Ark. Code Ann. § 5-37-203 (2026)

Research References

Ark. L. Rev.

Creditors' Provisional Remedies and Debtors' Due Process Rights: Attachment and Garnishment in Arkansas, 31 Ark. L. Rev. 607.

Nickles, A Localized Treatise on Secured Transactions — Part II: Creating Security Interests, 34 Ark. L. Rev. 559.

Case Notes

Applicability.

Defendant who sold property mortgaged to federal government agency could be prosecuted under former section prohibiting the removal of property subject to lien, since state and federal courts had concurrent jurisdiction. State v. Duncan, 221 Ark. 681, 255 S.W.2d 430 (1953) (decision under prior law).

Bankruptcy Proceedings.

Where defendant/debtor misappropriated the sale proceeds in which he had no legal or equitable interest, the debtor acted with malice in harming the creditor's property just as if he were a bank robber or an embezzler, and the fact that the debtor's conduct rose to the level of two separate criminal offenses under state law supported the conclusion that the debtor's act was malicious and the debt was not dischargeable in bankruptcy. Mercantile Bank of Ark.,N.A. v. Speers, 244 B.R. 142 (Bankr. E.D. Ark. 2000).

Consent of Lienholder.

Instruction that if the defendant removed the secured property from the state without the legal authority or consent of the prosecuting witness the jury should convict him was erroneous in using the word “legal,” being calculated to mislead the jury. Murry v. State, 150 Ark. 461, 234 S.W. 485 (1921) (decision under prior law).

Defendant was entitled to instruction that if evidence indicated that the secured party consented to the sale of the secured property, defendant would be acquitted, and that consent could have been expressed or implied from the conduct of the parties. Hill v. State, 253 Ark. 512, 487 S.W.2d 624 (1972) (decision under prior law).

Requested instruction to the effect that if the secured party later acquiesced in the sale of the secured property defendant should be acquitted, was properly refused, since consent, if set up as a defense in a criminal case, had to precede the act constituting the gist of the offense and did not relate to what occurred thereafter, although the secured party's conduct subsequent to the sale was considered as evidence of prior consent. Hill v. State, 253 Ark. 512, 487 S.W.2d 624 (1972) (decision under prior law).

Debt.

Existence of debt secured by lien had to be shown. McCaskill v. State, 68 Ark. 490, 60 S.W. 234 (1900) (decision under prior law).

Defenses of Debtor in Bankruptcy.

The debtor failed to establish that the prosecution was pursued in bad faith or for the primary purpose of collecting a dischargeable debt from the debtor individually, where the allegations against the debtor for which criminal sanctions were sought was the debtor's alleged fraud of selling mortgaged property without permission, not his failure to pay the debt owed to the bank. Evans v. Bank of Eureka Springs, 245 B.R. 852 (Bankr. W.D. Ark. 2000).

Demand.

Where a defendant was charged with disposing of mortgaged chattels, it was not necessary as a condition for conviction that a demand be made on the mortgagor for the debt or the mortgaged property nor that the defendant refuse, upon demand, to pay the debt. Stewart v. State, 139 Ark. 403, 214 S.W. 48 (1919); McClaskey v. State, 168 Ark. 339, 270 S.W. 498 (1925) (preceding decisions under prior law).

Disposal.

Concealment of secured goods so that it could not be found for the purpose of foreclosing the mortgage constituted a disposition of secured goods. McClaskey v. State, 168 Ark. 339, 270 S.W. 498 (1925) (decision under prior law).

Evidence.

Evidence held insufficient to support conviction. Houston v. State, 66 Ark. 120, 49 S.W. 351 (1899) (decision under prior law).

Evidence held sufficient to support conviction. Early v. State, 226 Ark. 376, 290 S.W.2d 13 (1956) (decision under prior law).

False Pretenses.

