Fergus Motor Co. v. Sorenson

Citing: Bradley, Clark Co. v. Benson, 93 Minn. 91,100 N.W. 670; National Cash Register Co. v. Zangs, 127 Iowa, 710,104 N.W. 360; Becker v. La Core, 211 Mich. 684, 179 N.W. 344;Kammeier v. Chauvet, 186 Iowa, 958, 171 N.W. 165; John DeerePlow Co. v. Edgar Farmers Store Co., 154 Wis. 490,143 N.W. 194; Essley Mach. Co. v. First Trust Co., 160 Wis. 300,151 N.W. 814. Citing: Jones on Chattel Mortgages, 5th ed., 251; First Nat.Bank v. Weed, 89 Mich. 357, 373, 50 N.W. 864, 869; Hales v.Zander, 24 Okla. 246, 138 Am. St. Rep. 879, 103 P. 669; Yund v. First Nat. Bank, 14 Wyo. 81, 82 P. 6; Greenville Nat.Bank v. Evans-Snyder-Buel Co., 9 Okla. 353, 60 P. 249;Stirk v. Hamilton, 83 Me. 524, 22 A. 391, 395; 35 Cyc. 688. *Page 124 This is an appeal from a judgment entered on an agreed statement of facts, by the district court of Custer county. The judgment having been in favor of the defendant, the plaintiff appealed.

As many of the facts as are pertinent to our inquiry were concisely stated by the judge who tried the cause in the court below as follows: "Briefly, * * * the facts disclose that on the sixteenth day of May, 1923, at Lewistown, Montana, the plaintiff sold and delivered to one W.P. Storm one Ford touring car complete with equipment, motor No. 7499241, for $569.76, at which time a portion of the purchase price was paid and the balance was represented in the form of a conditional contract of sale which was executed and delivered by the said W.P. Storm at Lewistown, Montana, at the time of the purchase of the car. * * * The contract was not filed in Fergus county, where the contract was executed and delivered, and where the property was situated at the time of the execution of the contract, but was filed in Garfield county, Montana, on the twenty-second day of May, 1923. It appears that after the delivery of the car to the purchaser, W.P. Storm, the next day the car was taken from Fergus county and driven into Garfield county, where the said Storm resided at the time of the purchase of the car, and where he now resides. The car was situated in Garfield county, Montana, from the nineteenth day of May, 1923, until June 8, 1923, at which time the car was driven to Miles City in the county of Custer, Montana. On June 9, 1923, the car was seized by the defendant as constable of Miles City township under and by virtue of a writ of attachment issued out of the justice court of Miles City township. * * * It is also agreed that the plaintiffs in the actions [in the justice court] against the said W.P. Storm *Page 125 had no knowledge of the conditional sale contract in question, or that the same was filed in Garfield county, Montana, except what constructive knowledge, if any, the mere filing of the same in Garfield county might give to the said parties."

In addition to the foregoing, it is well to note that the contract contains the following: "The express condition of this contract is such that I am to use said property in Fergus and adjoining county, Montana, and not to remove said property to any other county without consent in writing of Fergus Motor Company." It is clear that when the contract was made the situs of the property was in Fergus county.

The trial judge stated the question which was involved as follows: "The question for determination is whether or not the conditional sale contract was filed in the proper county." We think the lower court fully apprehended the problem which confronted it.

The statute which deals with the filing of conditional sales contracts is as follows: "All contracts, notes, and instruments for the transfer or sale of personal property, where the title is stipulated to remain in the vendor until the payment of the purchase price, or some part thereof, shall be in writing, and the original or true copy thereof, certified by the county clerk and recorder, shall be filed with the county clerk and the recorder of the county wherein the property is situated; otherwise, any such contract, note, or instrument is void as tobona fide purchasers, mortgagees, or attaching creditors of such property prior to such filing." (Sec. 7594, Rev. Codes 1921.)

Appellant seeks to have this court construe that statute as not meaning that the contract must be filed in the county where the property was situated at the time of the execution of the contract, without definitely stating what construction is contended for. It variously states what it seeks to have the court hold. The purchaser having been a resident of Garfield county at the time the contract was made, it is suggested that that element should be taken into consideration. Statutes are referred *Page 126 to which fix the place of filing as the county of the vendee's residence. Apparently it would also be satisfactory to appellant if we would conclude that the county where the property is at the time of filing is the proper county within which to file the contract.

