Bank of Keystone v. Kayton

• Decision Date: 21 December 1951
• Docket Number: No. 33061,33061
• Citation: 50 N.W.2d 511,155 Neb. 79
• Parties: BANK OF KEYSTONE v. KAYTON.
• Court: Nebraska Supreme Court

Page 511

50 N.W.2d 511

155 Neb. 79

BANK OF KEYSTONE v. KAYTON.

No. 33061.

Supreme Court of Nebraska.

Dec. 21, 1951.

Syllabus by the Court.

1. The Certificate of Title Act was enacted for the protection of owners of motor vehicles, those holding liens thereon, and the public.

2. The Certificate of Title Act eliminates the practice of filing and recording chattel mortgages on motor vehicles in the chattel mortgage records, and substitutes the recording of such upon the certificate of title itself.

3. One holding a lien upon a motor vehicle must, insofar as he can reasonably do so, protect himself and others thereafter dealing in good faith, by complying and requiring compliance with applicable laws concerning certificates of title to motor vehicles.

4. Under the act relating to certificates of title to motor vehicles, no valid lien can be asserted against a motor vehicle unless it is disclosed by a valid certificate of title regularly issued by the county clerk of the county in which the applicant resides.

5. The gist of a replevin action is the unlawful detention of the property at the inception of the suit and the rights of the parties with respect to possession of the property at that time.

6. The burden is on the plaintiff in replevin to establish facts necessary for him to recover, and these must be shown to have existed at the time the action was commenced.

7. The law requires that a plaintiff in a replevin case must recover on the strength of his right in or to the property and not upon any weakness of the interest of the defendant therein.

Firmin Q. Feltz, Jr., Ogallala, G. B. Hastings, Grant, for appellant.

Dallas A. Clouse, Chappell, for appellee.

Heard before SIMMONS, C. J., and CARTER, MESSMORE, YEAGER, CHAPPELL, WENKE, and BOSLAUGH, JJ.

MESSMORE, Justice.

This is an action in replevin brought by the Bank of Keystone, plaintiff, against Ivan L. Kayton, defendant, in the district court for Deuel County to obtain possession of a certain 1948 Dodge club coupe or the value of the same if not returned, and for damages and costs. This action is based on a chattel mortgage executed and delivered to the plaintiff bank by John A. Harney, a duly licensed automobile dealer.

The action proceeded to trial before a jury. Upon motion made by the defendant to dismiss the plaintiff's petition, based on the plaintiff's failure to produce sufficient evidence to make a case for the jury, the jury was discharged and the defendant's motion to dismiss was sustained.

The trial court, in substance, made the following findings: (1) That the defendant was a creditor of John A. Harney, a duly licensed automobile dealer; (2) that the defendant had been in possession of the 1948 Dodge club coupe at all times until the same was taken from him by virtue of the action in replevin; (3) that the chattel mortgage dated August 30, 1950, executed and delivered to the plaintiff bank by John A. Harney was not endorsed as a lien on the certificate of title covering the vehicle, nor was the same endorsed upon any certificate of title; (4) that under the terms of section 60-105, R.S.Supp., 1949, and section 60-110, R.S.1943, no lien was created against defendant even though title had passed from the defendant to John A. Harney; and (5) that defendant was entitled to have the right of possession of the vehicle in question at the commencement of the suit, the value of the same being $800, damages sustained by the detention of the automobile being nominal.

The trial court entered judgment on the findings that defendant was entitled to the immediate possession of the Dodge club coupe or the value of the same in the amount of $800, damages in the sum of one cent, and costs of the action.

The plaintiff filed a motion for new trial. From the order overruling the motion, plaintiff appeals.

For convenience we will refer to the plaintiff as the bank, to the defendant, Ivan L. Kayton, as defendant, and to the automobile dealer John A. Harney as Harney.

