Case Name: Lewis M. Smith, App'lt, v. Charles F. Taber, Resp't
Court: New York Supreme Court, General Term
Jurisdiction: New York
Decision Date: 1887-11
Citations: 14 N.Y. St. Rep. 644
Docket Number: 
Parties: Lewis M. Smith, App’lt, v. Charles F. Taber, Resp’t.
Judges: 
Reporter: New York State Reporter
Volume: 14
Pages: 644–647

Head Matter:
Lewis M. Smith, App’lt, v. Charles F. Taber, Resp’t.
(Supreme Court, General Term, Fourth Department,
Filed November, 1887.)
1. Lease — Agreement in lease that landlord shall have title to PROPERTY OF TENANT AS SECURITY FOR RENT IS VALID AND ENFORCEABLE AGAINST CROPS—When LEASE FILED AS CHATTLE MORTGAGE, CAN RECOVER VALUE OF CROPS SOLD PURCHASER.
The plaintiff leased his farm to one Bossard. The lease contained a, clause, whereby Bossard agreed that, “all the personal property on said land or thereafter brought on * * * and all said personal property and the crops raised and to be raised on said land * * * shall be-bound and hereby are bound to said Smith (plaintiff), as collateral security.” It further declares, that for the purpose of securing the said Smith, the lessor, “shall have the title to all the personal property of whatever kind raised, made, produced, kept, put or used upon said farm, and he shall have the right of possession thereof, at any time, and such title and right of possession is vested in said Smith as collateral security for the faithful performance of all the covenants,” etc. The lease was filed properly as a chattel mortgage. Thereafter the defendant purchased-for value and without actual knowledge of the plaintiff’s claim, from Bossard, the buckwheat raised upon the farm. Held, that the contract made as aforesaid, between the plaintiff and his tenant was valid, whether viewed as a chattel mortgage, or as a lease containing a lien clause and enabled the plaintiff to enforce payment of rent out of any property of the tenant, in and upon the premises, including the said buckwheat. That he could recover from defendant the value of said buckwheat.
2. Samé—Filing of lease as chattle mortgage constructive notice.
Held, that the defendant had constructive notice through the filing of' the lease in the proper town clerk’s office.
Appeal from a judgment of the Chemung county court, granting a non-suit.
The action was to recover the value of personal property taken by the defendant.
Plaintiff relies upon a farm lease with provisions giving-him a lien upon, title to, and interest in the property.
Defendant is a purchaser of the tenant, after the lease-was filed in the proper town clerk’s office.
The ‘c lien clause ” in the lease is as follows: “ He (the tenant Bossard) also agrees that all the personal property on said lands, or hereafter brought on, shall be and the same hereby is bound to said Smith (the landlord) for the faithful performance of all the covenants contained in this lease, and as collateral security for all the rent due and to become, due for said land, and for any and all sums now or hereafter to be due or owing from said Smith to said Bossard, and said Bossard also agrees that all said personal property and crops raised and to be raised on said land, and the cows and all the increase thereof shall be bound, and hereby are bound to said Smith as collateral security for the faithful performance of all covenants contained in this lease, and for the payment of said rent due, and to become due and owing from said Bossard to Smith, for any cause whatever, and for this purpose said Smith shall have the title to all the personal property of whatever kind raised, made, produced, kept, put or used upon said farm, and he shall have the right of possession thereof at any time, and such title and right of possession is vested in said Smith as collateral security for the faithful performance of all the covenants contained in this lease, including the payment of rent due, and any and all sums of money owing or to be hereafter due and owing from said Bossard to said Smith.
James A. Douglas, for app’lt; S. Q. Taber, for resp’t.

Opinion:
Habdih, P. J.
It must be assumed that the contract between the plaintiff and his lessee, Bossard, was valid, whether viewed exclusively as a chattel mortgage, or as containing a " lien clause" to enable defendant to enforce payment of rent out of any property of the tenant in and •upon the premises. Reynolds v. Ellis, 103 N. Y., 115; 2 N. Y. State Rep., 786; McCaffrey v. Woodin, 65 N. Y., 459.
