Hollipeter-Shonyo Co. v. Maxwell

This cause is in replevin to recover a Ford automobile. The cause was tried before the court, and judgment went for plaintiff, and defendant prosecutes this appeal.

Plaintiff claims the right to possession under and by virtue of a chattel mortgage executed by one Dunbar at Blytheville, Arkansas, on August 31, 1918. Plaintiff sold Dunbar the automobile, and took back the mortgage to secure $250 of the purchase price. The mortgage was recorded in Mississippi county, Arkansas, where both the mortgager and mortgagee resided, and where the property was situated at the time. The mortgage secured five notes of $50 each, dated August 31, 1918, and due September 30th, October 31st, November 30th, December 31st, and January 31st after date. Mortgagor had paid a part of these notes, and the court in its judgment fixed plaintiff's interest in the automobile at $123.85, and found the remaining interest belonged to defendant. Defendant claimed ownership as the vendee of the purchaser at an execution sale resulting from proceedings in a justice of the peace court against Dunbar.

One Fowler was engaged in the garage business at Cooter in Pemiscot county, Missouri. Dunbar's home was at Burdette in Mississippi county, Arkansas. In November, 1918, Dunbar left the automobile in Fowler's garage to be repaired, and Fowler did some work on it, February 20, 1919, Fowler sold his garage to Block Davis, and transferred by the bill of sale all of his accounts for work on cars. Dunbar directed Block Davis to repair the car, and they did so. Dunbar failed to pay the bill for repairs amounting to $81, and Block Davis kept the car until a $20 storage bill accrued, making a total bill of $101. On May 29, 1919, Block Davis instituted, in a justice of the peace court, proceedings against Dunbar to recover on their account, and asked that the judgment prayed for be made a lien on the car for the repairs. Personal service was had on Dunbar, but he defaulted and judgment went against him for $100, and was made a lien on the car. Under an execution the constable sold the car to Block Davis, and they sold to defendant.

Plaintiff did not know that the car was in Missouri until the early spring of 1919. When plaintiff found out that the car was at Cooter, Missouri, in a garage with a repair bill against it, its vice-president sent for Dunbar who came in. The vice-president then gave Dunbar $58 in money to pay the repair bill, and directed him to get the car and return it to Arkansas, and then dismissed the matter from his mind, he says. A few months later this witness, the vice-president, learned that Dunbar had paid nothing on the repair bill, had not returned the car to Arkansas, and that the car was about to be sold in Missouri for the repair bill. This witness then went up in Missouri a day or so before the sale, but no agreement could be reached, and nothing was done towards paying the repair bill, and the car was sold as stated. July 19, 1919, plaintiff brought this suit to recover the automobile.

The controlling question on the merits of this case is whether plaintiff in effect knew or consented or acquiesced in the removal of this automobile from Arkansas to Missouri. Plaintiff relies upon the rule of comity. The greater weight of authority as affecting chattel mortgages is to be the effect that such mortgage properly executed and recorded according to the law of the place where 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 the State to which the property is removed has some statute to the contrary, or unless to hold such mortgage valid would contravene some settled policy of the State to which such property is removed. [11 C.J., p. 424.] In Geiser Mfg. Co. v. Todd, 204 S.W. 287, we stated the law thus: "The greater weight of authority is to the effect that the grace of comity should not be extended to cases where the mortgagee consents for the mortgaged property to be moved from its situs when mortgaged, to a foreign jurisdiction, and rights of innocent third parties attach before the mortgagee makes any effort to comply with the laws of the jurisdiction to which the property has been removed as to the recording of his lien in that jurisdiction. In such case it is the negligence of the mortgagee in the first instance in consenting to the removal of the mortgaged chattel, and after rights of third parties have accrued the mortgagee should not be permitted to say his lien is superior. By giving his consent for the removal of the mortgaged property he places within the power of the mortgagor the opportunity to defraud innocent purchasers and lienors. The mortgagee could refuse consent to move the property, or, if he consents, he could record his mortgage in the other jurisdiction. This seems to square with substantial justice, and we think is the general rule."

In that case some of the authorities are cited and quoted, and we shall not here enter into an extended discussion of the same question. We are satisfied with out statement of the law there, and adhere to it. If, therefore, plaintiff knew that this car was brought to Missouri or consented that it be brought here, or after it was brought here plaintiff acquiesced therein, and took no steps to follow the property into this jurisdiction and file or record his lien here, and permitted the rights of innocent third persons in this State to attach, it ought not to recover.

The question as to plaintiff's consent, knowledge, etc., might be considered as settled by the finding of the court against defendant, if the court had any evidence before it authorizing a finding that plaintiff's mortgage was properly executed and recorded according to the laws of Arkansas. Plaintiff did not introduce in evidence the statute of Arkansas affecting the execution and recording of chattel mortgages. The courts of this State will not take judicial notice of a statute or decision of a sister State and if a party is relying upon such foreign statute or decision, it must be established like any other fact. [Schroeder v. Edwards, 267 Mo. 459, 184 S.W. 108; Otto v. Pryor et al., 193 S.W. 28.]

The notes secured by plaintiff's mortgage drew ten per cent interest, and defendant invoked, or attempted to, section 7184, Revised Statutes 1909, urging that under our statute the notes were usurious, and that for that reason the mortgage lien was invalid. Plaintiff says that the laws of Arkansas authorize ten per cent. This may be true, but such challenged fact should be established, and what we have said already about the proof, when relied on, of laws and decisions of a foreign State, is applicable here. Plaintiff cannot rely on the grace of comity between the States, and then rely on the grace of the court to establish the existence of the foreign laws relied on.

The cause should be reversed and remanded and it is so ordered.Sturgis, P.J., and Farrington, J., concur.