Lee Tire & Rubber Co. v. Gay, 23114.

• Decision Date: 16 October 1931
• Docket Number: 23114.
• Court: Washington Supreme Court
• Parties: LEE TIRE & RUBBER CO. v. GAY (TRANSPORTATION SECURITIES CO., Intervener.

4 P.2d 503

164 Wash. 569

LEE TIRE & RUBBER CO. v. GAY (TRANSPORTATION SECURITIES CO., Intervener.

No. 23114.

Supreme Court of Washington

October 16, 1931

As Amended November 6, 1931.

Department 2.

Appeal from Superior Court, King County; E. H. Guie, Judge.

Action by Lee Tire & Rubber Company against Charles F. Gay, in which the Transportation Securities Company intervened. From an adverse judgment, the intervener appeals.

Reversed and remanded with directions.

William H. Pemberton and Roy D. Robinson, both of Seattle, for appellant.

MILLARD J.

On February 7, 1929, Charles F. Gay purchased from the Roesch Motor Car Company a fully equipped motortruck, which was placed in the possession of the vendee. A chattel mortgage which was assigned to the Transportation Securities Company to secure the payment of the unpaid portion of the purchase price of the truck, was executed by the vendee and duly placed of record. The mortgage provided that it should cover 'additional material, supplies and accessories or substituted parts, if any, whether used upon said chattel or any other equipment of said mortgagor.'

On May 13, 1929, the Lee Tire & Rubber Company sold to Mr. Gay, the mortgagor, under a conditional sale contract, four solid pneumatic air center tires, which were placed upon the wheels of the truck. That contract was not placed of record. The court found that, prior and subsequent to the sale of the tires to Gay for use on the truck, the securities company was informed of the sale to Gay, but that the securities company 'was not advised it was a conditional sale, nor did intervenor (Securities Company) have knowledge of said conditional sales contract' and that the securities company advised the rubber company that Gay 'was not keeping up his payments on the truck.'

On or about September 25, 1929 (which was subsequent to the sale of the tires to Gay), the mortgagor, then in default of the terms of the mortgage, surrendered the truck, as then equipped with the tires purchased from the rubber company, to the securities company in consideration of the cancellation of the note and mortgage for the unpaid portion of the purchase price of the truck.

In October, 1929, Gay not having paid for the tires pursuant to the terms of the contract, the Lee Tire & Rubber Company instituted an action against Gay for repossession of the tires, in which action the Transportation Securities Company appeared as intervener. The court found that 'the conditional sale contract was never filed of record but that said intervener is not a bona fide purchaser, pledgee mortgagee, encumbrancer or subsequent creditor and acquired no right, title or interest in or to said tires,' and concluded that the rubber company was entitled to the return and possession of the tires. Judgment was entered accordingly. The intervener has appealed.

Under the conditional sale contract, the title to the tires was retained by the respondent, the seller, until the whole purchase price was paid. The tires were delivered into the possession of Gay, the buyer. Under the statute, that contract was required to be filed within ten days after the taking of possession by Gay of the tires to render the contract valid as against a bona fide purchaser claiming under Gay.

'That all conditional sales of personal property, or leases thereof, containing a conditional right to purchase, where the property is placed in the possession of the vendee, shall be absolute as to all bona fide...