Court Opinion

ID: 9766835
Source: CourtListenerOpinion
Date Created: 2023-08-29 05:00:20.147632+00
Date Added: 2024-06-11T07:30:26.590240
License: Public Domain

Williamson, C. J.
This is an action in trover by a conditional vendor against a mortgagee from the purchaser to recover the agreed value of certain personal property. The case is reported to us on an agreed statement. The decision turns on the effectiveness of the recording of the conditional sale agreement.
On February 4, 1952, the plaintiff as seller executed a conditional sale agreement with “Gills Self Service Mkt” as the named purchaser signed “Gills Self Service Mkt, by Frank M. Gill,” with the usual provisions for retention of title in the vendor until payment was made of the entire purchase price. The agreement was recorded on February 23, 1952, in the office of the City Clerk of Portland where Frank M. Gill resided. The following notation appears in the index:
“Mortgages 1943-1953 Gill’s Self Service Mkt. Globe Slicing Machine Co., Inc. Yol. 369, Page 163.”
It is agreed that “the office of the City Clerk provides an indexing system designed to enable any member of the public to determine, by recourse to this index, whether a particular instrument has been recorded, in what volume, and on what page it is set forth.”
In November 1953, Frank M. Gill executed a chattel mortgage to the defendant bank of “all merchandise and stock in trade in said store,” including specifically the items enumerated in the conditional sale agreement. The mort*61gage was duly recorded in the office of the Portland City Clerk. Subsequently the defendant foreclosed and sold the property.
We are of the opinion the conditional sale agreement was not effectively recorded insofar as the mortgagee was concerned, and hence is not valid against its title. The statute reads:
“No agreement that personal property bargained and delivered to another shall remain the property of the seller till paid for, is valid unless the same is in writing and signed by the person to be bound thereby; ... it shall not be valid except as between the original parties thereto, unless it or a memorandum thereof is recorded in the office of the clerk of the city, ... in which the purchaser resides at the time of the purchase; .• . .” R. S. Chap. 119, § 9.
The agreement was without question valid between the plaintiff and Frank M. Gill. They were the original parties and there could be no objection to the use of a trade name by the defendant in his transactions with the plaintiff. The controversy arises when the interest of a third party is at stake. Lipman et al v. Thomas, 143 Me. 270, 272, 61 A. 2d. 130; Bath Motor Mart v. Miller, 122 Me. 29, 118 A. 715; Skene v. Graham, 116 Me. 202, 100 A. 938; 63 C.J., TradeNames § 39; 87 C.J.S., Trade-Names § 8, p. 237, § 30, p. 264; 52 Am. Jur., Tradename § 3; 38 Am. Jur., Name § 13, p. 601; 2 Corbin, Contracts § 522; 1 Williston, Contracts § 300 (rev. ed.).
The fatal defect in the plaintiff’s claim lies in the fact that it chose to name the purchaser under his trade name. Thus the record, in our construction of the statute, gave no constructive notice to the mortgagee of the reservation of title in the vendor. We are not, it must be noted, concerned with whether the mortgagee had actual notice that Frank M. Gill was doing business under the trade name of Gills *62Self Service Mkt. See Hayden v. Killman, 119 Me. 38, 109 A. 485, and R. S. Chap. 178, § 1, on Mortgages of Personal Property and their recording. The same principles apply to conditional sales. It is proper recording, and the recording alone, that breathes validity against a third party into the retention of title in the vendor. Mac Motor Sales, Inc. v. Pate, 148 Me. 72, 90 A. 2d. 460; Boscho, Inc. v. Knowles, 147 Me. 8, 83 A. 2d. 122; Beal v. Universal C.I.T., 146 Me. 437, 82 A. 2d. 412.
“It has been declared also in decided cases that the burden of establishing that a personal property mortgage, or a conditional sale agreement, encumbers, or controls, the title of the property involved rests upon the party relying on it, Horton v. Wright, 113 Me. 439; 94 A. 883, and that nothing less than full compliance with all statutory requirements will satisfy that burden. Gould v. Huff, 130 Me. 226; 154 A. 574.” Tardiff v. M-A-C Plan of NE, 144 Me. 208, 211, 67 A. 2d. 337.
“Our recording statute as to conditional sales (R. S., (1930) c. 123, § 8) provides that no conditional sale shall be valid except as to the original parties thereto unless properly recorded. The record is necessary to establish its validity. The statute is for the benefit and protection of all persons who have any interest in examining the record title to property of which they may thereafter become owner, either in whole or in part, absolutely or otherwise.” Motor Finance Co. v. Noyes, 139 Me. 159, 166, 28 A. 2d. 235.
See also 45 Am. Jur. 489, Records and Recording Laws, § 123.
The trade name “Gills Self Service Mkt” is not the equivalent of the name “Frank M. Gill.” There is no substantial identity in the names. Dutton v. Simmons, 65 Me. 583; IV American Law of Property § 18.30, Identity and Substantial Identity of Names. The vendor gains nothing from the fact the word “Gills” appears in the trade name. The *63principle idem sonans plainly is not applicable. The trade name of Frank M. Gill for our purposes could as well have been “Jones Mkt” or “Cushnoc Mkt.”
