Banes Agency v. Chino

• Decision Date: 04 November 1955
• Docket Number: No. 5945,5945
• Citation: 60 N.M. 297,1955 NMSC 100,291 P.2d 328
• Parties: The BANES AGENCY, A Partnership, Plaintiff-Appellee, v. Lawrence A. CHINO and Roy Gallaher, d/b/a Gallaher Used Cars, Defendants-Appellants.
• Court: New Mexico Supreme Court

Page 328

291 P.2d 328

60 N.M. 297

The BANES AGENCY, A Partnership, Plaintiff-Appellee, v. Lawrence A. CHINO and Roy Gallaher, d/b/a Gallaher Used

Cars, Defendants-Appellants.

No. 5945.

Supreme Court of New Mexico.

Nov. 4, 1955.

Rehearing Denied Dec. 16, 1955.

McAtee & Toulouse, Albuquerque, for appellants.

Gallagher & Walker, Albuquerque, for appellee.

SADLER, Justice.

The defendant Gallaher, as appellant before this Court, complains of a judgment against him in plaintiff's favor in an action growing out of a transaction whereby the plaintiff as assignee of a note and chattel mortgage, given as a part of the purchase price of an automobile later traded in to defendant for another car, and as a part of the latter purchase the defendant promised the purchaser to pay off the balance unpaid to plaintiff on the first car.

From a somewhat confusing and tangled state of facts, we are able to deduce these events in the order of their occurrence. On or about March 16, 1953, Lawrence A. Chino executed and delivered to L. O. Bradley, d/b/a B & W Auto Sales, a promissory note for $635.70. It was secured by a chattel mortgage on a 1948 Plymouth, four-door sedan, given by Chino to Bradley. On February 6, 1954, nearly a year later, Chino traded the Plymouth to the defendant, Gallaher, receiving a credit on the purchase of a Chevrolet car in the sum of $345. Gallaher had the Plymouth car on his sales lot until April 25, 1954, and has continued in constructive possession thereof ever since.

At the time Chino traded or turned in the Plymouth to Gallaher on the purchase of the Chevrolet, February 6, 1954, the records of the Motor Vehicle, Commissioner of New Mexico showed title to the Plymouth to be in Lawrence A. Chino with a chattel mortgage outstanding in favor of the Banes Agency, the plaintiff, in the sum of $635.70, a fact well known to the defendant, Gallaher, from whom Chino was purchasing the Chevrolet. Moreover, Gallaher, at the time of the transaction between him and Chino, and as a part thereof, promised the latter that he would pay off the balance still owing by Chino on the Plymouth in the sum of $311.63, plus accrued interest.

The foregoing facts, as recited hereinabove, are all incorporated and appear in the court's decision. From them the trial court formally deduced conclusions of law, as follows:

'1. That the promise made by Roy Gallaher to Lawrence Chino to discharge the said debt to the Banes Agency was for an adequate consideration and is not regarded as a promise to answer for the said debt of another within the meaning of the Statute of Frauds.

2. That by his actions in accepting the 1948 Plymouth as a trade in on another car and by his said oral promise, the defendant, Roy Gallaher, made Lawrence Chino's debt to the Banes Agency his own and he thereby became the principal debtor.

3. That Roy Gallaher's action in taking the said mortgaged vehicle in on a trade constituted a sufficient part performance to take the contract he made with Lawrence A. Chino out of the Statute of Frauds.

4. That by the above mentioned actions, defendant, Roy Gallaher, converted said mortgaged vehicle to his own use.

5. That said cause of action is not barred by the Statute of Limitations.

6. That defendant, Roy Gallaher's Cross Complaint against plaintiff herein has no basis in fact and should be dismissed.

7. That plaintiff is entitled to Judgment against said defendant, Gallaher, for $461.63 plus $31.16 interest, for a total of $492.79, and costs expended.'

Judgment having been entered against defendant in the sum of $492.79, as indicated in last paragraph of the conclusions of law, quoted above, the defendant prosecutes this appeal, assigning some 24 errors which obligingly are reduced to three points for purposes of argument.

The first is that there is no substantial evidence to support the basic finding on which the judgment rests. Argument upon which this contention rests points out that when Chino visited the Gallaher sales lot to trade in his Plymouth on a 1953 Chevrolet, he was asked twice by Gallaher if there was a lien on the car, to which inquiry on each occasion he responded, 'No.' It is true such an answer was made but the same witness while under cross-examination was interrogated and made answers touching the subject, as follows:

'Q. Did your car have a lien on it? A. '48?

'Q. Yes, did it have a mortgage--your '48 automobile, did it have a mortgage on it? Were you making payments on it? A. Yes, sir.

'Q. Who were you making payments to? A. Banes Agency.

'Q. And, did you advise Mr. Gallaher you were making payments to anybody? A. Yes.

'Q. Who did you tell him you were making payments to? A. I told him I was making payments to Banes Agency yet, and he told me, if I trade the car in he'll pay all that what I owed to the Banes Agency, so naturally I thought if, well, that's going to be a fair deal like that, I'll trade in, I said, so he took my '48 Plymouth in for a trade-in stating that he would pay what I owed to the Banes Agency.'

Previous answers of the witness that there was no lien on the car, viewed in the light of the later testimony, seem to bear out the statement of counsel for plaintiff that Chino, apparently a Laguna Indian, didn't know what a 'lien' meant. To say the least, when asked about a mortgage, he readily understood and answered that there was one. He further testified he told Gallaher he was making payments on it to the plaintiff and that Gallaher promised to take up and satisfy the balance due on the trade-in car, something that was in accord with custom and that he would be compelled to do before he could dispose of the car. We think the evidence supporting the findings is substantial and, hence, they are to be taken as the facts upon which the appeal will be heard in this Court. Garvin v. Gordon, 36 N.M. 304, 14 P.2d 264. It was the privilege of the trial judge to reconcile inconsistent statements of the witness, Chino, and say when he spoke the truth. Bubany v. New York Life Ins. Co., 39 N.M. 560, 51 P.2d 864.

It is next urged upon us as the second point in the case that the Statute of Frauds bars recovery against the defendant, Gallaher. Counsel for defendant places great reliance upon this contention. They point out, and it is nowhere questioned, that there is absolutely no writing shown containing a promise by defendant to pay Chino's obligation to the plaintiff, representing unpaid installments on the Plymouth traded to Gallaher. This is quite true. Indeed, he makes no claim to possess or hold any such writing.

The plaintiff's position in this matter is that the promise relied upon is not within the Statute of Frauds at all. His counsel simply contend that Gallaher made a promise to Chino, for a valuable consideration, to pay the amount owing on the take-in car; that in doing so he made the balance due his own debt and in receiving and retaining possession of the car on his own sales lot for more than two months, he converted same to his own use and thereby became liable to the plaintiff in damages for the conversion. His counsel quote the principle upon which they rest their case on 49 Am.Jur. 438, as follows:

'Sec. 82. A promise by one person, although he is in no way liable for an existing debt, made to the debtor for an adequate consideration, to discharge the debt, is not regarded as a promise to answer for the debt of another within the meaning of the statute of frauds. Such rule has been attributed to the principle that the statute applies only to promises made to a person to whom another is answerable, but a more fundamental reason for the rule is that the promisor, under the circumstances stated, makes the debt his own and becomes the principal debtor, * * *.'

We think the trial court correctly...