Auto Money Corp. v. Clark

• Decision Date: 26 May 1941
• Parties: AUTO MONEY CORPORATION, A MISSOURI CORPORATION, AND L. A. PHARRIS AND L. A. PHARRIS, AGENT, APPELLANTS, v. HENRY D. CLARK AND LOU M. CLARK, RESPONDENTS
• Court: Kansas Court of Appeals

153 S.W.2d 113

236 Mo.App. 862

AUTO MONEY CORPORATION, A MISSOURI CORPORATION, AND L. A. PHARRIS AND L. A. PHARRIS, AGENT, APPELLANTS, v. HENRY D. CLARK AND LOU M. CLARK, RESPONDENTS

Court of Appeals of Missouri, Kansas City

May 26, 1941

Appeal from Circuit Court of Henry County.--Hon. C. A. Calvird Judge.

AFFIRMED.

Judgment affirmed.

Crawford & Harlan and Vance Julian for appellants.

(1) Defendants' motion in arrest of judgment should not have been ruled on after motion for new trial was sustained. Carnes v. Thompson (Mo.), 48 S.W.2d 903. (2) Instruction No. 3, requiring defendants to establish the defense of usury by clear and convincing proof, rather than by a preponderance of the evidence, is not erroneous, since usury constitutes an exception to the general rule that a defense in a civil case is required to be established only by a preponderance of the evidence. 27 Ruling Case Law, p. 268 sec. 71; Tobin v. Neuman et al. (Mo. App.), 271 S.W 842; General Motors Accept. Corp. v. Weinrich, 218 Mo.App. 68, 262 S.W. 425; Hansen et al. v. Duval et al. (Mo.), 62 S.W.2d 732; Friday v. Scherer (Mo.), 110 S.W.2d 819; Nelson v. Evans (Mo.), 93 S.W.2d 691; Sec. 2844, R. S. Mo. 1929. Instruction No. 4 instructing the jury that plaintiffs had a right to charge eight per cent per annum as interest and a right to collect such interest in advance, or to add the amount of the interest to the loan, was likewise properly given. Secs. 2845, 4982, R. S. Mo. 1929, as amended Laws 1933, p. 199, sec. 1. Instruction No. 5, instructing the jury that plaintiffs had the right to make the charges set forth in such instruction, was also properly given. Sec. 4982, R. S. Mo. 1929, as amended Laws 1933, p. 199, sec. 1; Simpson v. Smith Sav. Soc. (Ark.), 12 S.W.2d 890; People's Finance & Thrift Co. v. Varney (Utah), 285 P. 304; Gore v. Industrial Loan & Sav. Co. (Ga.), 183 S.E. 499; Beneficial Loan Soc. v. Haight (Calif.), 11 P.2d 857. (3) The court should have given plaintiffs' Instruction B. Ittner v. Hughes, 133 Mo. 679, 34 S.W. 1110; Gardner v. Queen Ins. Co. of Am. (Mo. App.), 115 S.W.2d 4; Puterman v. Simon, 127 Mo.App. 511, 105 S.W. 1098; Barth v. Boyer (Mo. App.), 27 S.W.2d 499. (4) The only defense in this case was that of usury, and the facts pertaining thereto were undisputed. Plaintiffs, upon these facts, were not guilty of usury: (a) No charges were made except those expressly allowed by the statute under which plaintiff operated. People's Finance & Thrift Co. v. Varney (Utah), 285 P. 304; Sec. 4982, R. S. Mo. 1929, as amended by Laws 1933, p. 199, sec. 1; Penn. Mut. L. Ins. Co. v. Marshall (Ga.App.), 175 S.E. 142; Simpson v. Smith Sav. Soc. (Ark.), 12 S.W.2d 890; Murray v. Gordon-Watts Grain Co., 216 Mo.App. 607, 260 S.W. 513. (b) Interest may be charged in advance and collected upon interest without violation of the usury statutes. Interest, 33 C. J. 188, sec. 29; Sec. 2845, R. S. Mo. 1929; Interest, 33 C. J., 192, sec. 37; Sec. 4982, R. S. Mo. 1929, as amended Laws 1933, p. 199, sec. 1. (c) Sec. 4982, R. S. Mo. 1929, as amended by Laws of 1933, p. 199, sec. 1, is an exception to the general usury statute, Sec. 2840, R. S. Mo. 1929, and any usury is to be determined by such exception. Gehert v. Smiley (Mo.), 114 S.W.2d 1029; Mo. Discount Corp. v. Mitchell, 216 Mo.App. 100, 261 S.W. 743. (d) Even in the absence of statute, a lender may make reasonable charges for the preparation of necessary papers and for the inspection of collateral by agreement with the debtor, and such items will not be considered in determining whether the lender has charged a usurious rate of interest. Bank of Picher v. Harris (Okla.), 229 P. 137; Stewart v. Boone County Trust Co. (Mo. App.), 87 S.W.2d 223. (e) Sec. 4982, R. S. Mo. 1929, as amended by Laws of 1933, p. 199, sec. 1, designates what is a reasonable charge for such services. Beneficial Loan Soc. v. Haight (Calif.), 11 P.2d 857; Mo. Discount Corp. v. Mitchell, 216 Mo.App. 100, 261 S.W. 743; Nolan v. Family Loan Co. (Tenn.), 83 S.W.2d 559. (f) The owner of property has a right to name the price at which he is willing to sell. He may sell at one price for cash, and a higher price on credit, and not be guilty of usury. Holland-O'Neal Milling Co. v. Rawlings (Mo. App.), 268 S.W. 683. (g) In the pending case, defendants purchased an investment certificate--the transaction resembling that pursued by building and loan associations. Simpson v. Smith Sav. Soc. (Ark.), 12 S.W.2d 890; Hammerslough v. K. C. Bldg. Loan & Sav. Ass'n., 79 Mo. 80; Coleman v. Cole, 158 Mo. 253, 59 S.W. 106; Hickingbotham v. Industrial Finance Corp. (Ark.), 91 S.W.2d 1023. (h) The transaction herein involved has been upheld in other states, as not violative of the usury laws. Simpson v. Smith Sav. Soc. (Ark.), 12 S.W.2d 890; People's Finance & Thrift Co. v. Varney (Utah), 285 P. 304; Gore v. Industrial Loan & Sav. Co. (Ga.), 183 S.E. 499. (5) The action of the trial court should be reversed, and judgment re-entered for the plaintiff in accord with the verdict of the jury. Central States Life Ins. Co. v. Bloom (Mo.), 137 S.W.2d 517.