We think that the conclusion of the supreme court of Wyoming, as stated in the opinion in the case of Studebaker Bros. Co. v.Mau, 14 Wyo. 68, 82 P. 2, where the Utah statute governing the filing of such contracts, which read "filed in the office of the county clerk of the county wherein the property is," was under consideration, is very persuasive as to the meaning of our own statute. That court, referring to the quoted language, said: "This can only mean where the property is at the time of the execution of the contract."

It would seem that a reading of our own statute would[1] naturally lead us to such a conclusion. It might, therefore, be said that this case falls within the oft-repeated rule: "If the language is plain, simple, direct and unambiguous, it does not call for construction by the courts. It construes itself." (Scheffer v. Chicago, M. St. P. Ry. Co., 53 Mont. 302,163 P. 565.) However, so many peculiar situations can be found as a result of any construction of this statute, that we will not content ourselves to rest with this statement.

Wherever it is possible for a court to construe a statute, the[2] rule is that the intent of the legislature is to be pursued, if possible. (See sec. 10520, Rev. Codes 1921.) In order to arrive at the intent of the legislature, there are many rules which have been laid down as helpful. For instance, it has been said that the policy of a law is persuasive as to its meaning. (State ex rel. McGowan v. Sedgwick, 46 Mont. 187,127 P. 94.) Arguing from this, appellant contends that the statute, which, after amendment, now appears as section 7594, supra, was originally passed in 1899 (see Laws 1899, p. 124) for the purpose of changing the rule theretofore in force as to conditional sale contracts, which declared that such contracts *Page 127 were valid as against the world without filing. Proceeding from this premise, appellant contends that the policy of the law was to require notice for the protection of purchasers, encumbrancers and attaching creditors, and that the logical place for failing to give such notice would be the county of the vendee's residence. All this may be true, but it is not conclusive as to the intention of the legislature.

It is also permissible, if not actually necessary, whenever the language of a statute is of doubtful meaning, for the court "to recur to the history of the times when it was passed and of the Act itself, in order to ascertain the reason as well as the meaning of particular provisions in it." (25 R.C.L., p. 1035; and see Sullivan v. City of Butte, 65 Mont. 495, 211 P. 301.)

It is a matter of common knowledge that in 1899 the use of the automobile was very limited, at least in Montana. Certainly, when any given piece of legislation is under consideration, the legislature does not resort to speculation. The operation of the law upon the sets of facts which are known to the individual legislators at the time would undoubtedly control in determining the feasibility of the law which has been introduced. True, we do not take the view that any given legislature will disregard apparent or probable growths of industry which take place from time to time, and only legislate for the immediate present. Whenever possible, a construction will be placed upon all enactments which will make them operative for the length of time they may be in force. This is the spirit of our administrative system. But, regardless of that point of view, in order to properly understand any utterance, it is always advisable to understand the conditions which surround the subject of the utterance.

As has been intimated, in 1899 the use of the conditional sale contract in consummating sales of automobiles and easily movable chattels of that character had not become general enough to have entered into the consideration of the legislature. On the other hand, if any inquiry had been made, they *Page 128 would have learned that this form of contract was quite frequently used in connection with sales of hotel furnishings, bars, saloon fixtures, buggies, wagons, farm implements and similar property which was purchased for use from persons who were selling out their businesses or leases, or from local dealers. The large implement manufacturers were not then operating extensively in the sale of machinery direct to farmers; nor had the musical instrument house commenced to broaden its field of activity. The instances, where the statute affecting the rights of the seller who reserved the title until payment was made, included very few concerning which the interested public would be compelled to go beyond the office of the county clerk of the county within which the vendor resided in order to find what claims there were against the particular chattel they were interested in. And if they inquired, in all probability the legislators of 1899 found that the vendors who were using such contracts declined to enter into any such arrangement where it was contemplated that the property was to be moved from the comparatively immediate vicinity where the vendor resided and the contract was entered into.

