Hauseman Motor Co. v. Napierella

• Decision Date: 06 March 1928
• Citation: 223 Ky. 433,3 S.W.2d 1084
• Parties: HAUSEMAN MOTOR CO. et al. v. NAPIERELLA.
• Court: Kentucky Court of Appeals

3 S.W.2d 1084

223 Ky. 433

HAUSEMAN MOTOR CO. et al. v. NAPIERELLA.

Court of Appeals of Kentucky

March 6, 1928

Appeal from Circuit Court, Henry County.

Action between the Hauseman Motor Company and others and A. M Napierella. Judgment for the latter and the former appeal. Reversed, with directions.

W. B Moody, of New Castle, and Kendrick Lewis, and Benedict Elder both of Louisville, for appellants.

Turner & Turner, of New Castle, for appellee.

WILLIS J.

This record presents for determination three conflicting claims to the priority of the respective rights of claimants in two motortrucks, or the proceeds thereof.

The Hauseman Motor Company asserts title to a service truck by virtue of a purchase thereof at an execution sale made on June 21, 1925, by the sheriff of Jefferson county. Peter Andriott & Sons claim a Paige truck under proceedings pursuant to Kentucky Statutes, §§ 2739h1 and 2739h2, being the Act of March, 1918 (chapter 75, Acts of 1918, p. 389) which provides a lien on motor vehicles for services, accessories, or supplies furnished by garages, mechanics, repairmen, or other persons or corporations. The Paige truck was left by the owner's agent with Andriott & Sons on November 20, 1925, for repairs, and was retained in custody and later sold for the garage bill, under the authority of the statute, supra, and purchased by the claimants.

A. M. Napierella predicates his right to a superior lien on both trucks upon a chattel mortgage given to him on July 23, 1923, by the owner, Geo. L. Geotz, duly acknowledged, and recorded two days later in the clerk's office of Henry county, Ky. where the trucks were, and where the owner then resided. The circuit court enforced the mortgage of Napierella, and the Hauseman Motor Company and Peter Andriott & Sons appeal, insisting that the chattel mortgage of Napierella was invalid as to each of them because of the defective and insufficient description of the property attempted to be mortgaged.

There is some contention that the appellants each had actual notice of the chattel mortgage, but the evidence does not sustain that claim as to either appellant.

It is well settled that a properly prepared chattel mortgage, duly executed and recorded in the clerk's office of the county of the residence of the owner, which is the legal situs of the mortgaged property, operates as constructive notice of the contents of the instrument in all other counties of the commonwealth, and is binding wherever the property may be taken. Hutchinson et al. v. Ford, 9 Bush, 318, 15 Am.Rep. 711; Burbank, etc., v. Bobbitt, 157 Ky. 524, 163 S.W. 457; Cable Piano Co. v. Lewis, 195 Ky. 666, 243 S.W. 924; Fry Bros. v. Theobold, 205 Ky. 146, 265 S.W. 498; Herold Motor Co. v. Commonwealth, 216 Ky. 355, 287 S.W. 939.

This court has held, in a case decided since the briefs in the present case were prepared, that a chattel mortgage on an automobile, properly prepared, executed, and recorded, confers a lien superior to the statutory lien created by sections 2739h1 and 2739h2, Kentucky Statutes, for work done and accessories funished on the mortgaged car at the instance of the mortgagor. Indiana Truck Corp. of Kentucky v. Hurry Up Broadway Co., 222 Ky. 521, 1 S.W.2d 990, decided January 10, 1928.

It is therefore obvious that the circuit court correctly decided this case, if the chattel mortgage of appellee was a valid instrument as to the appellants. The only ground of invalidity urged against the mortgage is that the description of the property mortgaged is so defective that it does not afford constructive notice of the lien asserted.

The mortgage, omitting the certificates of acknowledgment and of recordation, is as follows:

"Mortgage."

