Ratterman, Treas., v. Ingalls. below was right. As to the year 1886, there may possibly be room for doubt regarding the penalty. It is urged that if the return is true when made, it cannot be rendered false by what is learned afterwards. Defendant's return in April, 1886, was correct so far as it went. It did not include the railway stock. The trial court apparently thought there was evasion in not making voluntary correction. It was not necessary to find that the return itself was false. The court may have reasoned that, inasmuch as the defendant knew of the claim of the auditor shortly after November, 1886, that the shares ought to be returned, his failure to make voluntary correction was an evasion which rendered him liable to the penalty, and that his true disclosure, upon being cited some time afterward by the auditor, did not relieve him. The sixth finding of fact is consistent with this conclusion. This court is not prepared to say that the legal conclusion was erroneous. The findings of fact further show that a number of the cer tificates representing stock owned by the defendant had been pledged as collateral security for loans, with power to the pledgees to cause a transfer of the stock to their own names, and, in case the loans should not be paid, to sell. It is insisted by defendant that such shares cannot be taxable in his name on the ground that they were not in his possession or under his control within the meaning of sections 2730, 2736 and 2737, Revised Statutes. We are of a contrary opinion. The books of the company showed the shares to be in the name of the defendant, and he was the real owner. He had the power to resume absolute control by paying off the indebtedness. It is not the policy of our law to assess taxes upon pledged property against the pledgee, and the language of the sections referred to will not, in reason, bear so literal a construction. Waltham Bank v. Waltham, 10 Met. 334; Tucker v. Aiken, 7 N. H. 113. Other questions argued at length are rendered unimportant by reason of the conclusion reached on the main question. Acknowledgment is here made to counsel for their most thorough and elaborate argument of the case. The able briefs 48s 492 49 398 48 492 53 345 Betz v. Snyder. thorough and elaborate argument of the case. The able briefs have been freely resorted to in the preparation of this opinion, and have materially lightened the labor of the court. Finding no error in the record the judgment is Affirmed. BETZ v. SNYDER. Assignment for benefit of creditors-When deed of, takes effect-Need not be filed for record with the recorder of deeds-Superior to existing mortgages not deposited for record. 1. A mortgage of real property, which has not been deposited for record (Decided June 16, 1891.) ERROR to the Circuit Court of Columbiana county. On the 1st day of December, 1885, James M. Hape executed a mortgage on all his real estate situated in Columbiana county, to Salathiel Betz, to secure an indebtedness of $3,000, due in one year, with six per cent. interest. Josephine M. Hape, the wife of the mortgagor, joined in the execution of the mortgage. On the 21st day of December, 1885, the mortgage was delivered to the recorder of the county, for record, and was duly recorded. On the 16th day of December, 1885, said James M. Hape, who then resided in Columbiana county, made an assignment for the benefit of his creditors, to Charles N. Snyder. The deed of assignment, which embraced all the property, real and personal, of the assignor, (including Betz v. Snyder. that mortgaged to Betz) was executed, attested, and acknowledged in conformity to the requirements of the statute relating to conveyances of real estate, and was filed in the probate court of the county, on the 17th day of December, 1885, when the assignee qualified, and entered upon the execution of his trust. He thereafter filed his petition in the probate court of that county, to have the validity and priority of the liens determined, and the property sold. Betz, who was made a party defendant, filed an answer, setting up his mortgage, and asking for its payment out of the proceeds of the sale. The cause, after having proceeded to judgment in the probate court, was appealed to the court of common pleas, where it was submitted upon an agreed statement of facts, substantially as above stated, upon which, that court adjudged the mortgage to be a valid lien, and ordered the amount found to be due on it to be paid out of the proceeds of the sale, before any distribution to the general creditors. This judgment was reversed by the circuit court, which held, that, as the mortgage was not filed for record until after the deed of assignment was filed in the probate court, it was invalid as against the assignee, and not entitled to preference over the general creditors. Whether there was error in that judgment, is the question presented to this court. Wallace, Billingsley & Taylor, for plaintiff in error. Among the adjudicated cases bearing on the question in controversy, we think none can be found more directly in point than the case of Mellon's Appeal, 32 Penna. 