The lease before us contains language adequate to create a lien on "all the personal property on said laud, or thereafter brought on" to it, and " all the personal property and crops raised, and to be raised, on said land shall be bound, and hereby are bound, to said Smith, plaintiff, as collateral security."
It further declares that for the purpose of securing the said Smith, the lessor "shall have the title to all the personal property of whatever kind raised, made, produced, kept, put or used upon said farm, and he shall have the right of possession thereof at any time, and such title and right of possession is vested in said Smith as collateral security for the faithful performance of all the covenants, etc.
In Cressey v. Sabre, (17 Hun, 123), Boabdmah, J., said "no such grant is alleged or proved," and hence, that case differs from this one. The language is apt and broad enough to create a present lien, as well as a present transfer of title, to all property mentioned.
It is more full than the language of the agreement found in Hale v. The Omaha National Bank (49 N. Y., 634), which only provided for further and future liens being given.
Plaintiff's agreement, from which we have quoted, was duly filed in the town clerk's office of the town where the tenant, Bossard, resided.
In Daffus v. Bangs (6 N. Y. State Rep., 553), it appears by the opinion of Bo arum an, J., that the lease given to the defendant " was never filed," and hence the lease could not operate as a chattel mortgage.
But plaintiff's lien being valid as an instrument between the parties so as to create a lien, and filed properly as a chattel mortgage, we must consider whether the same is valid as against the defendant, who is a purchaser, for value and in good faith so far as actual knowledge is concerned from Bossard, of the buckwheat raised upon the farm.
Treating the filing of the lease containing the "lien clause" and the security clause vesting the title to the property in the lessor, as equivalent to an actual notice to the defendant, then it must follow that the defendant is not a purchaser in good faith without notice, and hence he only acquired such rights as were possessed by his vendor, as between the vendor and the lessor. Stevens v. Watson, 4 Abb. App. Cases, 302.
The property in question had a potential existence, and hence the transfer was not invalid. Van Hoozer v. Cory, 34 Barb., 12.
In the case last cited, the defendant had actual "notice-of the claim of the plaintiff." Here the defendant had constructive notice through the notice filed in the proper town clerk's office.
In Johnson v. Crofoot (53 Barb., 576), the lease or chattel mortgage had not been filed, and Teft, the tenant, was in actual possession when the levy was made upon his interest, and the levy was held valid.
In Andrews v. Newcomb (32 N. Y., 417), it was stipulated title to property should remain in Ray, the landlord.
Here it was stipulated it should vest in Smith, the lessor, and as soon as it came into existence Smith had the right to it, as it was vested in him, to the extent that was needed to secure or pay his debt, and that stipulation was valid. Andrews v. Newcomb (supra.); Farmers' Loan and Trust Co. v. Long B. Imp. Co., 27 Hun, 91; Conderman v. Smith, 41 Barb., 404; Jones on Mortgages, 115, § 141, 143; Stuart v. Taylor, 7 How, 251; Herman on Chattel Mortgages, § 44; Hawkins v. Giles, 12 N. Y. State Rep., 426; Betsinger v. Schuyler, 12 id., 377; Dresser v. United Fire Ins. Co., 12 id., 434.
It is suggested by the respondent that the mortgage was void, because there was a contemporaneous agreement that the mortgagor might sell portions of the property. Edgell v. Hart, 5 Selden, 213.
No such agreement is found in the instrument as in Regnolds v. Ellis (supra), and the trial court could not hold as matter of law that plaintiff's instrument was void.
If tire defendant shall give sufficient evidence to bring his case within the principle, the question may be one that should be submitted to a jury.
So, too, if the mortgage of plaintiff is inquired into, a question of fact may be presented in regard thereto. Gardner v. McEwen, 19 N. Y., 123.
The sufficiency of the demand need not be passed upon, as that was not the ground of the nonsuit, and we are of the opinion that evidence sufficient to raise a question, for a jury in that regard was presented.
Judgment of the county court of Chemung county reversed, and a new trial ordered in that court, with costs to abide the event.
Martin, J., concurs; Follett, J., dissents.