C. W. Prince and Charles E. Hassett for respondents.

(1) Where the trial court did not assign any ground on which defendants' motion for new trial was granted, appellate court would assume that motion was sustained on each ground stated therein. Ward v. Prudential Life Ins. Co. of Am. (Mo. App.), 105 S.W.2d 983; Security Bank v. National Surety Co. (Mo.), 62 S.W.2d 708; Gray v. City of Hannibal (Mo.), 29 S.W.2d 710; State ex rel. v. Hughes (Mo.), 142 S.W.2d 3. (2) The appellate court will not interfere with the action of the trial court in sustaining by a general order a motion for a new trial containing, among several grounds, one to the effect that the verdict is against the weight of the evidence, where there is any substantial evidence to support the court's action. Such action will not be reviewed except upon a record showing that no verdict in favor of the party to whom the new trial was granted, would be allowed to stand. Security Bank v. National Surety Co. (Mo.), 62 S.W.2d 708; Bowers v. K. C. Public Serv. Co. (Mo.), 41 S.W.2d 810; Hunt v. Metal Co. (Mo.), 39 S.W.2d 369; Guthrie v. Gillespie (Mo.), 6 S.W.2d 886; State v. Ellison, 268 Mo. 225, 186 S.W. 1075. (3) Plaintiffs' Instruction 3 is fatally erroneous in that it places upon the defendants the burden of establishing their case by "clear and convincing proof," rather than by a preponderance of the credible evidence. The invariable rule in all civil cases is that the burden of proof is established by a preponderance of the credible evidence. Nelson v. Evans (Mo.), 93 S.W.2d 691, 695; Marshall & Kilpatrick v. Ins. Co., 43 Mo. 586, 589; Edwards v. George Knapp & Co. (Mo.), 10 S.W. 54, 56; Grocery Co. v. Sanders, 74 Mo.App. 657, 660; 23 C. J. 14, 16. (a) In civil cases growing out of the violation of a penal or even a criminal statute, the rule is the same. Edwards v. Knapp & Co. (Mo.), 10 S.W. 54, 56; Smith v. Burrus, 106 Mo. 94, 16 S.W. 881; Brooks v. Roberts (in banc), 281 Mo. 557, 220 S.W. 11, 14; Trust Co. v. Southern Surety Co., 285 Mo. 621, 226 S.W. 926; State v. Burney, 193 Mo. 326, 186 S.W. 23. (4) The rule by which interest shall be calculated is that it be computed on the amount of the demand up to the first partial payment, then add such interest to the principal; then deduct the payment, then cast interest on the remainder to the second payment, then add such interest to the remainder and deduct therefrom the second payment, and so on until the last payment. Baker v. Contracting Co., 282 Mo. 685, 223 S.W. 45, 49; Sutton v. Libby (Mo. App.), 201 S.W. 615; James v. Hiatt, 80 Mo.App. 43; Call v. Moll, 89 Mo.App. 386; Riney v. Hill, 14 Mo. 501. (5) The appellants admit that they intended to do just what was done. That is to charge eight per cent interest on the full amount of the loan for one year, although the obligation was reducible monthly, and then charge interest on that interest for the full period of one year. In such case the intent to charge usury will be drawn from appellants' admitted intentional acts, rather than from their denial of intent to charge more than the law allows. Bank of Willow Springs v. Utterman (Mo. App.), 184 S.W. 1171, 1172.

OPINION

SHAIN, P. J.

--In this case we are called upon to review an action in replevin instituted in the Justice of Peace Court of Morgan County, Missouri. The subject matter in controversy is set forth in plaintiffs' petition as follows:

"One Blue 1935 Model Plymouth Coach, Motor No. PJ-167586, Serial No. 1064432. Of the value of $ 250.00. (Two Hundred and Fifty Dollars); that the same is wrongfully detained by the defendant at the county of Morgan County, Missouri; that the same has not been seized under any process, execution or attachment against the property of the plaintiff."

The plaintiff's duly executed and filed bond and writ was duly issued. The writ of replevin was duly executed by taking possession of the Plymouth coach in issue.

Defendants filed answer and counterclaim as follows:

"Come now the defendants and deny each and every allegation in plaintiffs' petition contained.

"Defendants further answering and for their counterclaim state that the automobile to which reference is made in the complaint herein, is and was at all the times hereinafter mentioned, the sole property of defendants; that the co-plaintiff, Auto Money Corporation, is a corporation engaged in money lending. That on the 15th day of February 1938, said corporation lent to defendants the sum of $ 250, and required defendants to execute a note and required defendants to secure said note by a chattel mortgage which chattel mortgage furnished the illegal basis for the cause of action asserted by plaintiffs.

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