Cavazos v. Holmes Tuttle Broadway Ford, Inc.

• Decision Date: 30 June 1969
• Docket Number: No. 9607-PR,9607-PR
• Citation: 104 Ariz. 540,456 P.2d 910
• Parties: Rosa P. CAVAZOS, Appellant, v. HOLMES TUTTLE BROADWAY FORD, INC., and Al Leon, Appellees.
• Court: Arizona Supreme Court

Page 910

456 P.2d 910

104 Ariz. 540

Rosa P. CAVAZOS, Appellant, v. HOLMES TUTTLE BROADWAY FORD, INC., and Al Leon, Appellees.

No. 9607-PR.

Supreme Court of Arizona, In Banc.

June 30, 1969.

S. Leonard Scheff, Tucson, for appellant.

Boyle, Bilby, Thompson & Shoenhair, by Michael Lacagnina, Tucson, for appellees.

UDALL, Chief Justice:

This case is before us on a petition to review a decision of the Court of Appeals which affirmed a judgment for defendant granted by the Superior Court of Pima County. The opinion of the Court of Appeals reported in 9 Ariz.App. 167, 450 P.2d 133, is vacated, and the case is remanded for hearing on one issue.

Plaintiff-appellant, Rosa Cavazos owned a 1963 Chevrolet and, on March 18, 1967, went to Holmes Tuttle Broadway Ford, Inc. to trade it in on another car. There she met and dealt with defendant's salesman, Al Leon. In a written 'Purchaser's Statement' she revealed her financial condition to be very weak. It showed that she worked as a dental assistant for the Pima County Hospital at a salary of $275 per month; that she owed the Pima County Credit Union $480; and that she had no property or other income.

She made it clear to Leon that any car which she selected would have to be financed, and that she intended to obtain the money from the Pima County Credit Union. She testified that Leon told her that financing a new Mustang, after a trade-in of her old car, would require only about $65 per month. Leon admitted that he knew the payments would exceed $100 per month, but denied mentioning the $65.00 figure to her.

After selecting the new car, she asked for papers to take to the credit union for its approval. Leon denies this, but admits that he appeared a 'work order', and a conditional sales contract, both of which he had her sign.

The events which followed, resulted from the selling tactics used by the salesman, and the use of a printed form in a transaction for which it was not designed.

Many customers leave the obtaining of their car loans to the dealer from whom they buy their cars. For this reason, defendant had a supply of printed work orders with blank spaces in which the salesman could write the name of the customer, description of the car, price, etc. The form used in this case, mentioned the possibility that the customer might also sign a conditional sales contract. Another printed provision was to the effect that 'Purchaser acknowledges that credit purchase is subject to Finance Company or Bank approval. If rejected, car must be returned to seller on demand.' (Italics ours.) In the blank spaces of the form, the salesman wrote that the purchase price would be paid by 'one payment of $2966.05 due March 24, 1967--Pima County Fed. Emp. Credit'. This work order was signed by plaintiff, as purchaser, and by Leon, as salesman. It was 'Accepted' by the signature of John Keal, defendant's new car manager.

As a part of the same transaction, and at the same time, plaintiff and the salesman signed a conditional sales agreement, which was also signed by Keal. It described the Mustang, acknowledged its delivery to plaintiff, reserved the title in the dealer, and contained plaintiff's promise to make the payment due on March 24.

Ordinarily, if a car is purchased for cash, is ready for delivery, and involves no financing, none of these documents would be needed. The price would be paid when the car was delivered. Where, as here, there is to be a delayed payment, but no installments of financing, the conditional sales agreement would suffice, and the 'work order' would be superfluous. Where the car is not ready, has not yet arrived on the dealer's lot, or is to be financed, the work order operates as an offer to buy, and it makes good sense for it to provide that the sale is contingent upon obtaining the necessary loan. Where, as here, the car was on the lot, was selected by the buyer, and--in Leon's language--it 'had already been serviced except for connecting the speedometer', the conditional sales contract, reserving title would have sufficed. However, both documents were executed. Plaintiff states that they were signed at the same time, and this is not contradicted by defendant.

Plaintiff testified that she expected to drive her old car home and to keep it until she got her credit union to approve the loan. However, she was told that it was O.K. to take the new car then, and she did so, leaving her old car as the trade-in. If a customer can be persuaded to drive the new car away, he cannot come back the next day and say that he has changed his mind and wants to return the car. If he does, the salesman simply tells him that the car has been used and is no longer saleable as a new car. Leon admitted this when he testified that he earned no commission until the sale was completed and the car was driven away, and that this ploy is known in the trade as 'getting the car over the curb.' In any event, plaintiff discovered, a few days later, that the credit union would not make the loan to her. She then returned to the dealer and asked permission to return the new car and receive her old car back. The dealer rejected this idea, and when the payment date passed, plaintiff was in default and the new car was repossessed. She then brought suit in three counts, for conversion of her old car, misrepresentation, and fraud.

Normally one would not expect a dealer to sell and Deliver a new car to a person in plaintiff's financial condition, except for cash, or a down-payment large enough to prevent a loss if the car has to be repossessed. Leon testified that that decision was not his to make--that it was made by Keal. It is understandable that Keal, on looking at the conditional sales contract, concluded that the trade-in was a sufficient down-payment to protect the company in event of a default, since payment of the balance was due in a lump sum in a few days, and title to the car was retained. If the conditional sales...