CHATTEL MORTGAGES IN FLOOR FINANCING-VALIDITY OF RECORDED CHATTEL MORTGAGE AS AGAINST PURCHASER IN ORDINARY COURSE-EFFECT OF CERTIFICATE OF TITLE ACT WHEN CERTIFICATE RETAINED BY MORTGAGE

Plaintiff, buyer of an automobile from a used-car dealer, brought suit against the dealer and a bank, to which the dealer had given a duly filed chattel mortgage covering the automobile, to have the mortgage declared invalid as to the automobile in question, and for specific enforcement of the promise by the dealer to deliver the certificate of title to the buyer. The mortgage contained a clause giving the dealer-mortgagor the right to sell automobiles mortgaged to the bank-mortgagee, but the bank retained possession of the certificate of title to the automobile. The Circuit Court in Chancery entered judgment for plaintiff. On appeal, held, reversed.

Bayer v. Jackson City Bank and Trust Co., 335 Mich. 99, 55 N.W. (2d) 746 (1952).