Court Opinion

ID: 6568541
Source: CourtListenerOpinion
Date Created: 2022-07-20 19:21:55.655747+00
Date Added: 2024-06-11T15:56:49.850095
License: Public Domain

Mr. Justice Allen
dissenting:
*367This is an action in replevin to recover the possession of an automobile. In October, 1918, the property was situated in the state of Utah and owned by the Hyland Motor Company of that state. The Company entered into a conditional sale and title retaining contract, in that state, with respect to the automobile, and in accordance with such contract delivered possession of the car to the' conditional vendee, retaining title in itself. It is conceded in the briefs on both sides that the seller could recover the property under its title retaining contract, if the automobile had at all times remained in Utah and all the transactions had occurred only in that state. The courts in Utah follow the rule which is stated in 35 Cyc. 675, as follows:
“A sale of goods on the condition that the property therein shall remain in the seller until the price is paid, in the absence of fraud, is valid against third persons, claiming under the buyer as subsequent purchasers, (or) mortgagees.” Standard Steam Laundry Co. v. Dole, 22 Utah 311, 61 Pac. 1103; First Nat. Bank of Evanston v. Bank of Waynesboro, 262 Fed. 754.
If all the transactions had occurred in the state of Colorado, the mortgagee, having had no notice of the seller’s lien or title, would prevail. Puzzle Co. v. Morse Co., 24 Colo. App. 74, 131 Pac. 791.
In view of the conflict between the rule prevailing in Utah and that adopted in Colorado with reference to conditional sales, the question becomes whether the title retaining contract made and valid in Utah is enforcible in Colorado against the mortgagee, plaintiff below, though such conditional sale would be invalid if it had been made in this state. Generally the law of the place where the contract was made will govern. 35 Cyc. 666. In 24 R. C. L. 453, sec. 750, it is said:
“It is generally held that if a conditional sale is valid in the state where made, without recording, but the buyer, without the knowledge or consent of the seller, thereafter removes the property to another state, and there sells it to a bona fide purchaser, the seller may recover the property *368in that state, notwithstanding the conditional sale would have been invalid there for want of recording.”
In Studebaker Bros. Co. v. Mau, 13 Wyo. 358, 80 Pac. 151, 110 Am. St. Rep. 1001, this rule was applied in favor of a conditional vendor of a foreign state (Utah) against a bona fide purchaser of the state of the forum. In Adams v. Fellers, 88 S. C. 212, 70 S. E. 722, 35 L. R. A. (N. S.) 385, the same principle was applied in favor of a party, residing in a foreign state, who had rented a motion picture machine, against a bona fide purchaser of such machine. The same rule has been followed in this state by our Court of Appeals in Harper v. People, 2 Colo. App. 177, 29 Pac. 1040, reviewed in a note in 64 L. R. A. 833. In that case a conditional sale contract, made and valid in the state of Kansas, was enforced in this state against attaching creditors of the conditional vendee. That case is cited in support of the following statement in Sec. 339, p. 539, Willis-ton on Sales:
“It has been held that if in the jurisdiction where the sale was made it was good against purchasers or creditors of the buyer, the seller’s title will prevail against such persons also though they acquire {heir rights in another state where purchasers and creditors of a conditional buyer are protected.”
In Harper v. People, supra, the court said:
“It would not ‘be profitable to discuss the reason of the rule, nor to determine whether it ought to be put on the recognized comity existing between the different sovereign-ties, or on the well settled principle of lex loci contractus, which permits the enforcement of a contract according to the established law of the place, so long as it does not contravene the recognized policy of the state of the forum. Both principles are frequently invoked. According to the Mumford case (Mumford v. Canty, 50 Ill. 370), the contract will not be deemed to be opposed to the policy of the state unless based upon immoral or criminal considerations. In either case and upon either ground the contract may be upheld.” •
*369To repudiate the rule announced in the Harper case and overrule that case, would make and does make the decision in the instant case not only in conflict with the weight of authority on the precise point here presented, but also inconsistent with the great weight of authority on a similar point in the law of chattel mortgages. As to the latter proposition, the following-is stated in 11 C. J. 424, sec. 33: '
“The great weight of authority is to the effect that a chattel mortgage, properly executed and recorded according to the law of the place where the mortgage is executed and the property is located, will, if valid there, be held valid even as against creditors and purchasers in good faith in another state to which the property is removed by the mortgagor.”
See also Flora v. Julesburg Motor Co., 69 Colo. 238, 193 Pac. 545. In 24 R. C. L. 453, in connection with the proposition that a conditional vendor may reclaim his property in any state, even though the conditional sale might be invalid in the state of the forum, a note further states that “this is the same rule which is applied in the case of chattel mortgages as to the effect of the removal of the property to another state without the consent of the mortgagee.”
The reason why conditional sales, made in this state, are invalid in this state as against third persons is that “they are constructively fraudulent as to creditors” and other third persons. George v. Tufts, 5 Colo. 162, 165; Coors v. Reagan, 44 Colo. 126, 96 Pac. 966. Another reason appears to be suggested in Andrews v. Bank, 20 Colo. 313, 36 Pac. 902, 46 Am. St. Rep. 291, in that such sales are in effect chattel mortgages, “and void as to third parties, because not executed and acknowledged in conformity with the chattel mortgage act.” Such contracts are not contrary to public policy as that term is used when refusing to apply the principle of lex loci contractus in dealing with foreign contracts. A contract to be contrary to public policy so as not to be enforcible in this state must be one “based on criminal or immoral considerations,” as said by our Court *370of Appeals in the Harper case. In 13 C. J. 256, sec. 27, it is said:
“A contract is not necessarily contrary to the public policy of a state merely because it could not validly have been made there; nor is it one to which comity will'not be extended merely because the making of such contracts in the place of the forum is prohibited.”
See also International Harvester Co. v. McAdam, 142 Wis. 114, 124 N. W. 1042, 26 L. R. A. (N. S.) 774, 20 Ann. Cas. 614. It is not disputed, and cannot be, that the foreign contract involved in the instant case is not one “based on criminal or immoral considerations.” Under the authorities above cited, it should be given effect in this state.
I am authorized to state that Mr. Justice Bailey and Mr. Justice Whitford concur in the views herein expressed.