COWART v. ALLEN

COWART v. ALLEN
1913 OK 437
134 P. 66
37 Okla. 708
Case Number: 2677
Decided: 06/20/1913
Supreme Court of Oklahoma

COWART
v.
ALLEN.

Syllabus

¶0 1. CHATTEL MORTGAGES--Filing for Record. Section 3542, St. Okla. 1890 (Rev. Laws 1910, sec. 4031), requires filing of chattel mortgage in county of situs of chattel at time of execution of mortgage, and further, while such chattel remains in or has not, with consent of holder of mortgage, been removed from such county.
2. SAME--Constructive Notice. Where chattel mortgagee takes mortgage in anticipation of removal of property to another county, to which it is removed with his knowledge and consent in a few days thereafter, and where he files mortgage in county of original situs twenty days thereafter, and does not file in county to which such removal is made, such filing does not constitute constructive notice.

Stanard, Wahl & Ennis, for plaintiff in error.
Holt, Williams & Johnson, for defendant in error.

THACKER, C.

¶1 In this opinion plaintiff in error will be designated as defendant and defendant in error as plaintiff, in accord with their respecive titles in the trial court. The facts are as stated above. Section 4031, Rev. Laws 1910, (section 3542, St. Okla. 1890), reads:

"A mortgage of personal property is void as against creditors of the mortgagor, subsequent purchasers, and incumbrancers of the property, for value, unless the original, or an authenticated copy thereof, be filed by depositing the same in the office of the register of deeds of the county where the property mortgaged, or any part thereof, is at such time situated * * *"

¶2 Section 4032, Rev. Laws 1910, (section 3543, St. Okla. 1890), reads:

"The filing of a mortgage of personal property, in conformity to the provisions of this article, operates as notice thereof to all subsequent purchasers and incumbrancers of so much of said property as is at the time mentioned in the preceding section located in the county or counties wherein such mortgage or authenticated copy thereof is filed * * *"

¶3 The omitted portion of section 4032, supra, was only recently added to the same, and therefore cannot be considered in the decision of the case. Section 2755, Rev. Laws 1910. (section 2557, St. Okla. 1890), expressly prohibits the mortgagor from removing the property beyond the limits of the county without the written consent of the holder of the mortgage, and makes such removal a felony. Sections 4031 and 4032, supra, considered in connection with the provisions of section 2755, supra, must be understood as contemplating that the property at the time of the filing of a mortgage will be in the county in which it was situated at the time it was executed, and the plain meaning of the language used in section 4031, supra, imperatively requires the filing of a mortgage in the county where the property is situated at the time of the filing, while, for obviously good reasons, the same has been and must be construed to also require filing in the county where the property is situated at the time of the execution of the mortgage, and the statute evidently contemplates that the situs of the property will be the same at the time of both of these events. In the case of La Crosse Boot & Shoe Mfg. Co. v. Mons Anderson et al., 9 S.D. 560, 70 N.W. 877 (twice again before that court: 13 S.D. 301, 83 N.W. 331; Id., 14 S. D. 597, 86 N.W. 641), the Supreme Court of South Dakota, under our parent statute in this regard, on April 6, 1897, held:

"The mortgage not having been filed in the county where the property was situated at the time of filing, as required by Comp. Laws 1909, secs. 4379, 4380, the burden was on plaintiff mortgagee to show that the purchaser took with actual notice of the mortgage."

¶4 In the case of Hales v. Zander et al., 24 Okla. 246, 103 P. 669, 138 Am. St. Rep. 879, following authorities there cited, section 4031, supra, is held to require a filing of the mortgage in the county in which the mortgaged property is situated at the time of the execution of the mortgage to constitute constructive notice and in the case of National Bank of Commerce v. Jones, 18 Okla. 555, 91 P. 191, 12 L.R.A. (N.S.) 310, 11 Ann. Cas. 1041, it is held:

"Where the owner of chattels covered by a valid recorded mortgage removes the chattels without the knowledge or consent of the mortgagee to another county, it is not necessary for the mortgagee, in order to preserve the lien to file the mortgage or a copy thereof for registry in the county to which the property is removed;"--but we are unable to find any case in which it has been held that the mortgaged property may be removed from the county of its proper situs to another county with the knowledge and consent of the mortgagee without destroying the effect of the filing of the mortgage in the first county, and, of course, no case has been found holding that filing could be made with the effect in the first county after such removal.

¶5 It is unthinkable that a mortgagee in a case like this could be required to do less under these statutes than properly file his mortgage while the property remains in the county in which it is situated at the time of the execution of the mortgage to give such filing effect as constructive notice, and certainly he could not permit the property to be removed to another county, where he did not file his mortgage, and afterwards file in the original county with effect as constructive notice. In the instant case plaintiff did not file his mortgage in the original county with diligence in respect to time; but, if we may understand the "few days" within which the property was removed from Lincoln county to Okfuskee county to mean less than a week, in deference to the usual measure of time by "days," "weeks," "months," etc., it was evidently at least two weeks after the removal of the property, with the consent and in accord with the anticipation of plaintiff when he took the mortgage, before he filed the same. So long as the holder of a mortgage does not consent to its removal, the county of the situs of the property at the time of the execution of the mortgage remains the county of its proper and, at least, constructive, if not actual, situs, and, although the property may be wrongfully removed after the execution and before the filing of a mortgage, the mortgagee or holder undoubtedly may, by the exercise of reasonable diligence in time of filing, give constructive notice by filing only in the original county; but when he consents to the removal of the property, and the same is removed, a subsequent filing in the original county cannot be held sufficient without doing violence to the language of section 4031, supra. We deem it unnecessary to discuss any other question in this case, and, the decision and judgment of the trial court having been in favor of plaintiff upon the theory that the filing of the mortgage in Lincoln county was constructive notice to defendant, the case should be reversed, and a new trial granted.

¶6 By the Court: It is so ordered.