Turnbull v. Cole

Mr. Justice Teller

delivered the opinion of the court.

Defendant in error had judgment in an action to recover an automobile on which he had a chattel mortgage. Plaintiff in error, defendant below, had taken possession of the automobile as agent for one Jones who claimed title under an assignment of a contract of sale, made in Utah, by which one Keightley, as purchaser of the car, agreed that, until he had paid the balance of the purchase price according to the terms of said contract, the vendor thereof should retain the title to it. It was further stipulated that if the purchaser failed to perform any part of his agreement, as set forth in said contract, or if the vendor, a corporation, should "at any timé deem itself insecure,” it might take possession of the car and sell it, and apply the proceeds to payment on any balance due on the purchase price, accounting to the purchaser for any excess. But, if the proceeds did not pay such balance, costs of sale, and attorney’s fees, the purchaser should still be liable for such balance.

The car was removed from Utah, without the knowledge | or consent of the vendor, or of Jones, brought to Colorado, and sold to one Bell, who mortgaged it to Cole to secure a promissory note of $600.

Defendant in error concedes that a conditional sale does not pass title according to the decisions of the courts of Utah. That being so, plaintiff in error contends that, under the rule of comity between states, the courts of this state should give effect to the contract, notwithstanding the fact that in this state such contracts are held to be absolute sales, as against creditors, and purchasers without notice of the vendor’s claim of title.

The only question to be determined is as to the correctness of the trial court’s action in rejecting said contention.

It is settled in this jurisdiction that contracts like that here under consideration, reserving a secret lien to the vendor, will not be recognized as leaving title in the vendor, as against interested parties without notice. Weber v. Diebold S. & L. Co., 2 Colo. App. 68, 29 Pac. 747; George v. Tufts, 5 Colo. 162; Tufts v. Beach, 8 Colo. App. 35, 44 Pac. 771; First Cong. Church v. Grand Rapids Co., 15 Colo. App. 46, 60 Pac. 948; Andrews v. Colorado Savings Bank, 20 Colo. 313, 36 Pac. 902, 46 Am. St. Rep. 291; Jones v. Clark, 20 Colo. 353, 38 Pac. 371; Clark v. Bright, 30 Colo. 199, 69 Pac. 506; Coors v. Reagan, 44 Colo. 126, 96 Pac. 966; Puzzle Co. v. Morse Co., 24 Colo. App. 74, 131 Pac. 791.

In Coors v. Reagan, supra, this court quoted with approval from Weber v. Diebold Safe Co., supra, a statement that “transactions of this character are not favored, and are opposed to public policy.” We are, therefore, of the opinion that the trial court was right in holding that the contract, though valid in Utah, could not be enforced in this state, because such action would be contrary to public policy, and would result in detriment to the interests of a citizen of this state. Both of these grounds furnish exceptions to the general rule of comity as applied to the enforcement of contracts.

In Dearing v. McKinnon Co., 165 N. Y. 78, 58 N. E. 773, 80 Am. St. Rep. 708, the court, dealing with a mortgage valid in Michigan, and attempted to be enforced in New York, said:

“Judicial comity does not require us to enforce any clausé of the instrument, which, even if valid under the lex domicilii, conflicts with the policy of our state relating to property within its borders, or impairs the rights or remedies of domestic creditors.”

Boydson v. Goodrich, 49 Mich. 65, 12 N. W. 913, is to the same effect.

In Skiff v. Solace, 23 Vt. 279, the court had under consideration the rights of an attaching creditor to a property which had been mortgaged in New York and moved to Vermont. Of the rule of comity, the court said:

“But such recognition does not take place by any foreign state, when it would be incompatible with its own authority, or prejudicial to the interests of its own subjects.”

Finding no error in the record, the judgment is affirmed.

Mr. Justice Whitpord, Mr. Justice Bailey and Mr. Justice Allen dissent.