Finance Service Corporation v. Kelly

• Decision Date: 07 November 1921
• Docket Number: No. 14112,14112
• Citation: 235 S.W. 146
• Parties: FINANCE SERVICE CORPORATION v. KELLY
• Court: Missouri Court of Appeals

235 S.W. 146

FINANCE SERVICE CORPORATION v. KELLY

No. 14112

Kansas City Court of Appeals. Missouri.

November 7, 1921.

Rehearing Denied December 5, 1921.

Appeal from Circuit Court, Platte County; Alonzo D. Burnes, Judge.

"Not to be officially published."

Action by the Finance Service Corporation against William C. Kelly. Judgment for plaintiff, and defendant appeals. Affirmed.

Gabriel & Conkling, of Kansas City, for appellant.

Terrence Riley, of Weston, for respondent.

TRIMBLE, P, J.

This is an action in replevin to recover an automobile. The verdict was for plaintiff, assessing the automobile's value at $1,500. Defendant appealed.

Plaintiff claimed the automobile under and by virtue of a chattel mortgage given January 29, 1920, in Denver, Colo., to the plaintiff by one Foster, who on that day had purchased the car of the Platt-Fawcett Motor Company in said city. Foster regularly paid the notes as they fell due each month, until in the latter part of that year he defaulted in such payments, and, in further violation of the conditions of the mortgage, he, without the knowledge or consent of the mortgagee, took the car out of the state of Colorado and brought it to Kansas City, where he sold it to one Earhart in July, 1920. Earhart repaired and painted the car, and in August of the same year sold it to Evans, who afterwards sold it to the defendant.

When the chattel mortgage was given it was duly recorded in the proper place in Colorado, and there is no contention over the fact that the mortgagor defaulted and the conditions of the mortgage were broken, entitling the plaintiff to the possession of the car, at least as between it and the mortgagor. Defendant's contention is that sufficient grounds exist to constitute an equitable estoppel against plaintiff, preventing it from enforcing its rights under the chattel mortgage, and that therefore the court should have sustained defendant's demurrer to the evidence, or at lest should have submitted the instructions asked by the defendant embodying the theory of estoppel.

Defendant's claim of equitable estoppel arises out of the following facts. On the day Foster purchased the car of the motor company, and after he had purchased it and obtained the title thereto, he obtained a loan of the plaintiff, secured by the chattel mortgage in question on the automobile, and with the proceeds thereof finished paying the motor company what he owed them for the car, which was a large portion of the purchase price thereof. There was no connection between the motor company and the plaintiff except that the latter often made loans on automobiles purchased of the former by its customers, whose responsibility and standing were, upon examination, found to be satisfactory to plaintiff. It was the custom of the motor company, upon receiving all the money due it for a car, to give to the purchaser an invoice or bill for the car, and mark it "Paid in full." And it seems that plaintiff knew that such was its custom, though, in the case of Foster's purchase, it did not see any such marked invoice given to Foster, nor the fact was such receipted invoice given to Foster until after chattel mortgage in question had been given and the proceeds of the loan obtained thereunder had been paid by him to the motor company.

When Foster, in July, without the knowledge or consent of the plaintiff mortgagee, took the automobile to Kansas City and sold it to Earhart, he exhibited to the latter the receipted invoice received from the motor company for the automobile, and also the receipted invoice for the accessories he had purchased, and made thereon to Earhart a written assignment or bill of sale of the automobile wherein he guaranteed that the automobile was free and clear of incombrances. This receipted invoice with the bill of sale indorsed thereon was successively turned over to the persons buying the car after Earhart got it.

It is defendant's contention that an equitable estoppel arises because plaintiff should...