Western States Acceptance Corp. v. Frank D. Tuttle, Inc.

SHENK, J.

This is an appeal by the plaintiff from a judgment in its favor in the sum of $527.96.

The plaintiff filed a complaint to recover the balance due on a lease and conditional sale contract entered into by it with the defendant Frank D. Tuttle, covering a stock of Ford automobile parts. The total amount contracted to be paid by said defendant was $15,594.70 in ten monthly installments of $1559.47 each, upon which the plaintiff alleged a balance due and unpaid of $2,720.66. The plaintiff also alleged the transfer of the liability under the contract to Frank D. Tuttle, Inc.

The defendants by their answer set up what is conceded to be the true transaction between the parties, viz.: that the plaintiff loaned to the defendant Frank D. Tuttle the sum of $14,771.54, repayment of which was to be secured by a stock of Ford automobile parts, the purchase of which from other parties was then being negotiated by the defendant Frank D. Tuttle. The lease and conditional sale contract purported to be the security for the repayment of said sum, and the difference between the sum loaned and the principal sum of the contract is the amount charged as interest. The defendants also pleaded the defense of usury, and a counter

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claim for moneys laid out and expended, and for insurance, in the sum of $886.93.

The plaintiff subsequently filed its amended and supplemental complaint, alleging the transaction in its true form; and further that the plaintiff was unaware of the usurious rate of interest charged, but that the intention of all parties was and is that the maximum legal rate of interest should be charged and collected, and that the overcharge was the result of miscalculation, mistake and inadvertence. By its amended complaint the plaintiff sought judgment of reformation of the contract and for the balance due under the contract as reformed. By stipulation the answer to the original complaint was considered as an answer to the amended complaint, and the allegations thereof uncontroverted or denied by the answer were deemed to have been denied.

The trial court found the essential facts above stated and that there was no mistake or miscalculation in the computation of the interest by the plaintiff; that the interest was computed without the knowledge of the defendant Frank D. Tuttle; that the parties did not have in view or contemplate interest at the rate of twelve per cent or less; that the plaintiff intended to and did actually charge the defendant Frank D. Tuttle the amount of interest on the loan of $14,771.54 as provided in said contract, and that the rate of interest charged was usurious and contrary to law. (Stats. 1919, p. lxxxiii.) Judgment was ordered for the plaintiff in the sum of $1102.84, together with attorney fees of $110.28, less the sum of $685.16 found by the court to be due as credits from the plaintiff to the defendant Frank D. Tuttle on account of insurance commissions.