Ray v. Mercantile Acceptance Corp.

THE COURT. This is an action for a conversion of a V-8 Tractor, a utility semi-trailer, and a GMC truck, based upon the unlawful re-possession thereof by defendant finance company.

Some time prior to July 1, 1937, plaintiffs were purchasing, under conditional contracts, the tractor and the GMC truck. On May 11, 1937, plaintiffs, being the owners of the utility trailer, executed a chattel mortgage thereon in favor of the Acceptance Corporation, as security for the payment of $504, re-payable in twelve monthly installments of $42, beginning June 15, 1937.

On June 24th, plaintiffs paid defendant Acceptance Corporation $200, of which $42 was credited on the chattel mortgage payment due June 15th, and the balance was applied to other obligations from plaintiffs to defendant.

[329]Some time in July, the exact date being one of the issues in this case, defendant re-possessed all three pieces of equipment on the ground plaintiffs Avere in default or had violated the terms of their contracts.

Plaintiffs then brought this action in conversion, claiming defendant had acted unlawfully in such seizures, and after a hearing thereon, judgment was entered in favor of defendant as to the tractor and the truck, the court finding that as to that equipment plaintiffs were in default under their contracts, but as to the utility trailer the judgment was in favor of plaintiffs.

Each side has appealed from that portion of the judgment adverse to them, defendant claiming it took possession of the trailer under the terms of the chattel mortgage, and plaintiffs as to the tractor and truck, contending that the vendor of a conditional sales contract, after default in a monthly installment, cannot accept a partial payment and then claim a forfeiture prior to the due date of the next monthly installment.

Directing our attention first to the appeal of the Acceptance Corporation as to the utility trailer, the record discloses the execution of the chattel mortgage and the payment of the June installment on June 24th.

According to the testimony of defendant the trailer Avas re-possessed in Petaluma, some time after July 15th, either July 17th or July 19th. The entry on the books of the company shows a re-possession entry as of July 19th, so it may be assumed the actual retaking was at a time prior thereto.