J. L. Mott Iron Works v. Middle States Loan, Building & Construction Co.
J. L. Mott Iron Works v. Middle States Loan, Building & Construction Co.
Opinion of the Court
delivered the opinion of the Court:
In the argument of the case in this court two main propositions have been presented and discussed. First, is a radiator of the character of those involved in this case, and under the circumstances here presented, a fixture that wall pass to a purchaser of the realty as part thereof, at a mortgage sale ? And,secondly, will a conditional sale of chattels, or an agreement for preserving the quality of personalty, as
But we shall not decide this case upon that abstract view. We prefer to rest our decision upon the second proposition that we have stated, namely, that relating to a conditional sale, or the effect of the agreement under which the radiators were placed in the buildings.
One of the best considered cases upon the subject is that of Campbell v. Roddy, 44 N. J. Eq. 244, decided in the Court of Errors and Appeal of New Jersey. In that case, the question arose out of the circumstance that a mortgagor of real property, after making the mortgage, had annexed to the real estate certain chattels, the machinery for an iron foundry, in which a third person claimed to have an interest. On a bill filed to foreclose the mortgage, a contest arose as to the right of the mortgagee to have all the property applied primarily to the payment of his mortgage, regardless of the interest which any other person might have had. in the annexed property before it was annexed. The personal chattels that had been bargained for by the mortgagor and annexed to the mortgaged premises, had been in part paid for, but for the balance he gave certain promissory notes, each containing the following agreement: “It is further agreed that the title to the property for which this note is given shall remain in said Robert Campbell until this note is fully paid.”
The Court of Errors and Appeal, upon review of the authorities and a full consideration of the case, denied the claim of the mortgagees of the realty. In speaking of the effect of annexing the chattels to the realty, the court said: “ But, as already observed, the real estate mortgagees in the
In the' case of Tifft v. Horton, 53 N. Y. 377, which is among the leading cases upon this subject, the owner of an elevator purchased from the plaintiff an engine and boiler to place therein, and to secure a part of the purchase money
In the opinion of the court, delivered by Mr. Justice Folger, the subject is very fully and clearly discussed. The court said that it is well settled that chattels may be annexed to real estate and still retain their character as personal property. Of the various circumstances which may determine whether in any case this character is or is not retained, the intention with which they are annexed is one; and if the intention is, that they shall not by annexation become a part of the freehold, as a general rule they will not. The limitation to this is, where the subject or the mode of annexation is such, as that the attributes of personal property can not be predicated of the thing in controversy; as where the property could not be removed without practically destroying it, or where it or part of it is essential to the support of that to which it is attached. The court then proceeds to say: ,
“It may in this case be conceded, that if there were no fact in it but the placing upon the premises of the engine and boilers in the manner in which they were attached thereto, they would have become fixtures, and would pass as a part of the realty. But the agreement of the then owner of the land'and the plaintiff is express, that they should be 'and remain personal property until the notes given therefor were paid; and by the same agreement, power was given to the plaintiffs to enter upon the premises in certain contingencies, and to take and carry them away. While there is no doubt but that the intention of the owner*597 of the land was that the engine and boilers should ultimately become a part of the realty, and be permanently affixed to it, this was subordinate to the prior intention expressed by the agreement. That fully shows her intention, and the intention of the plaintiffs, that the act of annexing them to the freehold should not change or take away the character of them as chattels, until the price of them had been fully paid. And as the parties may, by their agreement, expressing their intention so to do, preserve and continue the character of the chattels as personal property, there can be no doubt but that as between themselves, the agreement in this ca'se was fully sufficient to that end.” And the court concluded that the agreement was not only good and sufficient as between the parties thereto, but was good and effectual as against a prior mortgagee of the realty.
