest on refiling.— With the copy of the mortgage filed to continue the lien, there must also be filed " a statement exhibiting the inter- est of the mortgagee in the property thereby claimed by him by virtue thereof." ^ The object of the statute was to furnish a fair and reasonable notice to creditors and subsequent purchasers, and to prevent them from being misled by the possession and apparent ownership of the mortgagor. The statement required by the statute has universally been understood to be a statement of the amount remaining un- paid upon the mortgage, and such was undoubtedly the in- tention of the Legislature in the use of the expression. In the absence of fraud, or perhaps of gross negligence, it is not necessary to the preservation of the validity of the mortgage, that the statement should be entirely definite and accurate to the smallest amount. No doubt if the mortgagee should fraudulently make a false statement, by which the amount remaining unpaid should be willfully exaggerated ; or should willfully, and with a view to hinder, embarrass or mislead creditors or purchasers, make a statement so vague and indefinite as not to answer the sub- stantial object and purpose of the statute, the statement would be held insufficient and void. And perhaps a grossly inaccurate or vague statement, even without any fraudulent intent, where it appeared that the mortgagee had the means of making it accurate and definite, might be held not to be a compliance with the statue.^ But where the statement is made in good faith, with reasonable care, and is substan- tially correct and accurate, the mortgagee will have com- .plied with the spirit and intent of the statute.' In Dillingham v. Bolt (37 N. Y. 198), the statement was that " somewhere about the sum of $60, as near as can be ascertained," remained unpaid upon the mortgage. The sufficiency of the statement was necessarily assumed by the " Laws of 1833, c. 279, § 3, as am'd ' Per Talcott, J., iu Patterson t. by Laws of 1873, c. 501. GiUies, 64 Barb. 563. ' Ely V. Carnley, 19 N. Y. 496 ; aflB'g s. 0. 3 E. D. Smith, 489. WHEN FILING 18 UNNECE8SABY. 211 General Term of the Supreme Court, and appears by the opinion to have been conceded by the Court of Appeals. If the statement be for too small an amount, it will not invalidate the mortgage for the amount stated, but the mortgagee cannot collect more than the amount stated to be due, unless other interested parties have actual notice of the amount. Where the statement refers to other papers filed with it, so that the amount claimed to be due can be arrived at, this will be sufficient.^ But a reference to a lease, the covenants of which are secured, without stating how far those covenants have been performed, will not satisfy the statute.' The statement to be endorsed on the copy must be made by the mortgagee in person or by attorney.' A statement of the amount due signed by the mortgagor would not suf- fice to continue the prior lien,* but an endorsement of ap- propriate words by the mortgagor might amount to the execution of a new mortgage.^ "When Filing is Unnecessary. § 309. If the mortgage be accompanied by an imme- diate delivery, and be followed by an actual and continued change of possession, the statute will not apply ; the pos- session of the mortgagee will be more than a substitute for filing ; it will be an evidence of good faith, and the burden of proof will rest upon the creditor or purchaser alleging fraud. This is the case of all pledges, and the rule will include all assignments of mortgages and of other choses in action by way of security, which are really pledges." So, a delivery of a bill of lading as collateral to a note ' Beers v. Waterbury, 8 Bosw. 396. « Newell v. Warner, 44 Barb. 268. s Brigga v. Mette (Mich.), 3 N. W. » Smith v. Cooper, 22 Hun, 11. Rep. 231. « Haskins v. Kelly, 1 Abb. N. 8. ' Osborn v. Alexander, 40 Hun, 63 ; s. c. 1 Robfc. 160 ; see Tyler v. 323, 328. Strang, 21 Barb. 198. 212 MORTGAGES OP PERSONAL PROPERTY. is a delivery of the property, and the papers need not be filed.» When the mortgagee takes the property into his actual possession, this will be a substitute for filing, and the mort- gage may be shown to be valid as against creditors whose liens did not attach, or purchasers or mortgagees whose rights were not acquired until after that time.* It is suf- ficient to protect the mortgagee that possession was taken before levy.' It is only when the mortgagor is to remain in possession that the mortgage is required to be made a matter of record.* If the mortgagee is in fact in possession, the mortgage not being filed, and the mortgagor continues to sell and ap- ply proceeds to the payment of the mortgage debt, the mortgage may still be valid.° It has even been held that if the mortgagee, having filed his mortgage, commences proceedings to enforce the for- feiture, or to sell the equity of redemption, before the year from the filing of the mortgage has elapsed, this will render a refiling unnecessary, and that causing the property to be advertised for sale is sufficient.^ § 310. Where manual delivery is impossible. — There are cases of mortgages where an actual manual delivery of the property is impossible, and where the want of a change of possession is not evidence of a fraudulent intent ; as, if the property is in the possession of a third person. In • First Nat. Bank of Cincinnati v. Applewhite v. Harrell Mill Co., 49 Kelly, 67 N. Y. 84. « Levin v. Russell, 42 N. T. 251 Porter v. Parmley, 34 N. Y, Super, 398; 43 How. 445 ; 13 Abb. N. S. 104 Jaffray v. Thompson, 65 Iowa, 323 Jafitay v. Greenbaum, 64 Iowa, 492 Morrow T. Keed, 30 Wis. 81 ; First Nat Bank of Madison v. Damm, 63 Wis 249; Coe v. Manseau, 62 Wis. 81 Isenberg v. Fansler, 36 Kans. 402 Ark. 279; Hauselt v. Harrison, 105 U. S. 401. ' Dolan T. Van Demark, 35 Eans. 306 ; Cameron v. Marvin, 26 Eans. 612, 625. 4 BiemuUer v. Schneider, 62 Md. 647. ' Wilcox V. Jackson, 7 Col. 621. « Otis V. Sill, 8 Barb. 102. WHEN FILING IS UNNECESSARY. 213 suchi a case filing is not necessary, and nothing short of actual fraud will invalidate the mortgage.' When the mortgaged chattels are bulky and only sym- bolical delivery can be made, and they are left where the possession is uncertain, doubts must be decided in favor of creditors or purchasers, and against the mortgagee, since he could have protected himself by filing the mortgage.* § 311. Change of possession of only part of property. — The statute does not avoid the mortgage merely as to so much of the property as remains in the possession of the mortgagor. The mortgage itself is declared void if not filed as directed by the act, when it is not accompanied by an immediate delivery, and followed by an actual and continued change of possession of the things mortgaged. A change of possession as to part of the property in- cluded in the mortgage is not a change of possession of the things mortgaged within the intent and meaning of the statute. The mortgage must therefore be filed unless there is an immediate delivery of the whole property em- braced therein and a continued change of possession, or such mortgage is made absolutely and wholly void, as to creditors, by the express terms of the statute.' § 312. Absolute transfers not within statute. — The only transfers of chattels which are required to be filed are those which are intended to operate as mortgages. Absolute assignments of personal property, though prima faxyie fraudulent if not accompanied by possession, gain nothing by being filed. So, the assignment of a chattel mortgage need not be filed, the provisions of the statute having no application to rights of creditors of the mort- gagee.^ But an instrument which upon its face purports ' Nash V. Ely, 19 Wend. S23; Ar- ' Anderson v. Brenneman, 44 Mich ■cher V. Hubbell, 4"Wend. 614; Good- 198. win V. Kelley, 41i Barb. 194; Smithy. ^ Per Chancellor Walworth, in Post, 1 Hun, 616. Benedict v. Smith, 10 Paige, 126, 128. Baxter v. Gilbert, 12 Abb. 97. 214 MORTGAGES OF PEESONAL PROPERTY. to be an absolute assignment, should be filed if it is in- tended to operate as a security, and if it is not accompanied by a change of possession.* If the property has been sold and transferred, and a mortgage has been made by the purchaser, a judgment- creditor of the vendor cannot gain any advantage from an omission to file the mortgage.' § 313. Mortgages of interests in land.— The statute under consideration has no application to mortgages of interests in land,' but if a mortgage covers both real and personal property it is, as to the personalty, a chattel mortgage, and should be filed.^ Neither does it apply to a mortgage of a registered British vessel executed abroad ; but it relates only to mortgages executed within this State, or upon property which is here at the time.^ §314. Mortgages of leases. — The provisions of law relating to the filing of mortgages of chattels have no ap- plication to leases of real estate ; and a transfer of such a lease, though intended as a security, does not require to be filed in order to be valid as against creditors of the as- signor. These provisions relate to goods and chattels which can be removed from one place to another, and the possession thereof changed, and not to chattels real or to choses in action. The filing of a chattel mortgage as to a lease would be but an idle ceremony and of no conse- quence whatever, and there could be no such change of possession of such an instrument as is contemplated in re- gard to ordinary chattels.' A lease for a term exceeding three years is, by the statuie concerning the recording of conveyances, treated as • Tyler v. Strang, 21 Barb. 198. <■ Fairbanks v. Bloomfield, 6 Duer, ' Henry t. FergUBon, 65 Mich. 399. 434. <■ ' Breese v. Bange, 2 E. D. Smith, « Per Miller, J., in Booth v. Kohoe. 474. 71 N. Y. 341, 343; Breese v. Bange, 2 * Stewart v. Beale, 1 Hun, 406. E. D. Smith, 474. WHEN FILING IS UNNEOESSAEY. 215 real estate,^ and a mortgage of such a lease must be re- corded as a mortgage of real estate.' , § 315. Conditional transfers of choses in action. — The statutes requiring mortgages of goods or chattels to be filed have no application to conditional transfers of mere choses in action, and such conditional transfers need not be filed.' This principle exempts a transfer of a mortgage intended as security from being filed as a mortgage on a chattel ; * so, a legacy is not a chattel within the meaning of the statute, and a mortgage of it need not be filed ; ° and the same rule will apply to a mortgage of the capital stock of a corporation,* or to a mortgage on an agreement by which the mortgagor is to receive a part of a crop cultiTated by him.' In all these cases the possession of the thing mortgaged cannot be taken, otherwise than by the formal writing, and the object of the statute as to filing is to make a substitute for actual possession. § 316. Insurance. — There is no necessity for filing a mortgage upon chattels which have been destroyed by fire, in order to protect the right of action against the insurers. A mortgagee of chattels which are insured by a policy payable to him as his interest may appear, is entitled to the insurance money to the amount of his mortgage debt, as against creditors of the mortgagor, attaching after a loss, although the mortgage was not recorded.* §317. Mortgages by railroad companies.— Where a mortgage is made by a railroad of its real estate and roll- ' 1 R. S. 762, § 36. ■• Harrison v. Burlingame, 48 Hun, !! Johnson V. Stagg, 2 Johns. 610; 212. Berry v. Mutual Ins. Co., 2 Johns. Ch. ' Bacon v. Bonham, 27 N. J. Eq. 603 ; Spielman v. Kliest, 36 N. J. Eq. 209. 199. ' Rowland v. Plummer, 50 Ala. ' Harrison v. Burlingame, 48 Hun, 182 ; Williamson v. N. J. South. R. R. 212; Booth v. Kehoe, 71 N. Y. 343; Co., 26 N. J. Eq. 398. Monroe v. Hamilton, 60 Ala. 226; ' Hudgins v. Wood, 72 JS. C. 266. Kirkland v. Brune, 31 Gratt. (Va.) » jjanson v. The Phoenix Ins. Co., 126. 64 Wis. 26; Coykendall v. Ladd, 32 Minn. 529. 216 MORTGAGES OF PEESONAL PEOPEKTY. ing stock, the question has been raised as to whether such mortgage, in addition to being recorded as a mortgage of real estate, should not also be filled as a mortgage of chat- tels. It was claimed that the rolling stock is merely ac- cessory to the real estate, that it partakes of the nature of realty, being in law fixtures, and that therefore filing is unnecessary.* But this view has not prevailed in our courts of final resort, and it has been held that the roll- ing stock of a railroad is not a part of the realty, but re- tains its character as personal property, and that a mort- gage of such property is governed by the same rules with regard to filing, as other mortgages of chattels.^ The ques- tion was also set at rest by Laws of 1868, c. 779, which enacted that it should not be necessary to file as a chat- tel mortgage any mortgage which had been or which should thereafter be executed by any railroad company upon real and personal property, and which had been or should be recorded as a mortgage of real estate in each county in or through which the railroad runs.^ Lex Loci. § 318. Law of place of contract. — The validity of a con- tract is, for most purposes, to be judged by the law which prevails where the contract is made and is to be performed. Upon this principle a chattel mortgage executed to secure a debt valid under the law of the place of contract, is to be judged by that law so far as the debt is concerned. Thus, ' Bement v. Plattsburgh & Mont. ' Where a mortgage of personal E. R. Co., 47 Barb. 104; Hoyle v. property of a railroad, after being filed Plattsburgh & Mont. R. R. Co., 51 Id. a year, was never refiled, and some 46 ; but 3. 0. rev'd, 64 N. T. 314. time after an act was passed providing ' Hoyle T. Plattsburgh <& Montreal that a chattel mortgage of any railroad R. R. Co., 64 N. Y. 314; rev'g s. o., or canal company should be valid with- 51 Barb. 45 ; The Farmers' Loan Hauselt v. Harrison, 105 U. S. see contra, Hanes v. Tiffany, 25 Ohio 406. 222 MOETGAaES OF PERSONAL PROPERTY. mortgage on the ground that it was not filed.' And a re- ceiver appointed by the court, in an action brought by a creditor of the mortgagor to set aside a conTeyance of real and personal property, to which the mortgagee is not a party, cannot treat the mortgage as of no effect on the ground of an omission to file it." The administrators of the mortgagor are bound by the mortgage, though not filed.' § 325. Creditors of mortgagor. — In order that pur- chasers or mortgagees may claim the advantage of this provision, it is necessary that they should be "subse- quent," and it is also necessary that they shall have ob- tained their conveyances or mortgages "in good faith." But no such limitation is placed as against creditors. Their rights may have accrued prior to the making of the mortgage or subsequent to it, and they may still take ad- vantage of the failure of the mortgagee to comply with the condition which the statute imposes upon him, under which condition alone he is suffered to rebut by evidence the presumption of fraud arising from his continued pos- session. It is true that the mortgage cannot be legally questioned until the creditor clothes himself with a judg- ment and execution, or with some legal process ; for cred- itors cannot interfere with the property of their debtor without process. But when they present themselves with their process the statute declares, without any qualifica- tion, that a mortgage which has not been filed is void as against them.