Hall v. Work

• Decision Date: 10 August 1960
• Citation: 354 P.2d 837,223 Or. 347
• Parties: Harry H. HALL, Appellant, v. A. M. WORK, doing business as Billingsley Motors, Respondent and Cross-Appellant.
• Court: Oregon Supreme Court

Page 837

354 P.2d 837

223 Or. 347

Harry H. HALL, Appellant, v. A. M. WORK, doing business as Billingsley Motors, Respondent and Cross-Appellant.

Supreme Court of Oregon.

Argued and Submitted Jan. 14, 1960.

Reargued and Submitted April 14, 1960.

Decided Aug. 10, 1960.

Leo Levenson, Portland, for appellant. With him on the brief were Norman B. Kobin and Robert Lohman, Portland.

Wm. J. Masters, Portland, for respondent. On the brief were Masters & Masters, Portland.

Before McALLISTER, C. J., and ROSSMAN, WARNER, PERRY, SLOAN, O'CONNELL and DUNCAN, JJ.

McALLISTER, Chief Justice.

This is an action by plaintiff, Harry H. Hall, against the defendant, A. M. Work, doing business as Billingsley Motors, to recover both compensatory and punitive damages for the conversion of an automobile and certain personal effects therein. After both parties had rested the defendant moved the court to withdraw from the jury the issue of punitive damages. The court was of the opinion that the motion should be allowed but at the request of the plaintiff, pursuant to ORS 18.140(2) ¹, submitted the issue to the jury. The judge advised the parties that if the jury awarded plaintiff a verdict for punitive damages he would set aside that part of the verdict and grant a judgment in favor of the defendant notwithstanding the verdict.

The jury returned a verdict awarding plaintiff general damages in the sum of $847.37 and punitive damages in the sum of $9,000, and judgment on the verdict was entered. Thereafter the court, on motion of the defendant, entered a judgment notwithstanding the verdict which set aside the judgment for punitive damages and entered judgment for plaintiff for the general damages only. Plaintiff appeals from the order setting aside the judgment for punitive damages and defendant cross-appeals from the judgment against him for general damages.

On November 23, 1956, plaintiff entered into a conditional sales contract agreeing to purchase from defendant a Plymouth automobile. The contract required plaintiff to keep the car 'insured against loss by fire and theft and accident and collision' in companies designated or approved by defendant and to deliver the policies of insurance to defendant. The contract also provided that if plaintiff neglected to provide such insurance, or any part thereof, the defendant might procure such insurance and add the premiums to the purchase price of the car, and plaintiff agreed to pay such premiums on demand.

When the contract was entered into plaintiff transferred to the Plymouth car a policy of insurance which had covered the car traded in by plaintiff as a down-payment on the Plymouth. This policy met the requirements of the contract but it expired on February 17, 1957. Plaintiff then procured a policy of insurance covering only his liability for bodily injury and property damage but did not insure the Plymouth against loss by either fire, theft, accident or collision. The new policy was not delivered to defendant.

During the night of April 21, 1957, the defendant repossessed the Plymouth from the driveway of plaintiff's home. Defendant contends that he was entitled to repossess because of plaintiff's failure to insure the car according to the contract. Plaintiff, on the other hand, contends that defendant had waived his right to strict performance of the agreement to insure and, in repossessing the car, was guilty of a conversion thereof.

The parties disagree concerning the events leading up to the repossession of the car. Plaintiff testified that during the latter part of January his insurance agent notified him that the policy covering the Plymouth would expire in February and asked whether plaintiff wanted the policy renewed. Plaintiff did not order a renewal but instead, went to defendant's office where he talked to the office manager, a Mr. Schulze.

According to plaintiff, Mr. Schulze stated during this conversation that defendant was not concerned with what kind of insurance plaintiff carried. Plaintiff testified:

'Well, I went in to Mr. Schulze's office and I told him that financially I was hurting a little bit right at that time and I wanted to know if Billingsley Motor company would put the insurance onto my contract and let me pay the regular rate of interest on it. He turned around--or he was sitting right across from me there and he said, 'We just can't do that.' I said, 'Mr. Schulze, under those conditions then I will take out property damage and public liability and you can take care of the comprehensive,' and he turned around to me and he says, 'We aren't concerned as to what kind of insurance you carry,' so with that I walked right across the floor to the salemen's telephone, called my insurance agency, and took out the property damage and public liability.'

