Court Opinion

ID: 8835103
Source: CourtListenerOpinion
Date Created: 2022-11-26 16:19:28.090068+00
Date Added: 2024-06-11T17:05:02.317881
License: Public Domain

NETERER, District Judge
(after stating the facts as above).. The Supreme Court of Washington has from territorial days held a chattel mortgage upon a shifting stock void per se as to creditors, where the mortgagor remained in possession and no provision was made for the application of the proceeds of sale. See Miller v. Scarbrough, 108 Wash. 646, 185 Pac. 625. There is no testimony before the court as to the character of the stock in trade. If the stock in trade was a mere incident, and the primary purpose and business was a repair workshop, the mere incident of the “stock in trade” should not control, and defeat the mortgage lien upon the specifically described property. Upon the face of the mortgage the bsuiness of the mortgagor is shown as not that of exposing for and sale of a shifting stock of merchandise, but conducting an automobile repair workshop. The Supreme Court of Washington, in Hardin v. Seattle State Bank, 119 Wash. 169, at page 172, 205 Pac. 382, 384, said:
“We feel that our recording statute (Rem. Code, § 3662 [P, C. § 9761]), which makes every chattel mortgage duly filed and indexed ‘full and sufficient notice to all the world,’ * * * must be considered, * * * and - " * under the statute respondent had constructive notice, and cannot in law be said to be an innocent party.”
And (119 Wash, at page 173, 205 Pac. 382, 384):
“When * * * a mortgage is given upon a specifically described article without any provision for its sale, * * * we are pov/erless to protect the unwary purchaser.”
That decision determined the validity of a mortgage which specifically described automobiles which were exposed for sale in the show windows of the salesroom of the mortgagor. In this case the business was clearly that of "an automobile repair workshop,” and in the absence of proof to the contrary the court must find that any stock of merchandise was a mere incident, and in view of the specific description of the tools and machinery in the workshop (Hardin v. Seattle Bank, supra), the mortgage lien should not be defeated on such, property. •
The decision of the referee is affirmed.