E.P. Bacon & Co. v. Thompson

• Decision Date: 13 December 1882
• Citation: 14 N.W. 312,60 Iowa 284
• Parties: BACON & Co. v. THOMPSON ET AL
• Court: Iowa Supreme Court

14 N.W. 312

60 Iowa 284

BACON & Co. v. THOMPSON ET AL

Supreme Court of Iowa, Des Moines

December 13, 1882

Appeal from Sioux District Court.

THIS is a contest between the plaintiffs as mortgagees, and the defendants as attaching creditors, of certain personal property, for priority of lien. The court found in favor of plaintiffs. The defendants appeal. The facts are stated in the opinion.

REVERSED.

G. W Pitts and H. C. Hemmenway, for appellants.

D. A W. Perkins, for appellee.

OPINION

DAY, J.

I.

The plaintiffs claim a lien, upon the property in question, under a chattel mortgage executed by Teabout & Valleau, on the 28th day of April, 1881, and filed for record on the 3d day of May, 1881. This action is brought against Teabout & Valleau to recover the amount secured and foreclose the mortgage. The defendants, N. C. Thompson, Warder, Mitchell & Co., and Warder, Bushnell & Glassner, each claim a lien upon the mortgaged property, in virtue of attachments levied thereon on the 30th day of April, 1881, without any notice of the existence of the mortgage.

The attachments, it will be seen from the above statement, were levied after the mortgage was executed, and before it was filed for record. The case involves a construction of section 1923 of the Code, 2201 of the Revision, 1193 of the Code of 1851. This section is as follows: "No sale or mortgage of personal property, when the vendor or mortgagor retains actual possession thereof, is valid against existing creditors, or subsequent purchasers, without notice, unless a written instrument conveying the same is executed, acknowledged like real estate, and filed for record with the recorder of the county where the holder of the property resides." The decisions of this court upon the question now involved cannot all be harmonized.

In Miller v. Bryan, 3 Iowa 58; Crawford v Burton, 6 Iowa 476; McGavran v. Haupt, 9 Iowa 83; and Allen v. McCalla, 25 Iowa 464, it was held that the words without notice apply to existing creditors, as well as to subsequent purchasers, and that an unrecorded chattel mortgage would be valid against existing creditors with actual notice of execution of the mortgage. None of these cases, however, presented the question of the levy of an attachment or execution by an existing creditor, without notice of the execution of the mortgage. In Allen v. McCalla, on page 482-3, it is said: "Two issues of fact were made between the parties, and tried to the jury, one, whether the mortgage to the plaintiff was properly filed for record before the levy of attachment, and the other, whether the attaching plaintiffs had notice of the existence of the mortgage, prior to the levy of the attachment." In McGavran v. Haupt, the court say: "The question for our decision is, whether a mortgage of personal property, executed and acknowledged, but not recorded, where the mortgagor retains possession, is valid against existing creditors, with notice of the mortgage at the time of its execution." The same question was involved in Crawford v. Burton, and in Miller v. Bryan. In Cummings v. Tovey, 39 Iowa 195, no reference was made, either in the argument of counsel, or in the opinion, to section 1923 of the Code. Whatever, therefore, may be thought of the correctness of the opinion, it cannot be regarded as placing a construction upon section 1923 of the Code. In Boothby v. Brown, 40 Iowa 104, the exact question involved in this case was presented. In that case the court instructed the jury, "that if there was no change of the possession of the property upon the sale by the defendants in the attachment, but it still remained in their possession, and the defendant had no notice of such sale previous to the levy, and the transfer by the execution defendants was not acknowledged and recorded, the defendant was entitled to recover." This instruction was approved. The court say: "The right of the creditor attaches upon the levy of attachment. It is plain, that the sale without notice thereof, cannot defeat the levy, otherwise the sale would be valid against the creditors, without notice." The case of Hickok v. Buell, 51 Iowa 655, 2 N.W. 512, involves the same question, and it cites and follows Boothby v. Brown, supra. In Kessey v. McHenry, 54 Iowa 187, 6 N.W. 262, the following question, certified from the court below, was answered in the affirmative. "When a mortgage on growing crops is only recorded and not indexed, and a creditor, whose debt was in existence prior and subsequent to the execution of the mortgage, levies an execution on said crops, and has no actual notice of said mortgage at the time of levy, but before sale under execution is notified of such mortgage, and the said mortgage is duly indexed,...