Court Opinion

ID: 6632280
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:38:08.833849+00
Date Added: 2024-06-11T15:58:58.679127
License: Public Domain

Campbell J.:
The questions arising in this case, all go to the inquiry whether the mortgage, made by Backus to Montgomery, takes precedence of the execution sale against Backus, Whereby the property was sold.
The mortgage from Backus to Montgomery was made in Canada, and, in order to be valid at all, must be sustained under the laws of Canada. It is claimed by the defendants that, under those laws, the description of the horse in controversy is insufficient.
*147By the Canadian statute of 20 Vic. C. 3, § 4, it is declared that a mortgage of chattels, “shall contain such efficient and full description thereof, that the same may be thereby readily and easily known and distinguished.”
The description in the mortgage before us is “ one sorrel horse.” In the case of Rose v. Scott, 17 Q. B. 385, the court of Queen’s Bench of Upper Canada had occasion to apply the provision of the statute above quoted, to a chattel mortgage containing the following description, viz: “ seven horses, three lumber wagons, one carriage, one pleasure sleigh, all the household furniture in possession of the said party of the first part, and being in his dwelling house; all the lumber and logs in and about the saw mill and premises of the said grantor, and all the blacksmith’s tools now in possession of the said party of the first part; six cows and four stoves.” The court held that nothing but the furniture, lumber and logs, could pass, as none of the other articles were described in such a way as to enable a person to ascertain their identity by inspection or inquiry, and distinguish them from other similar articles. We do not perceive in the description before .us any way of distinguishing this sorrel horse from any other sorrel horse in the province, and are very well convinced that the instrument would be so construed by the Canadian courts, upon the authority cited. The object of the statute is to prevent purchasers and creditors from being deceived by ambiguous descriptions, the allowance of which would encourage fraud, and render it easy to substitute one chattel for another. As this horse had a name, that would have furnished a ready description. And any hint: which would have directed the attention of those reading the mortgage to any source of information beyond the word of the parties to it, would at least have been much more satisfactory. The provision in the statute was, as is remarked in Rose v. Scott, “to enable third parties to ascertain what was intended to be assigned.” The statute is certainly a wise one, *148and should be so construed as to make it effectual. As between the parties, the same difficulties are not likely to arise.
A more serious question, however, is whether the mortgage, if sufficiently certain, could yet avail against the levy. The defendants claim that it must yield to their execution title. The plaintiff, however, insists that we are bound by comity to protect his rights; and that his mortgage is valid here, to all intents and purposes, if valid in Canada.
We certainly should be very reluctant to deny to any party any right legally assured to him under the laws of our neighboring province, even if our common origin and friendly associations did not make the duty of extending the principles of comity a cheerful one. And in holding, as we are compelled to in this case, we are glad that we find no incompatibility between our own laws and those of Canada. We regard them both as aiming to accomplish the same object in very much the same way. They are substantially alike.
The evil which both statutes found in existence, was the facility for fraud held out by allowing mortgagors of chattels to retain possession under any circumstances. By pernfitting the mortgagee to hold,' if he took his security in good faith, the law formerly subjected subsequent purchasers from the mortgagor to all the danger arising from his fraud, although he was enabled to perpetrate it by the permission to retain possession given him by the mortgagee. At the same time there were many cases where it was very necessary to the mortgagor to be enabled to keep possession. In order to provide for such emergencies, and at the same time protect creditors and purchasers from fraud, our statutes declare that a chattel mortgage shall be void as against them, without an actual and continued change of possession, unless the mortgage is recorded by filing a copy, with us in the city or town, and in Canada, in the proper county office. And here, as there, an affidavit of renewal must be made yearly.
*149This provision for filing or registry is not intended by any means to encourage or legalize the practice of making mortgages without possession. The statute now as before, regards change of possession as the rule, and allows filing to dispense with its necessity, because filing is public notice. But we can not suppose that either statute was designed, or can be properly construed, to dispense in any case with filing and change of possession also. If a chattel mortgage of property here is made by a non - resident, our law contains no provision for filing it. In such a case a change of possession is therefore essential, and can not be dispensed with against creditors or purchasers. The Canadian law contains a provision for filing in the county where the property is, if the mortgagor is a non-resident, and also contemplates a new filing, if the property is removed from county to county. These provisions are ample, where the property continues within the jurisdiction. But neither law undertakes to provide for any notice to be effectual if the property is elsewhere, and in such contingency, the prohibition of retaining possession must be absolute, so far .as it can apply at all.
We must assume that these laws were passed in view of the well settled principle, that a law can have no binding force beyond the jurisdiction of the sovereignty enacting it. A resident of Canada, while dealing in Canada, for a chattel, can not be sirpposed to know the law of Michigan, or to be obliged to take notice of the records in a Michigan office. A statute of Michigan requiring him to do so would be of no validity beyond our own borders. And it would be equally unreasonable to require a citizen of Michigan, at home, to take notice of files and entries in Canada. These notices can have no extra territorial force. Proceeding upon the principle that the laws must have a sensible construction, we feel constrained to hold that the rules of these laws which require a change of possession, dispense with it only where an effectual notice may be *150given. If mortgagees desire to be protected where no notice can be made effectual, they must take possession, and not allow the mortgagor to take the property where third parties have no means of ascertaining its title.
In the view we have taken of these laws, no conflict arises, and we regard our ruling as sustaining the policy of both countries.
It must be certified, that the mortgage of plaintiff is invalid as against the levy and sale under the defendant’s execution, and that the latter must be allowed priority. The other questions become immaterial.
The other Justices concurred.