Fairbanks Steam Shovel Co. v. Wills - 240 U.S. 642 (1916)
U.S. Supreme Court
Fairbanks Steam Shovel Co. v. Wills, 240 U.S. 642 (1916)
Fairbanks Steam Shovel Company v. Wills
Argued December 2, 3, 1915
Decided April 10, 1916
240 U.S. 642
A corporation organized under the laws of Illinois is to be deemed a resident of the state within the meaning of the Chattel Mortgage Act of that state, and the county of residence is the county where its principal office is located, although it may transact business in another county.
A corporation can only change its residence within the state of its incorporation by complying with the law of the state.
As the Illinois corporation which made the chattel mortgage in this case had its principal office in Cook County, and that office was never legally established in any other county, a mortgage which was recorded in a different county did not comply with the Recording Act of Illinois, and, as against the trustee in bankruptcy, was invalid.
Even though the bankrupt did not have its principal place of business in the district where the bankruptcy proceeding was instituted, that objection can be waived by appearing and answering to the merits in a proceeding instituted to obtain possession of assets of the bankrupt.
An adjudication of bankruptcy is not open to collateral attack, and the question of capacity of the trustee to sue is waived if not raised in the trial court.
If the chattel mortgage is not valid against the trustee because not properly recorded under the state law, the mortgagee's title is not perfected by taking possession after the filing of the petition and before adjudication.
Under § 47 a-2 as amended by the Act of June 25, 1910, trustees have the right and remedies of lien creditors as against unrecorded transfers, and, the estate being in custodia legis, the trustee's title relates back to the date of filing the petition.
212 F. 688 affirmed.
The facts, which involve a controversy arising in a bankruptcy proceeding and the relative rights of a mortgagee
of certain chattels of the bankrupt and the trustee in bankruptcy, are stated in the opinion.