Marx Truck Line, Inc. v. Fredricksen

• Decision Date: 04 April 1967
• Docket Number: No. 52454,52454
• Citation: 150 N.W.2d 102,260 Iowa 540
• Parties: MARX TRUCK LINE, INC., Appellant, v. Marvin FREDRICKSEN, Appellee.
• Court: Iowa Supreme Court

Page 102

150 N.W.2d 102

260 Iowa 540

MARX TRUCK LINE, INC., Appellant, v. Marvin FREDRICKSEN, Appellee.

No. 52454.

Supreme Court of Iowa.

April 4, 1967.

Crary, Huff & Yates, Sioux City, for appellant.

William A. Shuminsky, Sioux City, for appellee.

MOORE, Justice.

This is a law action in replevin by plaintiff, Marx Truck Line, Inc., a Corporation, against defendant, Marvin Fredricksen, to secure possession of a certain 1956 Diamond T. truck-tractor. On filing its verified petition plaintiff posted bond and obtained immediate possession of the vehicle and put it into operation. On trial the jury found for defendant and fixed the value of the vehicle at time of taking at $2000. Defendant then elected to take judgment for that amount and interest thereon. Plaintiff has appealed therefrom. We affirm.

Plaintiff's petition, filed May 8, 1963, alleged it was the unqualified owner of a certain Diamond T. truck-tractor, 1956 Model, Serial No. 6620385, by reason of certificate of title No. 97--221744 duly issued to plaintiff July 22, 1961 by the Woodbury County Treasurer. It further alleged that on or about July 15, 1961 defendant did sell said vehicle to plaintiff's predecessor, Marx Truck Line, a partnership, under a conditional sales contract, defendant on that date assigned said contract to Siouxland Credit Corporation, with recourse, and that plaintiff corporation purchased the contract from Siouxland March 29, 1963. It alleged the value of the truck-tractor was $1500.

The writ issued on plaintiff's petition and the original notice served stated plaintiff claimed right of possession by reason of the above described certificate of title.

Defendant's answer denied plaintiff was the unqualified owner and had a right of possession to the vehicle. It alleged the value of the vehicle was $2500, and defendant at all times prior to the writ had possession of the vehicle under an oral repurchase agreement with Marx Truck Line, the partnership, under which he was to be employed by the partnership to haul freight to Chicago at least once a week with $50 per trip to be withheld as payment on the agreed purchase price of $1688.32.

The issues were thus fairly well established by these pleadings but did not long so remain. Amendments and motions followed until plaintiff on October 26, 1964 filed a recast petition. Defendant's answer was then recast. During trial plaintiff over defendant's objection was permitted to amend its recast petition and alleged the title certificate had been issued to its predecessor. At the close of the evidence plaintiff withdrew any claim of possession under the conditional sales contract except that it thereby came into possession of the title certificate. Defendant, over plaintiff's objection, was permitted to include a request that it have the value of the vehicle as of the time it was taken under the writ in May 1963.

The facts in this case are somewhat complicated due to the partnership's continued operation after the corporation was organized. During early 1961 defendant owned the vehicle here involved and a 1956 Fruehauf trailer which he used to haul freight. He had been engaged by Marx Truck Line, a partnership composed of Robert, Wallace and Donald Marx, to haul consigned freight to Chicago. He had financed his rig with Siouxland Credit Corporation and met with financial difficulties in the spring of 1961. Shortly before July 15, 1961 defendant related his troubles to Robert Marx, the managing partner. Defendant wanted to remain employed. The partnership needed his rig and services.

On July 15, 1961 defendant held the certificate of title to the truck-tractor here involved, subject to the lien for money loaned to him by Siouxland. On that date he executed a conditional sales contract selling the truck-tractor and trailer to the partnership for $5188.32. It provided for payment by the partnership of $322.83 per month, starting August 15, 1961. He then assigned the contract to Siouxland. As part of the transaction Siouxland included a finance charge of $622.62.

