Sandhu v. Main

SPARKS, J. pro tem.* Defendant Seaboard Finance Company, a corporation, has appealed from a judgment awarding plaintiff, Sohan Sandhu, damages in the sum of $1,400 for the value of an International tractor, and $240 for the loss of its use.

There is no material controversy as to the facts. They disclose that in November, 1946, the tractor in question was owned by one W. Main and situate in San Joaquin County. In that month Main executed a chattel mortgage on the vehicle to defendant Seaboard Finance Company for $2,000. This mortgage was recorded in San Joaquin County on November 22, 1946. Thereafter Main sold the tractor to Henry R. Sam, his stepson, for $1,700, and not only failed to apprise Sam of the mortgage but instead assured him that there were no encumbrances on it. On or about July 7, 1947, Sam removed the tractor from San Joaquin to Madera County and kept it there continuously until he sold it on September 10, 1947, to plaintiff Sandhu. Sandhu paid Sam $1,400 for the vehicle and had no knowledge of the mortgage of the Seaboard Finance Company or of any other defect of title. Appellant’s chattel mortgage had not been recorded in Madera County or in any county other than San Joaquin. Meanwhile, W. Main defaulted on his payments to Seaboard Finance Company and departed, leaving no forwarding address. The amount due and owing on the chattel mortgage was $1,831.91. Seaboard Finance Company instituted a search for the vehicle, located it sometime in the month of June or July in 1948 in Madera County and took it from the possession of plaintiff. It was subsequently sold by appellant and passed into the hands of persons outside the jurisdiction of the trial court.

It is appellant’s contention that respondent Sandhu acquired no better title to the tractor than that held by the party from whom he had purchased, namely, Henry Sam. The latter, of course, purchased the property in San Joaquin County, where appellant’s chattel mortgage was on record, and of which Sam had constructive notice. It is urged then [185]that since the sale from Main to Sam was without the knowledge or consent of appellant and subject to its mortgage, that when Sam took .the tractor to Madera County and claimed to be the owner thereof, he committed a conversion.

Respondent, on the other hand, maintains that appellant had lost its lien upon the tractor prior to the time it was repossessed, and that Sandhu as a bona fide purchaser for value without notice had acquired an unencumbered title and that consequently appellant was liable in damages for the unlawful taking of the vehicle.