the sale having been made after the mortgage was executed.16 If the one claiming under the buyer has notice, actual or constructive, of the buyer's want of title, as where he has notice of facts which fairly put him on inquiry, he cannot claim protection against the reserved title of the seller. And as the refusal to sustain such contracts as against third persons is based on the apparent ownership conferred on the buyer by the possession, the transaction will be upheld as against them as well as against the buyer, if the seller retains either the exclusive or joint possession. In the latter case, the buyer is neither the apparent nor is he the real owner; the world has no reason to believe he is the owner, and therefore the seller is not deprived of his property until he receives the whole of the stipulated price.18 And the rights of the seller will be upheld as against creditors of the buyer attempting to levy on the property after the seller has retaken possession.19 Where a mortgage is given by the buyer to indemnify cosureties, notice to one of such sureties will not affect the rights of the others, as they are in no sense partners with the one having notice and ought not to be affected by notice which is entirely personal to him, and it is their right to have the proceeds of the goods applied to the payment of the obligation upon which they became sureties on the faith of the mortgage, whatever may be the incidental advantage to the other surety.20 758. Necessity for Writing.-As between the parties, a parol reservation of title made at the time of the sale is, in the absence of a statute requiring such reservations to be in writing, valid and enforceable. It has been said that the only difference between a written and an oral reservation is as to the mode of proof. And though the contrary view has been taken, an oral reservation of title has been held 16. Fosdick v. Schall, 99 U. S. 235, 25 U. S. (L. ed.) 339 (decided under the law of Illinois, which gives preference to levying creditors). See also Fosdick v. Southwestern Car Co., 99 U. S. 256, 25 U. S. (L. ed.) 344. 17. Lincoln v. Quynn, 68 Md. 299, 11 Atl. 848, 6 A. S. R. 446. 18. Rose v. Story, 1 Pa. St. 190, 44 Am. Dec. 121. 19. Hineman v. Mathews, 138 Pa. St. 204, 20 Atl. 843, 10 L.R.A. 233. 20. Lincoln v. Quynn, 68 Md. 299, 11 Atl. 848, 6 A. S. R. 446. 1. Clark v. McMatt, 132 Ga. 610, 64 S. E. 795, 26 L.R.A. (N.S.) 585; Brown v. Mitchell, 168 N. C. 312, 84 S. E. 404, Ann. Cas. 1917B 933; Rose v. Story, 1 Pa. St. 190, 44 Am. Dec. 121; Herring v. Cannon, 21 S. C. 212, 53 Am. Rep. 661. Note: 13 Ann. Cas. 866. Under the Texas statute providing that reservations of title to chattels as security for the purchase price shall be held to be chattel mortgages and shall, where possession is delivered to the buyer, be void as to creditors and bona fide purchasers, unless such reservations be in writing and registered as required of chattel mortgages, a verbal reservation of title, made at the time of the sale to secure the payment of the purchase money, constitutes, as between the parties, a valid chattel mortgage. Crews v. Harlan, 99 Tex. 93, 87 S. W. 656, 13 Ann. Cas. 863. 2. Note: 13 Ann. Cas. 866. 3. Herring v. Cannon, 21 S. C. 212, 53 Am. Rep. 661 (referring with approval to earlier cases involving contracts entered into before the enact effectual as against bona fide purchasers for value to the same extent as such a reservation in a written contract. In some instances the statutes have expressly provided that every verbal agreement between the seller and buyer whereby the seller of personalty, who has parted with the possession thereof, reserves to himself any interest in the same shall be void either generally or as to subsequent creditors or purchasers for value without notice. And a statute requiring that contracts of sale reserving title in the seller must be recorded to render them valid as against certain third persons will prevent verbal contracts of this class from being enforced as against such persons; but it has been held that the fact that the written evidence of the sale was not executed before the delivery of the property to the buyer will not render the reservation of title in the seller ineffectual as against a purchaser from the buyer, if it is thereafter properly executed and recorded within the time required by statute, even though the statute also expressly required such contracts to be in writing, where at the time of the delivery of the possession to the buyer it was agreed that the transaction should not be deemed complete until the contract was duly executed. If the contract of sale is evidenced by writing purporting to evidence the entire contract, the general rule prohibiting the admission of oral evidence to vary or modify a written contract will, it has been held, preclude the seller from showing an oral reservation of title inconsistent with the written contract; 8 but it is otherwise, if the written evidence does not purport to be a complete transcript of the transaction," and though an absolute bill of sale was given it seems that the seller may show an oral contemporaneous reservation of the title. 