Court Opinion

ID: 9844535
Source: CourtListenerOpinion
Date Created: 2023-09-24 03:04:19.763856+00
Date Added: 2024-06-11T09:15:37.016889
License: Public Domain

On Denial of Petition for Rehearing.
McQUADE, Justice.
In a petition for rehearing, appellants raise three points for our reconsideration. Two points, concerning appellant Smith, concern our decision on some of the usury issues. The petition presents no matter additional to that which we have already considered in making our decision on these two points. It appears unnecessary to add to our opinion on these two points and in that respect this petition is summarily denied. However, the third point, concerning appellant Morgan & Morgan, requires further discussion.
Appellant Morgan & Morgan insists that it was both an encumbrancer of the truck and a creditor of the mortgagor, appellant Smith. Morgan & Morgan contends that though we correctly decided that respondent’s interest as mortgagee of an unrecorded mortgage was superior to Morgan & Morgan’s interest as subsequent encumbrancer with knowledge of respondent’s pre-existing mortgage, nevertheless we erred in not holding the mortgage void with respect to Morgan & Morgan’s status as creditor of Smith.
We assume without deciding that Morgan & Morgan became (subsequent to execution of the mortgage) a creditor of Smith’s within the meaning of the quoted statute, Rev.Code Wash. 61.04.020(1). And we note that the Washington cases hold that notwithstanding full knowledge of a preexisting chattel mortgage by one who becomes a creditor of the mortgagor such mortgage is void as against such subsequent creditor.1 However, under Washington law a creditor of the mortgagor of a chattel cannot question the validity of such mortgage after the sheriff’s seizure *257of such chattel and its sale in foreclosure proceedings.2, 3 Morgan & Morgan did not commence legal action with respect to their, claim for the repair bill until after the foreclosure. Therefore, we reaffirm our decision on this point.

. Hinchman v. Point Defiance Ry. Co., 14 Wash. 349, 44 P. 867 (1896); Blumauer v. Clock, 24 Wash. 596, 64 P. 844 (1901).

. Asbury v. Miller, 132 Wash. 235, 232 P. 360 (1925); cf. Haskins v. Fidelity Nat. Bk., 93 Wash. 63, 159 P. 1198 (1916); Watson v. First Nat. Bk., 82 Wash. 65, 143 P. 451 (1914); see also Martin v. Holloway, 16 Idaho 513, 102 P. 3, 25 L.R.A.N.S., 110 (1909); Kettenbach v. Walker, 32 Idaho 544, 186 P. 912 (1919).

. We note in passing the beneficial potential effect of this rule in protecting the interests acquired by some bona fide purchaser at an Idaho foreclosure sale of a chattel which an encumbrancer has released possession of and permitted to be brought into this state, thereby enabling it to be executed upon and sold in Idaho foreclosure proceedings.