Cochran v. Flint

57 N.H. 514, 1877 N.H. LEXIS 113

• Court: Supreme Court of New Hampshire
• Decided: August 11, 1877
• Status: Published

Opinion

Ladd, J.

The exact mode in which this machinery was affixed to the saw-mill building is not stated in the case; but from the course of the argument, and from what does appear in the case, it is to be assumed that, if it had been made by the owner in the same way, those movable things would have lost their independent character as chattels, becoming part of the immovable thing — the mill — so as to he included in its description and follow its ownership; — that is, they were so affixed that they would have passed as part of the realty between grantor and grantee. At the same time, the machinery was not incorporated into the building in such way that its legal identity was lost. It was not made part of the mill by adjunction, in the civil law sense of that word, like nails, or paint, or bricks, or a beam or rafter: it might be removed without destruction or material injury to the building. As between the conditional vendors, — that is, the legal owners and Jones & Parks, — the former might lawfully remove it. The question is, whether the mortgagee of Jones & Parks, whose mortgage was executed before the machinery was put into the building, has greater rights with respect to it than had Jones & Parks themselves, and if so, whence those rights are derived.

This question is, to my mind, a very narrow and a very simple one, and is conclusively answered in the negative by the fact that Jones & Parks did not own the property at the time it was affixed to the building, and liad not the assent of the owners, either express or implied, to annex it to the freehold or add it to the mortgage interest of any other person.

The discussions of counsel have taken a very wide range; and as almost all that has been said, and almost all the cases to which we have been referred, seem to me quite wide of the true ground upon which the case must be decided, it is necessary to examine with some care each step of the short process by which my conclusion has been reached.

Assuming, then, that the machinery can be removed without destruction or material injury to the building, are we right in our first proposition, that, as against Jones & Parks, the defendants might lawfully take it away ? Upon this point I suppose there can be but one opinion. The cases, so far as I have examined them (and I have looked into all that have been referred to by counsel, and many others), are all one way. Jones & Parks might agree that the machinery should remain a chattel, and they would be bound by that agreement. By force of the agreement it would retain its original character and attributes after it was placed in the mill, the same as before ; it would not become annexed in law to the real estate at all. The title to it would not be changed, and the owners might of course retake it, according to the agreement made for'their security, because it was still their own. Haven v. Emery, 33 N. H. 66.

How has the mortgagee acquired a greater right with respect to it than the mortgagors ever had ? Certainly not by contract. Has he by any act of the owners ?

Upon the first argument of the cause, it was suggested by the court that the rights of the mortgagee rest upon and are derived from the mortgage, and that until the machinery became the property of the mortgagors, either by contract or accession, or in some other way, their previously existing mortgage could not have any operation or effect upon it. There was no ground upon which to claim that the title passed by any application of the doctrine of estoppel, because the machinery was not affixed to the mill until after the mortgage was executed ; and it did not then occur to the court that there was any ground upon which it could be claimed that the owners of the property had consented that it should be annexed in law to any real estate in such way that their title and ownership of it would be gone. But counsel say this suggestion of the court was based upon the fundamental error of assuming that the mortgagee makes, and must make, his title to the machinery through Jones & Parks, whereas such is not the fact at all. But the plaintiff claims the machinery by virtue of his legal estate in the land, as if he were an absolute grantee of the premises. The argument is, that, in determining the question of title between the mortgagee and the conditional vendors, the former is to be regarded as the absolute owner of the realty.

Let this view be accepted. The plaintiff’s contention, then, assumes this form : The act of Jones & Parks in affixing these movable things of the defendants to the real estate of a third person had the effect of an annexation in law, whereby the title immediately passed from the owner to such third person ; — that is to say, A, having in his possession chattels belonging to B, affixes them to the real estate of C in such manner that they would pass by deed, but not so but that they can be removed without material injury to the realty. By this act of A the title to the chattels is passed from B to C. Nothing can be more certain than that the proposition, stated in this broad and unqualified way, cannot be sustained.