We also find that courts resort to the state of the law upon[3] cognate subjects in their effort to ascertain the meaning of a particular statute. (See 25 R.C.L. 1052.) This point was probably in the mind of counsel for appellant who argue that it would have been very easy for the legislature to have provided "that the contract shall be filed in the same manner as chattel mortgages are required to be filed." It seems to us that because of their general similarity, if the legislature had desired information as to how such matters were handled, reference would have been made to the chattel mortgage law; and had this been done, it would have appeared that from 1887 down to the time the subject was being considered, chattel mortgages were required to be filed in "the county where the mortgagor resides or in case he is not a resident" of Montana "in the county where the goods, chattels or personal property *Page 129 may be at the time of the execution of the mortgage." (See sec. 1540, Comp. Stats. 1887.) This provision appears substantially in the Codes of 1895 (sec. 3864, Civ. Code), the only change made being in the use of the language "is situated" in place of "may be," in the provision as to nonresident mortgagors. In this connection it should be noted that the provision relative to filing, where the mortgagor was a resident, was to all intents and purposes what appellant contends the rule now is as to conditional sale notes, and that the provision as to filing where the mortgagor was a nonresident was exactly what the trial court held was the rule controlling this case. It might be borne in mind that in 1887, and even in 1895, the banking business was very generally centered in the larger cities and towns of the state. The stock-grower, who was at those times in all probability the largest borrower upon chattel security, very generally was compelled to go long distances from his home, and the place where his livestock ranged, to his bank. It was quite natural, therefore, that at that time, in order to protect the lender and at the same time to convenience the borrower, the filing provision should be the county of the mortgagor's residence, in the event he was a resident of Montana, and, in the event he was a nonresident, in the county where the property was at the time of the execution of the mortgage.

Such, in general, then, is the history of the times and the subject of both conditional sale contracts and chattel mortgages, as well as the history of the legislation. What do we gather therefrom which aids us in arriving at the meaning of the statute in question?

It seems to us quite apparent that the legislature, after contemplating the entire situation which was then within their range of vision, deliberately chose the rule which they had at hand in the chattel mortgage law: That the contract should be filed in the county where the property "is situated" at the *Page 130 time of the execution of the contract, as being the rule which would be proper in the large majority of instances.

While it is true that the policy of the law is persuasive, it[4] is not controlling. (See State ex rel. McGowan v.Sedgwick, supra.) We cannot find anything to indicate that the legislature intended to do anything more than require such a filing as would be reasonable under the circumstances of the majority of cases. If that was their intention, certainly they chose the reasonable method, at least for their times.

If any significance is to be attached to the language used in the statute we are asked to construe, as compared with the chattel mortgage statute then in existence, it would be that they deliberately chose to use the situation of the property at the time of the execution of the contract, as opposed to the residence rule.

And to follow these statutes down to the time when this controversy arose, we find that the conditional sale contract rule has to all intents and purposes remained the same from the time of its enactment to the present as to the filing provisions; while in 1913, for some reason the legislature apparently, from a reading of the entire Act, at the behest of chattel mortgagees by enacting Chapter 86 of the Session Laws of the Thirteenth Legislative Assembly (pages 378 et seq.), changed the rule as to filing so as to provide only for filing in the county "where the property was situated at the time of the execution of the mortgage." It may be that this change from the rule, which was in effect in 1899 as to chattel mortgages, is not conclusive upon the question we are considering; but using the converse of the proposition we have just been asserting, it might be said that the legislature had found that with the growth of the country banking system and the increased borrowing upon chattel security, the necessity for the old rule for the convenience of borrowers had disappeared, and the reason for the rule which obtained as to conditional sales had come *Page 131 to the front. In other words, by 1913 the loaning upon chattel security had assumed such proportions in the banking system that the mortgagees deemed it to be to their interest that their mortgages should be filed in the county where the property was situated at the time of the execution of the mortgage. And to further protect them, and as a part of the same Act (Chap. 86, Laws 1913, supra, sec. 17), the legislature made it a misdemeanor to remove mortgaged property from the county where it was when the mortgage was executed. This clearly evidences the recognition by the legislature of the fact that mortgagees then deemed it necessary to keep their security within the vicinity of their operations, so that they might at all times be able to observe it.

