Case ID: ohio-cc-dec_27/html/0463-01.html
Source: Caselaw Access Project
Author: {"author": "NIMAN, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

CHATTEL MORTGAGES.
    [Summit (8th) Circuit Court,
    October 4, 1912.]
    Marvin, Winch and Niman, JJ.
    Harry Holub v. Kirk Co.
    Purchaser of Chattel Mortgage Selling Same Liable for Conversion.
    One who purchases of a mortgagor, a chattel upon which there is a properly executed and recorded chattel mortgage, and resells the chattel to a third person, is liable to the mortgagee in an action for conversion.
    Error.
    
      Holloway & Chamberlain, for plaintiff in error.
    
      Slabaugh, Seiberling & Huber, for defendant in error.
   NIMAN, J.

It appears from the agreed statement of facts, embodied in the bill of exceptions, that the Kirk Company, the defendant in error, sold to one Meredith a davenport of the value of $70.20; that a partial payment was made on the purchase price at the time of the sale, and a chattel mortgage on the davenport to secure the balance of the purchase price was given by Meredith to the company; that the mortgage was duly filed with the county recorder, and has ever since remained uncanceled; that at the time of the institution of the original action a balance of $15 remained unpaid on the purchase price of said davenport; that after the condition in said chattel mortgage had been broken, the said Meredith sold said davenport to Harry Holub, the plaintiff in error, who bought and paid for it without actual knowledge of the existence of the chattel mortgage; that thereafter the plaintiff in error sold said davenport to some person to him unknown ; that the value of said davenport at the time of its purchase and resale by the plaintiff in error was in. excess of $15; that the defendant in error, upon being apprised of what had taken place, demanded of the plaintiff in error, that he either surrender said davenport so that it might be subjected to the terms of said chattel mortgage, or pay to defendant in error the balance of $15 due it on the purchase price thereof; that plaintiff in error did not know, and did not have the means of ascertaining the location of said davenport and could not comply with the.demand to surrender the same, and neglected or refused to pay the bálance of the purchase price.

After the failure of the plaintiff in error to comply with the demand above mentioned, the defendant in error brought suit in a justice court to recover the balance of the purchase price due on said davenport. On the trial of the action on appeal in the court of common pleas, the plaintiff there recovered a judgment. A motion for a new trial having been overruled, this proceeding in error is prosecuted to secure a reversal of said judgment.

The sole question presented here is whether or not the plaintiff in error, in buying the davenport in question, covered by a chattel mortgage duly filed with the county recorder, and selling the davenport under the circumstances recited, can be held liable for conversion.

The legal wrong denominated “conversion” is defined in Cooley, Torts (3 ed.) 859, as being any distinct act of dominion wrongfully exerted over one’s property in denial of his right, or inconsistent with it.

The interest of a mortgagee under a chattel mortgage is that of a general owner of the property mortgaged. Robinson v. Fitch, 26 Ohio St. 659; Root v. Davis, 51 Ohio St. 29 [36 N. E. Rep. 669; 23 L. R. A. 445],

The defendant in error, by virtue of its chattel mortgage, was the general owner of the davenport. The chattel mortgage on file in the recorder’s office was constructive notice to the world of that ownership. When the plaintiff in error took said davenport under his purchase from Meredith and sold it again, he exercised acts of dominion over it which in contemplation of law were wrongful and in denial of the right of the defendant in error, and inconsistent with such right. His acts amounted to a conversion of the davenport, although he acted in good faith.

In Woolsey v. Seely, Wri. 360, it was held that the owner of a chattel, or one having a special property in it, coupled with the right to possession, may follow it into whosoever’s hands it may come, and make him liable in trover, if he shall have abused it, used it as his own, or done any act inconsistent with the rights of the owner, which is conversion.

The case of Kanaga v. Taylor, 7 Ohio St. 134 [70 Am. Dec. 62], is authority for the same proposition of law. It is true that in that case the defendant, who was an innocent purchaser of property covered by a chattel mortgage, was still in possession óf it when demand wTas made upon him for its surrender, but his refusal to deliver it to the owner on demand was no more inconsistent with the right of the owner than assuming and exercising the power to sell and dispose of the property would have been.

On the agreed statement of facts, the plaintiff below was entitled to a recovery, and the judgment is affirmed.

Marvin and Winch, JJ.. concur.