"This indenture, made and entered into, this the 23d day of July, 1923, between George Geotz, of the first part, and A. M. Napierella of the second part, witnesseth: That the said party of the first part, in consideration of one dollar in hand paid, and the further consideration hereinafter expressed, do hereby sell, grant and convey to the second part heirs and assigns the following described property, viz: 1 service truck 3 1/2 tons, 1 Paige truck 2 tons.

To have and to hold the same, with appurtenance unto party of the second part, heirs and assigns forever, with convenant of "general warranty."

Provided, however, that this writing shall operate as a mortgage to secure the second party in the payment of $1,600 evidenced by a note of even date and tenor herewith, and made due and payable six months after date 19 and bearing interest at the rate of 6 per cent. from maturity until paid.

Now, when said note and all accrued interests have been paid this writing shall be null and void, else remain in full force and effect.

Witness the hand of the first party date first written. George L. Geotz. [Seal.]"

It will be observed that the instrument does not show the residence of either of the parties to it, nor the ownership of the property attempted to be mortgaged, except such implication of ownership as may arise from the mere giving of the mortgage. 11 C.J. p. 466, § 90. Neither the location of the property nor the source of title is mentioned; and no means of identification of either truck is afforded by the document. The sole description of the property mortgaged is "one service truck, 3 1/2 tons," and "one Paige truck, two tons," and there is nothing else-where in the instrument to help out the vague and indefinite designation.

It is clear that as to innocent third parties such a description is void for uncertainty in that it does not identify, or afford the means of identification, of the particular property that is the subject of the lien, as distinguished from other property of the same general description.

The doctrine of constructive notice from the record of an instrument properly recordable is that the information furnished thereby is available to all the world, and to every person is conclusively attributed such notice as could be derived from an actual reading of the recorded instrument. As stated by this court in Loeb v. Conley, 160 Ky. 91, 169 S.W. 575, Ann.Cas. 1916B, 49:

"The constructive notice furnished by a recorded instrument, in so far as the boundary of the land and every other material fact recited therein is concerned, is equally as conclusive as would be actual notice acquired by a personal examination of the recorded instrument or actual notice acquired by or through other means. Every person must take notice of its contents to the same extent as if he had personal knowledge of every fact that it recites. This is the very purpose of our recording laws. Tiedman on Real Property, § 584; 39 Cyc. 1718."

The legal standard as to the sufficiency of a description in a mortgage of personal property, although less rigid, is substantially the same as is applied to conveyances of realty. American National Bank v. John Van Range Co., 211 Ky. 849, 278 S.W. 133; Goodin & Barney Coal Co. v. Southern Elkhorn Coal Co., 219 Ky. 827, 294 S.W. 792.

In Miller v. Daniel, 8 Ky. Law Rep. 329, the court said:

"Those having claims against the mortgagor or dealing with him were not under obligation to go to any other source than the mortgage for information."

In Pearce et al. v. Hall, 12 Bush, 209, the mortgage did not show the amount of the debt secured. The court said:

"The spirit of our statutes upon this subject requires not only that such conveyances shall be lodged for record, but that they shall show for themselves, and without the aid of extrinsic evidence to be obtained by inquiry, the nature of the lien, and with a reasonable degree of certainty the amount of the debts they are intended to secure. If the amount be ascertained, as in this case, it ought to be stated. If it be not ascertained, then such descriptive facts as are within the knowledge of the parties, and as tend to put one interested in the inquiry upon the track leading to a discovery, ought to be set out.

Unless this much is done the public record does not show the state of the title, and room is left for the substitution of fictitious and fraudulent claims, and the prime object of the recording system is subject to be defeated.

But the appellees claim there is enough in the mortgage to put purchasers and creditors upon inquiry, and that in equity this amounts to notice. But it is not the notice contemplated by the statutes; and, as we have just seen, it cannot be so regarded by the courts without, in the main, subverting the obvious purpose for which they were enacted."

The court held that the mortgage was not good as against creditors of the mortgagor, and that case has been uniformly followed. Robinson v. Sharp, 32 S.W. 416, 761, 17 Ky. Law...