Topper v. Jeffrey Manufacturing Co.

191 F. Supp. 105, 85 Ohio Law. Abs. 567
CourtDistrict Court, S.D. Ohio
DecidedJuly 1, 1960
DocketNo. 4979
StatusPublished

This text of 191 F. Supp. 105 (Topper v. Jeffrey Manufacturing Co.) is published on Counsel Stack Legal Research, covering District Court, S.D. Ohio primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Topper v. Jeffrey Manufacturing Co., 191 F. Supp. 105, 85 Ohio Law. Abs. 567 (S.D. Ohio 1960).

Opinion

WeistmaN, J.

The ultimate question to be decided in this case is whether each of five conditional sales contracts, filed March 15, 1956, by The Jeffrey Manufacturing Company for the purpose of retaining title in machinery sold to The Mus-kingum Coal Company, is valid as against the trustee in bankruptcy.

The trustee in bankruptcy alleges that the conditional sales contracts in question are void as they did not comply with Section 1319.11, Revised Code,1 the statute which prescribes the requisites for a valid conditional sales contract filing.

[569]*569Tbe trustee argues that The Jeffrey Manufacturing Company has failed to comply with Section 1319.11, Revised Code, in the following respects: (1) the sworn statements of claim attached to the copies of the conditional sales contracts were not “thereon” as required by Section 1319.11, Revised Code.

2) the copies filed March 15, 1956, were not “true copies” of the original contracts as required by Section 1319.11, Revised Code; and 3) the filings failed to show the correct amounts of the claims as required by Section 1319.11, Revised Code.

The Court will proceed to consider each of these objections to the validity of defendant’s filings.

1) The part of the statute which the trustee claims The Jeffrey Manufacturing Company failed to comply with in the first objection is that part which reads:

“. . . a statement thereon, under oath, made by the person so selling, leasing, or delivering the property, his agent or attorney, of the amount of claim. . .”

Upon the trial of this case, The Jeffrey Manufacturing Company introduced into evidence each of the five conditional sales contracts here in question (defendant’s Exhibit A-5 through A-9, inclusive). Each conditional sales contract filing had been held together by three brass staples; the brass staples were removed before trial but both parties agree that each filing had been stapled together in this manner. Was this a compliance with the statute which requires the statement of claim to be “thereon”?

In support of his contention, that the statement of claim was not so securely attached as to be “thereon” the trustee cites Columbus Merchandising Co. v. Kline2 and In re Chinese [570]*570Temple Restaurant Co.3 Columbus Merchandising Co. v. Kline, supra, which involved the chattel mortgage statute, held that the requirements of the statute were not complied with by the filing of an affidavit which was attached to a contract with brass (McGill) fasteners. The Court stated that if the paper containing the affidavit could be removed without mutilation of the original mortgage, there was a failure to comply with the statute. In re Chinese Temple Restaurant Co., supra, involving a conditional sales contract, it was held that a conditional sales contract was invalid as against the trustee in bankruptcy because the affidavit could be removed without mutilation of the original conditional sales contract as it was fastened thereto only by wire staples.

The Court has carefully considered both of these cases but finds that the trustee has been unable to satisfactorily explain why the case of J. J. Newberry Co. v. Marshal,4 a case decided by the Sixth Circuit Court of Appeals in 1942, should not be controlling on this point. The Newberry case involved a written lease devising land for twenty years. The lease consisted of separate sheets in a manuscript cover fastened together by staples. The Circuit Court held that since the staples could not be removed without some damage to the instrument, and it was probable that their removal would be very readily detected, there was a substantial compliance with the Ohio statute requiring the acknowledgment to be certified on the same sheet on which the instrument is written or printed.5 Upon examination of each of the filings in question, this Court finds that each of the five conditional sales contracts is fastened together in .such a manner that the brass staples could not be removed without some damage to the instrument and such removal would in probability be readily detected.

This Court is unimpressed as to the argument advanced to the effect that the Newberry case dealt with a lease and the case at bar involves conditional sales contracts. It is the Court’s opinion that the rule of law as to whether sheets of paper are [571]*571sufficiently bound together so as to constitute a unit which could not be separated without some damage to the unit should be the same whether considering leases, chattel mortgages or conditional sales contracts.

2) The trustee’s second contention is that The Jeffrey Manufacturing Company failed to comply with Section 1319.11, Revised Code, in that the copies filed March 15, 1956, were not “true copies” of the original contracts as required by Section 1319.11, Revised Code, because The Jeffrey Manufacturing Company failed to file true copies of the original statements of claim. The trustee argues, and the Court here quotes from his brief:

“It is clear that a proper construction of Section 1319.11, Revised Code, means that the ‘true copy’ required to be filed by the statute means a true copy of the original contract and the original statement of claim, and does not mean a true copy of the contract with a new statement of claim substituted for the original statement of claim required to be included ‘thereon’ on the original contract. We submit that when the legislature required the filing of a ‘true copy,’ they meant exactly what they said.”

Of course, the problem here is exactly what did the legislature mean when it enacted the following language of Section 1319.11, Revised Code:

“. . . such condition, in regard to the title so remaining until payment, shall be void as to all subsequent purchasers and mortgagees in good faith and for value, and creditors unless the conditions are evidenced by writing, signed by the purchaser, lessee, renter, hirer, or receiver thereof, and also a statement thereon, under oath, made by the person so selling, leasing, or delivering the property, his agent or attorney, of the amount of the claim, or a true copy thereof, with an affidavit that it is a copy, is deposited with the county recorder . .

This question was answered by the Ohio Court of Appeals in Remington & Son v. The Central Press Association Company,6 wherein the Appellate Court, reversing the lower court,7 stated:

[572]*572“The court below held this statute. [Section 7913-72, Revised Statute, now Section 1319.11, Revised Code], to require the seller, in order to preserve his title to the property against subsequent purchasers, lienholders or creditors, to deposit with the proper officer, either the original writing evidencing the ‘condition’ and the original verified statement indorsed upon it, or to deposit a true copy of the original writing, statement and affidavit, verified as such.. But the absurd and inconvenient consequences of such a construction raises a doubt that the legislature intended any such requirement.

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Related

Queen v. Commonwealth Trust Co.
64 F.2d 946 (Third Circuit, 1933)
Shell Oil Co. v. State Tire & Oil Co.
126 F.2d 971 (Sixth Circuit, 1942)
Arthur v. G. W. Parsons Co.
224 F. 47 (Sixth Circuit, 1915)
Columbus Merchandise Co. v. Kline
248 F. 296 (S.D. Ohio, 1917)

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Bluebook (online)
191 F. Supp. 105, 85 Ohio Law. Abs. 567, Counsel Stack Legal Research, https://law.counselstack.com/opinion/topper-v-jeffrey-manufacturing-co-ohsd-1960.