Burlington State Bank v. Marlin Nat. Bank

• Decision Date: 01 April 1914
• Docket Number: (No. 5313.)
• Citation: 166 S.W. 499
• Parties: BURLINGTON STATE BANK et al. v. MARLIN NAT. BANK et al.
• Court: Texas Court of Appeals

166 S.W. 499

BURLINGTON STATE BANK et al. v. MARLIN NAT. BANK et al.

(No. 5313.)

Court of Civil Appeals of Texas. Austin.

April 1, 1914.

Rehearing Denied April 29, 1914.

Appeal from District Court, Falls County; Prentice Oltorf, Judge.

Action between Batte & Baskin, Ben Johnson, Burlington State Bank, Tarver-Henslee Company, Marlin National Bank, and others. Judgment for Bates & Baskin against the Burlington State Bank and for Marlin National Bank against the Tarver-Henslee Company, and Burlington State Bank, Marlin National Bank, and Tarver-Henslee Company appeal. Affirmed as to other parties not appealing, and as to the remainder reversed and remanded.

W. A. Morrison, of Cameron, for appellants. Tom Connally, of Marlin, and Chambers & Baskin, of Cameron, for appellees.

Findings of Fact.

JENKINS, J.

Ben Johnson was a tenant farmer, and prior to December, 1908, had lived in Milam county. Batte & Baskin were dealers in horses and mules, and lived in Cameron, Milam county. They were acquainted with Johnson, and had sold him mules prior to October 15, 1909, for which he had paid them. In December, 1908, Johnson moved to the farm of Tarver-Henslee Company in Falls county, and continued to reside there to the time of the trial of this case. On October 15, 1909, Johnson purchased two mules from Batte & Baskin in the town of Cameron, and executed a mortgage thereon to secure the purchase money in the sum of $250. He immediately took the mules to his home in Falls county, where they remained to the time of the trial hereof, July 19, 1913. Batte & Baskin recorded their mortgage in Milam county October 22, 1909. They did not know that Johnson lived in Falls county at that time. On November 1, 1909, Johnson gave a mortgage on these same mules and other personal property to the Burlington State Bank. On January 3, 1910, Johnson gave a mortgage on these mules and other property to the Planters' National Bank, which prior to the trial hereof was transferred to the Burlington State Bank. On October 7, 1910, Johnson gave a mortgage to the Marlin National Bank upon cotton described as follows: "Ten bales of cotton crop of 1910 now being picked and to be ginned at High Banks in Falls County. * * * Said property is owned by me in good faith and a perfect title, free from all liens whatsoever, and I agree to hold same in Falls county, Texas, where it is now located, free of all liens other than the one hereby granted, until the indebtedness hereinafter mentioned is paid in full." This mortgage was recorded in Falls county, October 13, 1910. The mortgage to the Burlington State Bank and also the mortgage to the Planters' National Bank each recited that the property therein described was free from all mortgages and other liens. Neither the Burlington State Bank nor the Planters' National Bank had any actual knowledge of the mortgage executed to Batte & Baskin at the time their mortgages were taken. By agreement of all parties hereto, the property mortgaged by Johnson was taken possession of and sold by the Burlington State Bank, and the proceeds held subject to disposition by final judgment herein. The trial court held that the mortgage of Batte & Baskin was superior to the mortgages given to the Burlington State Bank and to the Planters' National Bank, and consequently gave judgment against the Burlington State Bank for the amount of Batte & Baskin's debt, the evidence showing that the mules had been sold for more than enough to pay said debt.

Tarver-Henslee Company, subsequent to October 13, 1910, purchased from Johnson 12 bales of cotton of the value of $60 each. Johnson was a tenant on the farm of Tarver-Henslee Company during the year 1910, and they advanced him money to enable him to pick his cotton, and the court allowed this amount by virtue of their landlord's lien, and gave judgment in favor of the Marlin National Bank against Tarver-Henslee Company for the balance, $370.15. From this judgment the Marlin National Bank and Tarver-Henslee Company have appealed.

Opinion.

The judgment in favor of Batte & Baskin involves the construction of article 5655, R. S. 1911, which, so far as applicable to this case, reads as follows: "Every chattel mortgage, deed of trust, or other instrument of writing, intended to operate as a mortgage of or lien upon personal property, which shall not be accompanied by an immediate delivery and be followed by an actual and continued change of possession of the property mortgaged or pledged by such instrument, shall be absolutely void as against the creditors of the mortgagor or person making same, and as against subsequent purchasers and mortgagees or lienholders in good faith, unless such instrument, or a true copy thereof, shall be forthwith deposited with and filed in the office of the county clerk of the county where the property shall then be situated, or if the mortgagor or person making the same be a resident of this state, then, of the county of which he shall at that time be a resident."

It is the contention of appellees Batte & Baskin that the words "filed in the office of the county clerk of the county where the property was then situated," means where the property is situated at the time the mortgage is executed. Appellant Burlington Bank contends that it means where the property is situated at the time the mortgage is recorded. We agree with appellees Batte & Baskin as to this matter. It will be observed that with reference to recording a mortgage in the county where the mortgagor resides, the language is "of which he shall at that time be a resident." We think this aids in the construction of the statute; that the language, "shall at that time be a resident," evidently means at the time of the execution of the mortgage, and that likewise the time referred to with reference to the situation of the property means the time when the mortgage is executed. Such being the case, had Batte & Baskin complied with the statute, there can be no question but that they would have a prior lien as against the mortgages subsequently executed. But they did not comply with the statute. The statute required that such mortgage should be "forthwith deposited with and filed in the office of the county clerk," etc. The mortgage was not filed until seven days after its execution. The office of Batte & Baskin was in sight of the courthouse of Milam county, and no reason is shown why they might not,...