Freeman v. Metro Transmission, Inc.

• Decision Date: 17 March 1975
• Docket Number: No. 2393--I,2393--I
• Citation: 12 Wn.App. 930,533 P.2d 130
• Parties: Richard FREEMAN, Appellant, v. METRO TRANSMISSION, INC., d/b/a Lee Myles Transmissions, a Washington Corporation, et al., Respondents.
• Court: Washington Court of Appeals

Page 930

12 Wn.App. 930

533 P.2d 130

Richard FREEMAN, Appellant, v. METRO TRANSMISSION, INC., d/b/a Lee Myles Transmissions, a Washington Corporation, et al., Respondents.

No. 2393--I.

Court of Appeals of Washington, Division 1.

March 17, 1975.

Stock & Welch, Inc., P.S., Eugene A. Stock, Marysville, for appellant.

Terry P. Watkins, Seattle, for respondent.

FARRIS, Judge.

Richard Freeman appeals from a trial court decision denying him recovery against Lacey Bonding & Insurance, Inc. for damage done to his automobile while it was in the possession of Metro Transmission, Inc., d/b/a Lee Myles Transmissions. Freeman acknowledges that he delivered the automobile to Metro for repairs but argues that his subsequent delivery of the certificate of title to Lacey created a second bailment, which made Lacey liable for the damage to the automobile, although Lacey never took actual possession of the vehicle. We affirm.

On August 26, 1970, Freeman took his 1965 customized Ford Galaxie, valued at approximately $6,500, to Metro for minor repair work which was to take approximately 3 days. Later that same day, Freeman was arrested in Everett, Washington, and the following day, Lacey issued a bail bond for his release after receiving from Freeman the bond premium and the endorsed title to the automobile. Lacey thereafter informed Metro that Freeman was no longer the title holder of the automobile and that it should not be delivered to Freeman without the permission of Lacey. Lacey also made inquiry of Metro regarding its security and insurance coverage. In addition, arrangements were made to store the automobile at Metro at Freeman's expense until he was able to substitute cash collateral for the automobile.

Before the repair work was completed, the automobile was vandalized and stripped. Neither Freeman nor Lacey were advised of this occurrence until a week following the incident. On September 10, 1970, Freeman, accompanied by an agent of Lacey, went to Metro and demanded the return of the vehicle in its delivery condition. Metro was unable to comply. Several days later, Metro's president placed the vehicle on blocks in the street near his home where it remained until December 21, 1971, when it was retrieved by Freeman. Its value at that time was $1,500.

Freeman was granted judgment of $8,077 in his action against Metro for damages. His appeal is from the adverse decision of the court in his action against Lacey and is based on the theory that his transfer of the automobile's title to Lacey as security for the bail bond created a bailment which obligated Lacey to return the vehicle in the same condition as it was when the title was delivered. He also argues that Lacey, in any event, is liable for damage to the automobile which occurred between the time that it was placed on blocks and left on the street until such time as it was retrieved.

Three questions are presented by the appeal: (1) Was the Freeman to Lacey transaction a bailment, (2) if so, what standard of care did Lacey owe as bailee, and (3) if that standard has been violated, what damages should Freeman recover from Lacey?

A bailment arises generally when personalty is delivered to another for some particular purpose with an express or implied contract to redeliver when the purpose has been fulfilled. Earhart v. Callan, 221 F.2d 160 (9th Cir. 1955). Freeman argues that a bailment of his automobile was created when he delivered the vehicle's certificate of title to Lacey as security for a bail bond until alternate security could be provided. His theory is that he constructively delivered the automobile to Lacey when he tendered the title certificate and that Lacey is responsible for the automobile even though it never possessed the vehicle. We do not agree.

The transaction is primarily a security transaction; Freeman's delivery of the certificate of title to Lacey creates in Lacey a pledge interest in the certificate and the underlying collateral, the automobile. Restatement of Security § 2(2) (1941). While delivery of the certificate of title to Lacey creates a bailment in that certificate, See Restatement of Security §§ 1, 5 (1941), it does not necessarily follow that there is a bailment of the automobile.

Before a bailment of the automobile can be said to exist

there must be a change of possession and an assumption or acceptance to possession by the person claimed to be a bailee. Theobald v. Satterthwaite, 30 Wash.2d 92, 190 P.2d 714, 1 A.L.R.2d 799 (1948); Ramsden v. Grimshaw, Supra (23 Wash.2d 864, 162 P.2d 901 (1945)); See R. Brown, The Law of Personal Property §§ 74, 75 (2d ed. 1955); 8 Am.Jur.2d Bailments § 54 (1963); Annot., 7 A.L.R.3d 927, § 3 (1966). Whether there is a change or acceptance of possession depends on...