Bank of North America v. Penn Motor Car Co.

Citations

• 235 Pa. 194
• 83 A. 622
• 1912 Pa. LEXIS 525

Syllabus

<p>Sale — Contract—Change of possession — Rights of creditors— Bailment.</p> <p>1. When a vendee or a pledgee, takes title to personal property without taking possession of it, he takes the risk of the integrity and solvency of his vendor or pledgor when the rights of subsequent bona fide purchasers, or of levying creditors, arise.</p> <p>Bankruptcy — Federal Act — Bailment—Pledge of automobiles— Possession — Replevin—Act of Congress of June 25, 1910, 86 Stat. at L. 888, amending Section JJ7 of Bankrupt Act.</p> <p>2. Where a bank, which has loaned money to the owner of automobiles under an agreement to hold the title to the automobiles as a pledge in the nature of collateral security for the money loaned, permits the automobiles to remain for a time in possession of the borrower, but a few days before bankruptcy proceedings are instituted against the borrower, takes possession of the machines by a writ of replevin, it is not entitled to retain possession of the machines as against the trustee in bankruptcy of the borrower. Under the Act of Congress of June 25, 1910, 38 Stat. at L. 838, amending See. 47 of Bankrupt Act, the trustee has the right to take possession of the machines.</p> <p>3. In such a case the trustee in bankruptcy has the same right during the period of four months immediately preceding the filing of the petition in bankruptcy, which an unsatisfied execution creditor would have had, if such creditor had issued an execution and levied upon the automobiles while they were in the possession of the pledgor.</p> <p>Mr- Chief Justice Fell and Me.. Justice Brown dissent.</p>