Case ID: nys_11/html/0226-01.html
Source: Caselaw Access Project
Author: {"author": "Mayham, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Harder v. Plass et al.
    
    
      (Supreme Court, General Term, Third Department.
    
    September 25, 1890.)
    1. Chattel Mortgages—Growing Crops—Piling.
    The tenant of a farm mortgaged a crop growing thereon to his landlord, as security for unpaid rent. Held that, as between the parties, the crop was personal property, and that the mortgage must be filed as a chattel mortgage in order to be valid as against subsequent purchasers and mortgagees in good faith.
    2. Same—Subsequent Mortgages.
    A chattel mortgage given for an existing indebtedness, although valid as between the parties, does not constitute the mortgagee a mortgagee in good faith, within Laws N. Y. 1833, c. 279, providing that unless a chattel mortgage is filed it shall be void as against subsequent mortgagees in good faith.
    Appeal from judgment on report of referee.
    Action by Nicholas W. Harder, as executor of Lucretia Wendover, deceased, against Herman Plass and William H. Plass. There was judgment for plaintiff, and defendants appeal.
    Argued before Learned, P. J., and Landon and Mayham, JJ.
    
      John Cadman, for appellants. L. R. Harder, for respondent.
   Mayham, J.

Plaintiff, as executor and trustee, leased to one Gardner a farm for two years, ending April 1,1888, reserving to the lessor all rye sown on the farm in the fall prior to the termination of the lease. On the 16th of February, 1888, plaintiff and Gardner settled, and there was found due the lessor for accrued rents $400. On that day the plaintiff again leased the farm to Gardner for one year for $650, taking from Gardner on that day a mortgage on the rye then growing on the farm for $400, to secure the unpaid rent in arrears, and also another mortgage on the same rye for $650, to secure the rent agreed to be paid for the ensuing year. These mortgages were filed by the mortgagee in the proper town-clerk’s office on the 1st day of March, 1888. On the 10th of February, 1888, Gardner borrowed of Herman Plass, one of the defendants, $200, and gave him his note for the same, and at that time agreed to give him a chattel mortgage to secure that loan, and $94.25 of old account, for which he was indebted to Herman Plass. On the 17th day of February, 1888, Gardner executed and delivered a mortgage on this same rye, as security for the amount of this note and book-account, to Herman Plass, who on the same day caused the mortgage to be filed in the proper townelerk’s office. At the time of taking this mortgage, Plass had no knowledge of the existence of the mortgages to plaintiff. The rye covered by these three mortgages was harvested by Gardner while holding under the lease of February 16, 1888, and the straw from the same was delivered by Gardner, without the knowledge or consent of the plaintiff, to the defendants, who at the time of taking the same had knowledge of the plaintiff’s mortgage. After such delivery plaintiff demanded the straw of the defendants, who refused to deliver the same, and plaintiff brings this action.

The rights of the plaintiff- and defendants to this straw rests alone upon their respective mortgages, and, as between themselves, must be determined in favor of the one having the first or superior right by virtue of his mortgage. On the part of the plaintiff it is insisted that this rye, at the time it was mortgaged to him, was a chattel real, and as such not within the provisions of statute requiring a mortgage or conveyance of goods or chattels not accompanied by an immediate delivery, and followed by a continual change of possession, to be filed. If this rye, in its then condition, was a chattel, then the plaintiff’s contention on this point is not sound. Subdivision 7, § 3343, of the Code of Civil Procedure, defines “personal property” as follows: “The words ‘ personal property ’ include money, chattels, things in action, and .evidences of debt. The word * chattel ’ is co-extensive with goods and chattels.” This rye would seem clearly to come within the plain meaning of this definition, and both parties to this controversy had treated it as a chattel.

