Grinnell Brothers v. Moy

203 N.W. 167, 230 Mich. 26, 1925 Mich. LEXIS 463
CourtMichigan Supreme Court
DecidedApril 3, 1925
DocketDocket No. 17.
StatusPublished
Cited by8 cases

This text of 203 N.W. 167 (Grinnell Brothers v. Moy) is published on Counsel Stack Legal Research, covering Michigan Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Grinnell Brothers v. Moy, 203 N.W. 167, 230 Mich. 26, 1925 Mich. LEXIS 463 (Mich. 1925).

Opinion

Clark, J.

On February 7, 1922, plaintiff sold a piano and bench to defendant Moy, receiving the following instrument:

“February 7, 1922.
“$655.00.
“For value received, I promise to pay to the order of Grinnell Brothers, at their store, 245-247 Woodward avenue, Detroit, Michigan,
“Six hundred fifty-five dollars as follows: $100.00 cash, Feb. 7, 1922, balance in monthly installments of fifty or more dollars each commencing March 7, 1922, with interest annually at six (6) per cent.
Inst. Premier Style, Grand No. 27464 with bench; Residence: 28 W. Adams.
“I hereby agree, that the title to the above described property, for which this note is given, is and shall *28 remain, in the said Grinnell Brothers, and under their direction until paid for in full. I also agree to keep the said instrument insured for the benefit of the said Grinnell Brothers, as their interest may appear, and that said property shall not be removed from my present residence without their written consent, and that they shall have the power to retake said property at any time after default in payment, or failure on my part to keep any of the promises or agreements herein contained, and whatever has been paid shall be forfeited for wear and tear, rent and expenses of taking the same, and for any damages and expenses they may have been put to on my account or in making this sale or by reason of such failure and forfeiture, and in case sufficient has not been paid at such time of retaking to cover an ordinary rental for said property,, as well as all damages and all expenses said Grinnell. Brothers may have been put to, then said Grinnell Brothers shall have the right to collect such deficiency.. The said Grinnell Brothers shall have the right to replace the said property in case any rightful fault shall be found with that described above.
(Signed) “Sam H. Moy.”

The paper, or a true copy thereof, was not filed as a conveyance intended to operate as a mortgage of goods and chattels (3 Comp. Laws 1915, § 11988). Moy placed the piano and bench in his place of business. Theretofore, and on October 7, 1921, he had given a chattel mortgage to Albert Pick & Company for $22,000, covering “a schedule and inventory of articles and chattels” then on his premises. The piano and bench, of course, were not included in such schedule and inventory. Said chattel mortgage contained a clause covering future acquisitions, as follows:

“Also all goods, chattels, etc., purchased for, added to or used in connection with the above, acquired in the future in said business at said premises — Providing, however, that this clause shall not be intended to cover any more than any equity of the purchaser in and to any property that may be subsequently acquired *29 and be in said premises upon which there shall be placed purchase money liens.”

The mortgage was duly filed. Pick & Company foreclosed its mortgage, and sold at foreclosure sale the piano and bench to defendant Carleton Cafe Company. Moy defaulted in payments to plaintiff. Carleton Cafe Company would not pay. Plaintiff, to recover its piano and bench, brought replevin in justice’s court. A judgment for plaintiff was reviewed in circuit court on certiorari, where defendants had judgment. Plaintiff brings error.

Counsel for plaintiff request that, in deciding whether the instrument first quoted is one of conditional sale or one for security in the nature of a mortgage, the question be considered at length and the cases reviewed for the benefit of counsel and others. But that has been done by Mr. Justice WlBST in a like case. Burroughs Adding Machine Co. v. Wieselberg, ante, 15.

We find it unnecessary to decide that question. If the instrument was one of conditional sale, it was valid as against defendants, though not filed, and plaintiff was entitled, under its terms, to possession of the property. If it was a conveyance in the nature of a chattel mortgage, void as against creditors of the mortgagor and subsequent purchasers or mortgagees in good faith, because not filed (3 Comp. Laws 1915, § 11988), plaintiff nevertheless was entitled toi possession of its property as against defendants. The creditors of Moy, if any, as to whom the instrument in question, if a mortgage, was void because not filed, are those who extended credit during the time the paper was withheld from record. Baker v. Parkhurst, 119 Mich. 542; Peter Schuttler Co. v. Gunther, 222 Mich. 430. Pick & Company was not a creditor who might complain. It became a secured creditor of Moy months before the piano and bench were pur *30 chased. Carleton Cafe Company was not a purchaser in good, faith. The after-acquired property clause of Pick & Company’s mortgage reached and covered only Moy’s interest in the piano and bench. Pick & Company could sell no greater interest to a purchaser at its foreclosure sale. The rule is well stated in United States v. New Orleans Railroad, 12 Wall. (U. S.) 362:

“A mortgage intended to cover after-acquired property can only attach itself to such property in the condition in which it comes into the mortgagor’s hands. If that property is already subject to mortgages or other liens, the general mortgage does not displace them, though they may be junior to it in point of time. It only attaches to such interest as the mortgagor acquires; and if he purchase property and give a mortgage for the purchase-money, the deed which he receives and the mortgage which he gives are regarded as one transaction, and no general lien impending over him, whether in the shape of a general mortgage, or judgment, or recognizance, can displace such mortgage for purchase-money. And in such cases a failure to register the mortgage for purchase-money makes no difference. It does not come within the reason of the registry laws. These laws are intended for the protection of subsequent, not prior, purchasers and creditors.”

See, also, Chafey v. Mathews, 104 Mich. 103 (27 L. R. A. 558); Wood v. Holly Manfg. Co., 100 Ala. 326 (13 South. 948, 46 Am. St. Rep. 56); Daly v. Railway Co., 55 N. J. Eq. 595 (38 Atl. 202); Hammel v. First Nat. Bank of Hancock, 129 Mich. 176.

But defendants contend that the replevin proceeding is void because the writ was made returnable 13 days from date instead of not more than 12 days, as-required by 3 Comp. Laws 1915, § 14333, and that Act No. 416, Pub. Acts 1919 (Comp. Laws Supp. 1922, § 14182), then in force (later amended by Act No. 13, Pub. Acts 1923), providing that such writ *31 may be made returnable not more than 21 days from issuance thereof, is unconstitutional.

The title of Act. No. 416 :

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Bluebook (online)
203 N.W. 167, 230 Mich. 26, 1925 Mich. LEXIS 463, Counsel Stack Legal Research, https://law.counselstack.com/opinion/grinnell-brothers-v-moy-mich-1925.