* Notice to a judgment-creditor of an existing mortgage is no answer to his objection that the mortgage has not been ' steward v. Cole, 43 Hun, 164. see Kilbourne v. Fay, 29 Ohio St. 264; 2 Lane v. Lutz, 3 Abb. App. Dec. Currie v. Knight, 34 N. J. Eq. 485. 19. * Laws of 1833, c. 2*7, § 1; Thomp- 3 Martin v. Ogden, 41 Ark. 186; son v. Van Vechten, 27 N. Y. 668, 582; Griffin v. Wertz, 2 Bradw. (111.) 487; Theriot v. Prince, 1 Edm. Sel. Gas. Gillv. Finney, 12 Ohio St. 38,47. But 219; Stewart v. Beale, 7 Hun, 406; Eraser v. GUbert, 11 Hun, 634. WHO MAY TAKE ADVANTAGE OF OMISSION TO FILE. 223 filed.^ As was said by Cowen, J., in WJiite v. Cole (24 Wend. 123, 124:), " a creditor having notice of a fraudulent mort- gage is a reason why he should bestir himself to avoid it." A mortgage for purchase-money has been held junior to an execution against the mortgagor in the hands of the sheriff but not levied at the time of the sale, for a delay of twenty hours in recording the mortgage.^ But a different rule has been applied as between a mortgage for the purchase-money and a junior mortgage, in which case the purchase-money mortgage was awarded the preference.' § 326. Creditor must have a lien. — The creditors of the mortgagor, as to whom an unfiled chattel mortgage is void, are those who have obtained attachments or judgments up- on their debts, and who have thereby acquired liens. A general creditor without any lien cannot attack a mortgage on this ground.* Where a judgment-creditor of the mortgagor made an agreement with the holder of an unfiled mortgage, by which the mortgagee agreed that a sale should be made free of the mortgage, and the mortgage-debt should be paid out of the proceeds, this was held to estop the creditor from after- ' Stevens v. Buffalo & N. Y. City W. Dig. 523 ; Manufacturer's Nationa R. K. Co., 31 Barb. 590; Sayre v. Bank of N. Y. v. Rober, 19 W. Dig. Hewes, 32 N. J. Eq. 652 ; Williamson 476 ; Ebling v. Husson, 54 N. Y. Supr. V. N. J. Soutliern R. R. Co., 29 N. J. (22 J. & S.) SI'J; Clark v. Gilbert, 14 W. Eq. 336 ; 28 N. J. Eq. 211 ; Brothers v. Dig. 24!; Stewart v. Beale, 1 Hun, 411; Mundell, 60 Tex. 240; Braley t. Jones t. Graham, 77 N. Y. 628 ; Over- Byrnes, 26 Minn. 297; Houk v. Con- street t. Manning, 67 Texas, 657; don, 40 Ohio St. 569 ; Crippen t. Grace r. Wade, 45 Texas, 527; Ransom Fletcher, 56 Mich. 386; People v. Bris- v. Schmela, 13 Neb. 77 ; Fitzgerald v. tol, 35 Mich. 32; Haynes v. Seppig, 40 Andrews, 15 Neb. 52; Gregory t. Mich. 607 ; Waite t. Matthews, 50 Whedon, 8 Neb. 373. The direction of Mich. 392; Baxter v. Smith, 2 Wash. a statute, that the assets of an insoly- T. 97 ; Foster v. Gillespie, 68 Mo. 644; ent estate shall be distributed ratably Ramsey v. Glenn, 6 Pacif. Rep. 265. among the creditors of a decedent, ' Self T. Sanford, 4 Bradw. (111.) gives them a lien in such assets such 329. as to entitle them to contest the valid- ' Walker v. Vaugn, S3 Conn. 577. ity of a chattel mortgage not duly * Kennedy v. National Union Bank, filed. Currie v. Knight, 84 N. J. Eq. 23 HuD, 494; Grassmuck v. Bauer, 17 485. 224: MOETGAGES OF PERSONAL PEOPEBTY. ward asserting tlie invalidity of tlie mortgage, though, at the time of making the agreement, he was ignorant of the fact that the mortgage was not filed.^ § 327. The purchasers or mortgagees who are bene- fited by the failure of a mortgagee to file or refile his mort- gage, are "subsequent" purchasers or mortgagees. By this term it is not intended that they shall merely have ac- quired their rights subsequent to the mortgage, but that they have become purchasers or mortgagees subsequent to the time when a mortgagee omitted to file or refile his se- curity as required by the statute.^ In Meech v. FatcMji (14 N. Y. [4 Kern. J 71) a mortgage had been made to the de- fendant and duly filed ; a few months after, another mort- gage to the plaintiff was executed and filed. More than a year elapsed; the defendant did not refile his mortgage, but the plaintiff kept his alive by successive renewals. Notwithstanding this, it was held that the defendant re- tained the priority which he had gained by his original fil- ing.« In DUlingliam v. Bolt (37 N. Y. 198 ; rev'g s. c. 35 Barb. 88) a mortgage had been made of a canal-boat, and duly filed ; subsequently to this the mortgagor sold the boat to a purchaser for value, and without notice. A year elapsed; the mortgage was not refiled, and, subsequent to the expira- tion of the year, the boat was again sold to another inno- cent purchaser. Under the principle of Meech v. PatcMn (supra) the first purchaser took subject to the mortgage, and the failure to refile did not help him, and it was there- fore argued that the last purchaser could acquire no greater rights, but this principle was said by the court to have no application under the registry acts. The last purchaser took at a time when, if he had searched the records, he ' Lane v. Lutz, 3 Abb. App. Dec. 19. v. Monaghan, 23 N. Y. 539 ; Wray v. 5 Latimer v. Wheeler, 30 Barb. Fedderke, 43 TS. Y. Supr. (IIJ. & S.) 486; s. 0. affi'd, \ Keyes, 468; Mars- 336. den V. Cornell, 62 N. Y. 216 ; Manning " Jaqueth v. Merritt, 29 Hun, B84. ■WHO MAY TAKE ADVANTAGE OF OMISSION TO FILE. 225 would have found nothing ; he was a subsequent purchaser in good faith, and as to him the mortgage was void.-' A purchaser at a foreclosure sale, made under a mort- gage given and filed while the prior mortgage was in full force, is a "subsequent purchaser," and will take free from the lien of the first mortgage, unless, at the time of the sale, it has been kept alive by proper refiling.^ § 328. Who are not "subsequent purchasers." — No rule of public policy protects subsequent purchasers or mortgagees to the extent of enabling them to claim more than they bargained for. A purchaser of a mortgaged chattel, with knowledge of the existence of the mortgage, is not a purchaser in good faith, and neither the statute nor any equitable principle will justify him in making claim to the interest of the mortgagee as well as his own.' The same rule will apply to one who parted with no value for his conveyance ; as if he received it for an antecedent debt,* or as assignee for the benefit of creditors.' So, too, a mortgagee who takes subject to another mortgage, and with notice of it, cannot take advantage of a want of filing of the first mortgage.* Filing the second mortgage first does not secure priority.' Notice to a purchaser, after his purchase, of a prior un- filed mortgage, will not affect his rights. Thus, where a ' Overruling, in effect, Wiles v. Thompson v. Van Veohten, 27 N. Y. Clapp, 41 Barb. 645. 668. An extension of the time of pay- ' Jaqueth v. Merritt, 29 Hun, 584. ment of a past-due indebtedness held 'Lewis V. Palmer, 28 N. Y. 211; sufficient. Sheldon v. Warner, 26 Benjamin v. The Elmira, Jefferson 16 Barb. 46. Minn. 228. WHO MAY TAKE ADVANTAGE OF OMISSION TO FILE. 229 titled ; and tliat no act' of passive sufferance, wliere the creditor is not required by the surety to proceed, will affect the surety's obligations.'' >Per Van Hoesen, J., in N. Y. Strobh. Ch. 59; Philbrook t. McEwen, National Exchange Bank v. Jones, 9 29 Ind. 347. See dictum contra, in Daly, 248, 251 ; Hampton v. Levy, 1 Schroeppell v. Shaw, 8 N. T. 459. McCord Ch. lOT; Lang v. Brevard, 3 CHAPTER X. TAKING MORTGAGED CHATTELS UPON EXECUTION. § 334. Before breach of condition.— While the prop- erty remains in the possession of the mortgagor, and the condition of the mortgage unbroken, he has an interest subject to his control and disposition. He can sell and de- liver such title as remains to him. The purchaser would take it in case of a sale subject to the lien of the mort- gage, whether its existence was ascertained by him or not, or whether the mortgagor mentioned or omitted to men- tion it. It follows, of course, that the interest of a mort- gagor, in such case, is equally subject to levy and sale by an execution creditor, and the purchaser will obtain at such sale the same title of which the mortgagor was possessed, and no more, no less.^ § 335- After breach of condition. — The possessory right of the mortgagor is a legal right which can be transferred by him, and it is therefore liable to be taken to satisfy his debts.* But after the legal right of the mortgagor to pos- session has ceased, and when his claim upon the property is one which is recognized only in courts of equity, the 1 Per Leonard, C, in HamU] v. Gil- Smith v. Beattie, 31 N. Y. 542; Rinds- lespie, 48 N. Y. 666, 669. kopf v. Lyman, 16 Iowa, 260; Gordon ' Bailey v. Burton, 8 "Wend. 339 ; v. Hardin, 38 Iowa, 560; Goldsmith v. Redman v. Hendricks, 1 Sandf. 32;' Wmson, 6*7 Iowa, 662 ; Woodaide v. Fairbanks v. Bloomfield, 5 Duer, 434; Adams, 40 N. J. L. 417; Thompson v. Hull V. Carnley, 11 N. Y. 501; rev'g Thornton, 21 Ala. 808; Curd v. Wun- s. 0. 2 Duer, 99 ; =. 0. 11 N. Y. 202; der, 5 Ohio St. 92; Eggleston v. Mun- Goulet V. Asseler, 22 N. Y. 226 ; Man- dy, 4 Mich. 296 ; Durfee v. Grinnell, ning V. Monaghan, 28 N. Y. 586 ; 69 111. 371. Michelson v. Fowler, 21 Hun, 169; MORTGAGED CHATTELS TAKEN ON EXECUTION. 231 equitable interest remaining in him is not subject to an execution,^ even though he be permitted to retain pos- session.'* A mortgage specifying no time of payment is due at once, and no leviable interest remains in the mortgagor.' If the mortgagor, prior to the mortgage becoming due, voluntarily surrenders the absolute title and the possession to the mortgagee, retaining merely a naked equity of re- demption, the property cannot thereafter be levied upon under an execution against the mortgagor.* § 336. Mortgage payable on demand. — If the right of possession ceases before the debt becomes due, the interest remaining in the mortgagor cannot be levied upon." But the right to possession may not be for any fixed time ; it may even depend upon the doing of some act by the mort- gagee which shall terminate it, and until the act which ter- minates it has been performed, the right of the creditors of the morgagor to seize upon his interest will continue. So, if the mortgage be payable on demand, it is payable imme- 1 Hall T. Tuttle, 8 Wend. 315 Howland v. Willett, 3 Sandf. 607 Farmers' Bank v. Cowan, 2 Keyes 211; Baltea V. Eipp, 3 Id. 210,212 Champlain v. Johnaon, 39 Barb. 606 Wiles v. Clapp, 41 Id. 646 ; Westoott V. Gunn, 4 Duer, 107 ; Stewart v. Slater, 6 Id. 83 ; Butler v. Miller, 1 N. T. 496 ; Mattison v. Baucus, 1 N. T. (1 Comst.) 296 ; Marsh v. Lawrence, 4 Cow. 461 ; Galen v. Brown, 22 N. Y. S7, 41; Hall v. Sampson, 3B N. Y. 274 Wells T. Sobelewitz, 68 Iowa, 238 Gordon v. Hardin, 33 Iowa, 560 Campbell v. Leonard, 11 Iowa, 489 Boyce v. Smith, 16 Mo. 317; Sexton V, Monks, 16 Mo. 166; King y. Bailey, 8 Mo. 332; Miller v. Pancoast, 29 N. J. L. 250; Saxton V.Williams, 15 Wis. 292; Jennings V. Mcllroy, 42 Art. 236; 48 Am. R. 61; Thompson v. Thornton, 21 Ala. 808 ; Hammond v. Solliday, Reo'r, 8 Colo. 610 ; Eggleston v. Mun- dy, 4 Mich. 295 ; Stuart v. Alexander, 14 Neb. 37 ; Chicago Lumber Co. v. Fisher, 18 Neb. 334; Norris v. Sowles, 57 Vt. 360. "Champlain v. Johnson, 39 Barb. 606 ; King v. Bailey, 8 Mo. 332 ; con- tra, Smith V. Acker, 23 Wend. 663; Hanford v. Artcher, 4 Hill, 271 ; Mor- gan V. Spangler, 20 Ohio St. 38; Carty v. Fenstemaker, 14 Ohio St 467. 8 Baltes V. Ripp, 1 Abb. App. Dec. 78. ■■ Powers V. Elias, 53 N. Y. Super. (21 J. & S.) 480 ; 1 N. Y. St. Reptr. 249 ; Hill v. Beebe, 13 N. Y. 666. ' Nichols V. Mead, 2 Lans. 222 ; Mattison T. Bauons, 1 N. Y. (1 Comst. ^ 295. 232 MORTGAGES OF PERSONAL PEOPEETY. diately, but until tlie demand of payment is made the mort- gagor is entitled to possession, and the property may be taken for his debts.^ The interest of a mortgagor in pos- session under a chattel mortgage payable on demand, until such demand is made, is to be deemed an interest for a definite period, and therefore subject to an execution against the mortgagor.^ § 337- Right of mortgagee to take possession on deeming himself insecure. — If the mortgage contains a clause that the mortgagee may take possession whencTer he may deem himself insecure, the mortgagor's right to possession, and the liability of the chattels to legal process against him, will continue until the mortgagee shall, in good faith, deem the possession essential to his protection, and shall take possession under the power.^ § 338. Rule is for benefit of mortgagee alone.— Where chattels are incumbered by two successive mortgages, upon one of which a default has occurred while the other has not yet become due, the title of the property will be vested in the holder of the first-mentioned security, and, in a legal sense, it will not be subject to be taken upon an execution against the mortgagor. But such exemption is for the benefit of the mortgagee holding the legal title, and for no other person, and the rights of that mortgagee will cease if, from the proceeds of the sale or otherwise, his claims are satisfied. If the owner of the mortgage upon which no de- fault has occurred shall object to a levy by the creditors of the mortgagor, he must rest upon the validity of his own 'Hull V. Carnley, H N. T. 501; » Lyman v. Bowe (N.Y. Com. Pleas), Hull V. Carnley, executrix, 17 Id. 202; 6 Civ. Pro. Rep. 157; 66 How. 481 ; Goulet v. Asseler, 22 Id. 226; Man- Wagner v. Jones, 7 Daly, 375 ; Matti. ning v. Monaghan, 28 Id. 639; s. 0. 28 son v. Banous, 1 K. T. (1 Comst.) 295 j Id. 586 ; Wisser v. O'Brien, 44 How. ' Hathaway t. Brayman, 42 N. Y. 209; Newaam v. Finch, 25 Barb. 176; 322; Hall v. Sampson, 19 How. 481 ; Liyor t. Orser, 6 Duer, 601; contra, a. 0. 23 How. 84; d. 0. 35 N. Y. 274 ; Brown v. Cook, 3 E. D. Smith, 123; contra, Farrell v. Hildreth, 38 Barb. Howland T. Willett, 3 Sandf. 607. 178. MOBTGAGED CHATTELS TAKEN ON EXECUTION. 233 security, and upon his own rights as they are secured under it. He cannot ayail himself of the rights of the holder of the other mortgage; and especially will this be so after the other mortgage has been paid.* § 339. Mortgages of property exempt from levy and sale. — If the chattels be exempt from execution the mort- gagor, during the time when he is entitled to retain posses- sion of them, has a right to maintain trespass or trover against a sheriff for taking them, and the making of the mortgage does not waive this exemption.^ So where a mortgage of articles exempt from execution was payable on demand, and provided that the mortgagor should have pos- session until default, a sheriff who levied under an execu- tion against the mortgagor before default was held liable to the mortgagor for the full value of the property.' When property of a debtor, some of which is exempt from execution, is mortgaged, he cannot be compelled to accept as his exemption that which is subject to the mort- gage at its full value, but he may himself select the exempt portions, free from the mortgage, up to the statutory amount.' By executing a chattel mortgage on exempt property, the mortgagor waives his exemption to the extent of the lien of the mortgagee.' § 340. Attachment oi equity of redemption. — Under the provisions of our Code of Civil Procedure relating to attachments against property incapable of manual delivery, an attachment against a mortgagor cannot be levied upon an equity of redemption of mortgaged property after the legal title has vested in the mortgagee. The right of the mort- gagor is then one in action, dependent on its declaration in ' Stewart v. Beale, 1 Hun, 405. Weis t. Levy, 69 Ala. 21 1 ; Bayne V. s Pate v. Harper, 94 N. C. 2S. Patterson, 40 Mich. 658 ; Tryon v. ' Livor V. Oraer, 5 Duer, 501. Mansir, 84 Mass. 219; Thompson on Per Comstock, Ch. J., in Manning v. Monaghan, 28 N. T. 639, 546. MORTGAGED CHATTELS TAKEN ON EXECUTION. 