Palmateer v. Robinson

The opinion of the court was delivered by Magie, Chief Justice. The single question presented by the assignments of error and the briefs in the case is whether, upon the facts set out in the bills of exception, the court below was right in holding that the machinery in ques [436] tion remained the property of Robinson, the vendor, and did not cease to be his personal property by its annexation to the land of the Palmateers. In view of the express provisions of the contract of sale of the machinery, made between Robinson, its owner, and the New Jersey Mill and Lumber Company, it is perfectly obvious that if that company had affixed the machinery to land belonging to it, in the same manner in which it affixed it to land of the Palmateers, which it occupied under a contract of purchase, such annexation would not necessarily have incorporated the machinery with the land so as to change its character from personalty to realty, for whether property personal in character becomes transformed into realty by annexation depends, among other things, upon the intent, expressed or implied, with which the annexation was made. Pope v. Skinkle, 16 Vroom 39; Campbell v. Roddy, 17 Stew. Eq. 244. The intent of the company in making annexation of machinery which they held under such a contract, must be considered to have been conditional, and the condition to have been that, before its character should be thus changed, the whole purchase price should have been paid, so as to vest the title to the machinery in the company. It is too plain for discussion that, under such circumstances, if the company had defaulted in paying the purchase price, Robinson might have regained possession of the machinery from the company, notwithstanding its being affixed to its land, and might have recovered damages for its conversion if the company refused to surrender it on proper demand. The case does not require any expression of opinion in respect to the right which is acquired by a bona fide ■ purchaser or mortgagee without notice of land to which the owner has affixed property, personal in character, which he holds under such a contract of sale as appeared in this case, before payment of the purchase price. As was pointed out in Campbell v. Roddy, ubi supra, the courts of this country are not in agreement upon that ques [437] tion, and the lack of harmony among them will appear not only upon the cases there cited, but from others collated in the notes to Hobson v. Gorringe, 12 Rul. Cas. 208. The Palmateers were neither purchasers nor mortgagees of the land with the machinery apparently affixed thereto. They have laid out nothing in its acquisition. They have simply retaken possession of their land upon the company’s default in the performance of its contract to purchase it. Upon retaking possession they have found upon the land the machinery in question, which was brought upon it and affixed to it by the company which they had put in possession under a contract of purchase and sale. The title to the machinery has never passed from Eobinson, the owner of it, unless annexation of it to the land has divested him of it. But such annexation was not made by the Palmateers, but by the company, which became able to annex only by being put in possession by them, and such annexation was, as we have seen, with express reservation of its character as personalty. Under such circumstances they occupy, in respect to the machinery, the same relation which the company occupied, and can no more defend possession of it—the purchase price not having been paid—than could the-company. The case of Hendy v. Dinkerhoff, 57 Cal. 3, presents the same features which appear in the case before us, and the conclusion reached was such as is above indicated. The case of Campbell v. Roddy, 17 Stew. Eq. 244, is analogous and justifies the conclusion above stated. In that case Mr. Justice Eeed, in delivering the opinion of the majority of this.court, points out that a mutual agreement between the owner of lands and the owner of chattels will be efficacious in preserving the personal character of the latter after annexation, and, while admitting the difficulty of applying the rule in cases where the rights of others become involved, did apply it under the following circumstances: to land which was subject to a prior mortgage the owner annexed machinery, which was subject to a chattel mortgage. It was [438] held that the lien of the chattel mortgage would be protected so far as it would not diminish the security which the real estate mortgagee would have had if there had been no annexation. The mortgagee in that case and thé Palmateers in the case before us occupy similar though not identical positions. The title to the chattels annexed to the land in the former case had passed to the owner of the land and the vendor retained an interest which was held to be that of a chattel mortgagee. In this case the company obtained no title whatever and expressly agreed that annexation to land should not convert the chattels into realty. If the interest of the chattel mortgagee can be asserted against the prior real estate mortgage, the title of the real owner of the chattels must be capable of assertion as against the landowner, under the circumstances of such annexation as is shown in this case. Whether, if the machinery had been put into a building which was on the lands the Palmateers contracted to sell to the company at the time the contract was made, and if in removing it damage might be done diminishing the value of the real estate, the owner of the machinery could recover its full value or only after allowance for the injury to the real estate, is a question not presented in the case, for the machinery was affixed to the land and a small building erected over it by the company. It appears it can be removed without injury to other buildings and without substantial injury to the new building. The result is that the judgment bslow must be affirmed. For affirmance—The Chancellor, Chief Justice, Depue, Gummere, Ludlow, Yan Syokel, Adams, Bogert, Hendrickson, Nixon. 10. For reversal—None.