Mr. Schulze testified that he told plaintiff that defendant would not procure the insurance covering the loss or damage to the automobile, referred to as the material damage or comprehensive insurance, and add the cost to the contract and insisted that plaintiff would have to provide the insurance as required by the contract. Schulze conceded that he and plaintiff talked about the public liability coverage and that he told plaintiff that defendant was not interested in that coverage. Schulze testified:

'Q. This is a question concerning the comprehensive insurance and you have testified that he came in and asked you to put that on and you stated that you told him you couldn't put it on. Now was anything else said by either one of you about that? A. In our conversation regarding the public liability, like I stated before, I told him we were only interested in the material damage coverage to protect our interest. Now whether he understood that or not, I don't know.'

Following his conversation with Mr. Schulze, plaintiff provided himself with public liability insurance but made no effort to procure the material damage insurance required by his contract.

Although plaintiff's policy expired on February 17, 1957, defendant did not communicate with plaintiff about the failure to furnish a new policy until about April 12, 1957. On that date, a Mrs. Kahleis, who was employed in defendant's office, telephoned plaintiff, told him that the insurance on his car had expired and inquired about a renewal policy. Concerning this conversation, plaintiff testified:

'Q. When was it, Mr. Hall, if ever, that you heard from Billingsley's or any of Billingsley's employees relative to your insurance after your initial discussions as you already testified? A. Well, sometime in March we received a telephone call, evidently from a lady working in the insurance office of Billingsley's, telling me that they had been notified that my policy had been lapsed, so I told the girl, without any argument whatsoever, I said, 'If you will just talk to Mr. Schulze I am sure that we have that all cleared up. I am carrying the insurance that is necessary.' She thanked me, hung the phone up, and that was the last of that.'

A few days later, Mr. Schulze instructed a firm engaged in repossessing automobiles, the West Coast Recovery Service, to repossess the Plymouth if plaintiff 'couldn't produce evidence of insurance.' On April 17, 1957, an employee of the West Coast Recovery Service, who will be referred to as Mr. Horton, called at plaintiff's home and talked to him about the insurance on the Plymouth. Concerning this visit, plaintiff testified:

'He said he was a representative from Billingsley Motor company and wanted to look at my insurance policy, which I certainly was not hesitant in showing it to him so I went to my file, got the insurance policy out, he looked at it, he says, 'You don't have any $100 deductible.' I says, 'That is very true. Mr. Schulze and I have talked this thing over and he said I absolutely didn't need it; they weren't concerned as to what kind of insurance I had.' Then he turned around and looked at his watch and he said, 'Well, it's five o'clock and the office is closed but I will have to talk to them tomorrow morning,' and that was the end of him.'

After his conversation with plaintiff, Mr. Horton contacted Mr. Schulze and was instructed to repossess the car if plaintiff did not have the insurance required by his contract. Without further notice to plaintiff the car was repossessed in the night of April 21, 1957.

The record discloses that the April payment on the contract was received by defendant on April 19th which was after Mr. Horton called on plaintiff and before the car was repossessed.

Our first question is whether there was sufficient evidence to support the finding by the jury that defendant converted the Plymouth. This turns on whether there is evidence that the defendant waived strict performance by plaintiff of the provisions of the contract requiring plaintiff to furnish insurance. The general rule of law is well stated in Smith v. Carleton, 185 Or. 672, 682, 205 P.2d 160, 165, as follows:

'It is a well settled rule of law that where the provision of a contract making time of the essence is waived by the vendor, he thereafter cannot exercise his rights under the forfeiture clause until he has given notice to the vendee of his intentions in this regard and has also given the vendee a reasonable time in which to perform his part of the contract. Graham v. Merchant, 43 Or. 294, 72 P. 1088; Maffet v. Oregon & California Railroad Co., 46 Or. 443, 80 P. 489; Ewing v. Ryan, 113 Or. 225, 231 P. 981; Rynhart v. Welch, 156 Or. 48, 53, 65 P.2d 1420, and authorities therein cited.'

This court has consistently followed the rule stated in 1 Mechem on Sales 512, § 624, that 'a waiver may be inferred wherever the conduct of the conditional vendor is inconsistent with the idea that he still expects to enforce a return of the goods if the conditions be not performed. Whether such is the case or not is a question of fact for the jury.' Endicott v. Digerness, 103 Or. 555, 568, 205 P. 975; Samuels v....