The rule is — and this is elementary — that the movable must be affixed by the owner of it, and affixed in the course of his general use and occupation of the immovable ; and I venture the remark that not a case can be found where it is held that the owner would be divested of his title if the movable thing is affixed without his consent, either express or implied. D'Eyncourt v. Gregory, Law Rep., 3 Eq., 394. The cases are not agreed as to the legal rights of the parties where the chattel is not affixed by the owner, but is affixed with his consent but without any intention of transferring the property in it, or is affixed by the owner with the intention and upon some agreement that it shall remain a chattel and shall not pass. Compare, for example, such cases as Crippin v. Morrison, 13 Mich. 23, and Ford v. Cobb, 20 N. Y. 344, with Clary v. Owen, 15 Gray 522, and Hunt v. Iron Co., 97 Mass. 279. The number of cases, English and American, bearing upon this question one way and the other, is pretty large, and, upon a tolerably careful examination of many of them, I am not now prepared fully to admit, with the plaintiff’s counsel, that either the weight of authority or the weight of reason is in favor of the conclusion that the property in the movable thing would, under such circumstances, pass to the owner of the immovable. But, to save discussion of this controverted point, let it be conceded that the Massachusetts cases enunciate the true rule, — that in the case of things affixed, with the consent of the owner, while no change of property is effected as between the owner and the person affixing them, still, for other purposes, and as concerns third persons, all the usual consequences of annexation follow : how, then, does the present case stand ?

This machinery was delivered by the defendants to Jones & Parks, upon a written agreement that it was “ to remain the property and subject to the order of C. M. Flint until paid for in full.” Now, it is said that the nature of the property was such that the inference is irresistible that the defendants knew it was to be affixed by Jones & Parks, and used by them in connection with real estate ; — and that this is so there can be little doubt. Machinery for a saw-mill is ordinarily affixed to a building, and steadied and kept in place there by means of some connection more or less intimate with the structure where it is set up.

It is further contended, that, upon the bill and answer, the defend ants must be taken to have expressly assented to its annexation to the particular mill in question. Neither the bill nor the answer is sworn to, and I do not find anything in those documents to show such express assent. The allegation of the bill on this point is not very clear. Perhaps, however, it is sufficiently alleged that the machinery was put into the mill with the knowledge and consent of the defendants, although it is not alleged that they had knowledge of the mortgage. This allegation is distinctly denied by the answer, except that Flint understood it was to be set up and used at some place at or near West Rumney. These allegations by way of pleading do not seem to add to or subtract from the statement of facts found in the printed case.

Let it be taken, then, that the defendants gave their assent that the machinery should be affixed to real estate in such way that it would pass by a deed of the land. Such consent was not express. It is an inference, but an inference which, I think, may be, and fairly ought to be, drawn from the nature of the thing, and the ordinaiy mode of its use.

The purpose of the agreement was, to secure the defendants against the consequences which would follow a delivery and annexation of the property without it. As between them and the vendees it was a legal and valid agreement, and, as we have seen, had the effect to prevent an annexation in law, retaining in the thing affixed the nature of a chattel. Now, in the face of this agreement, what is the extent of the inference which can fairly, or, indeed, with any show of reason, be made ? Certainly it is that the vendees should affix the machinery to their own mill, and not to the mill of another.

