Betsinger v. Schuyler

The plaintiff’s mortgage was executed by both Mamn and Mrs. Evans, so that whatever rights the plaintiff could acquire through a chattel mortgage he possesses. Could the products of this dairy be *352mortgaged? They were produced from property which the mortgagors owned and upon premises leased by them. The property mortgaged was potentially theirs, it was the subject of sale and might be mortgaged. (Van Hoozer v. Cory, 34 Barb., 9; Conderman v. Smith, 41 id., 406.) Therefore, unless Clarke had acquired some right to the property mortgaged which was paramount to the plaintiff’s, the plaintiff was entitled to recover. Clarke acquired no right under his bill of sale which was superior to the plaintiff’s. He could acquire no better or greater rights than the mortgagors possessed when it was given. Their rights were then subject to the plaintiff’s mortgage. Hence, if Clarke had any superior right to this property it was secured to him by the provisions of his lease giving him a lien on such products.

The provisions in the lease between Clarke and Mrs. Evans, by which a lien upon such products was sought to be given, was merely a provision for the security of the rent and was necessarily in the nature of a chattel mortgage. (Johnson v. Crofoot, 53 Barb., 574; see, also, McCaffrey v. Woodin, 65 N. Y., 459 ; Steffin v. Steffin, 4 Civ. Pro. R., 187; Thomas v. Bacon, 34 Hun, 88; Hawkins v. Giles, 45 Hun, 318; Yenni v. McNamee, 45 N. Y., 615.) The fact that the products in question were from cows to which Clarke had no title, and that the contract between the parties was a lease of the land only, for a specified money rent, render this case clearly distinguishable from those cited by the defendant. The whole effect and object of the provisions in the lease was to transfer the title of the products of the dairy to Clarke as security for the payment of the rent. He was to acquire the title for no other purpose, and was to retain it only until the rent was paid. Ve think it was in effect a chattel mortgage and must be treated as such.

Regarding the provisions in this lease as a mortgage, and not having been filed, it was void as to subsequent mortgagees in good faith. The plaintiff was such a mortgagee. He had no notice of Clarke’s lien, and the mortgage was founded on a good consideration. It was not given to secure a pre-existing debt; it was given to secure a note made on the same day, and also to secure the plaintiff for his indorsement of certain other notes. "When the mortgage was given his liability had not become fixed, subsequently he was charged as such indorser and was obliged to pay the amount secured by the indorsed notes.

*353Moreover, the title to the cows that produced the milk from which this cheese was made, never'vested in Mrs. Evans. It was in Martin, he owning the cows, was entitled to the products from them. He was not a party to the lease. How this lease could transfer the title of this milk or cheese from Martin to Clarke, we are unable to understand. We do not think Clarke had any right to the products from these cows that was superior to the plaintiff’s.

These considerations lead to the conclusion that the court erred in directing a verdict for the defendant. For that error the judgment and order appealed from should be reversed with costs to abide the event.

(dissenting):

The title to the products of the leased farm vested in the lessor, subject to be divested by the performance by the lessee of her covenants. (Andrew v. Newcomb, 32 N. Y., 417; Van Hoozer v. Cory, 34 Barb., 10; Benj. on Sales [Corbin’s ed.], §78.) The clause quoted from the lease is not, in legal effect, a chattel mortgage. A chattel mortgage is an instrument whereby the owner of personal chattels transfers the title to them to another (a mortgagee), as security for the payment of a debt, or for the performance of an obligation, with a condition, that upon payment or performance, the title shall revest in the original owner (the mortgagor); but if the debt is not paid, or the obligation is not performed, the title becomes absolute in law in the mortgagee, though redeemable in equity. (Jones Chat. Mort., § 1; Thomas on Mort., 427; Overton on Liens, § 481; Nichols v. Mead, 2 Lans., 222, 225; Butler v. Miller, 1 N. Y., 496, 500.) The lessee never having acquired title to this property, the plaintiff acquired no title to it under his chattel mortgage. Hawkins v. Giles (45 Hun, 318), and cases there cited, are not in point. In the case last cited there was no covenant that the title to the products of the farm should be and remain in the lessor; but the covenant was that the lessee should feed the hay upon the farm; and the question was, which had the title. It was held, ujion the authority of the preceding cases, that the title was in the lessee. The judgment should be affirmed, with costs.

Judgment and order reversed, and a new trial order, with costs to abide the event.