First National Bank v. Thompson

WARD, J.

This is an action in claim and delivery to recover possession of a Speeder gas shovel, or a judgment for its value, together with damages for its detention by defendants.

The facts are undisputed. On September 13, 1934, plaintiff, the owner of the shovel, entered into a conditional sales contract with E. H. Higgins for its sale for the amount of $1,000. Twenty-five dollars was paid on the execution of the contract, and the balance was to be paid in monthly installments, with interest on balances at the rate of 6% per annum. The contract gave the seller the option, upon default, to declare all unpaid sums immediately due with the right to sue therefor, or to retake possession of the equipment and credit the purchaser with the reasonable value thereof, or resell it, and in either event, to recover any deficiency. Notwithstanding Higgins paid only the initial payment of $25, and on November 4, 1937, the sum of $77.64 as interest, plaintiff

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allowed the shovel to remain in his possession, and he used it in construction work in which he was engaged. When the equipment had been badly wrecked Higgins placed it in his storage lot, located about two blocks from plaintiff’s establishment, where it remained for a period of more than two years, during which time the bank endeavored to find a purchaser at a price of $300. At the same time it gave Higgins “verbal authority to sell the equipment on approval of the bank of any deal that was made.” In July, 1938, Higgins, representing himself to be the owner, offered to sell the equipment to defendants for the sum of $400. He advised the bank that “he had a friend up on the coast that might desire to take this machine up there and repair it and use it in digging a drainage ditch across his place, and he would do that repair work for the use of the machine.” Incidentally, no evidence was offered to prove that this “friend up on the coast” was either of the defendants. The bank, relying upon such representation, agreed to the arrangement, and on July 28, 1938, defendants paid Higgins the $400 and received delivery of the equipment, which they removed to their ranch, repaired at an expense of approximately $600 and have ever since used in their work. They at all times continued to believe Higgins to be the owner of the equipment. Appellant states that at no time did it suspect that the transaction with the “friend up on the coast” was other than a “use-repair” job as had been represented; that from time to time its representative attempted to learn from Higgins and his son the name and location of the party in possession of the shovel, but that they evaded him in various ways and the information was never furnished. Finally, it became necessary for the bank to take over all the equipment that Higgins had under conditional sale, and Higgins disappeared. Shortly thereafter, the bank, having a prospective purchaser for the shovel, located it in the possession of respondents, upon whom, on November 22, 1941, it served a demand in writing for its possession. Delivery was refused and this action was filed on January 7, 1942. The value of the equipment at the date of the trial was stipulated to be the sum of $350.