Ashlock v. Sunwest Bank of Roswell, N.A.

• Decision Date: 22 March 1988
• Docket Number: No. 17068,17068
• Citation: 1988 NMSC 26,753 P.2d 346,107 N.M. 100
• Parties: George H. ASHLOCK, Plaintiff-Appellee, v. SUNWEST BANK OF ROSWELL, N.A., Defendant-Appellant.
• Court: New Mexico Supreme Court

Page 346

753 P.2d 346

107 N.M. 100

George H. ASHLOCK, Plaintiff-Appellee, v. SUNWEST BANK OF ROSWELL, N.A., Defendant-Appellant.

No. 17068.

Supreme Court of New Mexico.

March 22, 1988.

Rehearing Denied May 5, 1988.

[107 NM 100] Atwood, Malone, Mann & Turner, P.A., Rod M. Schumacher, Roswell, for defendant-appellant.

Bozarth, Craig & Vickers, P.C., Marion J. Craig, III, Roswell, for plaintiff-appellee.

OPINION

WALTERS, Justice.

Defendant Sunwest Bank of Roswell (Bank) appeals the trial court's award to plaintiff George H. Ashlock of $20,081.98 in actual damages and $2,962.88 in costs and attorney fees. Ashlock alleged in part, and the trial court so held, that the Bank violated the New Mexico Unfair Practices Act. The Bank's argument on appeal is that the trial court's decision is supported neither by the facts nor the findings. We disagree and affirm the trial court.

In 1981, Ashlock received a mail solicitation from the Bank inviting him to open a new kind of high interest-bearing checking account. Upon making inquiries at the Bank, Ashlock transferred $27,324 from his savings account to the new interest-bearing account. At that time Ashlock believed he had an agreement with the Bank whereby interest would be paid regularly on the funds in the new account. Because of an error at the Bank, however, no interest was paid on or credited to Ashlock's account. The non-payment came to Ashlock's attention in 1986 when he went to the Bank on another matter and a bank employee then discovered that his account had never drawn interest. The employee assured Ashlock that the account would start to draw interest that night, and Ashlock, dissatisfied, met several times thereafter with Bank officials attempting to persuade them to pay back interest due on his account. Those efforts failed; Ashlock's suit against the Bank followed.

According to the Bank, the trial court failed to enter necessary findings of fact to sustain the judgment. We have said that "findings are to be liberally construed in support of a judgment, and such findings are sufficient if a fair consideration of all of them taken together justifies the trial court's judgment." State ex rel. Goodmans Office Furnishings, Inc. v. Page & Wirtz Constr. Co., 102 N.M. 22, 24, 690 P.2d 1016, 1018 (1984). Here, the trial court found that the Bank advertised its interest-bearing checking account and suggested that savings funds be transferred to such accounts; Ashlock directed the Bank to so transfer his funds; the transfer of $27,324 was completed, but the Bank failed to transfer the sum to an interest-bearing checking account; no interest was paid until the error was discovered in January 1986; the Bank did not advise Ashlock that his new account would not bear interest although the Bank knew that Ashlock believed that it would; the account would have earned an additional $20,081.98 if interest had been paid and kept in the account; the Bank refused to pay Ashlock the back interest on his account.

Four elements must be established to invoke the Unfair Practices Act. First, the complaining party must show that the party charged made an "oral or written statement, visual description or other representation * * * " that was either false or misleading. Second, the false or misleading representation must have been "knowingly made in connection with the sale, lease, rental or loan of goods or services in the extension of credit or ... collection of debts * * *." Third, the conduct complained of must have occurred in the regular course of the representers trade or commerce. And, fourth, the representation must have been of the type that "may, tends to or does, deceive or mislead any person." NMSA 1978, Sec. 57-12-2(C) (Repl.Pamp.1987). Descriptions of unfair or deceptive trade practices include "failure to deliver the quality * * * of * * * services contracted for." Id. Sec. 57-12-2(C)(17). (Emphasis added.)

The Bank argues that the statute requires the statement to be made with the intent to mislead. Such an interpretation imposes an element not provided for by the legislature. Had the legislature wished intent to deceive to be an essential element of the offense, it would have so specified. Richardson Ford Sales, Inc. v. Johnson, 100 N.M. 779, 676 P.2d 1344 (Ct.App.1984). We may infer from the language of the statute that the legislature did not enact such a requirement of intent, because it clearly provides that "[w]here the trier of fact finds that the party charged with an unfair or deceptive trade practice or an unconscionable trade practice has willfully engaged in the trade practice, the court may award up to three times actual damages * * *." NMSA 1978, Sec. 57-12-10(B). (Emphasis ours.) That permissive language leads us to conclude that it was within the legislature's contemplation that in some cases, but not all, the false or misleading statement would be made at the outset with the intent to deceive, and in such cases triple damages would not be unwarranted. Conversely, it suggests also that the legislature anticipated other situations wherein the statement would not be intentionally unfair or deceptive, but could become a false or misleading representation at some time during the life of the transaction.

Additionally, an interpretation that would require the representer to intend to deceive the consumer at the time the representation is made would unwisely open the door to condonation of bait-and-switch trade practices. For example, a business could advertise specific services or goods, obtain orders and payments, yet substitute other services or goods if for some reason the advertised services became onerous or the advertised goods became unavailable. If purity of intent at the moment of making the representation were a complete defense, without regard to the conduct of the representing party before the deal is consummated, the Act would become toothless, and a change of heart at time of delivery of the services or goods would render Section 57-12-2(C)(17) meaningless.

Our construction is in accord with the legislature's declaration that "[t]he relief provided * * * [by the Unfair Practices Act] is in addition to remedies otherwise available against the same conduct under the common law or other statutes of this state." NMSA 1978, Sec. 57-12-10(D) (Repl.Pamp.1987). By recognizing that the Act applies to all misleading or deceptive statements, whether intentionally or unintentionally made, we ensure that the Unfair Practices Act lends the protection of its broad application to innocent consumers.

In the instant case the Bank advertised through the mail and in the newspapers that it would provide an interest-bearing account. The advertisements were representations knowingly made by the Bank in connection with the offering of a service. As a direct result of the advertising and of subsequent discussions with a Bank employee, Ashlock transferred monies into an account for the express purpose of earning such interest. Ashlock sued because of the Bank's failure to pay interest as advertised and as was indicated to him by the Bank when his funds were transferred. The entire series of acts clearly occurred in the regular course of the Bank's business....