Hinton v. Williams
| Decision Date | 17 November 1915 |
| Docket Number | (No. 11.) |
| Citation | 86 S.E. 994,170 N.C. 115 |
| Court | North Carolina Supreme Court |
| Parties | HINTON et al. v. WILLIAMS. |
Appeal from Superior Court, Pasquotank County; Justice, Judge.
Action by W. E. Hinton and others against D. E. Williams. From a judgment of nonsuit, plaintiffs appeal. Affirmed.
This is an action for the alleged conversion of certain personal property, i. e., one skidder and two trucks or log cars. C. L. and R. L. Hinton sold and delivered to the Camden Timber Company said skidder, four trucks, and some miles of railroad iron. Under a written agreement, June 21, 1912, "to be paid for about one-third cash, balance note, title to remain with vendor till all the note is paid in full, " $300 was paid in cash. This agreement was not recorded till August 30, 1913, over 14 months after date. In accordance with the agreement the Camden Timber Company executed two notes, one for $278.60 and one for $1,000, both dated November 15, 1912, and due three and six months after date. On July 8, 1913, the Camden Timber Company filed its petition in bankruptcy, including in its list of creditors holding securities the following:
"C. L. and R. L. Hinton, South Mills N. C, two notes, $278 and $1,000, secured by contract reserving title, for mill equipment and railroad track."
The timber company was adjudged a bankrupt and Ehringhaus and Spence were appointed trustees. On August 16, 1913, these trustees filed a petition, asking that they be empowered to sell all the property of the bankrupt, specifying, among such property, "a locomotive, a lot of rail, two skidding machines, and other property." On that date the bankrupt court granted the order of sale directing the property to be sold on Monday, September 1, 1913. The agreement between the timber company and plaintiff was not recorded till after such order, to wit, on August 30, 1913. The sales were reported to the court and confirmed September 23, 1913, and the trustees delivered this property to the purchaser. This action was brought to recover its value of the purchaser.
Aydlett & Simpson, of Elizabeth City, for appellants.
Ward & Thompson, of Elizabeth City, for appellee.
The sole question in the case is whether the vendors, Claiming under an unregistered conditional sale, are entitled to recover the property from the purchaser at sale by the bankrupt's trustees. At the close of the testimony the defendant moved for a nonsuit, which was allowed, and the plaintiffs excepted. The mortgage or conditional sale expressed the intention of the parties that title was to be retained by the Hintons until the purchase price was paid in full. Though the agreement was executed June 21, 1912, it was not recorded till August 30, 1913. In the meantime the Camden Timber Company had been adjudged a bankrupt, July 8, 1913, and on August 16th the trustees in bankruptcy had been directed to sell the property at public sale on Monday, September 1, 1913. The court adjudged that the purchasers at such sale took the property clear of any lien.
The plaintiffs contended that the mortgage, though unregistered, was good as between the parties, and that the trustees in bankruptcy stood in the shoes of the bankrupt, and did not hold as a purchaser for value. In this state and some others it has been held that the failure to record a conditional sale precludes the seller from any lien on the property when it has passed into the hands of the trustee in bankruptcy, on the ground that the contract is void as to creditors until it is recorded, and that therefore the title passes to the trustee in bankruptcy discharged of any lien. In re Tatum (D. C.) 110 Fed. 519; In re Smith & Shuck (D. C.) 132 Fed. 301; In re Poore (D. C.) 139 Fed. 862. In 1906 the Supreme Court of the United States in Mfg. Co. v. Cassell, 201 U. S. 344, 26 Sup. Ct. 481, 50 L. Ed. 782, held that: "The trustee in bankruptcy is vested in no better right or title to the property than the bankrupt had when the trustee's title accrued''
—and hence that where a conditional sale contract was not recorded before the adjudication in bankruptcy, the vendor's lien, being good as between the parties, was good against the trustees in bankruptcy. In 1910 Congress, in order, no doubt, to avoid cases offraud which arose under that decision, amended Bankrupt Law, § 47 (a), cl. 2, by adding thereto:
"And such trustees as to all property in the custody or coming into the custody of the Bankruptcy Court, shall be deemed vested with all the rights, remedies, and powers of a creditor holding a lien by legal or equitable proceedings thereon; and also, as to all property not in the...
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Reed v. Elmore
...however full and formal, cannot take the place of registered documents. Austin v. Staten, 126 N.C. 783, 36 S.E. 338; Hinton v. Williams, 170 N.C. 115, 86 S.E. 994; Blacknall v. Hancock, 182 N.C. 369, 109 S.E. Our Court has held that where restrictive covenants in the nature of mutual negati......
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Lynch v. Johnson
...priority over unregistered deeds and mortgages required by the law of the state to be registered, as is illustrated by the case of Hinton v. Williams, supra. the Connor Act have the effect of destroying equities against a purchaser who buys with notice of the equity? The question was discus......
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Davis v. Robinson
...147 N.C. 631, 61 S.E. 604; Blalock v. Strain, 122 N.C. 283, 29 S.E. 408; Buchanan v. Clark, 164 N.C. 71, 80 S.E. 424; Hinton v. Williams, 170 N.C. 117, 86 S.E. 994; Blacknall v. Hancock, 182 N.C. 372, 109 S.E. Upon the instant record we see no reason, either in law or equity, to disturb the......
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Coastal Sales Co. v. Weston
...transfer. Thereafter, it was held that an unrecorded chattel mortgage was void as against a trustee in bankruptcy. Hinton v. Williams, 170 N.C. 115, 86 S.E. 994; Holt v. Albert Pick & Co., 4 Cir., 25 F.2d 378; Fairbanks Steam Shovel Co. v. Wills, 240 U.S. 642, 36 S.Ct. 466, 60 L.Ed. 841. Su......