10 Oral reservations are of course more difficult to prove than similar reservations made in writing," and ordinarily the question whether the sale was absolute or conditional is one for the jury.12 ment of a statute expressly denouncing 79 S. E. 144, 47 L.R.A. (N.S.) 561 verbal reservations of title). (e plaining and distinguishing earlier cases). 4. Segrist v. Crabtree, 131 U. S. 287, 9 S. Ct. 687, 33 U. S. (L. ed.) 125. Note: 13 Ann. Cas. 866. 8. Note: 13 Ann. Cas. 866. See supra, par. 213 et seq., as to admission of oral evidence to vary written con 5. Herring v. Cannon, 21 S. C. 212, tracts of sale generally. 53 Am. Rep. 661. Note: 13 Ann. Cas. 866. 6 Knowles Loom Works v. Vacher, 57 N. J. L. 490, 31 Atl. 306, 33 L.R.A. 305. Note: 13 Ann. Cas. 866, 867. See the following paragraph as to the general necessity for recording a contract. 9. Segrist v. Crabtree, 131 U. S. 287, 9 S. Ct. 687, 33 U. S. (L. ed.) 125; Brown v. Mitchell, 168 N. C. 312, 84 S. E. 404, Ann. Cas. 1917B 933. 10. Segrist v. Crabtree, 131 U. S. 257, 9 S. Ct. 687, 33 U. S. (L. ed.) 125. 11. Note: 13 Ann. Cas. 866. 7. Rowe v. Spencer, 140 Ga. 540, 12. Segrist v. Crabtree, 131 U. S. 759. Recording Generally.-In the absence of a statute requiring conditional sales to be recorded, and in the jurisdictions in which their general validity is upheld as against creditors of and purchasers from the buyer, it is not necessary that conditional sale contracts. should be recorded,18 and it is generally held that a statute requiring chattel mortgages to be recorded in order to render them valid as against levying creditors or purchasers does not require that conditional sale contracts should be recorded, as they are distinct from chattel mortgages; 14 and it has been held that a statute requiring all chattel mortgages or other instruments "having the effect of a mortgage or lien" to be recorded did not include sales of this class, as the right of the seller under his reservation of title is more than a lien.15 On the other hand it has been held that the contract when in writing is "an instrument of writing in the nature of a mortgage" within the meaning of a statute requiring the registration of such instruments. 10 At the present time the statutes in many jurisdictions expressly require that conditional contracts of sale, under which title is retained by the seller until the price is paid, must be recorded to render them valid. and effectual as against certain persons claiming under the buyer, usually subsequently levying creditors and bona fide purchasers for value without notice; 17 and in some instances the statutes have required on the removal of the subject matter of the sale from the county 287, 9 S. Ct. 687, 33 U. S. (L. ed.) 125. Note: 13 Ann. Cas. 866. 13. Note: Ann. Cas. 1916A 1273 et seq. See supra, par. 752 et seq., as regards the general rule as to the valid ity at common law of conditional sales as against purchasers from and levying creditors of the buyer. 16. Herring v. Cannon, 21 S. C. 212, 53 Am. Rep. 661. Note: Ann. Cas. 1916A 1274, 1276. 17. Bass v. International Harvester Co., 169 Ala. 154, 53 So. 1014, 33 L.R.A. (N.S.) 374; Pulaski Mule Co. v. Haley, 187 Ala. 533, 65 So. 783, Ann. Cas. 1916A 877; Knowles Loom Works v. Vacher, 57 N. J. L. 14. Harkness v. Russell, 118 U. S. 490, 31 Atl. 306, 33 L.R.A. 305; 663, 7 S. Ct. 51, 30 U. S. (L. ed.) Boyer v. M. D. Knowlton Co, 85 285; Dinsmore v. Maag-Wahman Co., Ohio St. 104, 97 N. E. 137, 38 122 Md. 177, 89 Atl. 399, Ann. Cas. L.R.A. (N.S.) 224; Knittel v. Cushing, 1916A 1270; Praeger v. Emerson- 57 Tex. 354, 44 Am. Rep. 598; KimBrantingham Implement Co., 122 Md. ball v. Costa, 76 Vt. 289, 56 Atl. 1009, 303, 89 Atl. 501, Ann. Cas. 1916A 104 A. S. R. 937, 1 Ann. Cas. 610; 1255; Maxwell v. Tufts, 8 N. M. 396, Eisenberg v. Nichols, 22 Wash. 70, 60 45 Pac. 979, 33 L.R.A. 854; Freed Furniture, etc., Co. v. Sorensen, 28 Utah 419, 79 Pac. 564, 107 A. S. R. 731. 3 Ann. Cas. 634. Pac. 124, 79 A. S. R. 917; Studebaker Notes: 13 Ann. Cas. 866; Ann. As to who are to be regarded as bona fide purchasers of chattels for value generally, see supra, par. 668 et seq. in which the buyer resides and where the contract was recorded in the first instance as required by the statute that it shall be again recorded within a certain time in the county to which the property is removed.18 Statutes of this class do not apply so as to require the contract to be recorded to render it valid as against third persons, unless the possession is delivered to the buyer; and it has been held that where the subject matter of the sale is a structure upon the real estate of the seller, capable of being sold as personalty, and it is agreed between the parties that it is not to be removed until the price is paid, there is no delivery of possession to the buyer so as to require the contract to be recorded, though the buyer as