Valentine v. G. S. Donaldson Investment Co.

California Court of Appeal Oct 17, 1927 No. Docket No. 4920.Published

Before: McLucas

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Holding. The court held that an employee who fraudulently transferred his employer's vehicle to himself and mortgaged it had no authority to do so, and the employer was not estopped from asserting ownership because the employee's fraudulent registration and the lack of a signed certificate of registration should have put the mortgagee on inquiry.

Issues

Whether the evidence supported the trial court's finding that the plaintiff was the owner of the automobile and entitled to possession.
Whether the plaintiff was estopped from asserting ownership against a mortgagee who relied on the employee's fraudulent representations and registration.
Whether the failure to obtain a new dealer's license under the Motor Vehicle Act affected the plaintiff's ownership rights.

Disposition. affirmed

Quotations verified verbatim against the opinion

“the evidence was sufficient to support the finding of the trial court that respondent was the owner and entitled to the possession of the automobile in question”

“Hodges, while an employee of respondent, fraudulently secured the registration of said automobile in his own name and fraudulently represented to appellants that he was the owner”

“Appellants are thereby precluded from urging the doctrine of equitable estoppel.”

McLUCAS, J., pro tem.

his is an action in claim and delivery for the recovery of a certain automobile, resulting in a judgment for damages in the sum of $1,250. By reason of the fact that at the time of the trial the automobile had been sold, possession thereof could not be delivered to the plaintiff. Defendants appeal from the judgment.

[144]

At a time prior to April 3, 1922, one Walter Hodges was connected with. George M. Boss and Walter J. Boss, doing business under the name of Golden State Motor Company. While so engaged in said business said Walter Hodges, as manager, made an application on behalf of the copartnership, namely, Golden State Motor Company, to the motor vehicle department of the state of California for a dealer’s license to buy and sell automobiles, under which dealer’s license the copartnership named conducted and carried on business. On April 3, 1922, respondent, together with one E. N. Moore, entered into a written contract with said Walter Hodges, which recited that respondent and E. N. Moore had purchased and taken over one-half of the assets and liabilities of the said Golden State Motor Company, the copartnership, and under the terms of which they agreed that they employed said Walter Hodges at a certain salary, with a future or contingent interest in the business. Bespondent carried on his business under the original dealer’s license applied for and issued to his predecessors, Golden State Motor Company, a copartnership, and was doing business under said dealer’s license and under said fictitious name at the time of the transfer of the title of the automobile by Hodges to himself, to wit, on or about May 4, 1922. On April 13, 1922, respondent handed to Hodges a check for the sum of $1,215, payable by the Golden State Motor Company to Greer-Bobins Company, for the car in dispute, which was subsequently returned to respondent and then used by him as a car for demonstrating purposes. On May 3, 1922, Walter Hodges, purporting to be a co-owner of said automobile by reason of his alleged interest in the Golden State Motor Company, caused the title of said car to be transferred from the Golden State Motor Company to himself as an individual, and obtained a loan upon the car in dispute from the G. S. Donaldson Investment Company. A mortgage upon the car was taken by said corporation to secure the repayment of the loan. Hodges failed to make the payments upon the loan; whereupon the appellant G. S. Donaldson Investment Company took possession of said automobile under the terms of said mortgage. Thereupon respondent instituted a cause of action in claim and delivery to recover the automobile, or its alleged value of $1,525.

Valentine v. G. S. Donaldson Investment Co.

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