The offense of obtaining personal property under false pretenses was distinguished from the offense of fraudulently conveying property in that the former offense consisted of obtaining money or property by false representations of an existing or past fact whether relating to land or anything else by one who knew the representation to be false while the latter offense could exist under a conveyance to defraud whether there were false representations or not. Shelton v. State, 96 Ark. 237, 131 S.W. 871 (1910) (decision under prior law).

Indictment.

The indictment for removing property subject to lien did not have to allege the manner of disposal; nor the vendee's name. State v. Crawford, 64 Ark. 194, 41 S.W. 425 (1897) (decision under prior law).

The indictment did not have to allege that the mortgage was of record. Bennett v. State, 65 Ark. 80, 44 S.W. 1037 (1898) (decision under prior law).

An indictment for removing mortgaged property from the county wherein the mortgage was recorded was not demurrable as failing to allege an offense within the local jurisdiction of the court. Hampton v. State, 67 Ark. 266, 54 S.W. 746 (1899) (decision under prior law).

Indictment was required to allege the value of the property. Kightlinger v. State, 105 Ark. 172, 150 S.W. 690 (1912) (decision under prior law).

An indictment for disposing of mortgaged property was not required to allege the name of the person to whom the property was sold or that the purchaser was unknown. McClaskey v. State, 168 Ark. 339, 270 S.W. 498 (1925) (decision under prior law).

Intent.

A criminal intent was essential to sustain a conviction for removing property subject to lien. Lawhorn v. State, 108 Ark. 474, 158 S.W. 113 (1913) (decision under prior law).

In prosecution for removing mortgaged property from the state with intent to cheat and defraud mortgage holder, admission of evidence of extradition proceedings for such offense was not prejudicial as such evidence bore on the good faith and intention of defendant. Early v. State, 226 Ark. 376, 290 S.W.2d 13 (1956) (decision under prior law).

Where defendant could not be located and he allowed the insurance to lapse on his car, these circumstances alone do not establish defendant's intent to hinder the enforcement of a security interest; the state failed to prove that he acted with the requisite culpable mental state, and therefore his conviction cannot stand. Eggleston v. State, 16 Ark. App. 72, 697 S.W.2d 121 (1985).

Purpose to Hinder.

The fact that the defendant “removed” a truck to a new location was insufficient to establish a purpose to hinder enforcement of the lien of a secured creditor since the very nature and purpose of a truck is to be moved about, and since the defendant did not dispose of or destroy the truck. Anderson v. State, 62 Ark. App. 1, 967 S.W.2d 569 (1998).

Security Interest.

Lien could exist although mortgage was not recorded. Hampton v. State, 67 Ark. 266, 54 S.W. 746 (1899) (decision under prior law).

Where bank had erroneously sent automobile title to defendant who had not satisfied the indebtedness under a financing agreement, and where defendant transferred the certificate of title before bank discovered the mistake, bank held no lien at the time defendant transferred title and thus defendant could not be convicted of disposing of mortgaged property with intent to defraud lienholder. Austin v. State, 259 Ark. 802, 536 S.W.2d 699 (1976) (decision under prior law).

Where the debtor was aware of the bank's security interest at the time he undertook to sell the bank's collateral, debtor's actions constituted both the tort of conversion and the state law statutory offenses of theft and defrauding secured creditors, and therefore he acted with malice in harming the bank's property when he misappropriated the sale proceeds in which he had no legal or equitable interest. Mercantile Bank of Ark.,N.A. v. Speers, 244 B.R. 142 (Bankr. E.D. Ark. 2000).

Subsequent Satisfaction.

After the offense of removing mortgaged property had been committed, it could not be condoned by satisfying the creditor with other property. Cooper v. State, 37 Ark. 412 (1881) (decision under prior law).

Cited: Crockett Motor Sales, Inc. v. London, 283 Ark. 106, 671 S.W.2d 187 (1984); Cheshire v. State, 16 Ark. App. 34, 696 S.W.2d 322 (1985).