58 F.2d 915 (6th Cir. 1932), 5937, Central Acceptance Corp. v. Lynch
|Citation:||58 F.2d 915|
|Party Name:||CENTRAL ACCEPTANCE CORPORATION v. LYNCH.|
|Case Date:||May 06, 1932|
|Court:||United States Courts of Appeals, Court of Appeals for the Sixth Circuit|
Appeal from the District Court of the United States for the Eastern Division of the Northern District of Ohio; Paul Jones, Judge.
Ian B. Hart, of Canton, Ohio (Hart, Drukenbrod & McHenry, of Canton, Ohio, on the brief), for appellant.
Clarence A. Fisher and George N. Graham, both of Canton, Ohio, for appellee.
Before MOORMAN, HICKS, and HICKENLOOPER, Circuit Judges.
HICKENLOOPER, Circuit Judge.
Unrecorded or unfiled trust receipts of the present day, if title to the goods had in fact previously vested in the recipient of the receipt, are invalid as against creditors of a bankrupt only if they operate as preferences under the Bankruptcy Act (section 60 [11 USCA § 96]), or contravene the provisions of state recording or filing statutes as construed by the highest court of the state in question. It is not urged that the question of invalidity is to be decided as a matter of public policy, although, doubtless, the enactment of statutes requiring the record or filing of chattel mortgages, conditional sales contracts, and the like, was dictated by views of public policy antagonistic to the creation of secret liens of all kinds.
In the present case we are dealing with the validity of commercial trust receipts under the Ohio recording statutes. Ohio General Code, §§ 8560, 8561 and 8568. Under
these statutes it is now the settled law of Ohio that if the title conveyed to the holder of the trust receipt is only for security for the payment of a debt, the trust receipt must be characterized either as a chattel mortgage, as in Thorne v. First National Bank, 37 Ohio St. 254, or as a conditional sale, as in Re Bettman-Johnson Co., 250 F. 657 (C. C. A. 6). Compare, also, Martin v. Michigan Trust Co., 23 F.2d 609 (C. C. A. 6); Hyman v. Semmes, Trustee, 26 F.2d 10 (C. C. A. 6). In either event the receipt must be filed with the county recorder in order to prevail against the trustee in bankruptcy. Dale v. Pattison, 234 U.S. 399, 34 S.Ct. 785, 58 L.Ed. 1370, 52 L. R. A. (N. S.) 754, having to do with a pledge of warehouse receipts, does not hold otherwise.
We do not consider it necessary to discuss the numerous decisions construing the laws of other states as to the necessity of recording or filing...
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