241 Talue of the property taken or converted. Although it ap- peared that the plaintiff held the title as mere security for a debt, and that his debtor was abundantly able to pay, so that his actual loss was nothing, his recovery, in cases where he recovered at all, was nevertheless for the full value of the property, provided that it did not exceed the amount of his lien. In a special action on the case, on the contrary, the plaintiff could, under no circumstances, recover more than the damages shown to have been sustained. He must prove to what extent his security was impaired, by showing whether the debtor was or was not responsible, and whether or not it was in his power to follow and enforce his lien against the property.^ The subject under consideration was said by Comstock, Ch. J., in Manning v. Monaghan (23 N. Y. 539, 548), to sug- gest the following propositions : 1. When chattels are covered by a valid mortgage, with a continuing right of possession in the mortgagor, his interest, and that only, can be rightfully taken and sold on behalf of his creditors, and with the sale possession may be delivered. 2. The mort- gagee has no legal ground of action, although the sale is hostile to his right, provided the property is not dispersed or placed beyond his reach. Actual injury must be the ground of his complaint. 3. Property covered by a mortgage should be sold in mass and subject to the lien. If, being sold otherwise, it is scattered and dispersed, the proceeding is both a wrong and an injury, provided the mortgagor is insolvent and the debt is not otherwise secured. For such an injury an action will lie. § 352. An injunction may be granted on the suit of the mortgagee to prevent a sale injurious to his rights.^ § 353- Tax assessed against mortgagor.— The pro- vision of the Revised Statutes,' authorizing a tax collector ' Per Selden, J., in Goulet v. Asse- ' Smithurst r. Edmunds, 14 N. J. ler, 22 N. Y. 226, 228, and Denio, J., L. 408. Id. p. 236. M R. S. 398, § 2. 16 242 MOBTGAGES OP PEESONAL PEOPEETY. to levy an unpaid tax, "by distress and sale of the goods and chattels of the person who ought to pay the same, or of any goods or chattels in his possession," refers to actual physical and merely legal or constructive pos- session, and an actual possession by the consent of the owner, although unaccompanied by any ownership in the possessor, is a possession within the meaning of the stat- ute. This act is not in conflict with the State Constitu- tion, and, where mortgaged personal property is left in the possession of the mortgagor, though default has been made, it may be seized and sold by a collector by virtue of a tax warrant, and the purchaser will acquire a good title.' ' Hersee v. Porter, 100 N. Y. 403. CHAPTER XI MORTGAGES OF SHIPS AND VESSELS. Eecobding of Moetgaqes of Ships and Vessels. § 354- The national legislature has provided for the registration and enrollment of vessels, and for the record- ing of assignments and mortgages of them, and no bill of sale, mortgage, hypothecation or conveyance of any vessel, or part of any vessel, of the United States, is valid against any person other than the grantor or mortgagor, his heirs and devisees, and persons having actual notice thereof, un- less such bill of sale, mortgage, hypothecation or convey- ance is recorded in the office of the collector of the cus- toms where such vessel is registered or enrolled. The lien by bottomry on any vessel, created during her voyage, for a loan of money or materials necessary to repair or enable her to prosecute a voyage, does not, however, lose its pri- ority, or is not in any way affected by these provisions.^ § 355- Not necessary to comply also with State laws. — It has been held that the enactment of this statute was a proper exercise of the exclusive jurisdiction of Congress, under the Constitution of the United States, to regulate commerce with foreign nations and among the several States, and that it excludes all State legislation in respect to the same subject.^ If, therefore, a vessel comes within the meaning of the statute, that is, if it is a " vessel of the ' Revised Statutes of the U. S., tit. " White's Bank v. Smith, 1 Wall Commerce and Navigation, § 4192. 646; Aldtioh v. ^tna Ins. Co. 8 Id. 244 MORTGAGES OF PEB80NAL PEOPEKTY. United States," a mortgage of it will be valid if it be prop- erly recorded in the custom house, without the observance of any of the formalities prescribed by State laws, and this, even if the vessel is used entirely in the waters of one State.^ A mortgage of such a vessel also, even if unre- corded, is valid as against all persons having actual notice thereof, and the provisions of the local law in favor of creditors of the mortgagor when the mortgage is improp- erly filed, will not avail them if they have notice of the mortgage.^ The recording of a registered or enrolled vessel, pur- suant to the United States law, is regarded as satisfactorily accounting for the non-delivery of possession, notwith- standing the local State rules on that subject.' § 356. What is a vessel of the United States. — The question still remains as to what is a " vessel of the United States," Section 1 of the act of Congress of December 31, 1792, provides that ships or vessels which shall have been registered as required by the law, and " no other (except such as shall be duly qualified according to law for carry- ing on the coasting trade and fisheries, or one of them) shall be denominated and deemed vessels or ships of the United States, entitled to the benefits and privileges ap- pertaining to such ships or vessels, provided that they shall not continue to enjoy the same longer than they shall continue to be wholly owned and to be commanded by a citizen or citizens of the United States."* Section 1 of the act of February 18, 1793, in reference to enrolling and licensing vessels to be employed in the coasting trade. 491; rev'g 8. c. 26 N. Y. 92 ; Best v. v. Dayis, 26 N. Y. 495 ; Thompson v. Staple, 61 N. Y. 71; Shaw v. McCand- Van Vechten, 5 Abb. 458. less, 36 Miss. 296; Fontaine v. Beers, 'Lawrence v. Hodges, 92 If. C. 19 Ala. 722 ; Mitchell v. Steelman, 8 672. Cal. 368; Perkins v. Emerson, 69 Me. " Best v. Staple, 61 N. Y. 71. 319; Cunningham v. Tucker, 14 Fla. a Folger t. Weber, 16 Hun, 512; 251; Howe v. Tefft, 16 R. I. 477. Aldrich v. The CEtna Ins. Co., 8 Wall. These decisions also overrule Horton 491. * 1 Bright. Dig. 828. REOOBDING MORTGAGES OF SHIPS AND VESSELS. 245 provides that ships or vessels enrolled according to law, and having a license in force, as required by the act, and " no others, shall be deemed ships or vessels of the United States, entitled to the privileges of ships or vessels em- ployed in the coasting trade or fisheries."^ These acts contain provisions showing what vessels can be registered, enrolled and licensed, and the manner in which, and the place where it may be done ; and they define what are ves- sels of the United States.^ Before a vessel is registered or enrolled, a mortgage of it will be valid, as against all persons, if recorded according to the law of the State ; but after being registered or en- rolled it must be recorded according to the law of the United States.' § 357- Presumption.— If a mortgage is made the foun- dation of rights which are sought to be enforced in the courts of this State, the mortgaged property being also within their jurisdiction, the presumption is that the laws of this State apply and control. If, therefore, it is claimed that a mortgaged vessel is a " vessel of the United States," so as to render our statutes relative to the filing of chattel mortgages, inapplicable, the facts which render it such must be proved.* § 358- Canal boats. — It has been held that a canal boat, engaged in navigating our canals and the Hudson river, is not a " vessel of the United States " employed in the coasting trade ; that it need not be enrolled or licensed, and that it is not within the statute requiring transfers and mortgages to be recorded in the office of the collector of customs.^ § 359- Proving a mortgage on a vessel in judicial proceedings. — As a matter of practice it will not be advis- ' 1 Bright. Dig. 138. ' Perkins v. Emerson, 59 Me. 319. " Per Earl, C, in Best v. Staple, * Beat t. Staple, 61 N. Y. 11. 61 N. Y. 11, 1&. 5 Hicka v. Williama, 17 Barb. 523 Ryan v. Hook, 34 Hun, 185. 246 MOKTGAGES OF PEBSONAL PBOPEKTY. able to file the original of a chattel mortgage on a canal boat in the office of the auditor of the canal department, since a certified copy of it will only be evidence of the fact of filing.* By Laws of 1862, c. 251 (as amended by Laws of 1865 c. 512), " the record of any bill of sale, mortgage, hypothe- cation or conveyance of any vessel of the United States duly recorded in the office of the collector of customs where such vessels is registered and enrolled, or a trans- cript or copy thereof, duly certified by said collector, may be read in evidence in any of the courts of this State, and in any judicial proceedings in this State, with the like force and effect as the original bill of sale, mortgage, hy- pothecation or conveyance ; provided, however, that the execution of such bill of sale, mortgage, hypothecation or conveyance shall, before having been so recorded, have been acknowledged by the party or parties executing the same, or proved by a subscribing witness thereto in the same manner in which conveyances of real estate are re- quired to be acknowledged so as to entitle the same to be recorded in this State," Mortgages on Canal Boats. § 360. Filing mortgages on canal boats.— It was pro- vided by Laws of 1858, c. 247, that any person having any lien or encumbrance on any canal boat, steam tug, scow or other craft navigating the canals of this State, by a chattel mortgage duly filed, may make a statement in writing, set- ting forth the nature of his claim, the time when the same arose, the manner in which it originated, and the amount of such lien or incumbrance ; and may annex thereto an affidavit, made by himself or his agent or attorney, that the sa,id statement is correct, and the claim just and true, and file the same in the office of the auditor. All claims and liens by chattel mortgage, a statement of which shall be ' Laws of 1864, c. 412. MORTGAGES ON CANAL BOATS. 247 filed as provided in the act, were, from the time of such filing, to have preference and priority over all other claims and liens, in the same manner and to the like extent of claims and liens arising on chattel mortgages filed and en- tered in towns where the mortgagor resides, but they were not to have any priority over existing liens and claims. This statute did not require any paper to be filed in the office of the auditor, though it permitted such filing, and no penalty was laid down for an omission to file. The utmost effect which could be allowed to the statute, was to put mortgages which were registered in the audi- tor's office upon an equality with those properly recorded in the town clerk's office.* § 361. Amendment of statute.— The statute of 1858 was materially amended by Laws of 1864, ch. 412, which provided that thereafter any person having any lien or in- cumbrance on any canal boat, steam tug, scow, or other craft navigating the canals of this State, by a chattel mortgage, should file the same, or a true copy thereof, in the office of the auditor of the canal department. It also declared that every mortgage or conveyance intended to operate as a mortgage of any canal boat, steam tug, scow or other craft navigating the canals of this State, together with the appurtenances belonging thereto and used in navigating such craft, thereafter made, which should not be accompanied by an immediate delivery, and followed by an actual and continued change of possession of the prop- erty mortgaged, should be absolutely void as against the creditors of the mortgagor, and as against subsequent pur- chasers and mortgagees in good faith, unless the mortgage, or a true copy thereof, should be filed as directed by the act. This statute also contained a provision to the effect that every mortgage filed in pursuance of it, should cease to be valid as against the creditors of the person making the same, or against subsequent purchasers or mortgagees in good faith, after the expiration of one year from the ' Sweet T. Lawrence, 35 Barb. 337. 248 MORTGAGES OP PERSONAL PROPERTY. filing thereof,' unless, within thirty days next preceding the expiration of the said term of one year, a true copy of such mortgage, together with a statement exhibiting the interest of the mortgagee in the property thereby claimed by him by virtue thereof, should be again filed. This latter provision is similar to that contained in the act of 1833 relative to the filing of chattel mortgages in the offices of the town clerks, previous to the amendment of 1873, and a single refiling at the end of the first year is all that is required ; successive annual refilings are not necessary.^ § 362. Double filing not now required. — The act of 1858 concerned mortgages of canal boats " duly filed " and required another filing in the office of the auditor. In other words, as to canal boats, a double filing was made necessary, by the act of 1858. The act of 1864 superseded the act of 1858 and under its provisions it has been held that the act of 1833 as to filing of chattel mortgages has been abrogated as to canal boats, and that a mortgage on a canal boat need only be filed in the office of the auditor of the canal department.^ § 363. Discharge of record not authorized.—There is nO provision of law permitting the auditor to note the dis- charge of record, of a chattel mortgage upon a canal boat.^ The statute of 1879, as to discharging chattel mortgages filed in the offices of recorders, or town clerks, does not apply.* § 364. Admiralty jurisdiction.— The admiralty jurisdic- tion of the District Courts of the United States extends to enforcing by libel and sale a lien for towage, and the title acquired by the purchaser will be superior to the lien of a ' Newell V. Warren, 44 N. T. 244 ; denoe, 55 How. 205 ; see also Maradea rev'g s. 0. 44 Barb. 2S8; Pickert t. v. Cornell, 62 N. Y. 216. Canal Boat Independence, 55 How. * Burns v. Munger, 45 Hun, t5. 205. ^ Laws 1879, ch. 1"?!. ^ Pickert r. Canal Boat Indepen- LIABILITY OF MOETGAGEES FOB SUPPLIES, &C. 249 preYiously executed and duly filed mortgage. Section 4,251 of the United States Eevised Statutes, providing that *' no canal boat -without masts or steam power which is re- quired to be registered, licensed, or enrolled and licensed, shall be subject to be libelled in any of the United States courts for the wages of any person who may be employed on board thereof, or in navigating the same," does not apply to a claim for towing such a canal boat made by a corporation.^ Liability of Mobtgagees of Ships for Supplies and Eepaies. § 365. Mortgagee in possession. — An owner of a ship, in possession of her, and having both the legal and equi- table title, is liable for all supplies furnished, and all re- pairs made to her, and all work and service rendered for her benefit by order of the master, and in general for all the contracts made by him for the benefit of the vessel; be- cause, from the necessity of the case, the master is invested with a very wide authority to do and provide whatever is requisite for his ship.