An assent by A that his chattel may be affixed by B to the real estate of C, is, upon our assumption, an assent by A that his property become the property of C. How can such an assent be inferred without a particle of proof to sustain it, and directly against an express stipulation that the thing shall remain the property of A until it is paid for in full ? I confess it seems to me almost too plain for argument or illustration, that the consent of the defendants that this machinery might be affixed to and used with real estate, which is to be inferred from the nature of the property and the ordinary mode of its use, was a consent that it be affixed to and used with the real estate of Jones & Parks, and not a consent that it be annexed in law to the real estate of a third person, whereby the express agreement of the parties should be wholly nullified, the security of the defendants lost, and their title transferred, without consideration and without their consent, to a stranger. The inference we are called upon to draw is, that the defendants consented to an appropriation of their property by Jones & Parks entirely inconsistent with the agreement. Suppose Jones & Parks, after getting the machinery into their possession, had undertaken to make an outright gift of it to some friend, or sold it to the first customer they met, or executed a chattel mortgage of it to secure a creditor: would such disposition be consistent with the agreement ? Could not the defendants have retaken it from the donee, the vendee, or the mortgagee, in either of the cases supposed, by virtue of their paramount title and right ? Suppose such donee, vendee, or mortgagee had affixed the machinery to his real estate, and commenced using it there : should we be asked to infer the consent of the defendants from the fact that the property was designed to be used in connection with real estate ? Jones & Parks might as well give the property to a stranger in one way as another. The difference is only a very slight difference in form — whether they make the gift by affixing it themselves to- the realty of a stranger, or hand it over to the stranger and suffer him to make the annexation himself. The substance is the same: one act is no less inconsistent with their agreement than the other. The consent of the defendants to the act can no more be inferred from the nature of the thing in one-case than in the other.

But it is contended that the defendants’ knowledge that the machinery was to be put up and used in a saw-mill building was enough to put them upon inquiry as to the title of the mill to which it might be affixed by Jones & Parks, and that, inasmuch as they ought to have inquired, they must be charged with the knowledge they would have gained by inquiry, namely, the fact that the mill of Jones & Parks was under a mortgage to the plaintiff. We are referred to no case which gives countenance to such a claim, and I certainly think it cannot be maintained. The transaction was a conditional sale of personal property. The vendors were not acquiring any interest whatever, by way of security or otherwise, in any real estate. How can it be said that even a very cautious man would have thought to inquire of the purchasers whether they owned the mill into which the machinery was to be put, or whether there was any mortgage on it ? Perhaps such a man might have made such an inquiry. But the question is not what a very cautious man might or probably would have done. That is not the rule. The rule which, I conceive, must apply to cases of this sort, is the second rule laid down by Vice-Chancellor Wigram in Jones v. Smith, 1 Hare 43, namely, — When the conduct of the party charged evinces that he had a suspicion of the truth, and wilfully and fraudulently determined to avoid receiving actual notice of it, then he is to be treated as though he had the knowledge which he has so studiously avoided obtaining. It need not be said that there is no evidence whatever before us to bring this case within this rule, or that tends at all in that direction. Indeed, there seems to be little more reason why the defendants, after the execution of the agreement, should inquire if the mill of Jones & Parks was under a mortgage, than that they should inquire if Jones & Parks had creditors, to whom they might, in violation of the agreement, attempt to convey the machinery for security.

I think it is very clear that there was no assent of the defendants, either express or implied, that their property should be affixed to the real estate of ány person except their vendees, Jones & Parks.

With respect to the remark of Bellows, J., in Stantons v. Thompson, 49 N. H., at page 276, upon which so much stress has been laid in the argument, it would probably be enough to say that the case had been once or twice tried by jury, and twice transferred upon questions of law before the questions reported as above were decided. If any question as to the mode of annexation was made, it must have been settled before upon rulings to which there was no exception, or which had been sustained by the court. But however that may be, the case is distinguished from the present, as I understand, by a broad and impassable difference in the facts. I am informed that the annexation in that case was made by the owners of the machinery. Perhaps that fact sufficiently appears upon page 272 of the report. If I am right in reference to this fact, the case would seem to stand in the same category as Clary v. Owen, 15 Gray 522, and other similar cases; and the dictum, referred to is no authority whatever against the conclusions at which I have arrived.

If the court held, by an unreported decision, at any stage of the litigation in Stantons v. Thompson, that where A, having in his possession the movable thing of B, annexes it without the knowledge or consent of the owner to the real estate of C, it thereupon, and by force of that act alone, becomes the property of C, I must repeat the remark that, so far as my investigations have extended, the case would stand alone, and the decision would be so manifestly contrary to reason and justice, as well as the fundamental principles of law relating to the acquisition and ownership of property, that I could only follow it from a sense of duty that would amount to moral compulsion.

I think the injunction should be denied.

Cushing, C. J., and Smith, J., concurred.

Bill dismissed.