Gray v. Prudential Ins. Co. of America , 182 Okla. 342 ( 1938 )

This is an action in replevin instituted in the district court of Oklahoma county by John L. Gray against the Prudential Insurance Company of America, a corporation. From an adverse judgment, plaintiff below has appealed. The parties are here referred to as plaintiff and defendant, respectively.

The question involved on appeal is whether certain equipment installed in apartment buildings by the owner thereof became fixtures as a matter of law and passed under a real estate mortgage as fixtures free of any claim of a subsequent bona fide chattel mortgagee. If such was the circumstance. the plaintiff's chattel mortgage was inferior to the real estate mortgage of defendant, and the judgment of the trial court must be affirmed.

The property here under consideration is substantially of the same character and employed to the same use and purpose as that in the case of Mortgage Bond Co. v. Stephens, 181 Okla. 419 74 P.2d 361. There, as here, positive evidence of express intention of the owner as to whether the equipment was placed in the building as chattels or fixtures was wanting, and the court held that the property upon installation became fixtures; that the intention of the owner to install the equipment as fixtures was inferred from the circumstances.

If the intention of the owner may be inferred from the nature of the equipment as said in the above case, then the plaintiff here was charged with knowledge that he was dealing with realty and not personalty. Under the aforesaid decision such equipment becomes prima facie realty, or realty as a matter of law. The private intention of the owner becomes immaterial. Nothing short of an express agreement or estoppel would save such equipment from the operation of a real estate mortgage upon the premises, regardless of the date of the execution of such real estate mortgage.

Plaintiff says there was an express agreement or stipulation between the owner of the premises and the defendant under the terms of which a severance of the personalty in question was accomplished and his chattel mortgage recognized as superior to defendant's real estate mortgage.

The agreement referred to, executed subsequent to the two mortgages, contained a stipulation that as between the parties thereto the personalty here involved constituted fixtures and a part of the buildings located on the mortgaged premises. The agreement contained the further provision that said articles of equipment (describing them) "are at this time subject to the unpaid balance of the chattel mortgage covering the same made by said Charles Gray to John L. Gray in the sum of $2,000 dated June 10, 1932, and filed for record on July 13, 1932. It is expressly stipulated, however, that this instrument shall not be considered as giving the holder of the said chattel mortgage any lien upon the real estate above described."

It is said that this stipulation constituted an express agreement that plaintiff's chattel mortgage should be considered as superior to defendant's real estate mortgage.

But the defendant executing the written agreement in no manner changed its position with relation to the equipment. It merely agreed to its rights as then and theretofore existing as a matter of law concerning said property. The reference to the chattel mortgage was no more than a recognition of a private agreement between the mortgagor and the plaintiff accompanied by an express provision which in effect limited that agreement to the parties to the chattel mortgage, in that it was agreed that said chattel mortgage should not be a lien upon the realty, which, of course, included the equipment theretofore affixed.

The decision in Mortgage Bond Co. v. Stephens, supra, is controlling here and pargraphs 1, 2 and 4 of the syllabus in that case are adopted and applied as the statement of the law governing the present case.

The judgment is therefore affirmed.

OSBORN, C. J., BAYLESS, V. C. J., and WELCH and HURST, JJ., concur.

Supplemental Opinion on Rehearing.