^ A mortgagee of a ship, especially after forfeiture, is the legal owner, and, under some circum- stances, incurs the liabilities of an owner for repairs and supplies. The question was long mooted as to whether a mortgagee, even though not in possession, was liable in this way, and it was doubted as to whether it was not pos- sible, at least, that a mortgagee might expose himself to a loss by the very act from which he expected a security.* If a mortgagee takes possession, and especially if he takes out a new register in his own name, or if he does any acts which can be deemed in some degree equivalent to public notice that he is owner, this actual, or apparently actual, possession, added to his legal title as owner, seems ' Ryan v. Hook, 34 Hun, 185. " Abbott on Shipping, 19, n. ' 1 Pars, on Shipping, 125. 250 MORTGAGES OP PEESONAl PBOPERTY. to confer upon him the responsibilities and liabilities of an owner.^ § 366. Mortgagee not in possession. — But a mortgagee who does not have the possession and control of a ship does not authorize the world to consider him the owner, and the great preponderance of authority is now in favor of the proposition that a mortgagee not in possession is not liable.'^ This is the rule even though the ship be regis- tered in the name of the mortgagee.' And even if a person takes a bill of sale of a vessel, absolute in its terms, and is registered as owner, and the person furnishing the supplies consulted the record at the custom house, and gave credit to him as owner, he is not liable as such if the bill of sale was intended as collateral security, and he has never taken the vessel into his possession or control, or exercised any acts of ownership.* The mortgagee may, of course, make himself liable by a bargain,^ and he will be held to have made this bargain if he authorized the credit to be given to him personally.* Liens fok Supplies and Eepaies. § 367. Statute. — While the mortgagee is not personally bound for debts incurred for supplies or repairs to the ship, it by no means follows that he can hold his lien as against persons claiming for service rendered in preserving the property. By Laws of 1862, c. 482, whenever a debt ' 1 Pars, on Shipping, 126; Champ- Cutler v. Thurlo, 20 Id. 213; a. 0. 1 lin V. Butler, 18 Johns. 169 ; Miln v. Kent, 133 ; Howard v. Odell, 1 Allen Spinola, 4 Hill, 177; Hodgson v. Butts, (Mass.), 85; Blanchard v. Fearing, 4 3 Cranch, 140; Tucker v. Boffington, Id. 118. 16 Mass. 477; Hesketh v. Stevens, 7 ^ Weber v. Sampson, 6 Duer, 368; Barb. 488 ; Dean v. MoGhie, 4 Bing. Rice v. Cobb, 9 Cusb. 302 ; Langton v. 48. Horton, 5 Beav. 9. 'Ringv. Franklin, 2 Hall, 1; Birk- < Howard v. Odell, 1 Allen, 86; beck V. Tucker, 2 Id. 121 ; Miln v. Blanchard v. Fearing, 4 Id. 118 ; Birk- Spinola, 4 Hill, 177; Hesketh v. Stev- beck v. Tucker, 2 Hall, 121; King v. ens, 7 Barb. 488 ; Mclntyre v. Scott, 8 Franklin, Id. 1. Johns. 169; Brooks v. Bondsey, 7 Pick. ^ Fish v. Thomas, 5 Gray, 45. 441; Winslow v. Tarbox, 18 Me. 132; « 2 Pars, on Cont. 280. LIENS FOR SUPPLIES AND REPAIRS. 251 amounting to $50 or upwards, as to a sea-going or ocean- bound vessel, or amounting to $15 or upwards, as to any other vessel, sliall be contracted by the master, owner, charterer, builder or consignee, of any ship or vessel, or the agent of either of them within this State, for work done or materials or other articles furnished in this State for or towards the building, repairing, fitting, furnishing or equip- ping such ship or vessel; for provisions and stores fur- nished to the vessel; for wharfage; for labor in loading or unloading the ship; for advances for the purchase of neces- saries, or for insurance, or for towing or piloting; "such debt shall be a lien upon such vessel, her tackle, apparel and furniture, and shall be preferred to all other liens thereon, except mariners' wages." Such debt shall cease to be a lien at the expiration of twelve months after the said debt was contracted, unless at the time when said twelve months shall expire such ship or vessel shall be absent from the port at which said debt was contracted, in which case the said lien shall continue until the expiration of thirty days after such ship or vessel shall next return to said port, and in all cases such debt shall cease to be a lien upon such ship or vessel, unless the per- son having such lien shall, within thirty days after said debt was contracted, cause to be drawn up and filed specifi- cation of such lien, which may consist either of a bill of particulars of the demand, or a copy of any written con- tract under which the work may be done, with a statement of the, amount claimed to be due from such vessel, the cor- rectness of which shall be sworn to by such person, his le- gal representative, agent or assigns.' The statute in question makes provision, also, for the enforcement of such liens.^ § 368. Courts of admiralty. — No doubt exists as to the competency of State legislation to determine the rank of ' L. 1886, ch. 88. L. 1879, ch. 334; L. 1885, ch. 216; ' See this statute, and amendments L. 1885, ch. 273; L. 1886, ch. 88. thereto, as follows: L. 1862, ch. 462 ; "252 MORTGAGES OF PEESONAL PEOPERTY. liens Tipon domestic Tiessels when it does not invade the jurisdiction of the court of admiralty or the legislation of -congress concerning such liens. And courts of admiralty will enforce the lien given by the local law by. process in rem where the cause of action is maritime in its nature, and where the claim is not maritime will recognize the lien in the distribution of proceeds in the registry of the court. In enforcing the lien given by local laws, courts of admiral- ty are governed by the terms of those laws where they are explicit, and not by the general doctrines of maritime law.* § 369. Power of mortgagor to create lien prior to mortgage. — By statutes of this and other States and countries,^ and by the law merchant, in the absence of stat- utory provision, if a master borrows money abroad for the necessities of the ship, and so applies the same, the lender has a lieu on the ship for the amount.' Where a mortgagor of a vesssel is permitted to have the uncontrolled use and possession of her, he has the power to confer a lien on her for repairs necessary to keep her seaworthy and to preserve her as a security for the mortgagee's debt, and the lien thus created will be superior to the lien of the mortgage, though duly recorded under the United States statute.* The mortgagee, by assenting to the use and possession of the vessel by the mortgagor, for the purposes of navigation, without restriction, assents, by implication, to the creation of such maritime liens as by law arise incidentally in the ordinary business of the ship.^ ' Per Wallace, J., in Brown v. The ^ Scott v. Delahunt, 65 N. Y. 128 ; Propeller W. T. Graves (U. S. Dist. 6 Lans. 372; Williams v. AUsup, 10 Ct.), 14 Blatchf. 189. See Maguire v. Com. Bench, N. S. 417: 100 E. C. L. Card, 21 How. (U. S.) 248 ; The Cir- 416 ; In re The Young Mechanic, Ware cassian, 11 Blatchf. 472. (2d ed.), 535 ; 2 Curtis C. C. 404. ' Genl. Stat, of Massachusetts, ch. "In re The E. M. McChesney, 8 151, § 12; Donnell v. The Starlight, Ben. 150; In re The Granite State, 1 103 Mass. 227. Spr. 277; In re The Lulu, 10 Wall. ' Wainright v. Crawford, 8 Yeates, 192, 193. 131 ; 4 DaU. 225. bottomry and respondentia bonds. 253 Bottomry and Eespondentia Bonds. § 370. Bottomry. — Hypothecation by bottomry is a con- tract in the nature of a mortgage, by which the owner of a ship, or the master as his agent, borrows money for the Tise of the ship, and for a specified voyage or for a definite period, pledges the ship (or the keel or bottom of the ship,. pars pro toto) as a security for its repayment, with maritime or extraordinary interest on account of the marine risks to be borne by the lender : it being stipulated that if the ship be lost in the course of the specified voyage, or during the limited time, by any of the perils enumerated in the con- tract, the lender shall also lose his money.i The contract of bottomy is usually in the form of a bond, termed a bottomry bond, conditioned for the repay- ment of the money loaned, with the interest agreed upon, if the ship safely accomplishes the specified voyage, or completes in safety the period limited by the contract. Sometimes it is in that of a bill of sale, and sometimes in a different shape.^ The essentials of a contract of bottomry are that it shall bind the ship for the payment of the money, provided the ship performs a certain voyage and returns in safety ; and if the ship be lost, no part of the sum borrowed is to be repaid ; and because the lender takes upon himself this risk, he may charge for the use of the money maritime interest or extra interest, which will cover and compensate him for the risk he runs, which interest would be usurious but for that risk.^ § 371. Respondentia. — A similar contract with relation to the goods laden on board of a ship is called respondentia. Bottomry is a loan on the ship ; respondentia is a loan upon the goods. In most other respects the contracts are nearly the same, and are governed by the same principles.* ■Bouvier's Law Diet. tit. Bottomry; ' The Northwestern Ins. Co. v. Abbott on Shipping, llT, 131; White Ferward, 36 N. T. 139; IPars. on T. Cole, 24 Wend. 116, 126. Shippins;, 134; White v. Cole, 24 ' 5 C. Rob. Adm. 102. AVend. 116; s. 0. 26 Wend. 511. ^ 1 Pars, on Shipping, 165. 254 MORTGAGES OF PEKSONAL PEOPEBTT. § 372. Resemblance to mortgage or pledge.— A bot- tomry bond is in some respects similar to a mortgage or a pledge. It differs from a pledge in that the lender does not take possession, which is of the essence of a contract of pledge, and it differs from both a pledge and a mortgage in that there is no debt apart from the security, for if the se- curity is lost, all of the claims of the lender are lost with it. It also differs from both a pledge and a mortgage in being a valid security for a loan, at a rate of interest greater than the law allows in other contracts. In its theory, a bottomry bond is a means of raising money to save the ship and send her home with her cargo, and it creates a lien preferred over all others,^ except for seamen's wages,'' though there are authorities for holding that the liens of material men for supplies or repairs indis- pensable to the safety of the ship would also be prior.' For a similar reason, if there be several successive bonds, a later bond takes precedence of an earlier, for it saves the ship for the earlier.* § 373- Presumption of fraud. — In the case of mortgages of chattels, generally, it is necessary that there shall be an immediate delivery, followed by an actual or continued possession, or the transaction is presumed to be fraudulent and void, but there is an express reservation in the statute to the effect that nothing contained in it shall be construed to apply to contracts of bottomry or respondentia, nor to assignments or hypothecations of vessels or goods at sea or at foreign ports.' A similar exception in favor of the lien by bottomry on any vessel, created during her voyage by a loan of money or materials necessary to repair or en- able her to prosecute a voyage, is contained in the United 1 The Duke of Bedford, 2 Hagg. * The Betsey, 1 Dods. 289 ; The Adm. 294; The Draco, 2 Sum. 157. Exeter, I Rob. Adm. 113 ; The Trid- « The Madonna D'Idra, 1 Dods, 40; eut, 1 W. Rob. 29; Leland v. The Blaine v. Ship Charles Carter, 4 Medora, 2 Woodb. & M. 113 ; Furniss Cranch, 328 ; The Virgin, 8 Pet. 538. v. Brig Magoun, Olcott, Adm. 66. 3 The Jerusalem, 2 Gallis. 346 ; M ' 2 E. S. 136, § 1, ante, % 229. parte Lewis, Id. 483. BOTTOMEY AND EESPONDENTIA BONDS. 255 States law requiring all other transfers, mortgages or hy- pothecations of vessels to be recorded.* § 374. Filing. — The general statute of this State, requir- ing all chattel mortgages to be filed, does not expressly exclude bottomry bonds from its operation. It has been held that the law has no application, even to a mortgage of a registered British vessel executed abroad, and that it relates only to mortgages executed within this State, or upon property which is here at the time ;' and it is quite clear that it could have no application to a contract of bot- tomry entered into in a foreign port. If the parties resided and the contract were made here, it would doubtless be prudent to file a copy of the bond in the clerk's office, but a delivery of the written evidence of title might render this unnecessary, and would certainly do so in the case of a contract of respondentia, which concerns the cargo and not the ship.* ' U. S. Rev. Stat. tit. Commerce ' First Nat. Bank of Cincinnati v. and Navigation, § 4192. Kelly, 57 N. Y. 34. ' Fairbanks v. Bloomfield, 5 Duer, 434. APPENDIX OF STATUTES. STATUTES OF THE STATE OF NEW YORK RELA- TIVE TO MORTGAGES AND CONDITIONAL SALES OF PERSONAL PROPERTY. Laws of 1833, Chap. 279. An Act requiring mortgages of personal property to be filed in the town clerk's and other o£Bces. Passed April 29, 1833. TTis People of the State of New York, represented in Senate and Assembly, do enact as foUows : Sec. 1. Every mortgage or conveyance intended to oper- ate as a mortgage of goods and chattels hereafter made, which shall not be accompanied by an immediate delivery, and be followed by an actual and continued change of pos- session of the things mortgaged, shall be absolutely void as against the creditors of the mortgagor, and as against subsequent purchasers and mortgagees in good faith, un- less the mortgage, or a true copy thereof, shall be filed as directed in the succeeding section of this act. § 2. The instruments mentioned in the preceding sec- tion shall be filed in the several towns and cities of this State where the mortgagor therein, if a resident of this State, shall reside at the time of the execution thereof ; and if not a resident, then in the city or town where the prop- erty so mortgaged shall be at the time of the execution of such instrument. In the city of New York, such instrument shall be filed in the of6.ce of the register of said city. In the several cities of this State, other than the city of New York, and in the several towns in this State in which a 17 258 APPENDIX OP STATUTES. county clerk's office is kept, in such office ; and in each of tlie other towns in this State, in the office of the town clerk thereof ; and such register and clerks are hereby required to file all such instruments aforesaid presented to them re- spectively for that purpose, and to endorse thereon the time of receiving the same, and shall deposit the same in their respective offices, to be kept there for the inspection of all persons interested. « § 3. (As amended by L. 1873, ch. 501, and L. 1879, ch. 418.) Every mortgage, filed in pursuance of this act, shall cease to be valid as against the creditors of the person making the same, or against subsequent purchasers or mortgagees in good faith, after the expiration of one year from the filing thereof, unless, within thirty days next pre- ceding the expiration of each and every term of one year after the filing of such mortgage, a true copy of such mort- gage, together with a statement exhibiting the interest of the mortgagee in the property thereby claimed by him by virtue thereof, shall be again filed in the office of the clerk or register aforesaid of the town or city where the mort- gagor shall then reside, if the mortgagor shall then be a resident of this State; and if not such resident, then in the office of the clerk or register of the town or city where the property so mortgaged was at the time of the execution of such mortgage. § 4. A copy of any such original instrument, or of any copy thereof, so filed as aforesaid, including any statement made in pursuance of this act, certified by the clerk or register in whose office the same shall be filed, shall be re- ceived in evidence, but only of the fact that such instrument or copy, and statement, was received and filed according to the endorsement of the clerk or register thereon, and of no other fact ; and in all cases the original endorsement by the clerk or register, made in pursuance of this act upon such instrument or copy, shall be received in evidence only of the facts stated in such endorsement. § 5. The register of the city and county of New York, and the clerk of the city and county of Albany, shall respec- tively number every such instrument or copy which shall be filed in their offices, and shall enter, in books to be pro- vided by them, alphabetically, the names of all the parties to such instrument, with the number endorsed thereon op- APPENDIX OF STATUTES. 