Article 4. Conditional Sale Of Railroad Equipment of California Public Utilities Code >> Division 4. >> Chapter 1. >> Article 4.
In any contract for the sale of railroad or street railway
equipment or rolling stock, it is lawful to agree that title to the
property sold or contracted to be sold, although possession thereof
may be delivered immediately or at any time or times subsequently,
shall not vest in the purchaser until the purchase price is fully
paid, or that the seller shall have and retain a lien thereon for the
unpaid purchase money.
In any contract for the leasing or hiring of railroad or
street railway equipment or rolling stock, it is lawful to stipulate
for a conditioned sale thereof at the termination of the contract,
and that the rentals or amounts to be received under the contract
may, as paid, be applied and treated as purchase money, and that the
title to the property shall not vest in the lessee or bailee until
the purchase price has been paid in full and until the terms of the
contract have been fully performed, notwithstanding delivery to and
possession by the lessee or bailee.
No contract of the type provided for in this article shall be
valid as against any subsequent judgment creditor or any subsequent
bona fide purchaser for value and without notice, unless all of the
following conditions are met:
(a) The contract is evidenced by an instrument executed by the
parties and duly acknowledged by the vendee, lessee, or bailee, as
the case may be, or duly proved before some person authorized by law
to take acknowledgments of deeds, and in the same manner as deeds are
acknowledged or proved.
(b) Each car or locomotive engine so sold, leased, or hired, or
contracted to be sold, leased, or hired has the name of the vendor,
lessor, or bailor plainly marked in letters not less than one inch in
size on each side thereof, followed by the word "owner," or "lessor,"
or "bailor," as the case may be.