Jasper v. Presley

LENNON, P. J.

This is an appeal from a judgment and from an order denying a new trial.

The action was brought to foreclose a chattel mortgage executed by the defendant Presley on January 3, 1912, on personal property situate in the Empire Hotel in the city and county of San Francisco. The appellant was made defendant in the action under allegations in the complaint to the effect that it claimed some interest in the mortgaged property. The facts of the case pertinent to the point presented here briefly are these: On the seventeenth day of April, 1911, the appellant was the owner of all the personal property then contained in the Empire Hotel. On that date, the defendant, Presley, entered into possession of the Empire Hotel and the personal property contained therein, under a written agreement- with the appellant, and continued in its actual and exclusive possession thence until the twelfth day of August, 1912, or thereabouts; and by the terms of another agreement entered into on the same date, Presley agreed with the appellant to purchase certain additional furnishings for the hotel to the value of three thousand five hundred dollars, the appellant agreeing to purchase them in turn from the defendant, Presley, when the latter was in a position to display to the appellant the receipted bills for the same. Presley, pursuant to this second agreement, did purchase from time to time additional furnishings to the value of three thousand five hundred dollars; and on the twenty-first day of November, 1911, sold them to appellant. This sale was not accompanied by an immediate delivery or any delivery, and was not followed by any actual or continued change of possession. It was accomplished merely by the execution of a bill of sale. Presley continued in the actual and exclusive

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possession of this property thus transferred from the date of the transfer until the twelfth day of August, 1912, or thereabouts, and was in such possession on the third day of January, 1912, the date upon which he executed and delivered a promissory note and mortgage upon the additional furnishings hereinbefore mentioned to the plaintiff. No other furnishings contained in the Empire Hotel at any time are involved in this action. The additional furnishings purchased by Presley alone are concerned.

From these facts the trial court concluded that the plaintiff was entitled to judgment foreclosing its chattel mortgage. The appellant based its defense to the action upon the ground that Presley was not the owner of the mortgaged property at the time that the mortgage was executed, but that, on the contrary, the property was owned by and in the possession of the appellant long prior to that time. The trial court, however, found that Presley, and not the appellant, was in the possession of the said property on the date of the execution of the mortgage, and was in the possession of it from the time of its original "purchase until August 12, 1912. For this reason it was held, pursuant to the terms of section 3440 of the Civil Code, that the transfer not being accompanied by an immediate delivery or any delivery, and not being followed by a change of possession, was presumed to be fraudulent, and therefore void, as against creditors. The appellant now contends that a change of possession was not required to complete the transfer, and that therefore it was not affected by the provisions of section 3440 of the Civil Code. This contention is based upon the claim that the agreement between Presley and the appellant was a conditional sale from Presley to the appellant which was consummated upon Presley’s acquisition of the goods, and that therefore all right, title, and interest in and to the goods were vested in the appellant from the moment of Presley’s purchase, regardless of whether or not there was an immediate delivery, and an actual and continued change of possession. Were this contention supported by the evidence, it might follow as a matter of law that Presley never obtained such a possession of the property as to necessitate, upon the sale to appellant, a compliance with the provisions of the code section mentioned. But a careful reading of the agreement entered into by