The case of Warren y. Liddell, 110 Ala. 232, is a very direct authority upon this subject. In that case it was held, that where the vendee of personal property under a conditional sale, without perfecting his title thereto by pajunent of the amount due, attaches the property so purchased to land, which he had previously mortgaged, in such a way as to make it a part of the realty, but not in a manner to render it incapable of removal without detriment to the land, such annexation of the personalty to the land does not defeat or affect the rights of the conditional vendor. And in the case of Binkley v. Forkner, 117 Ind. 177, 184, it was declared by the court that “A prior mortgagee can not occupy the attitude of an innocent purchaser. The interests and rights of the holder of a chattel mortgage upon property which is annexed to real estate upon which there is an existing mortgage, must be determined by the practical application of equitable principles to the rights of the respective parties.” The same principle is laid down in the case of Bank v. Elmore, 52 Iowa, 541.
In this case it does not appear that the deeds of trust contained any provision with respect to after-acquired property. But even if they had contained any such provision, it would have been without effect as to the radiators in question until payment made therefor. This is very clearly shown by the Supreme Oourt, in United States v. New Orleans RR. Co., 12 Wall. 362, 364. In that case, the court, by Mr. Justice Bradley, in disposing of a contention that after-acquired property was subject to a mortgage, said: “This, we apprehend, is an erroneous view of the doctrine by which after-acquired property is made to serve the uses of a mortgage. That doctrine is intended to subserve the purposes of justice, and not injustice. Such an application of it as is sought by the appellants would often'result in gross injustice. A mortgage intended to cover after-acquired property can only attach itself to such property in the condition in which it comes into the mortgagor’s hands. If that property is already subject to mortgages or other liens, the general mortgage does not displace them, though they may be junior to it in point of time. It only attaches to such interest- as the mortgagor acquires; and if he purchase property and gives a mortgage for the purchase money, the deed which he receives and the mortgage which he gives are regarded as one transaction, and no general lien
In deciding this case below, the learned justice seems to have rested his opinion mainly, if not exclusively, upon the case of Porter v. Pittsburg Steel Co., 122 U. S. 267; and that case has been strongly pressed as an authority by counsel for the appellee here. But we fail to perceive wherein that case has any controlling application to this. In that case railroad bridges were the subject-matter of controversy; and the court, in its opinion, said that “the bridges became a part of the permanent structure of the railroad, as much so as the rails laid upon the bridges or upon the railroad outside of the bridges.” The bridges, therefore, were not sever-able from the railroad without destruction of those parts of the railroad, and necessarily impairing the entire structure. The case is in no respects in conflict with the principle of the cases that we have cited. Bridges and rails necessarily become actual parts of the permanent structure of a railroad and are inseparable from it without destruction of the road itself. But in the present case no such condition of things exists. The radiators are severable without injury to the buildings, and it was contemplated, and expressly stipulated, by the parties when they were placed in the buildings, that they might be removed in the event of default in the payment of their price to the owner.
The case of Porter v. Steel Co., supra, has been the subject of examination in several recent cases, and the courts have all distinguished it in the same way, and shown that it is
In the opinion of this court there was error in the order or decree of the court below from which the appeal was taken, and it must therefore be reversed. The order will be reversed and the cause remanded, that the bill may be dismissed; and it is so ordered.
Order reversed and cause remanded.
Reference
- Full Case Name
- THE J. L. MOTT IRON WORKS v. THE MIDDLE STATES LOAN, BUILDING AND CONSTRUCTION COMPANY OF HAGERSTOWN, MARYLAND
- Status
- Published
- Syllabus
- Fixtures ; Conditional Sales. i. Whether steam radiators not attached to the floors or walls or any part of the building in which they are used, but connected only with the piping by means of radiator valves screwed to the piping and readily detachable by a wrench without injury to the building, are to he regarded as fixtures which will pass with the realty upon a sale thereof, quaere. 2. A conditional sale of such radiators whereby the vendor retains title thereto until they shall be paid for, will prevail as against a prior mortgage of the realty, so that upon a foreclosure sale of the realty under the mortgage, the radiators, if not paid for, will not pass to the purchaser, but the title thereto will remain in the vendor.