Court Opinion

ID: 8797312
Source: CourtListenerOpinion
Date Created: 2022-11-26 14:16:35.249786+00
Date Added: 2024-06-11T17:03:42.268454
License: Public Domain

NEWMAN, District Judge.
The question for determination in this case is one which has arisen in a number of cases; that is, whether the mortgage should be allowed as a secured claim.
[1] First. It appears that the mortgage was made in March, 1914, but not recorded until September, and the bankruptcy petition was filed in October. So that the recording of the mortgage was within four months of the bankruptcy, but not its execution. The question on this part of the case is whether the mortgage was one which was required to be recorded under the Bankruptcy Act, as amended, providing that:
“Where the preference consists in a transfer, such period of four months shall not expire until four months after the date of the recording or registering of the transfer, if by law such recording or registering is required.”
I passed’ on the question as to whether or not the recording of a mortgage as against general creditors, in a case like this, was “required” in Georgia in the case of In re Jacobson & Perrill, 200 Fed. 812, relying upon the authority of our Circuit Court of Appeals in Meyer Bros. Drug Co. v. Pipkin Drug Co., 136 Fed. 396, 69 C. C. A. 240, and in Keeble v. John Deere Plow Co., 190 Fed. 1019, 111 C. C. A. 668.
The Circuit Court of Appeals in the two cases named was considering this question in some cases coming from Texas. The Texas statute (Rev. St. 1895, art. 3328), in reference to the recording of mortgages is stated by Judge Pardee, in Meyer Bros. Drug Co. v. Pipkin Drug Co., supra, as follows:
“This statute has been construed in the Supreme Court of the state of Texas to mean that an unrecorded chattel mortgage shall be void only against lien creditors of the mortgagor, or subsequent purchasers and mortgagees or lienholders in good faith; and, as between the parties to the chattel mortgage and against all ordinary creditors, the record is immaterial.”
And, as I stated in that case:
“The statute of Georgia on this subject could be stated in exactly the same •language.”
I shall adhere to the ruling made in the Jacobson & Perrill Case.
[2] The only other question in this case requiring attention is the rights of creditors who sold goods to Roberts between the time of the *181execution of the mortgage and its record. The facts relative to that in this case aré not at all like the facts in the Jacobson & Perrill Case. I!n the Jacobson & Perrill Case the mortgagee knew that Jacobson & Perrill were buying considerable quantities of new goods— indeed, they expected them to do this when they took the mortgage — ■ and they stood by and allowed them to do it, and then claimed that the goods so purchased came within the lien of the mortgage, although it was not recorded, and no notice was given to the sellers of goods during the period that the mortgage was withheld from record. Here I think the most that can be claimed against the mortgagee, the Lamar, Taylor & Riley Drug Company, is that they did not expect Roberts to buy very much from any establishment other than their' own, and only such articles as they did not carry in stock, and for him to pay for the same when he bought them. Such is, I think, substantially what the referee finds in his opinion in the case.
On the whole, I do not feel that I would he justified in disagreeing with the referee in the conclusion he reached in this matter. Consequently his action in allowing the claim of the Lamar, Taylor & Riley Drug Company as a secured claim is sustained.

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