121. The statutes of Pennsylvania as to the recording of mortgages. are substanially the same as ours. Brightly's Purdon's Digest, vol. 1, page 588, sec. 122. When Hape made the assignment on December 16, 1885, he could only assign what rights he held in the land previously mortgaged to Betz. American and English Encyclopædia of Law, vol. 1, 854; Lemon, Assignee, v. Hutchins et al., Ohio Circuit Court Reports, vol. 1, p. 388; see also Hodgsen v. Barrett, 33 Ohio St. 63. Betz v. Snyder. There is no question made about the bona fide character of the mortgage. Now the subsequent assignment of Hape to his assignee, in no sense of the term constitutes him purchaser for a valuable consideration, as is clearly shown by all the authorities which treat upon that subject. Gill v. Pinneys, Adm'r, 12 Ohio St. 38; Giauque on Assignments, p. 44, sec. 15 and notes. See also note on p. 46. Jones on Mortgages, vol. 1, p. 468, 2d ed; Burrill on Assignments, 5th ed., sec. 391; Morgan v. Kinney, 38 Ohio St. 610. W. G. Wells and C. N. Snyder, for defendant in error. Section 4133, Revised Statutes, relating to the recording of mortgages, and section 6335, relating to the filing of deeds of assignment, and the holdings of this court as to the effect and policy of our recording acts, must largely control this case, and hence the decisions of the courts of other states can throw but little if any light upon the question here presented. The principle running through all the cases since the recording act of 1831 is, that the subsequent acquired legal rights or title of third persons cannot be displaced by an unrecorded mortgage, a defectively executed mortgage, or any specific though merely equitable lien. Stansell v. Roberts, 13 Ohio 149; Mayhew v. Combs, 14 Ohio 429; Jackson v. Luce, 14 Ohio 514; White v. Denman, 16 Ohio 60; White v. Denman, 1 Ohio St. 11; Fosdick v. Barr, 3 Ohio St. 471; Van Thornly v. Peters, 26 Ohio St. 471. The force and effect of these decisions is, that a duly executed but unrecorded mortgage as to all third persons, who have acquired a legal lien on, or been clothed with a legal title to, the property, is entirely void, both in law and equity, and stands in no better position, but on an equal footing with a defectively executed mortgage or a contract for a mortgage. Does an assignee for the benefit of creditors come within this rule? Is he a third person clothed with a legal title? In two cases before this court he was distinctly and squarely brought within this rule. Bloom v. Noggle, 4 Ohio St. 45; Erwin v. Shuey, 8 Ohio St. 510. Under these decisions it follows conclusively that an as Betz v. Snyder. signee for creditors holding the legal title for the benefit of creditors, by force of the statute, stands in a better position. than the assignor, for in each of those cases the court find, that instrument though good and valid as against the assignor, is entirely inoperative against the assignee. Following out this principle and thereby preserving the harmony of the law, are the chattel mortgage cases. Hanes v. Tiffany, 25 Ohio St. 549; Kilbourne v. Tay, 29 Ohio St. 264; Lindemann v. Ingham, 36 Ohio St. 11; Blandy v. Benedict, 42 Ohio St. 299. It is difficult to conceive upon what principle a distinction could be drawn between a judgment creditor, whose rights have been repeatedly declared superior to an unrecorded mortgage, and an assignee holding the legal title in trust for the benefit of creditors. The logic which establishes the one applies equally to the other. If it is said that an assignee is not a purchaser for a valuable consideration, this is likewise true of a judgment creditor. If it is said that the assignee takes only the interest of the debtor and stands in his shoes, this is likewise true of a judgment creditor. If it is said that the law favors the diligence of the judgment creditor, then it is also true that the assignment statute, which, by requiring the exact time when the deed is filed to be stated, and providing that it shall take effect only from the time it is so filed, provides for diligence on the part of the assignor, and possible priorities of judgments and mortgages as a penalty for lack of diligence. If it is said that the judgment is superior because it is in favor of a creditor and that an assignee is not a creditor, as in the case of Mellon's Appeal, cited in plaintiff's brief, then it may be replied that, by the policy and holding of our courts, the rights of creditors may be as effectually asserted through an assignee as by judg ment and execution; that the possession of the assignee is the possession of the creditor. But it is claimed that this case must be controlled by Gill v. Pinney, 12 Ohio St. 38, where it was held that a mortgage not recorded until death of the mortgagor, was not for that reason inoperative as against the general creditors of the es |