Lindsey v. Butte

FINCH, P. J.

The plaintiff was given judgment against all the defendants for the sum of $6,000 as damages for the conversion of an automobile and the further sum of $250 as compensation for time and money expended in pursuit of the automobile. There are two appeals from the judgment; one by the defendant Heilman Commercial Trust and Savings Bank and the other by defendants Butte, Barker, and Pacific Ready-Cut Homes, Inc.

October 19, 1923, the plaintiff and E. L. Butler entered into a conditional sale contract, in the usual form, by the terms of which the former agreed to purchase from the latter a Duesenberg automobile for $5,000, of which sum $2,000 was paid at the execution of the contract and the balance of $3,000 was to be paid in ten equal monthly installments, commencing November 19, 1923. The contract contained the following:

“Time is of the essence of this contract, and acceptance by the seller of any payment after same is due shall not constitute a waiver by him of this provision. . . .

“Said purchaser agrees that he will not and has no right to asssign, pledge, mortgage or otherwise dispose of this contract or said automobile, ... or in any manner relinquish or lose control thereof, . . . without the written consent of said seller. . . .

“If said purchaser defaults in any of the above payments, when due, or breaches any provision of this contract, or if said automobile is attached or levied upon under any writ or process of any court, . . . said seller may, at his option,— First—take possession of said automobile . . . with or without process of law; and all payments theretofore paid here

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under shall thereupon be forfeited to said seller for the use wear, tear and depreciation of said automobile, and this contract and the purchaser’s rights in and to said automobile shall thereupon cease, . . . or,—Second—said seller may declare the whole of the sums then remaining unpaid to be immediately due and payable and sue therefor.”

There is testimony showing the facts enumerated herein. Both parties to the contract were automobile dealers in Los Angeles. The automobile was immediately delivered to the plaintiff. Butler immediately sold and assigned the contract to the defendant bank for the amount of the unpaid installments. The bank mailed notice to the plaintiff of the assignment, but the plaintiff testified that he did not receive the notice and that he had no knowledge of the bank’s ownership of the contract until April 22, 1924; that “Mr. Butler told me he had simply put it in there as collateral security for a loan. . . . Mr. Heilman was supposed to be his backer in the automobile business and had financed his money to pay for the automobiles he purchased, and it was understood, I was told by him that it was simply put up as collateral security for the money that Mr. Heilman advanced him.” Butler testified: “I think my office made collections from Mr. Lindsey of the payments due under the contract. ... I paid them to the Heilman bank. . . . During March, 1924, I owed Mr. Lindsey a little money. I think I owed him $400 and some odd.” The officer of the defendant bank who had “charge of the automobile department” testified that when payments were not made promptly on automobile contracts assigned to the bank, “it was customary for us to wait a few days—after which the payment was charged up to the dealer or strenuous efforts were made to collect it from the dealer”; that it “is the custom of the bank to go after the dealer who turned the contract over” to the bank “and tell him to get after the purchaser and get the money in”; that he “expected Mr. Butler to see that the payments from Mr. Lindsey were collected and turned into the bank”; that in this case “two specific payments were as a fact made by Mr. Butler or charged by the bank against his account out of six payments which were made altogether.” Only five installment payments were made by the plaintiff, and the first four of them Were made to Butler. None of them were made until several days after they respectively became due.