NICHOLSON v. BYNUM

NICHOLSON v. BYNUM
1917 OK 79
162 P. 740
62 Okla. 167
Case Number: 8040
Decided: 01/09/1917
Supreme Court of Oklahoma

NICHOLSON
v.
BYNUM et al.

Syllabus

¶0 1. Chattel Mortgages--Effect of--Liens. Under the laws of Oklahoma a chattel mortgage creates a lien on the mortgaged property and does not convey title to the property.
2. Chattel Mortgages--Construction--Priorities. Where the agreed value of chattels mortgaged to secure the payment of two separate and independent debts is insufficient to pay the first mortgage, the second mortgage being subject to the first, and after default the mortgaged chattels are delivered to the first mortgagee, and its note canceled and surrendered, the question whether or not the first mortgage was paid so as to give the second mortgage priority in right in the application of the proceeds of the sale of the chattels is largely a question of intention for the determination of the triers of the facts at issue in the cause.
3. Same--Priorities--Burden of Proof. In such case the burden of proof was upon the second mortgagee to establish the fact that the first mortgage had been paid.

Utterback & McDonald, for plaintiff in error.
Hatchett & Ferguson, for defendants in error.

GALBRAITH, C.

¶1 This action was originally tried in the justice of the peace court. Upon appeal to the district court a jury was waived, and the cause tried to the court upon an agreed statement of facts, from which it appears that C. F. Bynum executed a note to the Durant National Bank for $ 284.80, and gave a chattel mortgage on some mules to secure the same; that the mortgage was properly filed and that afterwards Bynum gave a second mortgage on the same property to the plaintiff in error, O. R. Nicholson, to secure an indebtedness of $ 90; that this mortgage was also properly filed. Neither of said notes was paid at maturity, and the agreed statement of facts proceeds as follows:

"It is further understood and agreed that said C. F. Bynum delivered said property to the State National Bank, and that his note was by said Bank stamped ''paid'' and torn up and turned over to said C. F. Bynum; that said first mortgage was not satisfied of record at that time or any other time; that thereupon the said O. R. Nicholson brought this replevin action in the justice of the peace court, which said note, so stamped and indicating the torn places thereon, is hereto attached and made a part of this agreed statement of facts. That on the day after the trial of this cause in the justice of the peace court the State National Bank proceeded to sell said property under notice as prescribed by statute, the said notice being dated the day after the trial of said cause in said justice of the peace court, said notice being hereto attached and such a part of this agreed statement of facts, and the sale thereof took place ten days later, to wit, June 22, 1915; that said property sold for the sum of $ 137.

"It is further agreed that the property was not of sufficient value to pay the first mortgage in favor of the State National Bank."

¶2 It is complained here that the judgment in favor of the bank is contrary to law and not supported by the evidence. In Oklahoma a chattel mortgage creates a lien on mortgaged property in favor of the mortgagee, and does not convey title to the property. Smith-Wogon Hardware & Imp. Co. v. Bice,

¶3 By the Court: It is so ordered.