It appears from the record that Harney was a duly licensed automobile dealer having a Packard agency in the city of Ogallala. He dealt in both new and used automobiles. On July 25, 1950, by written contract, Harney sold to the defendant, who resides near Chappell, a new 1950 Packard club sedan, the purchase price being $2,915, with a down payment of $100 by check which he cashed. The defendant was given a trade-in allowance for a 1948 Dodge club coupe which amounted to $1,185, making the total down payment $1,285. Upon delivery of the Packard the defendant was to pay $630 in cash and to give Harney a note for $1,000 with interest at 8 percent due in 90 days. On August 3, 1950, the defendant mailed the certificate of title to the Dodge club coupe to Harney. On August 30, 1950, Harney's bookkeeper, making a business transaction for him with the bank, presented the bank with the following instruments: An installment note executed and delivered by Harney to the bank in the amount of $1,005, payable on October 30, 1950; a chattel mortgage which included therein the 1948 Dodge club coupe as security; two certificates of title; and a power of attorney. One of the certificates of title covered the Dodge automobile here involved. On the reverse side of this certificate of title was an assignment of the Dodge club coupe to Harney, bearing date of August 8, 1950. The reassignment appearing on the certificate of title was in blank, not acknowledged, but signed by Harney.

On July 25, 1950, a power of attorney appointing Harney lawful attorney to assign a certificate of title covering the Dodge club coupe or to make application for a certificate of title was signed by the defendant and delivered to Harney.

The power of attorney and certificate above referred to were in the possession of the bank until introduced in evidence in this case, together with the note and mortgage above referred to. At the time of trial there was due on the debt of Harney to the bank $805.

It was represented to the bank at the time the transaction was had with Harney that the Dodge club coupe was in his possession and free of encumbrances. The bank did not verify this fact for the reason that it had transacted business satisfactorily with Harney for a period of two years.

Harney died on September 3, 1950. He was insolvent at the time. On September 6, 1950, the plaintiff filed its chattel mortgage in Keith County.

The plaintiff first learned of the location of the Dodge club coupe on September 6, 1950, and that it was in the possession of the defendant. The defendant went to the bank looking for his title on or about September 6, 1950, and asked to see the papers with reference to the transaction had between the parties. He was shown the note, the chattel mortgage, the certificate of title, and the power of attorney. He told the bankers that there was no use denying that his signature appeared on some of the papers. Later in his testimony he denied that he had signed the power of attorney or made any assignment of the title to the vehicle to Harney.

The defendant also testified that Harney was not able to furnish him the 1950 Packard for which he had contracted, but orally agreed to furnish him a 1951 Packard of the same model and on the same terms. The defendant was to mail to Harney the certificate of title to the Dodge automobile which he did on or about August 3, 1950. There was nothing said about a power of attorney. When the transaction was had with Harney by the defendant, he drove the Dodge coupe home and retained the possession of it awaiting delivery of the Packard. It was taken from him in this replevin action instituted on October 16, 1950.

The plaintiff's assignments of error may be summarized as follows: (1) The trial court erred in dismissing the plaintiff's petition at the conclusion of the evidence; (2) the trial court erred in finding the defendant was a creditor of Harney; and (3) the judgment entered by the trial court is contrary to the evidence and the law.

A motion for a directed verdict or dismissal must, for the purpose of a decision thereon, be treated as an admission of the truth of all material and relevant evidence submitted on behalf of the party against whom the motion is directed, and such party is entitled to have every controverted fact resolved in his favor, and to have the benefit of every inference that can reasonably be deduced from the facts in evidence. See, Moncrief v. Interstate Transit Lines, 129 Neb. 168, 261 N.W. 163; Robinson v. Central Neb. Public Power & Irrigation Dist., 146 Neb. 534, 20 N.W.2d 509.

We bear in mind the foregoing rule in analyzing this appeal.

The trial court found, and properly so, under the factual situation presented that the title to the 1948 Dodge club coupe passed from the defendant to Harney, the licensed dealer.

This appeal involves the act relating to title and transfer of motor vehicles, and provides for the recording of liens and encumbrances on motor vehicles on a certificate of title. This act is found in Chapter 60, article 1, R.S.1943, and amendments thereto. Certain sections of the act were amended by the 1945 and 1949 Legislatures. See Laws 1945, c. 140, p. 442; Laws 1949, c. 93, p. 249; Laws 1949, c. 179, p. 505.

In support of its assignments of error the plaintiff contends that the provisions of the Certificate of Title Act do not apply to motor vehicles acquired by licensed automobile dealers in this state...