Maxwell Motor Sales Corp. v. Bankers' Mortg. & Sec. Co.
| Decision Date | 17 February 1923 |
| Docket Number | 35183.,Nos. 35184,s. 35184 |
| Court | Iowa Supreme Court |
| Parties | MAXWELL MOTOR SALES CORPORATION v. BANKERS' MORTGAGE & SECURITIES CO. CHALMERS MOTOR CAR CO. v. BANKERS' MORTGAGE & SECURITIES CO. |
OPINION TEXT STARTS HERE
Appeal from District Court, Black Hawk County; H. B. Boies, Judge.
Action by the Maxwell Motor Sales Corporation, to recover the value of a Maxwell automobile. This action was consolidated in this court with another in which the Chalmers Motor Car Company is also appellant. The cases and pleadings are identical, except as to the parties plaintiff and amount. A demurrer to defendant's answer in each case was overruled, and the respective plaintiffs appeal. Affirmed.Edwards, Longley, Ransier & Harris, of Waterloo, for appellants.
Arbuckle & Arbuckle, of Waterloo, and Hamlin, Clark & Pierson, of Chicago, Ill., for appellee.
The appellant Maxwell Motor Sales Corporation alleged in its petition that the Bankers' Mortgage & Securities Company, on or about July 20, 1921, wrongfully took possession of a motor vehicle described as roadster model, serial No. 309867, of the value of $691.26, and converted it to its own use. Judgment is asked against it for that amount. Appellee in its answer admitted that it took possession of the automobile as alleged in plaintiff's petition, but averred that it did so under the authority of a chattel mortgage executed thereon on or about September 15, 1920, by the Harry Padden Auto Company to secure the payment of a note for $650 in favor of the Waterloo Bank & Trust Company, trustee. The answer further admitted the execution of a certain written instrument by the Harry Padden Auto Company, a copy of which was incorporated in appellant's petition, and that the said Padden Auto Company held possession of said automobile at the time of the execution of the mortgage to the Waterloo Bank & Trust Company under the terms of said agreement. Defendant further alleged that--
“At the time when said money was loaned by it to the Harry Padden Automobile Company and when said note and mortgage were executed and delivered as aforesaid, the motor vehicle was in the possession of said mortgagor in its place of business where it was engaged in operating a public garage and salesroom, and where it had a large number of motor vehicles of various makes and models, including the one in question, which it was at that time ostensibly keeping and exhibiting for sale and selling as its own property, and that, at the time when said loan was made and security given as aforesaid, neither the defendant nor the said Waterloo Bank & Trust Company, trustee, had any notice either actual or constructive of the plaintiff's said trust receipt or of any right or interest which the plaintiff had or claims to have in said motor vehicle.”
A demurrer to the answer was overruled, and plaintiff elected to stand upon its petition, and refused to plead further. The written instrument incorporated in appellant's petition upon which its claim of ownership of the automobile is based is as follows:
“* * * But with liberty to us to exhibit and sell same for its account for cash for not less than $691.25, and we further agree in the case of sale to keep the proceeds separate from our funds and immediately hand the proceeds to said Maxwell Motor Sales Corporation without expense or cost to the holders of said note. The acceptance of note equal in amount to the value of said motor vehicle shall not be effective to terminate this trust, but said note and any sums delivered by us shall be security for the performance of the things obligatory upon us hereunder. We further agree to keep a separate account of all motor vehicles delivered to us under this or like receipt and of the proceeds thereof when sold, to report any sale to the holders of said note immediately after the same is made. We will also permit them, or their duly accredited representatives, to examine the motor vehicles in our possession at all reasonable times during business hours. The Maxwell Motor Sales Corporation shall during the entire time said motor vehicle is held hereunder keep said motor vehicle insured against loss by fire and theft. We further agree to pay all costs, charges, expenses and disbursements, including attorney's fee should the holder find it necessary to protect his property in said car by placing it in the hands of an attorney.
[Signed] Harry Padden Auto Co.,
By H. L. Padden.”
Attached to this written instrument is a promissory note of the Harry Padden Auto Company dated April 20, 1920, for $691.25, payable to appellant and due in three months. Written across one end on the face of the note is the following:
The court below construed the contract as a conditional sale as against the contention of appellant that it is, on the contrary, a contract of bailment. Appellant concedes that, if the contract created a conditional sale, and not a bailment, the judgment should be affirmed. Our decision must therefore rest upon the construction of the contract.
[1] This court defined conditional sale in Donnelly v. Mitchell, 119 Iowa, 432, 93 N. W. 369, as follows:
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