In re Shannahan & Wrightson Hardware Co. , 32 Del. 37 ( 1921 )

Richards, J.,

delivering the opinion of the court:

In 11 Corpus Juris, p. 424, we find the following:

“The great weight of authority is to the effect that a chattel mortgage, properly executed and recorded according to the law of the place where the mortgage is executed and the property is located, will, if valid there, be held valid even as against creditors and purchasers in good faith in another state to which the property is removed, by the mortgagor, unless there is some statute in that state to the contrary, or unless the transaction contravenes the settled law or policy of the forum.”

This principle is supported in the following cases: Shapard v. Hynes, 104 Fed. 449, 45 C. C. A. 271, 52 L. R. A. 675; Handley v. Harris, 48 Kan. 606, 29 Pac. 1145, 17 L. R. A. 703, 30 Am. St. Rep. 322; Creelman Lumber Co. v. Lesh, 73 Ark. 16, 83 S. W. 320, 3 Ann. Cas. 108; Kanaga v. Taylor, 7 Ohio St. 134, 70 Am. Dec. 62; Smith v. McLean, 24 Iowa 322.

In Langworthy v. Little, 12 Cush. (Mass.) 109, Chief Justice Shaw said:

“A party who obtains a good title to property, absolute or qualified, by the laws of a sister state, is entitled to maintain and enforce those rights in this state."

In the states of Pennsylvania, Michigan, Texas and Louisiana, the above-stated principle has not been followed.

We think that the statement in Corpus Juris is substantiated by a great majority of the reported cases in this country and is the law in this country. To hold otherwise would take from a great many persons a method which they have of purchasing personal property upon credit, and in many cases might make it impossible for them to acquire necessary property.

The prayer of the Maryland chattel mortgage creditor to draw the fund in question out of court is, therefore, granted.