General Elec. Credit Corp. v. Tidenberg

• Decision Date: 29 May 1967
• Docket Number: No. 8118,8118
• Citation: 40 A.L.R.3d 1151,78 N.M. 59,1967 NMSC 126,428 P.2d 33
• Parties: , 40 A.L.R.3d 1151, 4 UCC Rep.Serv. 337 GENERAL ELECTRIC CREDIT CORPORATION, Plaintiff-Appellee, v. Harold TIDENBERG and Ben Hatcher, Defendants-Appellants.
• Court: New Mexico Supreme Court

Page 33

428 P.2d 33

78 N.M. 59, 40 A.L.R.3d 1151, 4 UCC

Rep.Serv. 337

GENERAL ELECTRIC CREDIT CORPORATION, Plaintiff-Appellee, v. Harold TIDENBERG and Ben Hatcher, Defendants-Appellants.

No. 8118.

Supreme Court of New Mexico.

May 29, 1967.

Charles E. Barnhart, Dazzo, Dazzo & Ashby, Albuquerque, for appellants

James Sidwell, Albuquerque, for appellee.

OPINION

OMAN, Judge, Court of Appeals.

The plaintiff, as assignee of two conditional sales contracts and two negotiable promissory notes, brought suit to recover the balances owing thereon. The defendants executed these contracts and notes in connection with their purchase from The Robert A. Cloud Company of some drycleaning units and dryers to be used in a drycleaning business operated by defendants.

Defendants admitted all the allegations of the complaint, except for the allegation that the notes and contracts had been assigned to plaintiff for a valuable consideration. They also asserted affirmative defenses and filed a counterclaim upon the basis of a claimed breach of implied warranty and misrepresentations on the part of the seller.

The deposition of the defendant, Hatcher, was taken by plaintiff, and based upon the pleadings, this deposition and an affidavit of plaintiff's credit manager, the plaintiff moved for summary judgment, which was granted.

The affidavit stated that plaintiff had acquired the conditional sales contracts from The Robert A. Cloud Company by assignment, and the two notes evidencing the indebtedness mentioned in the contracts by assignment and endorsement; that plaintiff paid the assignor a substantial sum of money for the contracts and notes; that at the time of the acquisition of the contracts and notes plaintiff had no notice of any claim or defense of any kind or character by defendants or either of them, or of any other person as against the obligations; and that plaintiff accepted the contracts and notes in good faith in reliance upon the terms and conditions thereof, including freedom from defense, counterclaim or cross claim. This affidavit was in no way controverted.

From the summary judgment in favor of plaintiff, the defendants have appealed, and their position is that the trial court erred in granting the summary judgment because plaintiff, as assignee of the seller, took the contracts and the notes subject to the defenses which defendants had against the seller, and that the following quoted provision in the contracts is void:

'* * * This agreement may be assigned without notice to Buyer and when so assigned, shall be free from any defense, counterclaim or cross complaint.'

We agree with defendants' position that a summary judgment is not properly granted if disputed issues of material fact are present. Buffington v. Continental Cas. Co., 69 N.M. 365, 367 P.2d 539 (1961); Reed v. Fish Engineering Corp., 74 N.M. 45, 390 P.2d 283 (1964). We also agree that the pleadings, depositions, affidavits and other matters presented and considered by the court, in determining whether or not there are disputed issues of material fact, must be viewed in the most favorable aspect they will bear in support of a right to trial on the issues. Gonzales v. Gackle Drilling Co., 70 N.M. 131, 371 P.2d 605 (1962). All reasonable inferences must be construed in favor of the party against whom the summary judgment is sought. Agnew v. Libby, 53 N.M. 56, 201 P.2d 775 (1949); Hewitt-Robins, Robins, Inc. v. Lea County Sand & Gravel, Inc., 70 N.M. 144, 371 P.2d 795 (1962).

However, after considering the facts in the light of these rules of construction, if the undisputed facts, as a matter of law, will support a judgment in favor of the moving party, then the summary judgment should be granted. Morris v. Miller & Smith Mfg. Co., 69 N.M. 238, 365 P.2d 664 (1961); Hubbard v. Mathis, 72 N.M. 270, 383 P.2d 240 (1963); Shipman v. Macco Corp., 74 N.M. 174, 392 P.2d 9 (1964). As stated in Pederson v. Lothman, 63 N.M. 364, 320 P.2d 378 (1958):

'Summary judgment provides a method whereby it is possible to determine whether a genuine claim for relief or defense thereof exists and whether there is a genuine issue of fact warranting the submission of the case to the jury. Agnew v. Libby et al., 53 N.M. 56, 201 P.2d 775. In a case where the facts are not in dispute, but only the legal effect of the facts is presented for determination, summary judgment may be properly granted. Ades v. Supreme Lodge Order of Ahepa, 51 N.M. 164, 181 P.2d 161; Bank of China v. Wells Fargo Bank & Union Trust Co., D.C., 104 F.Supp. 59.'

Here there are no disputes of material fact, and, as above stated, defendants' contentions are that plaintiff, as assignee, took subject to the defenses against the assignor, and that the provision that the assignee shall take free from any defense, counterclaim or cross complaint is void as against the public policy of New Mexico.

We should observe that the contracts and the parties refer to the cleaning and drying units as 'equipment.' No question has been raised or claim asserted that these units may fall within the classification of 'consumer goods' under the Uniform Commercial Code, which appears as Chapter 50A, N.M.S.A.1953 and which was adopted by the 1961 Legislature prior to the date of execution of the contracts and notes, but which did not become effective until twelve days after the date of execution. Thus, we need not and do not concern ourselves with the question of whether or not a rule different from that set forth in § 50A--9--206, N.M.S.A.1953 (Repl.1962) should be established in New Mexico for buyers of consumer goods. For an excellent comment on this section generally, see Comments, 5 Natural Resources J. 408 (1965).

Defendants rely largely on the case of State Nat. Bank of El Paso, Texas v. Cantrell, 47 N.M. 389, 143 P.2d 592, 152 A.L.R. 1216 (1943). Although the result in that case was largely predicated on a particular statute then in force relative to the pleading of a counterclaim, it did adopt the 'single contract' theory, by which the assignee takes not only the rights conferred by the contract but takes subject to all the defenses arising from the contract. The contract there involved contained no agreement that defenses or claims would not be asserted against an assignee. For a case arising since the effective date of the Uniform Commercial Code in which it was held the assignee takes subject to defenses, but in which case there was no negotiable note and no agreement not to assert any defense or claim against the assignee, see Associates Loan Co. v. Walker, 76 N.M. 520, 416 P.2d 529 (1966). We do not decide...