Lankford v. First Nat'l Bank of Lawton
| Decision Date | 15 July 1919 |
| Docket Number | Case Number: 7997 |
| Citation | 1919 OK 216,75 Okla. 159,183 P. 56 |
| Parties | LANKFORD, State Bank Com''r, v. FIRST NATIONAL BANK OF LAWTON. |
| Court | Oklahoma Supreme Court |
¶0 1.Chattel Mortgages -- Acknowledgement--Necessity.
A chattel mortgage is valid between the parties without being acknowledged or witnessed.
2. Same.
A compliance with the conditions prescribed in section 4036, Rev. Laws 1910, wherein it provides, "Such signature may either be attested by acknowledgment before any person authorized to take acknowledgments of deeds, or it may be signed and validated by the signature of two persons not interested therein," is only required in order that said mortgage may be entitled to be filed in the office of the register of deeds of the proper county, and operate as constructive notice to creditors and subsequent purchasers and incumbrancers who have no actual notice of said mortgage.
3.Same--Attestation--"Signed and Validated."
The words "signed and validated," as used in section 4036, Rev. Laws 1910, refer to the attestation of a chattel mortgage, and being essential only as a requisite required in order that a chattel mortgage may be entitled to be filed for record.
4.Same--Attestation--Validity.
A chattel mortgage is valid as between the parties without being attested in any manner. For the purposes of record, it must be attested either by acknowledgment or witnessed by two disinterested witnesses; but where it does not appear from the face of the instrument that the officer taking the acknowledgment, or the subscribing witnesses, are legally disqualified by reason of their interest in the estate or property mortgaged, the instrument may properly be received for record, and such recording will be constructive notice to subsequent creditors and mortgagees.
5.Same--Disqualification of Witness--Validity of Record.
Where a chattel mortgage has been filed for record in the office of register of deeds of the proper county, and the acknowledgment is regular upon the face of the instrument, or the same is attested before two witnesses, and the attestation of the same is regular upon the face of the instrument, but there is a latent defect in the instrument by reason of the subscribing witnesses being disqualified or the person taking the acknowledgment being disqualified, by reason of their being interested in the estate or property mortgaged, but said fact does not appear upon the face of the instrument, the filing of said instrument of record is voidable, and not void.
Error from District Court, Comanche County; Cham Jones, Judge.
Replevin by the First National Bank of Lawton, Okla., against J. D. Lankford, Bank Commissioner of the State of Oklahoma. Judgment for plaintiff, and defendant brings error. Reversed and remanded, with directions.
S. P. Freeling, Atty. Gen., J. I. Howard, Asst. Atty. Gen., and Chas. C. Black, for plaintiff in error.
Johnson & Stevens, for defendant in error.
¶1 On the 4th day of January, 1913, one Garrett executed a chattel mortgage on certain personal property located in Comanche county to the Bank of Lawton to secure an indebtedness to the bank. The mortgage was not acknowledged, but was witnessed by two witnesses, to wit, Frank T. Blair and M. A. Wert. Thereafter, on April 25 and 28, 1913, respectively, Garrett executed two chattel mortgages to the First National Bank of Lawton on a black horse named Dick, which horse was included in the mortgage to the Bank of Lawton. The note due the Bank of Lawton was not paid, and one McCalmant, acting as the agent of the Bank of Lawton, took this horse under the mortgage, whereupon the First National Bank instituted a replevin action to recover possession of said horse by virtue of its mortgage. Thereafter the affairs of the Bank of Lawton passed into the hands and control of the Bank Commissioner of the state, and the latter was substituted as a party defendant in the proceedings. The case was tried on an agreed statement of facts.
¶2 The only question involved, was the effect to be given to the purported mortgage executed to the Bank of Lawton. It was stipulated and agreed that the two witnesses to the mortgage executed to the Bank of Lawton were both stockholders, and one of them also a director, in the bank at the time of witnessing the mortgage. It was agreed that, at the time the First National Bank took its mortgage, it did not examine the records in the office of the register of deeds and did not have actual knowledge of the mortgage to the Bank of Lawton. The mortgage of the Bank of Lawton was filed for record on the 6th day of January, 1913, in the office of the register of deeds.
¶3 It will be first necessary to determine whether this is a valid mortgage. Does the fact that the same is witnessed by two interested persons make it void? Section 4036, Rev. Laws 1910, is as follows:
¶4 It is the interpretation of this statute that is decisive of the issues in the case at bar. The defendant in error contends that the portion of the statute wherein it provides "that the same may be signed and validated by the signature of two persons not interested therein" refers to the execution of the instrument, and the execution is not complete nor the instrument valid until signed and subscribed by two persons as witnesses not interested therein. It will be noticed that the first portion of the section refers to how a chattel mortgage may be executed, and the second portion refers to the attestation. The second sentence therein is: "Such signature may either be attested by," etc. It then provides that the same may be by acknowledgment or signed and validated by the signature of two persons not interested therein. The word "either" means one of two ways, as defined in the case of Aldrich v. Bay State Const. Co., 186 Mass. 489, 72 N.E. 53, wherein the court said:
"In the use of the word ''either'' one or the other of two is meant. '
¶5 It must be apparent that the Legislature when it used the language "may either be attested," and then provided two methods for the attestation, was referring to the attestation of the instrument, and provided that the same might be attested in two ways: First, the attestation would be valid if the instrument was acknowledged before a person who is authorized to take acknowledgments of deeds; second, the attestation was valid when the instrument was signed and validated by the signature of two persons not interested. The words "signed and validated," as used in said sentence, must refer to the sentence which it is a portion of, and refers to the attestation of the instrument, and not the execution thereof. In construing and interpreting statutes, one of the cardinal rules is to look to the origin of the statutes and the different acts of the Legislature to find the intent of the lawmakers. If we look to the origin of the statute relating to chattel mortgages in Oklahoma, we find the statutes of 1893 have two sections which we think are material in determining the intent of the Legislature in the instant case. Section 3263, Statutes of 1893, provides:
"A mortgage of personal property may be made in substantially the following form."
¶6 The form of the mortgage is then set out, but no mention is made of witnesses, nor are blanks left indicating that any are required, nor does it make provision for the same being acknowledged. This section of the statute has been carried forward into the different statutes of Oklahoma, and is now section 4025, Rev. Laws 1910. At no time has the Legislature ever attempted to change this form or amend the section, but have seen fit to readopt it and permit it to stand in its original form. This section of the statute is substantially the same as the statute of South Dakota wherein, in dealing with chattel mortgages, was provided a form for chattel mortgage.
¶7 If we look to the statute of 1893, among the sections provided for the filing of chattel mortgages, and the effect to be given them when filed as constructive notice, we find section 3275 of the Statutes of 1893, which is as follows:
"A mortgage of personal property must be signed by the mortgagor in the presence of two persons, who must sign the same as witnesses thereto, and no further proof or acknowledgment is required to admit it to be filed."
¶8 This section was copied exactly from the statutes of South Dakota, and being section 4384 of the Comp. Laws of Dakota (1887). In construing said statute, the Supreme Court of South Dakota, in the case of Walter A. Wood Mowing & Reaping Mach. Co. v. Lee, 4 S.D. 495, 57 N.W. 238, stated as follows:
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