Defendant on July 15, 1961 assigned his certificate of title to Marx Truck Line. On July 22, 1961, certificate of title No. 97--221744 for the vehicle here involved was issued to Marx Truck Line, the partnership. It showed the lien of Siouxland Credit Corporation. This certificate remained unchanged until April 13, 1964 when the partnership transferred the vehicle to Marx Truck Line, Inc., and a new certificate of title No. 97--292307 was issued.

On September 11, 1961 the Iowa Secretary of State issued a certificate of incorporation to Marx Truck Line, Inc. The three Marx brothers signed the articles of incorporation.

On January 22, 1962, Robert L. Marx, as managing partner executed an assignment of physical assets of the partnership to the corporation, including the title to various motor vehicles owned by the partnership. It made no reference to any particular vehicle.

The record discloses the monthly payments due under the conditional sales contract were made regularly until August 1962 when apparently a dispute developed over the balance then owing to Siouxland. In October 1962 the partnership brought an action in the Woodbury District Court against Siouxland Credit Corporation and Marvin Fredricksen. The record discloses this action was settled by a stipulation between the partnership and Siouxland on April 2, 1963. The stipulation states the plaintiff had at the commencement of the action tendered and paid into court $1518.87 as the balance owing on the conditional sales contract. Siouxland stipulated and agreed to accept that sum and agreed to sell and turn over to Marx Truck Line its right, title and interest in the conditional sales contract. That part of the stipulation does not designate the truck line as a partnership or corporation but in the last paragraph states Siouxland had assigned its interest in the contract to the corporation on March 29, 1963. Fredricksen, if ever served, was not a party to this stipulation. The check for $1518.87 paid into court was that of the corporation. The corporation was not a party in that action or the settlement stipulation.

Trial of the case at bar commenced March 29, 1965. Defendant, Marvin Fredricksen, and Robert L. Marx testified at the time the partnership purchased the truck-tractor and traier an oral agreement was entered into whereby the truck-tractor was to remain in Fredricksen's possession, he was to be given at least one trip a week to haul freight to Chicago with the vehicle pulling a Marx trailer and from his compensation therefor $50 per trip was to be withheld by the partnership until he fully paid the amount of the repurchase agreement. The partnership was then to transfer title to the truck-tractor back to defendant Fredricksen.

Between July 1961 and January 1962 regular trips were made for the partnership by defendant. A total of $1130 was withheld by the partnership in performance of the repurchase agreement. In January 1962 a disagreement developed between defendant and Robert Marx as to the balance owing. Marx contended the $622.62 credit charge should be paid as part of the repurchase price. Defendant contended $3500 was allowed for the trailer and the balance of $1688.32 was the amount agreed upon. Thereafter Robert Marx as managing partner or manager of the corporation refused to give any more trips to defendant.

Defendant at all times had possession of the truck-tractor until it was taken under the writ of possession on May 8, 1963. Certificate of title No. 97--221744 was then held in the form received by the partnership on May 22, 1961 with the lien of Siouxland Credit Corporation noted thereon.

Siouxland did not release the lien until March 17, 1964. The first certificate of title to plaintiff corporation was issued April 13, 1964. On that date the partnership by W. A. Marx executed an assignment on the back of the certificate of title No. 97--221744. The corporation was then issued certificate of title No. 97-292307. It shows the partnership as the previous owner. Thereafter the vehicle here involved was for the first time licensed in the name of plaintiff corporation. This was eleven months after plaintiff had taken possession of the truck-tractor under the writ of replevin.

Wallace Marx, one of the partners, when asked to explain why title was not transferred until April 13, 1964 testified: 'This title was not transferred to the corporation until this date for the reason it was not a clear title. The title showed a lien which had to be satisfied and paid off before it could be transferred from Marx Truck Line to Marx Truck Line, Inc. It could not have been transferred before that date.'

Several of plaintiff-appellant's assigned errors are directed to the trial court's rulings on pleadings and its submission to the jury of defendant-appellee's pleaded oral agreement. Our study of the record, however, leads us...