259 posite to each name ; wliicli entry shall be repeated alpha- betically under the name of every party thereto. § 6. For services under this act, the clerks and registers shall be entitled to receive the following fees: For filing each instrument or copy, six cents; for entering the same in a book, as aforesaid, in the said cities of Albany and New York, six cents for every party to such instrument; for searching for each paper, six cents; and the like fees for certified copies of such instruments or copies, as are al- lowed by law to clerks of counties for copies and certifi- cates of records kept by them. Laws of 1848, Chap. 282. An Act relating to chattel mortgages for the city of Eochester. Passed April 12, 1848. The People of the State of New York, represented in Senate and Assembly, do enact as follows : Sec. 1. The fifth and sixth sections of chapter two hun- dred and seventy-nine, of an act requiring mortgages of personal property to be filed, and so forth, passed April 29, 1833, applicable to the city and county of New York, and the city and county of Albany, are hereby extended, and made applicable to the city of Rochester. § 2. This act shall take effect immediately. Laws oe 1849, Chap. 69. An Act requiring chattel mortgages to be registered. Passed March 1, 1849. The People of the State of New York, represented in Senate and Assembly, do enact as follows : Sec. 1. It shall be the duty of the clerks of the several towns and counties in this State, in whose offices chattel 260 APPENDIX OP STATUTES. mortgages are by law required to be filed, to provide proper books, at the expense of their respective towns, in which the names of all parties to every mortgage or instru- ment intended to operate as a mortgage of goods and chat- tels, hereafter filed by them, or either of them, shall be en- tered in alphabetical order, under the head of mortgagors and mortgagees, in each of such books respectively. § 2. It shall be the duty of the said several clerks to number every such mortgage or copy so filed in said office, by endorsing the number on the back thereof, and to enter such number in a separate column in the books in which such mortgages shall be entered, opposite to the name of every party thereto; also the date, the amount secured thereby, when due, and the date of the filing of every such mortgage. § 3. The said several clerks, for services under this act, shall be entitled to receive therefor the following fees: For filing every such mortgage or copy, six cents; for entering the same in books, as aforesaid, six cents. Laws op 1858, Chap. 247. An Act to provide for the registry of liens and incum- brances upon boats and crafts navigating the can- als of this State. Passed April 15, 1858; three-fifths being present. TU People of tU State of New Yorl, represented in Senate and Assembly, do enact as follows : Sec. 1. Any person having any lien or incumbrance on any canal-boat, steamtug, scow or other craft navigating the canals of this State, by a chattel mortgage duly filed, may make a statement in writing setting forth the nature of his claim, the time when the same arose, the manner in which it originated, and the amount of such lien or incum- brance; and may annex thereto an affidavit made by him- self, or his agent or attorney, that the said statement is cor- rect, and the claim just and true, and file the same in the office of the auditor. APPENDIX OF STATUTES. 261 § 2. It shall be tlie duty of the said auditor, on the re- ceipt of the said statement, to file the same in his office, and to enter the substance in a book to be provided for that purpose, and the amount, if any, claimed to be due ; which book shall always, during office hours, be open for the inspection of all persons desiring to examine the same. § 3. All claims and liens by chattel mortgage, a state- ment of which shall be filed as herein provided, shall from the time of such filing have preference and priority over all other claims and liens, in the same manner and to the like extent of claims and liens arising on chattel mortgages filed and entered in towns where the mortgagor resides, but shall not have any priority over existing liens and claims. § 4. The auditor shall charge, for filing the said state- ment, and making the entry thereof as herein provided, the sum of fifty cents, and he shall not be obliged to file or en- ter the same until such sum is paid. § 5. Any statement made and filed as herein provided, and copies thereof duly certified by the auditor in the man- ner required by law, may be read and used as evidence in all courts of justice. Laws of 1864, Chap. 412. An Act to amend an act entitled ' ' An act to provide for the registry of liens and incumbrances upon boats navigating the canals in this State," passed April fifteenth, eighteen hundred and fifty-eight. Passed April 38, 1864 ; three-flfths being present. The People of the State of New York, represented in Senate and Assembly, do enact as foUows : Sec. 1. Hereafter any person having any lien or incum- brance on any canal-boat, steamtug, scow or other craft navigating the canals of this State, by a chattel mortgage, shall file the same, or a true copy thereof, in the office of the auditor of the canal department. 262 APPENDIX OF STATUTES. § 2. Hereafter every mortgage or conveyance intended to operate as a mortgage of any canal-boat, steamtug, scow or other craft navigating the canals of this State, together with the appurtenances belonging thereto and used in navi- gating such craft, hereafter made, which shall not be ac- companied by an immediate delivery, and followed by an actual and continued change of possession of the property mortgaged, shall be absolutely void as against the creditors of the mortgagor, and as against subsequent purchasers and mortgagees in good faith, unless the mortgage, or a true copy thereof, shall be filed as directed in the previous section of this act. § 3. Every mortgage filed in pursuance of this act shall cease to be valid as against the creditors of the person making the same, or against subsequent purchasers or mortgagees in good faith, after the expiration of one year from the filing thereof, unless, within thirty days next pre- ceding the expiration of the said term of one year, a true copy of such mortgage, together with a statement exhibit- ing the interest of the mortgagee in the property thereby claimed by him by virtue thereof, shall be again filed as directed in the first section of this act. § 4. It shall be the duty of the said auditor, on the re- ceipt of the mortgage, or copy thereof, to cause every such instrument to be respectively numbered, the time of receiv- ing the same to be endorsed thereon, and the substance thereof to be entered in a book provided for that purpose, entering alphabetically the names of all the parties to such instrument, with the number endorsed thereon opposite to each name ; which entry shall be repeated in the index alphabetically under the name of every party thereto, also indexing the name of each boat mortgaged, with the num- ber of the mortgage opposite to each; which book of mortgages and index shall always, during office hours, be open for the inspection of all persons desiring to examine the same. § 5. All claims and liens by chattel mortgage which shall be filed as herein provided, shall, from the time of such filing, have preference and priority over all other claims and liens, but shall not have any priority over exist- ing claims and liens. APPENDIX OP STATUTES. 263 § 6. A copy of any such original instrument, or of any copy thereof, so filed as aforesaid, including any statement made in pursuance of this act, certified by the auditor or his deputy, may be read and used as evidence in all courts of justice, but only of the fact that such instrument or copy and statement was receiyed and filed according to the endorsement of the register thereon, and of no other fact ; and in all cases the original endorsement by the clerk or register, made in pursuance of this act, upon such instru- ment and copy, shall be received in evidence of the facts stated in such endorsement. § 7. The auditor aforesaid shall designate a clerk, who shall act as register, and the auditor shall be entitled to receive the following fees for services under this act, for the use of the State: For filing each instrument or copy, and entering the same in a book, as aforesaid, twenty-five cents; for searching for each paper, twenty cents; and the like fees for certified copies of such instruments or copies as are allowed, under existing laws, to be charged by the auditor for copies and certificates of record kept in the canal department; and the said auditor shall not be obliged to file or enter, or cause to be filed or entered, any mortgage or copy thereof until the fee provided under this section is paid. § 8. The auditor aforesaid shall not grant permission to change the name or hailing-place of any canal-boat, steam- tug, scow or other craft navigating the canals of this State, upon which there is an existing lien or mortgage filed in the canal department, unless it shall be necessary to make the name or hailing-place conform to the United States custom-house regulations, by reason of a change of name on the canal, after having been registered at the custom house ; and any boat, steamtug, scow or other craft found navigating the canals of this State, the registered name or hailing-place of which shall have been changed without the written permission of the auditor of the canal department, shall, upon due proof thereof, pay a fine not less than fifty nor more than three hundred dollars. § 9. This act shall take effect on the first day of May, eighteen hundred and sixty-four. 264 appendix of statutes. Laws of 1868, Chap. 779. An Act in relation to mortgages executed by railroad companies. Passed May 9, 1868. The People of the State of New York, represents in Senate arid Assembly, do enact as follows : Sec. 1. It shall not be necessary to file as a chattel mortgage any mortgage -which has been or shall hereafter be executed by any railroad company upon real and per- sonal property, and which has been or shall be recorded as a mortgage of real estate in each county in or through which the railroad runs. § 2. This act shall take effect immediately. Laws of 1879, Chap. 171. An Act to provide for discharging chattel mortgages. Passed April 16, 1879. The People of the State of New Yorh, represented in Senate and Assembly, do enact as follows : Sec. 1. Whenever any mortgagor, or any person obtain- ing title to mortgaged property, shall present to any re- corder, county or town clerk, in whose office a chattel mort- gage executed by said mortgagor on such property may be filed, a certificate from the mortgagee therein named, or the holder or owner thereof, that such mortgage is paid or sat- isfied, it shall be the duty of such recorder, or either of the clerks above mentioned, to file such certificate in his office and discharge such mortgage, by writing in the book kept by such recorder or either of such clerks, and opposite the entry therein of such mortgage, the word "discharged," with the date thereof. § 2. This act shall take effect immediately. appendix of statutes. 265 The Penal Code. Sec. 571. Mortgagor secreting personal property. — A per- son who, haying theretofore executed a mortgage of per- sonal property, or any instrument intended to operate as such, sells, assigns, exchanges, secretes or otherwise dis- poses of any part of the property upon which the mortgage or other instrument is at the time a lien, with intent there- by to defraud the mortgagee, or a purchaser thereof, is guilty of a misdemeanor. Laws of 1882, Chap. 410. An Act to consolidate into one act and to declare the special and local laws affecting public interests in the city of New York. Passed July 1, 1883; three-fifths being present. The People of the State of New York, represented in Senate and Assembly, do enact as follows : Sec. 1753. Every mortgage, or conveyance intended to operate as a mortgage of goods and chattels, hereafter made, which shall not be accompanied by an immediate de- livery, and be followed by an actual 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 and mortgagees in good faith, unless the mortgage, or a true copy thereof, shall be filed as directed in this section. The instruments mentioned in this section shall be filed in the several towns and cities of this State, where the mortgagor therein, if a resident of this State, shall reside at the time of the execution thereof; and if not a resident, then the city or town where the prop- erty so mortgaged shall be at the time of the execution of such instrument. In the city of New York such instru- ment shall be filed in the office of the register of said city ; such register is required to file all such instruments afore- said presented to him for that purpose, and to endorse thereon the time of receiving the same, and shall deposit the same in his office, to be kept there for the inspection of all persons interested. 266 APPENDIX OP STATUTES. § 1754. Every mortgage filed in pursuance of the pre- ceding section shall cease to be valid as against the credit- ors of the person making the same or .against subsequent purchasers or mortgagees in good faith, after the expiration of one year from the filing thereof, unless, within thirty days next preceding the expiration of the said term of one year, a true copy of such mortgage, together with a state- ment exhibiting the interest of the mortgagee in the prop- erty thereby claimed by him by virtue thereof, shall be again filed in the office of the clerk or register aforesaid of the town or city where the mortgagor shall then reside. § 1755. A copy of any such original instrument or of any copy thereof, so filed as aforesaid, including any state- ment made in pursuance of the last section, certified by the register in whose office the same shall be filed, shall be re- ceived in evidence, but only of the fact that such instrument or copy and statement was received and filed according to the indorsement of the register thereon, and of no other fact; and in all cases the original indorsement by the register, upon such instrument or copy, shall be received in evidence only of the acts stated in such indorsement. § 1756. The register shall number every such instrument or copy which shall be filed in his office, and shall enter, in books to be provided by him, alphabetically, the names of all the parties to such instrument, with the number in- dorsed thereon opposite to each name, which entry shall be repeated, alphabetically, under the name of every party thereto. § 1757. For services under the four preceding sections the register shall be entitled to receive the following fees : For filing each instrument or copy, six cents ; for entering the same in a book as aforesaid, six cents to every party to such instrument ; for searching for each paper, six cents ; and the like fees for certified copies of such instruments or copies as are allowed by law to clerks of counties for copies and certificates of records kept by them. appendix of statutes. 