tenant or licensee upon the land has the use of the structure.19 The general rule is that statutes respecting the recording of instruments relating to "personal property" apply only to tangible things, which are capable of actual, visible, or manual possession or delivery, and not to defeasible or contingent sales or assignments or mortgages of intangible things such as choses in action; and this is applicable to statutes requiring the registration of conditional sales,1 and it has been held that a contract for the sale of standing timber to be cut and removed by the buyer, wherein title is reserved in the seller until the price is paid, is not within the operation of statutes requiring contracts for the conditional sale of personalty, where possession is to be delivered to the buyer, to be recorded.2 760. Sales Made in Another State. In some instances local statutes have expressly required the contract to be recorded in the state to which the property is removed though the sale was made in another state. A local statute requiring the contract to be recorded at the residence of the buyer, when a resident of the state, is held to apply to a contract of sale entered into in another state with the intention of both parties that the property is to be brought into the state enacting the statute by the buyer, a resident thereof. And where the statute required in general terms that, in case of sales made out of the state, 18. Pulaski Mule Co. v. Haley, 187 Ala. 533, 65 So. 783, Ann. Cas. 1916A 877. 19. Webster Lumber Co. v. Keystone Lumber, etc., Co., 51 W. Va. 545, 42 S. E. 632, 66 L.R.A. 33. 1. Note: L.R.A.1917C 629. 2. Note: L.R.A.1917C 630. As to whether a contract for the sale of standing timber is a contract for the sale of an interest in the realty, see generally, LOGS AND TIMBER, vol. 17, p. 1066 et seq. 3. Pulaski Mule Co. v. Haley, 187 Ala. 533, 65 So. 783, Ann. Cas. 1916A 877. Note: L.R.A.1917D 944. 4. Knowles Loom Works v. Vacher, 57 N. J. L. 490, 31 Atl. 306, 33 L.R.A. 305. See also Boyer v. M. D. Knowlton Co., 85 Ohio St. 104, 97 N. E. 137, 38 L.R.A. (N.S.) 224; Schmaltz v. York Mfg. Co., 204 Pa. St. 1, 53 Atl. 522, 93 Ă. S. R. 782, 59 L.R.A. 507 (considering effect to be given to a New York statute, to which state the property was removed). Note: 35 L.R.A. (N.S.) 387. the contract should be recorded in the county into which the property is brought and remains, other provisions of the section primarily relating to contracts made within the state and requiring the contract to be again recorded where the property is removed to another county from the county in which the sale was made and in which the contract was first recorded as required by the statute have been held to apply to sales made out of the state, the property being brought into the state and thereafter removed from one county to another.5 The provisions of the statute with respect to the place of recording may, however, be such as to render it inapplicable to contracts of sales made in another state, though the property is subsequently removed to the state of the forum.6 761. Sufficiency of Compliance with Statute.-The requirements of the statutes as to the recording of conditional contracts of sale to render them valid as against the designated persons claiming under the buyer must be substantially complied with; and it is held that a notice attached to the chattel stating that it remained the property of the seller is ineffectual to preserve the seller's rights as against third persons entitled to the protection of the statute. Where the memorandum is in the form of a note, the marginal figures designating the amount of the note may constitute a sufficient designation of the amount, within a requirement that the memorandum state the amount of the unpaid price, though by clerical mistake the amount of the note is left blank. This is in pursuance of the general rule that marginal figures in a note may be referred to for the purpose of supplying the amount for which the note was given, when such amount has been wholly omitted in the body of the note. Under a statute requiring the filing of the contract in the county where the buyer resides, it must be filed, in case a corporation is the buyer, in the county where its principal place of business is located, although the property covered by the contract is in another county.10 762. Persons Entitled to Protection of Statute Generally.—The question as to the persons entitled to the protection of a statute requiring the contract to be recorded depends upon the terms of the statute, and on account of the difference in the phraseology of the several 5. Pulaski Mule Co. v. Haley, 187 Ala. 533, 65 So. 783, Ann. Cas. 1916A 877. 6. Notes: 64 L.R.A. 833; 35 L.R.A. 387. As to the effect to be given under the principle of comity to conditional contracts of sale on the removal of the property from the state in which the sale was made to another state, see supra, par. 750. 7. Potter Mfg. Co. v. Arthur, 220 Fed. 843, 136 C. C. A. 589, Ann. Cas. |