As between the plaintiff, who in this case was the landlord, and Gardner, the tenant, this rye was personal property, and might be mortgaged as such. Smith v. Jenks, 1 Denio, 580. In this case the tenant occupied land under a lease by the terms of which he was entitled to the growing crops, and it was held that he might mortgage it as a chattel by personal mortgage, while yet growing, and this was affirmed on appeal by the court of appeals, on the ground that both parties had treated the grass as a chattel. 1 N. Y. 90. But in Green v. Armstrong, 1 Denio, 554, the rule governing this class of cases seems clearly stated, and which, when applied to this case, is decisive of this question. In that case the court says: “The word ‘ land ’ is comprehensive in its import, and includes many things besides the earth we tread on, as waters, grass, stones, buildings, fences, trees and the like; for all these may be conveyed by the general designation of land. * * * They pass to the heir by descent as part of the inheritance, and not as personal chattels do, to executor or administrator; and, being strictly real property, they cannot be sold on an execution against chattels only. It is otherwise with growing crops, as wheat and corn, the annual produce of labor and cultivation of the earth; for these are personal chattels, and pass to those entitled to the personal estate, and not to tile heir.” They may be sold on execution like personal chattels. It follows, therefore, both within the definition given in the Code, § 3343, supra, and within the rule laid down in the cases, that this rye, at the time of the execution of these mortgages, was personal property belonging to Gardner, and liable to be mortgaged as a chattel by him. The case of Booth v. Kehoe, 71 N. Y. 341, cited by the learned counsel for respondent on this point, has no application to this case. In that case the mortgage was of a lease or chose in action, and not a chattel. Chapter 279 of the Laws of 1833 provides that “every mortgage, or conveyance intended to operate as a mortgage, of goods and chattels hereafter made, which shall not be accompanied by an immediate delivery, and be followed by an actual and continued change of possession, of the thing mortgaged, shall be absolutely void as against the creditors of the mortgagor, and as against subsequent purchasers and mortgagees in good faith, unless the mortgage, or a true copy thereof, shall be filed,” etc. The plaintiff, having failed to file his mortgage before the delivery of the mortgage to Plass, would for that reason, as against Plass, under his mortgage, lose his lien on this property, provided Plass is a mortgagee in good faith, within the meaning and intent of the act above quoted, unless he can claim some immunity from the terms of the lease of February 16th, which, for security for the rent, refers to the terms of the mortgage.

There are no provisions in this lease or mortgage that the title to this crop should remain in the plaintiff, as in the case of Andrew v. Newcomb, 32 N. Y. 417, cited by respondent, and it would seem that the most that could be claimed for that provision in that lease is that it was intended as a security, and as such was subject to the provision of the statute requiring mortgages to be tiled. Were the defendants in this case subsequent mortgagees in good faith? On the 10th of Febrnary, 1888, Plass loaned this $200, and at that time Gardner agreed to execute a mortgage on the rye to secure that loan and the old debt. At that time Gardner had not renewed his lease, and had no interest in the rye which he could mortgage. The lease was therefore made with no other security or evidence of the debt than the nóte. If Gardner had on that day executed to Plass a mortgage on the rye, he not having the title, but intending to acquire it in future, the mortgage would have been void. Otis v. Sill, 8 Barb. 102; Gardner v. McEwen, 19 N. Y. 123. By tire lease to Gardner on the 16th of February, 1888, he acquired title to this rye, and on the 17th of the same month, and after he had mortgaged this rye to the plaintiff, he executed a mortgage for the $200 loan, and to secure this note and the old account to Plass. At that time no credit was given on the faith of the mortgage, and no rights or valuable consideration passed from Plass to Gardner for the mortgage. The only consideration for the mortgage on the day it was executed was wholly a past one. The agreement of Gardner to give a mortgage when the loan was made was an executory agreement, which created no lien on the property, and could not be enforced against it, especially' as the title was not at that time in Gardner. Otis v. Sill, supra. When the mortgage was given, it was for a pre-existing debt, and the mortgage was therefore not a subsequent mortgage in good faith, so as to divest the right of the holder of a valid prior and unfiled mortgage. In Wood v. Robinson, 22 N. Y. 567, the court says: “ When a conveyance is made or a security taken the consideration of which is an intended debt, the grantee or party taking the security is not looked upon as a bona fide purchaser, * * * and it is well settled that a grantee or incumbrancer who does not advance anything at the time takes the interest conveyed subject to any prior equity attaching to the subject.” To the same effect is Arnold v. Patrick, 6 Paige, 310; Thompson v. Van Vechten, 27 N. Y. 581. In Jones v. Graham, 77 N. Y. 628, the court, in discussing the effect of chapter 279, Laws 1833, says: “2*Tor is a person a mortgagee in good faith, within the meaning of said statute, whose mortgage was given for a pre-existing indebtedness, without any new consideration. ” The defendants are not, therefore, in a condition to challenge the prior mortgage of the plaintiff on the ground that it was not filed before theirs. 2Tor does their diligence in filing their mortgage in any way affect the_ priority of the plaintiff’s unfiled mortgage, for the reason that they are not", within the rules above referred, subsequent incumbrances in good faith. As between the mortgagor and mortgagee, all the mortgages are valid;- and, as the plaintiff lost nothing of his rights as to the defendants’ mortgage by his failure to file his, it follows that the plaintiff under his prior mortgage has title to this straw as against the defendants and their vendor.

The report of the referee was right, and must be sustained, and judgment entered thereon affirmed. Judgment affirmed, with costs.