267 Laws op 1884, Chap. 315. An Act requiring contracts for the conditional sale of personal property on credit to be filed in the town clerk's and other offices. Passed May 21, 1884. TJw People of the State of Neio York, represented in Senate and Assembly, do enact as follows : Sec. 1. In every contract for the conditional sale of goods and chattels hereafter made which shall be accom- panied by an immediate delivery, and be followed by an actual and continued change of possession of the things contracted to be sold, all conditions and reservations which provide that the ownership of such goods and chattels is to remain in the person so contracting to sell the same, or other person than the one so contracting to buy them un- til said goods or chattels are paid for, or until the occur- ring of any future event or contingency, shall be absolutely void as against subsequent purchasers and mortgagees in good faith, and as to them the sale shall be deemed abso- lute, unless such contract for sale, with such conditions and reservations therein, or a true copy thereof, shall be filed as directed in the succeeding section of this act. § 2. (As amended by L. 1885, ch. 488.) The instruments mentioned in the preceding section shall be filed in the several towns and cities of this State where the person to whom such property is contracted to be sold, if a resident of this State, shall reside at the time of the execution there- of ; and if not a resident, then in the city or town where the property so contracted to be sold shall be at the time of the execution of such instrument. In the city of New York such instrument shall be filed in the office of the register of the city, and, in the county of Kings, in the office of the register of said county. In the several cities of this State, other thaiU the cities of New York and Brooklyn, and in the several towns of this State in which a county clerk's office is kept, in such office; and in each of the other towns of this State, in the office of the town clerk thereof. If the conditional vendee be a railroad corporation, the instrument mentioned in the preceding section shall be filed in the of- fice of the clerk of each county through which its railroad is located, or, in counties where there is a register, in the 268 APPENDIX OF STATUTES. office of the register ; and such filing shall be deemed suf- ficient for all the purposes of this act. Such registers and clerks are hereby required to file all such instruments aforesaid, presented to them respectively for that purpose, and to indorse thereon the time of receiving the same, and shall deposit the same in their respective offices, to be kept there for the inspection of all persons interested. § 3. The conditions and reservations specified in the first section of this act, which may be in any instrument filed in pursuance of this act, shall cease to be valid against subsequent purchasers or mortgagees in good faith after the expiration of one year from the filing of such instru- ment, and as to them the sale shall then be deemed absolute, unless, within thirty days next preceding the expiration of each and every term of one year after the filing of such in- strument, a true copy of such instrument, together with a statement exhibiting the interest of the person so contract- ing to sell such property, in the property thereby claimed by him by virtue thereof, shall be again filed in the office of the clerk or register aforesaid of the town or city where the person to whom such property is so contracted to be sold shall then reside, if such person shall then be a resi- dent of this State ; and if not such resident, then in the of- fice of the clerk or register of the town or city where the property so contracted to be sold was at the time of the ex- ecution of such instrument. § 4. The clerks of the several towns and counties of this State in whose offices contracts for the conditional sale of goods and chattels on credit are by this act required to be filed, shall indorse on every such instrument or copy so filed the number thereof, and enter such number and the names of all parties to such instrument, and the amount thereby required to be paid and the contingency or event required to occur before the ownership of the goods and chattels described therein shall pass from the person con- tracting to sell the same, the time when such amount will be due, and the date of the filing of such instrument or copy, in the books kept in such offices for the entry of similar matters regarding mortgages of goods and chat- tels, and in like manner as in cases where such mortgages are so filed, except that the name of the person in such in- strument contracting to sell shall be entered in the coltimn of mortgagees, and the name of the person therein con- APPENDIX OF STATUTES. 269 tracting to buy shall be entered in the column of mortgag- ors. For their services under , this act such clerks shall receive the same fees they are now authorized to receive for like services in regatd to mortgages of goods and chat- tels. § 5. A contract for the conditional sale of goods and chattels on credit, filed as required by this act, may be sat- isfied and discharged of record in the same manner, so far as is applicable, as may mortgages of goods and chattels which may now be filed in the offices of town or county clerks. § 6. This act shall not affect any proceeding now pend- ing, nor any transaction had before the passage of this act. § 7. (As amended by L. 1885, ch. 488, and L. 1886, ch. 495.) This act shall not apply to household goods, pianos, organs, scales, engines and boilers, portable saw-mills and saw-machines, threshing-machines and horse-powers, mow- ing-machines, reapers, and harvesters and grain-drills, with their attachments; provided that the contract for the sale of the same shall be executed in duplicate, and one duplicate shall be delivered to the purchaser. In case household goods, pianos, organs, scales, engines and boilers, portable saw-mills and saw-machines, threshing-machines and horse- powers, mowing-machines, reapers, and harvesters and grain-drills, with the attachments, are sold upon the condi- tion that the title shall remain in the vendor, or some other person than the purchaser, until the payment of the pur- chase-price, or until the occurring of any future event or contingency, and the same are taken by the vendor or his successor in interest, such property so retaken shall be re- tained for thirty days by the person by whom or in whose behalf the same has been so taken, during which time the purchaser or his successor in interest may fulfill such con- tract of purchase, and shall be entitled thereupon to receive such property. After the expiration of such time all inter- est of the purchaser, or his successor in interest, in such property lawfully retaken under such contract, shall cease. APPENDIX OF POMS. No. 1. Mortgage of Personal Property. — Ordinary Form. To all to whom these presents shall come, know ye that I, A. B., of the town of , in the county of , and State of New York, party of the first part, for securing the payment of the money hereinafter mentioned, and in con- sideration of the sum of one dollar to me duly paid by C. D., of the same place, party of the second part, at or before the ensealing and delivery of these presents, the receipt whereof is hereby acknowledged, have bargained and sold, and by these presents do grant, bargain and sell unto the said party of the second part, one gray mare named " Mary," and all other goods and chattels mentioned in the schedule hereunto annexed, and now in the stable used by me in said town of . To have and to hold, all and singular the goods and chattels above bargained and sold, or intended so to be, unto the said party of the second part, his executors, administrators, and assigns, forever. And I, the said party of the first part, for myself, my heirs, execu- tors, and administrators, all and singular the said goods and chattels above bargained and sold unto the said party of the second part, his heirs, executors, administrators, and assigns, against me, the said party of the first part, and against all and every person or persons whomsoever, shall and will warrant and forever defend. Upon condition that if I, the said party of the first part, shall and do well and truly pay unto the said party of the second part, his execu- tors, administrators, or assigns, the just and full sum of dollars, in days after the date hereof, in which said sum I am now justly indebted to him for money loaned and advanced by him to me, then these presents shall be void.^ ' A mortgage payable ia one day tory sort of security for the mort- after its date affords the most satisfac- gagee, since a default occurs at once 272 APPENDIX OF FOEMS. And I, the said party of the first part, for myself, my executors, administrators, and assigns, do covenant and agree to and with the said party of the second part, his ex- ecutors, administrators, and assigns, that in case default shall be made in the payment of the said sum above men- tioned [or, if the party of the second part shall at any time deem himself to be unsafe or insecure^], then it shall and may be lawful for, and I, the said party of the first part, do hereby authorize and empower, the said party of the second part, his executors, administrators, and assigns, with the aid and assistance of any person or persons, to enter any dwelling-house, store, and other premises, and such other place or places as the said goods or chattels are or may be placed, and take and carry away the said goods or chattels, and to sell and dispose of the same for the best price they can obtain ; and out of the money arising therefrom, to re- tain and pay the said sum above mentioned, and all charges touching the same, rendering the overplus (if any) unto me or to my executors, administrators, or assigns. And until default be made in the payment of the said sum of money, I am to remain and continue in the quiet and peaceable possession of the said goods and chattels, and the full and free enjoyment of the same. In witness whereof I, the said party of the first part, have hereunto set my hand and seal, the day of , one thousand eight hundred and (Signed) A. B. [l. s.J Sealed and delivered j in the presence of f SCHEDULE EEFBBEED TO IN THE FOEEGOING MOETGAGE. One gray mare, named " Mary." One wagon, painted red. One set of single-harness. Two blankets. (Signed) A. B. and the mortgagee can protect himself must be made before possession can be against the fraud of the mortgagor, or obtained. See cmte, § 27. the claims of his creditors, by taking ' The clause in brackets is known possession at any time. If the mort- as the "danger clause." See ante, gage be payable on demand, a demand § 29. APPENDIX OP FOBMS. 273 No. 2. Statement of Mortgagee on Refiling Chattel Mortgage. I, C. D., the mortgagee within named, do certify and state that there remains due and unpaid on the mortgage of which the foregoing [or, within] is a true copy, the sum of dollars, and interest thereon from the day of , 18 , which sum is the amount of my interest in the property described in said mortgage, claimed by me by virtue thereof. Dated this day of , 18 . (Signed) C. D. No. 3. Power of Attorney to Foreclose Chattel Mortgage. — Short Form to he Indorsed on Mortgage. I, C. D., do hereby nominate and appoint S. T. as and for my true and lawful attorney, for me and in my name to take possession of the goods and chattels described in the within mortgage [or, if the power to foreclose is written on a different paper, describe the mortgage], and to foreclose the said mortgage by a sale of said goods and chattels, in conformity with the power therein contained, and I author- ize my said attorney to do all acts for me and in my behalf which I, under the said power and under said mortgage, could lawfully do, and for that purpose to procure the aid or assistance of any person or persons. And I also covenant with the said S. T., that the sum of dollars, and interest thereon from the day of ,18 , is now justly owing to me on the said mort- gage, that I am the lawful owner and holder thereof, and that I will indemnify and hold him harmless for any acts done by him in carrying out and executing the power here- inbefore granted to him. Dated the day of , 18 . (Signed) C. D. [l. s.] 18 274 APPENDIX OF FOBMS. No. 4. Notice of Sale under Chattel Mortgage. By virtue of a chattel mortgage, executed by A. B. to C. C, dated on the day of , 18 , and which was duly filed in the office of the clerk of the town of ,1 will expose for sale at public auction at , in the said town of , on the day of j 18 , at o'clock in the forenoon of that day, the following goods and chat- tels, to wit: One gray mare, named "Mary"; one wagon, painted red ; one set of single-harness ; two blankets. Dated the day of , 18 . (Signed) W. X., Auctioneer. No. 6. Contract of Conditional Sale, in Form of a Lease. This indenture, made this day of , 18 , be- tween the Ajax Company, of the first part, hereinafter called the lessor, and C. D., of the city of New York, of the second part, hereinafter called the lessee, Witnesseth, that the lessor has let and hired for use, and by these presents doth let and hire for use, unto the said lessee, the foUowihg-described personal property, war- ranted free from defects of material and manufacture, and with the following attachments [insert description'], for the term of months from the date of receipt of bill of lad- ing, at the rent or hire of $ , payable in installments as follows, namely : On receipt of bill of lading of same, cash, $ {insert terms of sale], the said several installments to be further evidenced by the lessee's notes, bearing legal interest, to be given by the lessee on receipt of said bill of lading, but which notes are not-to be considered as payment of said in- stallments. And it is further agreed by and between the parties to these presents, that if default shall be made in the payment of the first or any of the above-named installments, then it shall be lawful for, and the lessor may re-enter into posses- sion of the personal property above described ; may enter upon the premises of the lessee and upon any other prem- ises where the same may be found, and take away, repos- APPENDIX OF FOEMS. 