The case does not turn on error by the recording officer. The agreement was correctly recorded and indexed under the stated name of the purchaser, i.e., “Gills Self Service Mkt.” The clerk did not err in failing to index the agreement under the name of Frank M. Gill. There was no more reason for indexing the name of “Frank M. Gill” as the purchaser than the name of the vice president who signed the corporate name of the plaintiff. The issue before us does not arise from an error in the records, but from the recording as effective constructive notice to third parties.
It is obvious that an agreement in the name of “Cushnoc Mkt,” so recorded and indexed, would not come to the attention of one searching the records for mortgages or conditional sales against Frank M. Gill. Information linking the trade name and the individual would of necessity come from outside the records. Recording alone is not enough; it must be effective. Gould v. Huff, 130 Me. 226, 154 A. 574.
“The purpose of the statute clearly is that all persons may have notice of the mortgage, of the property mortgaged, and of the character and extent of the incumbrance created. The mere record of a valid mortgage gives constructive notice to all. All are presumed to know its contents, for any one interested can obtain knowledge by examining the record. But a record is not constructive notice of more than the record itself discloses. Third persons are chargeable with notice of no more than they can ascertain from the record or from being put upon their inquiry by the record.” Thurlough v. Dresser, 98 Me. 161, 163, 56 A. 654.
The index or entry book is not a part of the record, but must be maintained by the clerk under the statute. R. S. Chap. 178, § 2. It is, however, an essential tool in the search *64for encumbrances. The principle that errors in the index are at the risk of one who relies on the record does not lessen the importance of an index, and thus the necessity of the disclosure of the names of parties in instruments such as conditional sales. See Boscho, Inc. v. Knowles, supra; Monaghan v. Longfellow, 81 Me. 298, 17 A. 74; 14 C.J.S., Chattel Mortgages § 159, § 162.
The vendor, it is important to recall, knew that it was taking the agreement in a trade name and that this was the trade name of Frank M. Gill. A trade name is not a person, corporation, or other entity, but a business sign. The vendor knew the person behind the sign and it was its obligation, if it chose to be protected by a record against claims under the purchaser, to cause the sale agreement to show the latter’s name.
We need not discuss cases arising from the record of an instrument executed by the owner in a wrong or fictitious name. In the instant case there was no deception practiced on the vendor. Frank M. Gill at no time said that his name was, let us say, George Brown. The vendor could have readily insisted upon evidence of the name of the person with whom he dealt under a trade name. Indeed, he could have ascertained whether the record of business names in the city clerk’s office disclosed the name of the person or persons involved. B. S. Chap. 181, § 13. See dictum in Martin v. Green, 117 Me. 138, 143, 102 A. 977, (purchase money mortgage in fictitious name) with comment in Hayden v. Killman, supra; 78 C.J.S., Sales § 586 — purchase under fictitious or unauthorized name.
The purpose of a search of the records for conditional sale agreements and chattel mortgages is not to establish a chain of title as in a search of real estate records. Ownership of personal property ordinarily is not evidenced by recorded instruments. The searcher is interested only in *65recorded encumbrances against the seller or mortgagor. If there are none, he is then satisfied that no one can claim title against him by virtue of a conditional sale or mortgage.
In Griffith v. Douglass, 73 Me. 532, we said, at p. 534:
“The object to be attained by requiring the recording of mortgages of personal property is the same as that in providing for the registration of mortgages of real estate. The same general principles are alike applicable in each case. The design is to give notice to the public of all existing incumbrances upon real or personal estate by mortgage. Hence it is obvious that the property mortgaged, whether real or personal, the person mortgaging, to whom the mortgage' is made and the debt or claim to be secured should be fully disclosed and made apparent of record.”
The necessity that such instruments give fair notice of the parties to the one who deals on the faith of the record and who is chargeable only with notice from the record is apparent. This the plaintiff vendor failed to do and so the defendant mortgagee prevails.
Our attention has been directed to the Business Name Statute which is designed to protect those who deal with persons under their trade names.
The statute requiring the purchaser to file a certificate of his business name with the city clerk is of no moment in this case. R. S. Chap. 181, § 13.
In Lipman et al vs. Thomas, supra, we said of the statute, at p. 273:
“The primary purpose of the statute was to enable persons dealing with individuals transacting business under a partnership or assumed name to know or be able to ascertain from a public record, the name or names of those with whom they are dealing and the nature of the business in which they are engaged. From this record an investiga*66tion of the financial responsibility of the partnership and the individuals composing it may be made, and whether the particular business to be transacted is within the scope of the partnership. The statute sought to protect the public against fraud and deceit in extending credit. It was not intended to protect those who obtained credit from the partnership.”
The purpose of the statute is not to enable one dealing with Frank M. Gill to ascertain from the records in what trade name or names he may be doing business.
The entry will be

Judgment for defendant.