Pruitt v. . Parker

ClaeKSON, J. This action, in effect, is brought to determine the rights of plaintiff and defendants to certain personal property. (1) On 26 May, 1930, L. Y. Parker, defendant (L. Y. Parker trading as Carolina Box Lumber Company) being indebted to J. T. Pruitt, the plaintiff, and to secure the indebtedness executed a chattel mortgage to plaintiff on certain personal property describing same. This chattel mortgage was duly recorded in the office of the register of deeds of Franklin County, on 28 May, 1930, in Book 294, at pages 129-30. (2) On 1 January, 1929, L. Y. Parker being indebted to R. W. Jordan, the defendant, and to secure the indebtedness executed a deed in trust to G. C. Fanney, trustee defendant, on certain personal property describing same. In said deed in trust is the same personal property that is set forth in plaintiff’s chattel mortgage. This deed in trust was duly recorded in the office of the register of deeds of Franklin County, on 20 May, 1930, in Book 294, pages 123-4. Plaintiff’s chattel mortgage was indexed and cross-indexed on 28 May, 1930, upon the general chattel mortgage cross-index maintained and kept by the register of deeds of Franklin County, before the deed in trust to G. O. Fanney, trustee, was indexed and cross-indexed upon the general chattel mortgage cross-index maintained and kept as aforesaid. The first question presented by defendant: Is the deed of trust from L. Y. Parker to G. C. Fanney, trustee for R. W. Jordan, recorded in the same book and indexed in the same book ahead of the chattel mortgage from said Parker to plaintiff J. T. Pruitt inferior in lien because indexed in the general chattel mortgage book subsequent to the Pruitt mortgage? Ye think so, as it was not properly indexed and cross-indexed as is provided by the statute. This action involves the construction of chapter 32Y of the Public Laws of 1929, entitled “An act to amend section 3560 and 3561, of the Consolidated Statutes, relating to the indexing of instruments in the office of the register of deeds for the several counties.” Section 1 amends section 3560 giving authority to the county commissioners to install the “Family” index system and providing that no instrument shall be lawfully recorded until indexed and cross-indexed according to the particular system in use. Section 2 strikes out all of section 3561, and inserts in lieu thereof the following: *700 “3561. Index and Gross-Index of Begistered Instruments. The register of deeds shall provide and keep in his office full and complete alphabetical indexes of the names and the parties to all liens, grants, deeds, mortgages, bonds and other instruments of writing required or authorized to be registered; such indexes to be kept in well bound books, and shall state in full the names of all parties, whether grantors, grantees, vendors, vendees, obligors or obligees, and shall be indexed and cross-indexed, within twenty-four hours after registering any instrument, so as to show the name of each party under the appropriate letter of the alphabet; and wherever the 'Family’ index system shall be in use, to also show the name of each party under the appropriate family name and the initials of said party under the appropriate alphabetical arrangement of said index; and all instruments shall be indexed according to the particular system in use in the respective office in which the instrument is filed for record. Reference shall be made, opposite each name to the page, title, or number of the books in which is registered any instrument; Provided, that where the 'Family’ system hereinbefore referred to has not been installed, but there has been installed an indexing system having subdivisions of the several letters of the alphabet, a registered instrument shall be deemed to be properly indexed only when the same shall have been indexed under the correct subdivision of the appropriate letter of the alphabet; Provided, further, that no instrument shall be deemed to be properly registered until the same has been properly indexed as herein provided; Provided, further, that all counties where a separate index system is kept for chattel mortgages or other instruments concerning personal property, no instrument affecting the title to real estate shall be deemed to be properly registered until the same has been properly registered and indexed in the books and index system kept for real estate conveyances; Provided, further, that it shall be the duty of the register of deeds of each county, in which there is a separate index for conveyances of personal property and for those of real estate, to- double index every such conveyance, provided that such conveyance shall contain both species of property. A violation of this section shall constitute a misdemeanor.” Section 3. That this act shall not affect pending legislation (litigation) or instruments heretofore registered.” The act of 1929 provides that no- instrument shall be deemed to be properly registered until the same has been properly indexed as provided in the act, and where a separate index system is kept for chattel mortgages (4th finding of fact), as was this case in Franklin County, chattel mortgages must be indexed and cross-indexed in the chattel mortgage index system. *701 In Story v. Slade, 199 N. C., at p. 597, citing a wealth of authorities, in this jurisdiction, it is held: “The indexing and cross-indexing of instruments required to be registered is an essential part of their registration.” We do not think Whitehurst v. Garrett, 196 N. C., 154 relied on by defendants, is applicable. That decision was rendered 10 October, 1928, before the act of 1929, supra, and the facts were also different. We think the intention of the present act clear and not ambiguous, and on the facts in this case plaintiff, on this aspect, had a prior lien. The second question presented: But defendants further contend: “If any additional notice is required, it is to be found in the mortgage to-Pruitt itself, as follows: That the same (the property herein described) are free and clear from all encumbrances except encumbrances of record.’ ” Defendants contend that “While it is the established rule that no notice however full and formal • can take the place of registration where the subsequent mortgage of the same property recites that it is made subject to a prior mortgage, such recitation is more than a mere notice of prior encumbrance-, and it establishes a trust in equity in favor of the prior encumbrances, even though his instrument is not registered. Bank v. Vass, 130 N. C., 590; Bank v. Smith, 186 N. C., 635.” We do not think the above cases cited by defendant are applicable, but in Story v. Slade, supra, at pp. 597-8, we find: “The present case, therefore, comes squarely within the decisions in Hardy v. Abdallah, 192 N. C., 45, 133 S. E., 195 and Piano Co. v. Spruill, 150 N. C., 168, 63 S. E., 723, in which similar references are held to be insufficient to take the place of proper registration of alleged prior encumbrances.” Lawson v. Key, 199 N. C., 664. For the reasons given, the judgment below is Affirmed.