Bell Finance Co. v. Gefter

• Decision Date: 21 February 1958
• Citation: 67 A.L.R.2d 578,147 N.E.2d 815,337 Mass. 69
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: , 67 A.L.R.2d 578 BELL FINANCE CO. v. William GEFTER.

Page 815

147 N.E.2d 815

337 Mass. 69, 67 A.L.R.2d 578

BELL FINANCE CO. v. William GEFTER.

Supreme Judicial Court of Massachusetts, Middlesex.

Argued Dec. 3, 1957.

Decided Feb. 21, 1958.

Alfred Legelis, Boston, for plaintiff.

Robert P. Cook, Boston, for defendant.

Before WILKINS, C. J., and RONAN, SPALDING, WILLIAMS, COUNIHAN, WHITTEMORE and CUTTER, JJ.

SPALDING, Justice.

The plaintiff brings this action of tort to recover for property damage to an automobile as a result of an accident on December 20, 1955.

The plaintiff is a finance company and at the time of the accident it held, by an assignment in writing from the conditional vendor, the note and conditional sale agreement given in connection with the sale of the automobile. When the accident occurred the automobile was being driven by the conditional vendee, one Scuturio. Due to the negligence of the defendant, the automobile was damaged to the extent of $250. On May 17, 1956, the date of trial, there had been no default on the conditional sale agreement or note by the conditional vendee.

The case was heard on the foregoing meager statement of agreed facts. The judge found for the defendant and a report to the Appellate Division was dismissed. The plaintiff appealed.

In many respects this case closely resembles Morris Plan Co. v. Hillerest Farms Dairy, Inc., 323 Mass. 452, 82 N.E.2d 889. There is was held, among other things, that a conditional vendor of an automobile could recover from a third person for negligently damaging the automobile while it was in the possession of the conditional vendee. At the time of the accident the conditional vendee was in default and the sum owed to the plaintiff under the conditional sale agreement was in excess of the damage. The case at bar differs in that (1) the conditional vendee was not in default at the time of the accident and (2) it does not appear what the amount of the debt was, that is, whether it was greater or less than the damage. The defendant argues that because of these differences the plaintiff does not come within the decision and cannot recover.

The first difference (lack of default on the part of the conditional vendee) we think is without significance. Even though the conditional vendor (or an assignee such as the plaintiff, who stands in his shoes) has no right to possession until default, he, nevertheless, has a security title to assure the payment of the debt. A conditional sale resembles in many respects a chattel mortgage, and the position of a conditional vendor is quite similar to that of a mortgagee. In Delano v. Smith, 206 Mass. 365, at pages 369-370, 92 N.E. 500, at page 501, 30 L.R.A.,N.S. 474, it was said by Rugg, J. (as he then was), 'Whether the mortgagee is in possession of the mortgaged premises or not, or whether his right to possession begins only with the breach of condition and there has been no breach, nevertheless he has such an interest in the property and its preservation as enables him to maintain an action in his own name for injury to it. Such right of action is founded not upon the right to present possession, but on title to the estate. He may maintain such an action, although he is a junior mortgagee and although the security remains ample for his protection. He has a right to his security unimpaired.' To the same effect are Gooding v. Shea, 103 Mass. 360; Chamberlain v. James, 294 Mass. 1, 8, 200 N.E. 361, and W. & R. Investment Co. v. Edwards Supply Co., 304 Mass. 650, 652, 24 N.E.2d 518. This principle has been applied with respect to chattel mortgages. Allen v. Butman, 138 Mass. 586. And we think it applies equally to a conditional sale. Ayer v. Bartlett, 9 Pick. 156 (conditional vendor allowed to recover against one who wrongfully attached property before default in possession of conditional vendee). Moreover, in the Morris Plan Co. case it was said that because of the similarity of a conditional sale to a bailment a conditional vendor had a right of action against a third person whenever a bailor would have one. That a bailor who is entitled to the future possession of a chattel can proceed against a third person to recover for the harm to his interest is not open to doubt. Restatement: Torts, §§ 220, 243. First National Acceptance Corp. v. Annett, 121 N.J.L. 356, 2 A.2d 650. See Note 28 B.U.L.Rev. 381; Williston on Sales (Rev.Ed.) § 333a; Note 38 A.L.R. 1337, 1340.

The second difference between the case at bar and the Morris Plan Co. case (where the debt exceeded the damage to the automobile) presents a question of more difficulty. Indeed, that question was there expressly left open, the court saying, 'Whether, if the damage to the automobile had been greater than the amount owed to the plaintiff, the latter, especially since it had the right of immediate possession, could have recovered an amount larger than the balance owed to it is a question not here presented' (323 Mass. 452, 453, 82 N.E.2d 889, 890). Here we do not know what the debt was. All that the agreed facts...