General Sales Co. v. Miller
| Decision Date | 13 July 1984 |
| Citation | 454 So.2d 532 |
| Parties | GENERAL SALES COMPANY, d/b/a Anniston Lincoln-Mercury-Dodge, et al. v. Jean S. MILLER. 82-601. |
| Court | Alabama Supreme Court |
Ralph D. Porch of Merrill, Porch, Doster & Dillon, Anniston, and J. Wilson Dinsmore of Dinsmore, Waites & Stovall, Birmingham, for appellants.
Charles H. Rice of Main, Smith & Rice, H. Wayne Love of Burnham, Klinefelter, Halsey & Love, Anniston, for appellee.
Jean Miller, a registered nurse, sued Anniston Lincoln-Mercury-Dodge, Tim Brown, Local Mortgage Company, Inc., and Robert L. Jackson, in a complaint alleging fraud, misrepresentation, outrage, bad faith, and violation of the Truth in Lending Act, 15 U.S.C. § 1601 et seq., in the sale to her of a 1978 Chrysler LeBaron. The case was tried before a jury. At the conclusion of the trial, and after the trial court denied motions for a directed verdict, the jury returned a verdict in favor of Miller and against the defendants jointly and severally, for $50,000.00 on the fraud and misrepresentation claim, and for $500.00 on the Truth-In-Lending claim. Following the entry of judgment, the trial court denied motions for JNOV or in the alternative a new trial.
This case arose out of a complex set of facts. Ms. Miller was in need of an automobile to transport her to and from her places of employment--one in Bowden, Georgia, the other in Heflin, Alabama. But, having been adjudicated a bankrupt, and suffering the stigma of bad credit, she was not a prime candidate for a bank loan. So, she went to Anniston Lincoln-Mercury-Dodge in response to an advertisement to the effect that, if one had been in bankruptcy, that firm would assist in financing the purchase of an automobile. Tim Brown was named in the ad as the person to see.
Ms. Miller went to Brown in December 1980, and, according to her testimony, he agreed to finance an automobile for her through the First National Bank of Anniston by placing a second mortgage on her home. The mortgage was to be for a period of thirty-six months.
Some five months later, Mr. Brown, accompanied by a Mr. Dinsmore, came to Miller's house in order to appraise it. According to Miller, Brown and Dinsmore considered the house sufficient for a loan and again mentioned the terms "second mortgage" and "thirty-six."
On May 2, 1981, Ms. Miller met Mr. Brown at the Anniston Lincoln-Mercury-Dodge car lot. At that time, according to Ms. Miller, Mr. Brown showed her a 1978 Chrysler LeBaron and told her that she could purchase it under the terms they had discussed. Ms. Miller agreed.
Later that evening, Mr. Brown introduced Ms. Miller to a Mr. Robert Jackson. Brown told Ms. Miller that Jackson would handle the paperwork for the sale. Additionally, according to Ms. Miller, Brown related that the cost of the car, with an allowance for a trade-in, would be $6,300.00, and would be financed over a period of three years.
Mr. Jackson prepared a stack of documents for Ms. Miller to sign and told her she could have the car after signing. Thereafter, Mr. Jackson left the room. Ms. Miller testified that she then reviewed the documents to the best of her ability, and, believing the material terms to be as represented by Brown, signed the documents.
Several months later Ms. Miller discovered that she had not in fact executed a "second mortgage" on her house for a period of 36 months, but rather had signed what is known as a "wrap around mortgage." This type of mortgage, by its terms, amounted to refinancing the balance due on Miller's first home mortgage in addition to the $6,300.00 purchase price of the Chrysler LeBaron. In sum, Miller executed several agreements which obligated her to a note in excess of $40,000.00, with a term of twenty years and six months.
Three issues are presented on appeal for our review. First, whether the trial court properly denied appellants' motions for a directed verdict. Second, whether a new trial or remittitur should be ordered based on excessive punitive damages. Third, whether the trial court's instructions to the jury were erroneous.
Appellants argue that a directed verdict should have been entered on the fraud and misrepresentation count in favor of the defendants, because Miller failed to prove any willful misrepresentations concerning the terms of the loan documents. We disagree.
The definition of "legal fraud" in Alabama may be found in § 6-5-101, Code of Ala. (1975):
"Misrepresentations of a material fact made willfully to deceive, or recklessly without knowledge, and acted on by the opposite party, or if made by mistake and innocently and acted on by the opposite party, constitute legal fraud."
Regardless of whether the representations...
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