275 sess and enjoy the said personal property as though these .presents had never been made, without any liability, ac- countability, or responsibility of the lessor to the lessee, or any other person or persons, for so doing. And the lessee doth covenant and agree that the said personal property shall be taken to his aforesaid place of business, and there held and kept, and not removed there- from without the written consent of the lessor first had and obtained; and at the expiration or sooner determining of the said term, he will quit and surrender and deliver up possession of the said personal property to the lessor in like good order and condition, reasonable use and wear thereof excepted. And the lessor doth hereby covenant and agree that the lessee, on paying the above-specified installments, and per- forming the covenants aforesaid, shall and may peaceably and quietly have, hold, use, and enjoy the said personal 3)roperty for the said term. And the lessor doth hereby covenant, promise and agree -to and with the lessee, that if the lessee shall well and truly keep and perform the covenants herein made, and shall make no default in the payment of the aforesaid install- ments as the same shall become due and payable, and this lease shall not be sooner determined by mutual consent, or otherwise, that the lessor will make, execute and deliver to the lessee a good and sufficient bill of sale for said personal property, the consideration whereof shall be the amount of the above-named payments received on account of the rent for the use of the same for the aforesaid term, and $10 additional, payment of said $10 after expiration of lease be- ing a condition precedent to right of purchase. And the lessee does hereby covenant and agree to keep said personal property in good order and repair, reasonable wear and tear excepted, and insured against loss or damage by fire, during the continuance of this lease, in the sum of at least $ , in a good and incorporated company, to be approved by the lessor, and assign the policy or certificate thereof to the lessor, and in default thereof the lessor may effect such insurance, and the premium so paid for effect- ing the same shall be a lien on said personal property, added to the above-named amount, and be paid for by the lessee. The lessee shall not assign this lease, nor under-let or sub-hire the said personal property, without the written consent of the lessors endorsed hereon. 276 APPENDIX OF FORMS. It is further expressly understood and agreed, that the rights and liabilities herein given to or imposed upon either of the parties hereto shall extend to the successors, executors, administrators, and assigns of such party as though they were in each case named. And the lessor agrees to deliver the said personal prop- erty, boxed on cars, at its factory, about , 18 . In witness whereof, the parties hereto have signed and sealed this indenture the day and year first above written. AJAX COMPANY, Lessor, [l. s.] By A. B., Sec., E. K, Pres. C. D., Lessee. [L. s.] No. 6. Contract of Conditional Sale. — Short Form. A. B. has this day delivered to C. D. the following per- sonal property, to wit : llnsert description.] The said C. D. agrees to pay to said A. B., for said prop- erty, the sum of dollars, in installments, as follows : [Insert terms of payment.'] It is agreed that A. B. does not relinquish his title to said property, but that he shall remain the sole owner thereof until the above sum is fully paid in money, and, if notes are given, until all such notes are actually paid in cash. In the event of the failure to pay any of said install- ments or notes when the same shall become due, then said A. B. may take possession of said property without legal process, and may enter on the premises of C. D. for that purpose. If the said A. B. shall take possession of said property without legal process of said property, because of any de- fault, he may retain all installments previously paid, as and for compensation for the use of said property. It is expressly understood that there are no conditions whatever not stated in this memorandum. Dated, etc. (Signed) A. B. G. D. Q-ENEEAL INDEX. References ake to Sections. ACCEPTANCE by mortgagee, 8 in general, presumed, 8 ACCRETIONS to mortgaged property, 122-124 ACTION to foreclose chattel mortgage, 186-19 5 regulated by Code of Civil Procedure, 190-195 for surplus after foreclosure, 215 See Conversion ACTION TO REDEEM, proper remedy of mortgagor, 213 who may maintain, 214-216 tender before action brought, 218 delay in bringing action, 219 ADMINISTRATOR of mortgagor may disaffirm mortgage for fraud, 275 AFFIDAVIT of validity of mortgage required in some States, 299 AGISTERS OF CATTLE, statute as to lien of, 184, 185 APPENDIX of statutes, page 257 See Statutes of forms, page 271 See Forms ARIZONA, statute as to conditional sales, 70 ARKANSAS, statute as to conditional sales, 71 ASSIGNEE IN BANKRUPTCY, may attack fraudulent mortgage, 275 • of mortgagor, cannot allege lack of filing, 323 ASSIGNMENT, shown to be a mortgage, 5 as security, may be a mortgage, 6 or a pledge, 13, 16 278 GENEEAL INDEX. [References are to sections/] ASSlGNMENT-continued. of dhattel mortgage, 160-163 effect of assigning debt apart from mortgage, 161, 162 when subject to equities, 163 mortgage securing negotiable note, 163 ASSIGNMENT FOR CREDITORS, differs from mortgage, 19 chattel mortgage may be adjudged to be, 19 and void as fraudulent, 19 distinguished from mortgage, 20, 21 remedy against assignee for selling free from lien, 166 assignee of mortgagor may show fraud in mortgage, 275 rights of creditors after assignment, 276 assignee cannot allege lack of filing, 323 ASSENT OF STOCKHOLDERS to mortgage by manufacturing corporation, 103-108 mortgage by gas light company, 110 mortgage by business corporations. 111 ASSUMING MORTGAGE, enforcing obligation created by, 212 ATTACHMENT, condition against permitting, 28 proceedings under, as against void m.ortgage, 271, 272 when leviable on mortgagor's interest, 334-353 AUCTIONEER, fees of, at foreclosure sale, 209 BADGE OF FRAUD, continued possession of mortgagor, 227-231 what constitutes actual delivery and continued change ■ of possession, 232-242 overstating claims of the mortgagee, 243 sales by mortgagor with consent of mortgagee, 247-262 BAILMENT, under contract of conditional sale, 63 mere agreement of, need not be filed, 67 BILL OF SALE, shown to be a mortgage, 5 right of possession shown by parol, 24 BONA FIDE PURCHASER, from vendee of property sold con- ditionally, 42 from vendee of chattels sold conditionally, 42-58 rule in Pennsylvania, 59 * New York decisions, 60-63 mortgagee for pre-existing debt is not, 87 GENERAL INDEX. 279 [JRe/erences are to sections.'] BOTTOMRY BOND, nature of, 370-372 not required to be filed, 374 BUSINESS CORPORATIONS, mortgages by, 111 CALIFORNIA, statute as to conditional sales, 72 CANAL BOATS, mortgages of, not recorded with collector of cus- toms, 858 filing mortgages of, 360-364 CHANGE OF POSSESSION, what constitutes, 232-244 CHATTEL MORTGAGE, differs from mortgage of real estate, 1 definition of, 2 by parol, 3 no seal required, 4 absolute transfer may be shown to be, 5 examples of, 6 delivery of, 7 acceptance by mortgagee, 8 distinguished from pledge, 9 et seg. from assignment for creditors, 19, 20 may be to one person to secure debts to several, 20 right to possession, 22 distinguished from conditional sale, 39 by partnership, 97 power of one partner to execute, 97 to secure individual debts, 98 form of executing, by one partner, 99 by corporation, 102 organized under manufacturing act, 103-109 gaslight companies, 110 business corporations, 111 lien on goods subsequently manufactured, 122 on property improved by repairs, 123 on natural increase of animals, 124 on fixtures as against mortgagee of land, 127-129 on property to be acquired, 137-153 See Ftttuke Property assignment of, 160-163 rights of junior mortgagee, 171-176 who may contest validity, 269 280 GENEBAL INDEX. [References are to sections.'] CHATTEL M.O^TGKG:^- continued. how contest can be made, 277-280 filing of, 281-299 refiling of, 300-308 ■when filing is unnecessary, 309-317 lex loci, as to filing, 318-321 who may take advantage of lack of filing, 322-333 COMMON CARRIEE, lien of, as against mortgagee, 182 CONDITIONAL SALE, distinguished from mortgage, 5, 39 inadequacy of price as a test, 40 where entire contract is in writing, 41 writing not binding upon third persons, 41 as security for purchase-money, 42-45 securing other debts than purchase-money, 46 validity against creditors and purchasers, 48 fraud and oppression by means of, 49 construction of contract, 50 extending time for performance of condition, 51 tender of performance by vendee, 52 provision against removal of property, 53 authority to vendee to sell free of condition, 54 selling as agent of vendor, 55 sale of goods to be manufactured, 56 sales or mortgages by conditional vendee, 57 to purchaser with notice, 57 bona fide purchaser from vendee, 58 rule in Pennsylvania, 59 New York decisions as to title of bona fide purchaser, 60-63 controlling distinction, 63 filing contract of a conditional sale, 64 New York statute, 64 limitations of statute, 65 who may take advantage of failure to file, 66 mere agreement of bailment not within statute, 67 statute of Minnesota, 68 Iowa and Nebraska, 69 statutory provisions in Arizona, 70 Arkansas, 71 GENERAL INDEX. 281 [References are to sections. ] CONDITIONAL SALE -continued. California, 72 Florida, 73 Kansas, 74 Kentucky, 75 Maine, 76 Missouri, 77 New Hampshire, 78 New Jersey, 79 North Carolina, 80 Texas, 81 Vermont, 83 Virginia, 83 West Virginia, 84 suggestions as to further legislation, 85 of choses in action not required to be filed, 315 CONFUSION OF GOODS, rule as to admixtures, 125 as against junior liens, 126 CONSTEUCTION of contract of conditional sale, 51 of description of mortgage property, 120 CONVERSION, action for, when maintainable by mortgagee, 25 action by mortgagee against mortgagor, 31 against purchasers from mortgagor, 32 against trespassers, 33 measure of damages, 33 action by mortgagor against mortgagee, 34 ■ measure of damages, 34 exemplary damages, 35 mortgagor's action against trespasser, 36 eifect of judgment by mortgagor against trespasser, 37 effect of judgment by mortgagee, 37 mitigation of damages, 38 sale under usurious mortgage constitutes, 86 action by mortgagee of real estate for removing fixtures, 132 action by mortgagee against mortgagor for selling property, 165 against persons aiding in the sale, 165 action by prior mortgagee against junior mortgagee, 173 282 GENERAL INDEX. [Rfferences are to seeiions.^ CONVERSION - con tinned. against mortgagor for creating junior mortgage, 174 value of use after conversion, not element of damage, 220 remedy of mortgagor in equity, 221 COEPORATION, power to mortgage, 102 executing mortgage by, 102 organized under the manufacturing act, mortgages by, 103 assent of stooitholders required, 103 form of assent, 104 who must sign assent, 105 when assent must be made and filed, 106 purchase-money mortgage does not require assent, 107 who may take advantage of lack of assent, 108 what debts may be secured, 109 gas light companies, mortgages by, 110 consent of stockholders required, 110 business corporations, mortgages by, 111 assent of stockholders required, 1 1 1 residence of, for purpose of filing mortgage, 286 CREDITORS, who are, within statute of fraudulent sales, 269 all, protected against actual fraud, 270 with execution, may ignore void mortgage, 271 must have execution or attachment, 272 action to set aside fraudulent mortgage, 269, 280 who may take advantage of lack of filing, 325 must have a lien, 326 CROP, mortgage on, by parol, 3 growing, mortgage of, 144-148 unplanted, mortgage of, 149-153 DANGER CLAUSE, effect on right to levy on property, 337, 343 DEBT SECURED, several debts by same mortgage, 20 essential to validity of chattel mortgage, 86 usurious, mortgage void, 86 illegality of contract, 86 pre- existing, secured by chattel mortgage, 87 evidence of, 88 description of, 89 mortgage for future advances, 90 GENEEAL INDEX. 283 [References are to sections.^ DEBT SECURED— cowimMetf. parol evidence as to debt, 91 efiect of assignment of, apart from mortgage, 161 after default has occurred, 1 62 enforcing personal liability for, 21 1 against person assuming debt, 212 payable in installments, eflfect of default, 217 overstating, a badge of fraud, 243 evidence of, 244 DEFAULT, right of possession reserved until, 24 rights of mortgagee after, 26, 27 authority to sell before default, 197 DEFICIENCY, enforcing personal liability for, 211 against person assuming mortgage, 212 DELIVERY of mortgage, 7 of mortgaged property cures insufficient description, 118 what constitutes actual and immediate delivery, 232-244 DEMAND OF PAYMENT, where debt is payable on demand, 27 not required before action to foreclose mortgage, 189 DESCRIPTION, of debt secured by chattel mortgage, 89 of mortgaged property, 1 12 greatest accuracy not required, 113 specific chattels not designated, 114 exempting property exempt from execution, 1 15 examples of definite descriptions, 116 indefinite descriptions, 117 insufficient description cured by delivery, 118 parol evidence to aid description, 119 construction of description, 120 schedule annexed to mortgage, 121 DISCHARGE of mortgage of record, 298 EQUITABLE LIENS, neither pledges nor mortgages, 18 examples of, 18 on property to be acquired, 137-143 EVIDENCE, certified copy of chattel mortgage, 297 as to mortgage on registered vessel, 359 EX ECUTION, against mortgagee after default, 26 proceedings under, as against void mortgage, 271, 272 284 GENEBAL INDEX. {^References are to sections.'] EXECUTION— conlmned. actual levy not required to contest mortgage, 279 nor return of execution, 280 when leviable on interest of mortgagee, 334-353 before breach of condition, 334 after breach of condition, 335 mortgage payable on demand, 336 effect of " danger clause," 337, 343 exempt property, 339 attachment of equity of redemption, 340 when execution becomes a lien, 341 execution against mortgagee, 342 remedy against sheriff for unlawful levy, 344, 347 sale by sheriff ignoring mortgage, 345, 346 in what lots or parcels sale to be made, 348, 349 remedy for improper sale, 350, 351 injunction restraining sale, 352 EXECUTOR of mortgagor may disaffirm mortgage for fraud, 275 EXEMPT PROPERTY, effect of excepting exempt property from mortgage lien, 115 priority of mortgage of, 179 mortgages of, 267 not leviable, though mortgaged, 339 EXTENDING LIEN on new property by parol, 3 EXTENSION OF TIME, of payment, extends mortgagor's right of possession, 25 for performing condition, 51 FILING contracts of conditional sale, 64 limitations of statute, 65 who may take advantage of the failure to file, 66 mere agreement of bailment not to be filed, 67 statute of Minnesota, 68 Iowa and Nebraska, 69 lease of land creating lien on chattels should be filed, 158 statute of 1833, 28 ; page 257 Kings and Westchester counties, 282 statute adds another ground to invalidate mortgage, 283 residence of mortgagor at date of mortgage, 284 non-resident mortgagor, 285 GENERAL INDEX. 285 [References are to sections.^ FlUNG^-continued. residence of corporation, 286 joint-stock company, 287 joint mortgagors, 288 how filing to be done, 289 duty of clerk, 290 effect of delay in filing, 291 copy filed must be a "true copy," 292 agreement forming part of mortgage, 293 schedule referred to in mortgage, 294 lien clause in lease, 295 filing after default, 296 legal force of certified copy, 297 discharging mortgage of record, 298 affidavit required in some States, 299 refiling, 300-308 of mortgages of canal boats, 360-364 PIXTURES, when bound by mortgage of the real estate, 127 treated as personal property by agreement, 128 such agreement not always binding on mortgagee of real estate, 129 mortgage of, to be recorded as mortgage of real property, 130 mortgaged chattels afterwards affixed to land, 131 remedy of mortgagee of real estate for removal, 132 what are, as between mortgagees of chattels and real estate, 134-136 intention of the owner in affixing, a test, 134 character of annexation as a test, 135 FLORIDA, statute as to conditional sales, 73 FORECLOSURE of rights of pledgor, 14 right to take possession after default, 30 by action, is permissible, 186 ' when preferable to sale under power, 187 parties to action, 188 demand before suit, 189 Code of Civil Procedure regulates action, 190 warrant to take possesion, 191, 193 judgment, 192 286 GENERAL INDEX. [References are to sections.