Morris Plan Co. v. Moody

BROWN (Gerald), P. J.

Plaintiff, The Morris Plan Com

[29]

pany of California, appeals from a take nothing judgment in its action to quiet title to three automobiles.

On October 29, 1965, Clyde C. Johnson and Richard A. Johnson, dba Johnson & Son, delivered a 1960 Mercury and a 1961 Mercury to Robert K. Moody and Janet Moody, dba Royal Motors, in exchange for Moody’s draft on his bank to be presented to the bank with the vehicles’ title certificates. On November 5, 1965. Moody sold his interest in the. 1961 Mercury to John A. Mestmaeher. On November 21, 1965, Moody sold his interest in the 1960 Mercury to John N. Pish, Jr. On November 26, 1965, Frank Reiman Pontiac, dba Reiman-Turpin Pontiac, delivered a 1962 Cadillac to Moody on the same terms as the Johnson deal. On November 28, 1965, Moody sold his interest in the 1962 Cadillac to Robert E. Boyer. Moody’s sales to Mestmaeher, Pish and Boyer were by conditional sales contracts. Under a long existing financing arrangement it had with Moody, plaintiff purchased the three conditional sales contracts. Moody’s bank dishonored Ms drafts when presented by Johnson & Son and Reiman. Johnson & Son and Reiman kept the title certificates. They did not deliver or mail to the Department of Motor Vehicles any documents to transfer registration of the cars.

The trial court determined title to the vehicles remained in Johnson & Son and Reiman because title never passed from them to Moody. This result necessarily follows from Vehicle Code, section 5600: “No transfer of the title or any interest in or to a vehicle registered under this code shall pass, and any attempted transfer shall not be effective, until the parties thereto have fulfilled either of the following requirements: (a) The transferor has made proper endorsement and delivery of the certificate of ownership and delivery of the registration card to the transferee as provided in this code ... (b) The transferor has delivered to the department or has placed in the United States mail addressed to the department the appropriate documents for the registration or transfer of registration of the vehicle ...” Plaintiff’s contentions are based in part on Commercial Code, section 2403 : “ (1) A purchaser of goods acquires all title which his transferor had or had power to transfer except that a purchaser of a limited interest acquires rights only to the extent of the interest purchased. A person with voidable title has power to transfer a good title to a good faith purchaser for value. When goods have been delivered under a transaction of purchase the purchaser has such power even though . . . (b) The delivery was in exchange for a check which is later dishonored. ...” Plaintiff