Bern v. Rosen
| Decision Date | 30 June 1953 |
| Docket Number | 3 Div. 653 |
| Parties | BERN et al. v. ROSEN. |
| Court | Alabama Supreme Court |
White, Bradley, Arant, All & Rose and Jos. H. Johnson, Jr., Birmingham, for petitioner.
Bernard Lobman and H. T. Fitzpatrick, Jr., Montgomery, opposed.
Files Crenshaw and Jack Crenshaw, Montgomery, amici curiae, in support of petition. The instrument involved is as follows:
'State of Alabama,
'Montgomery County,}
'This Is To Witness, That I have this day received of Nathan Rosen of said County, hereinafter known as Vendor, the following described property, to-wit:
'One Gents diamond ring, .25 points--for the price of $169.50, One Simmons 'Boston link' watchchain--for the price of $17.95--which I agree to purchase from said Vendor at the price of One hundred eighty-seven and 45/100 Dollars, to be paid as follows: _____ Dollars Cash and the balance in installments, as follows:
'$18.75 due May 15, 1950
'$18.75 due June 15, 1950
'$18.75 due July 15, 1950
'$18.75 due August 15, 1950
'$18.74 due September 15, 1950
'$18.74 due October 15, 1950
'$18.74 due November 15, 1950
'$18.75 due December 15, 1950
'$18.74 due January 15, 1951
'$18.74 due February 15, 1951
'$_____ due _____ 19__
'$_____ due _____ 19__
'Witness my hand and seal, this 14th day of March, 1950
'Signed, Sealed and Delivered in Presence of _____ X /s/ Aaron Benjamin (L.S.)'
Certiorari to the Court of Appeals to review an opinion of that court holding the subject instrument (reported with the case) to be a chattel mortgage rather than one of conditional sale. The suit was in detinue by Rosen against Bern. Rosen bases his claim on this unrecorded instrument.
The instrument contained not only the usual conditional sale clause retaining title to the property until the full amount of the debt shall have been paid, but also the customary mortgage clause authorizing the vendor in case of default in the payment of the obligation to repossess the property, resell it and hold the vendee liable for any deficiency in the debt.
The inquiry arose thus: Rosen sold the chattel to one Benjamin, who executed the instrument to Rosen; Benjamin later pawned the property to appellant, Bern, who had no knowledge of the Rosen-Benjamin contract. Benjamin defaulted in both debts, the one to his vendor, Rosen, as well as his pledge to Bern; so the question has arisen, what recording statute with respect to constructive notice to innocent purchasers governs Rosen's unrecorded contract from Benjamin. Is it § 123, Title 47, Code 1940, which provides that all conveyances of personal property to secure debts are inoperative against innocent purchasers unless recorded, etc., in which case Bern would be protected since he had no actual notice and the contract was not recorded. Or does § 131 of the Title govern, which exempted (in Montgomery County and some others) from recordation 'contracts for the conditional sale of personal property, by the terms of which the vendor retains the title until payment of the purchase money and the purchaser obtains possession of the property' where the amount is less than $200 (now changed to $500, Acts 1951, No. 292). If this latter section controls the claim of Rosen would prevail, of course.
The Court of Appeals ruled the contract to be in the nature of a chattel mortgage and to be governed by § 123. The case has been ably argued both orally and in written briefs and we are frank to say that had not the question been fairly well foreclosed by previous decisions of this court, it would be a close one in view of well-reasoned decisions elsewhere supporting the contrary view. There seem to be at least two distinct views with varying degrees of rationalization with respect to such instruments, one view supporting the theory that the mortgage clause does not change the essential character of the instrument and the other...
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In re Greene
...590, 63 So.2d 670, 678 (1953). Also, conditional sales have traditionally been disfavored by the courts of Alabama. Bern v. Rosen, 259 Ala. 292, 66 So.2d 711, 713 (1953); Cousins, 63 So.2d at 678. The why of disfavor arises from the nature of a conditional sale. If the purchaser defaulted, ......
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Lloyd's of London v. Fidelity Securities Corp.
...Ala. 228, 198 So. 356, a recorded judgment took precedence over an unrecorded conditional sales contract. However, based on Bern v. Rosen, 259 Ala. 292, 66 So.2d 711 (affirming 36 Ala.App. 296, 55 So.2d 361, with modification as to T. 57, § 28--risk of loss)--see also Burroughs Adding Machi......
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ABC Supermarket, Inc. v. American Emp. Ins. Co.
...Conditional Sale' and which are referred to by the parties as conditional sales contracts, but which under our holding in Bern v. Rosen, 259 Ala. 292, 66 So.2d 711, are chattel mortgages and subject to recordation under the provisions of § 123, Title 47, Code 1940, in that the said instrume......
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Webb v. Dickson
...although part in the form of a conditional sales contract. American Discount Co. v. Beck, 263 Ala. 470, 83 So.2d 232; Bern v. Rosen, 259 Ala. 292, 66 So.2d 711. It appears in evidence that plaintiff signed an agreement as 'Buyer promises to pay to the order of seller the deferred time balan......