^ FOB,EGLOS\]RE— continued. receiver may be appointed, 195 by sale without judicial decree, 196-210 express power of sale not essential, 196 sale before default, 197 notice of sale, 198 private sale, 199 collusive and fraudulent sales, 200 method of procedure in ordinary cases, 201 mortgagee may purchase, 202, 203 terms of sale, 204 sale in parcels, 205 how much to be sold, 206 warranty of title, 207 combinations not to bid, 208 expenses of foreclosure sale, 209 injunction restraining sale, 210 delay in foreclosing, 224 accounting as to amount due, 220-226 mortgagee not chargeable with unsold goods, 226 FORMS, appendix of, page 271 mortgage of personal property, ordinary form, page 271 statement on refiling chattel mortgage, page 273 power of attorney to foreclose, page 273 notice of sale under mortgage, page 274 contract of conditional sale, page 274 short foriij, page 276 FRAUD, using form of mortgage for fraudulent assignment, 19, 20 in conditional sale, rights of creditors, 48 continued possession of mortgagor, a badge of, 227-231 overstating claims of mortgagee a badge of, 243 " invalidates mortgage to its entire extent, 263 rule where mortgagee is innocent, 266 who may attach mortgage for, 269-280 FUTURE ADVANCES, chattel mortgage given for, 90 form of, 90 parol evidence as to debt, 91 priority of mortgage for, 92 extending lien for new advances, 93 GENERAL INDEX. '287 \_R"fe fences are to sections.'\ FUrURE PROPERTY, lien where mortgagor has no present right or title, 137 when mortgagor has potential right, 138, 139 agreement for a lien valid in equity, 140 rights of mortgagee before taking possession, 141 after taking possession, 142 lien on substituted property, 143 mortgage of growing crop, 144-148 mortgage of unplanted crop,. 149-1 53 OAS LIGHT COMPANY, mortgage by, 110 GENERAL ASSIGNMENT, distinguished from mortgage, 19, 20 / See Assignment for Cbeditoks • INADEQUACY OF PRICE distinguishes conditional sale from mortgage, 40 INFANT, chattel mortgage by, 94 restoring consideration on avoiding mortgage, 95 purchase-money mortgage by, 96 INJUNCTION to restrain removal of fixtures, 132 by junior mortgagee against prior mortgagee, 175 when granted to restrain foreclosure, 210 where mortgage is usurious, 210 to restrain sale by sheriff under execution, 352 INNKEEPER, lien of, as against mortgagee, 181 INSTALLMENTS, title vests in mortgagee after first default, 27 effect of payments on account, 27 INSURANCE, filing mortgage after fire, 316 IOWA statute as to filing conditional sales, 69 JOINT-STOCK COMPANY, filing mortgages by, 287 JUDGMENT in action to foreclose chattel mortgage, 192 JUNIOR MORTGAGE, making of not a waiver of conversion by third person, 38 JUNIOR MORTGAGEE, rights, as affected by confusion of goods, 126 nature of the title of, 171-173 after default, 173 288 GENERAL INDEX. [References are to sections.^ JUNIOR MORTGAGEE— continued. may be liable for conversion for foreclosing his mortgage, 173 cannot enjoin foreclosure of prior mortgage, 175 rights of, as against mortgagor, 176 priority of mortgages independent of recording acts, 177- 179 may attach fraudulent mortgage, 273 may take advantage of lack of filing, 329 rights of assignee of junior lien, 330 KANSAS statute as to conditional sales, 74 KENTUCKY statute as to conditional sales, 75 KINGS COUNTY, filing chattel mortgages in, 282 LEASE, clause in, creating lien on chattels, 154-157 lease should be filed as a chattel mortgage, 158, 295 privilege to tenant to sell, may invalidate lien, 159 mortgages of, not required to be filed, 314 LEX LOCI, as to mortgages of chattels, 318-321 LIENS, equitable, on chattels, 18 See Equitable Liens. on accretions to mortgaged property, 122-124 on goods afterwards manufactured, 122 where mortgaged chattels are repaired, 123 natural increase of animals, 124 rule as to eonfiision of goods, 125, 126 mortgages upon fixtures, 127-136 on property to be acquired, 137-153 See Future Pbopbbty created by reservation in lease of real property, 154-159 priority of, independent of recording acts, 17^-179 for repairs, priority of, 180 of innkeepers and stablers, 181 of common carrier, 182 of storage, 183 of livery keepers and agisters of cattle, 184, 185 of mortgagee for expenses incurred, 209 LIMITATION of action to redeem, 219 GENEEAL INDEX. 289 IBe/erences are to sections.] LIMITED PARTNEKSHIP, mortgage by, 100 unlawful preferences to creditors, 100 mortgage given for present consideration, 101 LIVERY STABLE KEEPER, statute as to lien of, 184, 185 MAINE statute as to conditional sales, 76 MANUFACTURING CORPORATION, mortgage by, 103 assent of stockholders required, 103-108 what debts may be secured, 109 MEASURE OF DAMAGES, action by mortgagee against mort- gagor for conversion, 31 action by mortgagee against trespasser, 33, 37 action by mortgagor against mortgagee, 35 by mortgagor against trespasser, 37 mitigation of damages, 38 MINNESOTA statute as to filing conditional sales, 68 MISDEMEANOR to sell or seerete mortgaged property, 167, page 265 MISSOURI statute as to conditional sales, 77 MORTGAGE. See Chattel Mortgage MORTGAGED PROPERTY, description of, 112-121 accretions to, 122-124 confusion of goods, rule as to admixtures, 125 as against junior liens, 126 right of mortgagor to sell invalidates mortgage, 247-262 lien on substituted property, 256 mortgages of property consumable by use, 257 MORTGAGEE may purchase at foreclosure sale, 202, 203 lien of, for expenses incurred, 209 liabilities and duties on taking possesion, 220-226 of ships or vessels, liablity for supplies and repairs, 305, 366 MORTGAGE OF REAL PROPERTY, lien of, upon fixtures, 127-129 lien on crops and emblements, 153 MORTGAGOR, remedies against, for selling free from lien, 164- 170 misdemeanor to sell or secrete property, 167 sale with consent of mortgagee, 168 19 290 GENERAL INDEX. [References are to sectiorvi.~\ MORTGAGOR— eowzinwerf. rights in equity after default, 213 right of action for surplus after foreclosure, 215 right to sell free from lien invalidates mortgage, 247-262 NEBRASKA statute as to filing conditional sales, 69 NEGOTIABLE NOTES to be surrendered on payment, 23 secured by mortgage rights of bona fide purchaser, 163 NEW HAMPSHIRE statute as to conditional sales, 78 NEW JERSEY statute as to conditional sales, 79 NORTH CAROLINA statute as to conditional sales, 80 NOTICE OF SALE to foreclose chattel mortgage, 1 98 OVERSTATING CLAIMS OF MORTGAGEE a badge of fraud, 243 PARCELS, sale in, to foreclose mortgage, 205, 206 PAROL EVIDENCE, mortgagor's right of possession also shown by parol, 24 to distinguish conditional sale from mortgage, 41 in favor of a stranger to a writing, 41 as to debts secured by mortgage, 91 to aid description of mortgage property, 119 PAROL MORTGAGE, good between the parties, 3 and as to third parties if possession taken, 8 effect of statute of frauds, 3 PARTIES to action to foreclose a chattel mortgage, 188 PARTNERSHIP, mortgages by, 97, 265 to secure firm debts, 97 to secure individual debts, 98 form of executing mortgage by partners, 99 mortgages by limited partnerships, 100, 101 PLEDGE, possession essential, 9 rights of parties to, 9 creates a lien and not a title, 9 character of delivery required, 10 distinguished from mortgage, 10, 11 use of word "pledge" not conclusive, 12 GENERAL INDEX. 291 [References are to sections.'] P LEDGE — continued. nor the word " mortgage," 13 examples, 13 method of enforcing lien, 14 differs from mortgage, 14 pledgee may not purchase, 15 right of redemption, 16 resemblance to mortgage, 17 voluntary surrender by mortgagor to mortgagee under void mortgage, 259 POSSESSION, mortgagee's right of, 23 right of, reserved to mortgagor, 24 effect of retaining, by mortgagor, 25 mortgagor may waive his right of, 25 right of, after default, 27 special agreements for, 28 stipulation against removal, 28 or sale, 28 or suffering attachment or levy, 28 mortgagee deeming himself insecure, 29 how taken, 30 rights of owner of equitable lien as affected by, 141, 142 how taken under mortgage of growing crop, 145 liabilities and duties on mortgagee when taking, 220, 224 continued possession of mortgagor a badge of fraud, 227- 231 what constitutes actual delivery and change of posses- sion, 232-244 under void mortgage, effect of, 259 PREFERENCE by insolvent limited partnership forbidden, 100 by insolvent mortgagor, act of 1887, 245 evidence as to good faith, 246 PRESUMPTION OF FRAUD, what creditors are protected by, 269 PRIORITY of mortgage for future advances, 92 of chattel mortgage independent of recording acts, 177 as between two mortgagees, 177 where one gives mortgage of chattels belonging to an- other, 178 292 GENERAL INDEX. [References are to sections.^ VmOnYSY— continued. on exempt property, 179 as against liens for services rendered to the property, 180 liens for repairs, 180 innkeepers and stablers, 181 lien of common carrier, 182 lien for storage, 183 statute as to livery stable keepers and agisters of cattle, 184,185 PEIVATE SALE to foreclose chattel mortgage, 199 PURCHASER, title of, on purchase from mortgagor, 164 on sale by sheriff under execution, 166 mortgagee may become, at foreclosure sale, 202, /!03 may attack fraudulent mortgage, 273 when purchase is subject to mortgage, 274 may take advantage of lack of filing, 327 must be " subsequent " and bona fide, 328 PURCHASE-MONEY MORTGAGE, by infant, 96 by corporation, 107 RAILROAD COMPANIES, filing mortgages of chattels by, 317 ' RAIIFICATION, mortgage rendered valid by priority of, 178 REAL ESTATE MORTGAGE differs from mortgage of chattels, 1 RECEIVER, when appointed in action to foreclose chattel mort- gage, 195 against mortgagee in possession, 210 of mortgagor, in supplementary proc3edings, rights of, 214 of mortgagor, may attack mortgage for fraud, 275 of mortgagor, cannot allege lack of filing, 324 RECORDING, mortgages of fixtures should be recorded, 130 REDEMPTION, pledgor's right of, 16, 17 mortgagor's right of, 16, 17 right of mortgagor after default, 213 action for, when proper, 213 receiver in supplementary proceedings may maintain, 214 who may bring action, 216 where mortgage is payable in installments, 217 tender before action brought, 218 GENERAL INDEX. 293 \_References are to sections.'] REDEMPTION— cowCmwec?. deliiy in bringing action, 219 accounting on, 220-226 REFILING, of chattel mortgage, 300-308 necessity of annual refiling, 300 another copy to be filed, 301 calculations of time, 302 fraction of a day, 303 place for refiling, 304 after expiration of the year, 305 new mortgage for old consideration, 306 intervening mortgage, 307 statement of mortgagor's interest, 308 REMOVAL, condition against, 28 RENT, received by mortgagee to be credited on mortgage, 220 unless mortgagor recovers as for conversion, 220 REPAIRS to mortgaged property, lien for, 180 mortgagee of vessel, when liable for, 365, 366 lien on vessel for, 367 REPLEVIN, when maintainable by mortgagee, 25 RESIDENCE, of mortgagor, to fix place of filing pfiortgage, 284 non-resident mortgagor, 285 corporation, 286 joint-stocif company, 287 joint mortgagors, 288 RESPONDENTIA BOND, nature of, 371 filing of not required, 374 SALE to enforce lien on pledge, 14 pledgee may not purchase, 15 by mortgagee, not to be made before default, 23 proceeds not applied on note not due, 23 rights of mortgagee after default, 26 by mortgagor, condition against in mortgage, 28 by conditional vendee, rights of bona fide purchasers, 5, 42 effect of authority to vendee to sell, 54 sale as agent of vendor, 55 goods to be manufactured, 56 purchaser from vendee with notice, 57 294 GENERAL INDEX. l^Refermces are to seciions,^ SALE — continued. rights of bona fide purchaser, 58 rule in Pennsylvania, 59 New York decisions, 60-63 by mortgagor disregarding mortgage, 164-170 title of purchaser, 164 mortgagor punished criminally, 167 ■ by mortgagor with consent of mortgagee, 168-170 by mortgagee, no express power required, 196 See FORBCLOSURB remedies of mortgagor, 221, 223 by mortgagor free from lien with consent of mortgagee, 247, 262 agreement that mortgagor may sell, invalidates mort- gage, 247 of mortgaged property under execution, 348-350 SCHEDULE, annexed to mortgage to be construed with it, 121 rule as to filing, 294 SEAL, not required to chattel mortgage, 4 addition of, does not invalidate chattel mortgage, 99 of corporation, effect of, 102 SHIPS AND VESSELS, mortgages of, 354-369 recording mortgages of, 354-359 mortgages on canal boats, 360-364 liability of mortgagees for supplies and repairs, 365, 369 bottomry and respondentia bonds, 370-374 STABLER, lien of, as against mortgagee, 181 STATEMENT of mortgagee's interest on refiling, 308 STATUTES, appendix of, page 257 act requiring chattel mortgage to be filed, page 257 act applicable to city of Rochester, page 259 act as to indexing chattel mortgages, page 259 act as to registering liens on canal boats, page 260 amendment to said act, page 261 act as to. railroad mortgages, page 264 act as to discharging chattel mortgages, page 264 provision of Penal Code as to secreting property, page 265 Consolidation Act, city of New York, page 265 act as to filing conditional sales, page 267 GENERAL INDEX. 295 \^Beferences are to sections.'] STOCK OF GOODS, agreement that mortgagor iTiay sell free from lien, 247 agreement appearing on face of mortgage renders it void, 247 agreement implied from other facts, 248, 249 burden of proof, 250 proceeds of sales to be applied on mortgage, 253 sales for the use of the mortgagor, 254 lien on substituted property, 256 STORAGE, lien for, as against mortgagee, 183 SUPPLIES, lien for, on ships or vessels, 367 SURPLUS, after foreclosure, action for, 215 may be recovered by mortgagor, 221, 223 application to another debt, 221 unsold goods, after satisfaction of mortgage, 226 TENANT, mortgage of crop by, 147 may create liens on chattels by clause in lease, 154-159 TENDER, to defeat mortgagee's right of possession, 23 of performance of condition by conditional vendee, 53 removal, provision against in contract of conditional sale, 53 when waived, 53 of debt does not discharge lien, 218 before bringing action to redeem, 218 before action to redeem, 221 TEXAS statute as to conditional sales, 81 TITLE vests in chattel mortgagee on default, 2 of bona fide purchaser from vendee of property sold con- ditionally, 42, 58-63 TRESPASS not maintainable by mortgagee against mortgagor, 25 but maintainable against wrong-doer, 25 TRUST ASSIGNMENTS, distinguished from mortgages, 19, 20 USURY, mortgage given for, is void, 86 sale under, constitutes conversion, 86 statute providing for injunction against foreclosure, 210 where two debts are secured, 268 296 GENERAL INDEX. l^Hefereiues are to sections.^ VALIDITY, when mortgagor is authorized to sell free from lien, 247, 262 when mortgage void only in part, 263-268 fraudulent intent, 263 reserving rights to mortgagor, 264 partnerships, 265 innocent mortgagee, 266 failure of title, 267 invalidity of debt, 268 who may dispute, 269-280 VERMONT statute as to conditional sales, 82 VIRGINIA statute as to conditional sales, 83 WAIVER of forfeiture in contract of conditional sale, 51 WARRANT to obtain possession in action to foreclose, 191-193 WESTCHESTER COUNTY, filing chattel mortgages in, 282 WEST VIRGINIA statute as to conditional sales, 84