This is exactly what, by making the filing provision it did in 1899 as to conditional sale contracts, the legislature must have had in mind as to that character of transaction. In a peculiar sense — since in many instances it had been held that the taking back of the property sold with a reservation of title in the vendor resulted in exonerating the vendee from all further payments — it would always be desirable for the vendor to see just how the property is being used and cared for, and as a consequence he would ordinarily decline to permit the removal of the property from a point where he could watch it. And with this in mind the filing provision must have been adopted as being the best suited to meet existing conditions.

But we are not left to the language of section 7594 alone to ascertain its meaning. Apparently at some time prior to 1923, conditional sale vendors discovered that section 17 of Chapter 86, Laws of 1913, supra, did not cover removal of goods sold under such agreements, for the legislature in 1923 amended that section so as to include within its penalties the removal of property sold with reservation of title in the vendor "from the county where it was situated at the time of the execution of the contract." (See Chap. 23, Laws 1923.) *Page 132

It has been stated as a rule of construction: "If it can be[5] gathered from a subsequent statute in pari materia what meaning the legislature attached to the words of a former statute, they will amount to a legislative declaration of its meaning, and will govern the construction of the first statute." (25 R.C.L. 1064.)

It cannot be doubted that section 7594, supra, and 8291, as amended by Chapter 23, Laws of 1923, are in pari materia. Both sections affect the rights of vendors under conditional sale contracts; section 7594 specifying the conditions under which any rights shall obtain as against all except vendees, and section 8291 being for the protection of the right of the vendor as against the vendee.

We have, then, this situation as a result of the passage of Chapter 23, Laws of 1923: Section 8291, Revised Codes of 1921, which, as amended by this Chapter, was originally passed as a portion of the revision of the chattel mortgage law; at the time of its original passage section 17 (now sec. 8291), Rev. Codes 1921) defined the crime as being the removal of property covered by chattel mortgage "from the county where said property was situated at the time of the execution of the mortgage," or, in other words, from the county within which by the terms of the same Act the mortgage was required to be filed; section 8291 was then (in 1923) amended so as to include within its penalties the removal of property sold under conditional sale contract, and the language used in defining the new misdemeanor was the same as that used in defining the crime relative to mortgaged chattels. If the county of filing was the county from which the mortgaged property could not be removed without criminal liability, certainly the same rule should control as to property sold with title reserved in the vendor. It is apparent, therefore, that the legislature in 1923 construed section 7594 as providing that the conditional sale contract should be filed in the county wherein the property is *Page 133 situated at the time of the execution of the contract. No change in result can be seen by the use in section 8291 of the language "was situated at the time," etc., in place of the phrase "is situated," as used in section 7594. The foregoing demonstrates that from the enactment of the original statute to and including Chapter 23, Laws of 1923, the legislative intention respecting conditional sale contracts has been consistent. We think that, if no other reason existed, this would compel us to conclude that the lower court was correct in its ruling.

Relative to the proposition asserted by appellant that in[6] instances the operation of the law as we understand it will result in injustice, we point out that a vendee, who is contemplating entering into such a contract, can refuse to do so unless he is protected by consent in writing to remove from the county, which is permissible by the terms of section 8291,supra, and the vendor can likewise refuse to give such permission if he chooses. As to the public, in those instances where it might be affected, we are concluded by the rule that even though the practical application of a law which is capable of enforcement fails to meet the needs of a particular class, it is not an argument against its validity. (See State ex rel.Board of County Commrs. v. District Court, 62 Mont. 275,204 P. 600.) The legislature having seen fit to legislate in the manner it did, we are not permitted to construe its Act by omission or insertion, and thus to substitute our judgment as to proper legislation, even though we might in instances prefer it otherwise. We are bound by the intention of the legislature in so far as we can ascertain it. "With questions of legislative policy, courts are not concerned. The duty imposed upon them is to construe the laws as they find them." (State ex rel. Thelen v. District Court, 51 Mont. 337, 152 P. 475.)

The lower court properly held that the place for filing of[7] conditional sale contracts is the county where the property is at the time of the execution of the contract. *Page 134

The opinion heretofore promulgated is withdrawn and the judgment is affirmed.

Affirmed.

MR. CHIEF JUSTICE CALLAWAY and ASSOCIATE JUSTICES STARK and MATTHEWS concur.