Moore v. Preiss Trading Corp.

• Decision Date: 05 February 1936
• Citation: 182 A. 824
• Parties: MOORE v. PREISS TRADING CORPORATION.
• Court: New Jersey Court of Chancery

182 A. 824

MOORE

v. PREISS TRADING CORPORATION.

Court of Chancery of New Jersey.

Feb. 5, 1936.

Syllabus by the Court.

1. Under the Chattel Mortgage Act (Comp.St.Supp.1930, § 36—4), the affidavit attached to the mortgage when made by an agent of the mortgagee must state agency of the person verifying the affidavit.

2. Under the Chattel Mortgage Act (Comp.St.Supp.1930, § 36—4), requiring the affidavit annexed to the mortgage to set forth the true consideration, held, the affidavit before the court does not recite the true consideration thereof.

Suit by Edward T. Moore, receiver of Floe Art Print Works, Incorporated, against the Preiss Trading Corporation, to set aside a chattel mortgage. On motion to confirm report of special master finding that mortgage was invalid.

Report confirmed, and decree advised setting aside mortgage.

Herman Herbert Singer, of Paterson, for complainant.

Beery & Adlman, of Paterson, for defendant.

LEWIS, Vice Chancellor.

In this suit the receiver of Floe Art Print Works, Inc., prays that the court set aside a certain chattel mortgage made by Floe Art Print Works, Inc., to defendant. It is contended on behalf of complainant that the mortgage is void under the Chattel Mortgage Act because of failure to comply with the provisions of the Chattel Mortgage Act. This act (Comp.St. Supp. 1930, § 36—4) provides that the affidavit annexed to the chattel mortgage shall be made and subscribed by the holder or holders of the mortgage or his agent or attorney, and also that it must set forth the true consideration.

The matter was referred to a special master, who took testimony and has made his report in which he finds that the mortgage is invalid on both of the foregoing grounds. His report is now before me for confirmation.

The affidavit to the mortgage in question reads as follows:

"Elias Preiss of Preiss Trading Corporation, the mortgagee in the foregoing mortgage named, being duly sworn, on his oath, says that the true consideration of the said mortgage is as follows, viz.: the sum of Five Thousand Dollars advanced this day by the mortgagee to the mortgagor as evidenced by two (2) checks this day made by the mortgagee to the order of the mortgagor, one in the sum of Three Thousand Dollars ($3,000.00) drawn on the Manufacturer's Trust Co., 8th Av. and 34th Street Branch, New York City, total $5,000.00.

"Deponent further says that there is due and to become due on said mortgage the sum of $5,000.00 and 00/00 cents besides lawful interest thereon from the 18th day of December, 1933.

"Elias Preiss."

The mortgage is evidently not made or subscribed by the mortgagor, and the first question for determination is whether it is made and subscribed by its agent within the meaning of the statute.

It seems established under the decisions that it is not enough if the affidavit is made by one who is an agent in fact of the corporation, but that the agency must be disclosed in the affidavit itself. In Watson v. Rowley, 63 N.J.Eq. 195, 52 A. 160, 161, the court said that the affidavit must be made "by an affiant who is particularly described by his special relations to the mortgagor and the mortgaged property." In Mitschele-Baer, Inc., v. Livingston Sand Co., 108 N.J.Eq. 286...