American Loan Plan v. Frazell

• Decision Date: 10 February 1939
• Docket Number: 30469.
• Citation: 283 N.W. 836,135 Neb. 718
• Parties: AMERICAN LOAN PLAN v. FRAZELL ET AL.
• Court: Nebraska Supreme Court

283 N.W. 836

135 Neb. 718

AMERICAN LOAN PLAN v. FRAZELL ET AL.

No. 30469.

Supreme Court of Nebraska.

February 10, 1939

Syllabus by the Court.

1. " Where an affidavit (in replevin) has defects in form or substance which might be amendable, if the parties in the case who might interpose objections to the affidavit appear answer to the merits of the action, and go to trial without making objections to the affidavit, they waive the defects." Hudelson v. First Nat. Bank of Tobias, 51 Neb. 557, 71 N.W. 304.

2. " Where a creditor accepts from his debtor any form of new agreement in place of a prior contract or obligation between them, with the intent to cancel the former and to substitute the new one therefor, novation by the substitution of an obligation takes place." 46 C.J. 586.

3. " A dealer in automobiles may in good faith sell a car on time for a price in excess of the cash price without tainting the transaction with usury, though the difference in prices may exceed lawful interest for a loan." Grand Island Finance Co. v. Fowler, 124 Neb. 514, 247 N.W 429.

4. " Where original purchase of automobile on credit was valid, it is immaterial in defense of usury to suit on note for car that finance company solicited contracts from automobile dealers and furnished schedules for that purpose." Grand Island Finance Co. v. Fowler supra.

5. " Purchase of note at discount beyond legal rate of interest does not constitute transaction ‘ usurious.' " Grand Island Finance Co. v. Fowler, supra.

Appeal from District Court, Douglas County; Leslie, Judge.

Replevin action by the American Loan Plan against V. C. Frazell, John E. Frazell, and another. From a judgment in favor of the plaintiff, the named defendants appeal.

Judgment affirmed.

W. A. Ehlers, of Omaha, for appellants.

Monsky, Grodinsky, Marer & Cohen, of Omaha, for appellee.

Heard before SIMMONS, C. J., and ROSE, EBERLY, PAINE, CARTER, MESSMORE, and JOHNSEN, JJ.

EBERLY, Justice.

This is an action for replevin for a new Ford Tudor automobile, brought in the district court for Douglas county by the American Loan Plan, a corporation, against V. C. Frazell, John E. Frazell, and Marie Frazell. The record discloses that at the commencement of the action the plaintiff filed a petition, and also the statutory affidavit for a writ of replevin. It also appears that the writ of replevin issued, but the property claimed (the automobile in suit) was not taken thereunder, and the action proceeded as one for damages under the terms of the statute. Comp.St.1929, § 20-10,106. A jury was duly impaneled, and, at the close of all evidence, the trial court sustained the motion of plaintiff, " to instruct the jury to return a verdict in its favor or that the jury be discharged and judgment entered for plaintiff," and entered judgment in favor of plaintiff and against said defendants, V. C. Frazell and John E. Frazell, and each of them, for the sum of $446.99 and costs of suit. From the order of the trial court overruling their separate motions for new trial, the defendants appeal.

The following facts appear in the record, substantially without dispute, viz.:

In September, 1935, John E. Frazell approached the McFayden-Stewart Company to purchase an automobile. He sought a " time plan" purchase. There was a difference between the automobile price on a cash basis and when purchased on the " time plan." As the bargain was finally consummated, on the basis of the time plan, he purchased a new 1935 Ford, Tudor model; he received an allowance of $78.75 for an old automobile which he traded in, paid $50 in cash, and together with his father, V. C. Frazell, executed and delivered to the McFayden-Stewart Company a chattel mortgage note or contract in triplicate, in the sum of $659, payable in 23 installments of $27.50 and one of $26.50. At the time of the transaction it was expected by the parties that the Universal Credit Company would finance the transaction, and the chattel mortgage note or contract in triplicate was executed on blanks provided by that company. However, the Universal Credit Company refused to take the paper because of the time of maturity provided therein. Accordingly, the American Loan Plan, a corporation, plaintiff herein, was contacted, and it purchased the chattel mortgage note or contract (exhibits 5, 6, 7) and paid therefor by a check of $500 dated September 18, 1935, payable to the McFayden-Stewart Company, and received its purchase as indorsee or assignee thereof. Thereafter, within a few days, V. C. Frazell, John E. Frazell, and Marie Frazell (wife of John E. Frazell) executed a promissory note and a " conditional sale contract and assignment," securing the same (exhibits 1 and 2) covering the automobile purchased (and described in the chattel mortgage note or contract, exhibits 5, 6, 7, previously executed), which were delivered to the McFayden-Stewart Company, and then executed by the latter (together with necessary indorsements and assignments to the American Loan Plan), and in turn, by the McFayden-Stewart Company, delivered to the American Loan Plan, plaintiff herein. It appears that by agreement of the parties the instruments last executed (exhibits 1 and 2) were substituted for the instruments first executed (exhibits 5, 6, 7), which latter were, in due time, returned to and delivered back to Frazell, who accepted and received the same. Thereafter the Frazells made default in the payments contracted to be made, and thereupon this action was instituted to recover possession of the property covered by the conditional sale contract and assignment.

Appellants' first contention is that plaintiff cannot recover because in the affidavit in replevin it claims a right to recover by reason of a special ownership, and " the proof if any shows general ownership or title." The authorities cited by appellants in support of this contention are not in point. True, it may be said the affidavit in replevin is defective. In this instrument the statement appears that plaintiff " has a special ownership in the above described property (the automobile in suit) under...