Smith v. Taber , 14 N.Y. St. Rep. 644 ( 1887 )

Hardin, P. J.:

It must he assumed that the contract between the plaintiff and his lessee, Bossard, was vahd, whether viewed exclusively as a chattel mortgage, or as containing a “ hen clause,” to enable the plaintiff to enforce payment of rent out of any property of the tenant in and upon the premises. (Reynolds v. Ellis, 103 N. Y., 122; McCaffrey v. Woodin, 65 id., 459.) The lease before us contains language adequate to create a hen on “ all the personal property on said land or thereafter brought on ” to it, and “ all the personal property and crops raised and to be raised on said land * * * shall be bound and hereby are bound to said Smith (plaintiff) as collateral security.”

It further declares that for the purpose of securing the said Smith, the lessor “ shall have the title to all the personal property of whatever hind raised, made, prodteced, kept, put or used upon said farm, and he shah have the right of possession thereof at any time, and such title and right of possession is vested in said Smith as collateral security for the faithful performance of all the covenants,” etc.

In Cressy v. Sabre (17 Hun, 123) Boardman, J., said “no such grant is aheged or proved,” and hence, that case differs from this-one. The language is apt and broad enough to create a present hen as well as a present transfer of title, to all property mentioned. It is more full than the language of the agreement found in Hale v. The Omaha National Bank (49 N. Y., 634) which only provided for further and future hens being given. PlavnUff's agreement, from, which we heme quoted, was duly filed in the town clerk’s office of the town where the tenant, Bossard, resided. In Duffus v. Bangs (43 Hun, 54) it appears by the opinion of Boardman, J., that the lease given to the defendant “ was never filed,” and hence the lease could not operate as a chattel mortgage. But plaintiff’s lease being vahd as an instrument between the parties so as to create a. hen, and filed properly as a chattel mortgage, we must consider whether the same is vahd as against the defendant who is a purchaser for value and in good faith so far as actual knowledge is. concerned, from Bossard, of the buckwheat raised upon the farm.

Treating the filing of the lease containing the “ hen clause ” and tbe security clause vesting tbe title to tbe property in the lessor, as equivalent to an actual notice to the defendant, then it must follow that the defendant is not a purchaser in good faith without notice; and hence he only acquired such rights as were possessed by his vendor, as between the vendor and the lessor. (Stevens v. Watson (4 Abb. App. Cas., 302.) The property in question had a potential existence, and hence the transfer was not invalid. ( Van Hoozer v. Cory, 34 Barb., 12.)

In the case last cited the defendant had actual “ notice of the ¡halm of the plaintiff.” Here the defendant had constructive notice through the notice filed in the proper town clerk’s office. In Johnson v. Croofoot (53 Barb., 576) the lease or chattel mortgage had not been filed, and Teft, the tenant, was in actual possession when the levy was made upon his interest and the levy was held valid. In Andrew v. Newcomb (32 N. Y., 417) it was stipulated title to property should^ remain in Ray, the landlord. Here it was stipulated it should vest in Smith, the lessor, and as soon as it came into existénce Smith had the right to it, as it was vested in him, to the extent that was needed to secure or pay his debt, and that stipulation was valid. (Andrew v. Newcomb, supra; Fammers' Loan and T. Co., v. Long B. Imp. Co., 27 Hun, 91; Conderman v. Smith, 41 Barb., 404; Jones on Mortgages, 115, §§141,143 ; Shuart v. Taylor, 7 How., 251; Harmon on Chattel Mortgages, § 44; Hawkins v. Giles, 45 Hun, 318; Betsinger v. Schuyler, MS. opinion, Martin, J., Fourth Depart., Nov., 1887; ^* Dresser v. United F. Ins. Co., 45 Hun, 302.)

It is suggested by the respondent that the mortgage was void, because there was a cotemporaneous agreement that the mortgagor might sell portions of the property. (Edgell v. Hart, 5 Seld., 213.) No such agreement is found in the instrument as in Reynolds v. Ellis {supra), and the trial court could not hold, as matter of law that plaintiff’s instrument was void. If the defendant shall give sufficient evidence to bring his case within the principle, the question may be one that should be submitted to a jury. So, too, if the mortgage of plaintiff is inquired into, a question of fact may be presented in regard thereto. {Gardner v. McEwen, 19 N. Y., 123.) The sufficiency of .the demand need .not be passed upon as that was not the ground of the nonsuit, and we are of the opinion that evidence sufficient to raise a question for a jury in that regard was presented.

Judgment of the County Court of Chemung county reversed and a new trial ordered in that court, with costs to abide the event.

Martin, J., concurred; Follett, J., dissented.

Judgment of the County Court of Chemung county reversed and. a new trial ordered in that county, with costs to abide the event.

* Reported, post, p. 348.