In re the General Assignment for the Benefit of Creditors of Levy , 8 Misc. 2d 596 ( 1957 )

James S. Brown, J.

Motion by assignee to declare a chattel mortgage null and void as against him because of late filing, The chattel mortgage was executed on October 25, 1954 and was filed on April 10, 1956, about 18 months after the execution and delivery of said chattel mortgage by the assignor to the chattel mortgagee. The chattel mortgagor assigned for the benefit of creditors on September 12, 1957.

Under section 230 of the Lien Law, this chattel mortgage should have been filed within a reasonable time. The failure to do so makes it void as against the creditors of the mortgagor. It is conceded that 18 months is an unreasonable time. In the case of Stich v. Pirkl (100 Misc. 594) it was held that under section 17 of the Debtor and Creditor Law the assignee for the benefit of creditors of a mortgagor could attack the validity of a chattel mortgage which was not filed for more than 10 months after it was executed. In Matter of Brown Bomber Baking Co. (Fiske) (293 N. Y. 141) the chattel mortgage renewal was filed two days late so that the mortgage became invalid as against the mortgagor’s creditors. Thereafter the corporate mortgagor assigned for the benefit of creditors and the assignee sold the mortgaged chattels. It was held that the chattel mortgagee under section 17 of the Debtor and Creditor Law had no lien against the proceeds of the sale. Accordingly the motion is granted. Submit order on notice.