Peerless Motor Co. v. Sterling Finance Corp.

THOMPSON, J. The defendant Sterling Finance Corporation has appealed from a judgment quieting title in the respondent to one Peerless sedan automobile. It is claimed the respondent is estopped from asserting title thereto. Judgment was also rendered against the other defendants by default. They have not appealed.

The respondent Peerless Motor Company, a corporation, is a factory distributor of Peerless automobiles, authorized to do business in California, with its principal place of business at Los Angeles. The appellant is a financing corporation of the same city. The defendant Arthur Bowe is an independent dealer in automobiles, doing business under the name of Wilshire Center. Motors, with its place of business also in Los Angeles. He was engaged in buying and selling motor vehicles. He was not an agent of the respondent. Prior to September 11, 1929, Bowe had secured the prospect of selling a Peerless machine to Mr. and Mrs. P. J. Brady. On the last-mentioned date, Bowe exhibited to them the automobile which is involved in this action at the warehouse of the respondent in Los Angeles. Two days later, which was Friday, the 13th, Bowe agreed with W. F. Fowler, the representative of the respondent company, to purchase the Peerless machine for a cash consideration of $2,094.90. Thereupon Bowe drew and delivered to Fowler his personal check for that sum on the Seaboard National Bank of Los Angeles, in favor of Peerless Motor Company, saying, “This check is all right.” No receipt for this check or the money which it represented was delivered. No bill of sale or other evidence of transfer of title to the machine was executed. The title to the machine was not intended to pass until the check was honored and paid. Mr. Fowler [623]testified in that regard, “It (the check) was supposed to be cleared before the car was delivered.” The delivery of the machine was not authorized by the respondent. Mr. Fowler further testified regarding the delivery: “Q. The car was not delivered at that time but was held for future delivery? A. Yes. Q. At no time did you deliver the car to Mr. Bowe? A. No.”

On Saturday, the fourteenth day of September, the cross-defendants P. J. Brady and wife, executed a conditional contract to purchase the car from Bowe for the sum of $3,200, which was immediately assigned to the appellant Sterling Finance Corporation. In the afternoon of that same day, Bowe went to the respondent’s warehouse and took possession of the automobile, which he delivered to Mr. and Mrs. Brady. In compliance with the terms of their contract of purchase with Bowe, the initial payment on the Peerless car was satisfied by turning over to Bowe their old Gardner machine. Upon an application therefor, signed by Arthur Bowe, without the authorization of the respondent company, the' division of motor vehicles, on September 16th, issued to Jeannette M. Brady, as the purchaser of a “new Peerless” automobile, a certificate of ownership. The appellant merely, credited the net allowance for the assigned agreement for purchase of the Peerless ear to a debt which Bowe owed it. The check which Bowe gave to the respondent was not paid. He had no funds in the bank with which to pay it when it was drawn or thereafter. On Monday, the 16th, the respondent hunted up Brady, the purchaser of the car, and informed him the check was dishonored and that the title to the car had not passed. Brady voluntarily returned the Peerless machine to the respondent.