Metschke v. Marxsen

• Decision Date: 10 January 1964
• Docket Number: No. 35478,35478
• Citation: 176 Neb. 240,125 N.W.2d 684
• Parties: Ralph E. METSCHKE and Margie E. Metschke, Appellants, v. Leland MARXSEN, Appellee.
• Court: Nebraska Supreme Court

Page 684

125 N.W.2d 684

176 Neb. 240

Ralph E. METSCHKE and Margie E. Metschke, Appellants, v. Leland MARXSEN, Appellee.

No. 35478.

Supreme Court of Nebraska.

Jan. 10, 1964.

Syllabus by the Court

1. Where a contract is executed but its effectiveness or fulfillment is dependent upon the doing of an agreed-upon condition before it shall become a binding contract, such contract cannot be enforced unless the condition is performed.

2. There can be no usury where a loan contract has not been entered into.

Kerrigan, Line & Martin, Fremont, for appellants.

Sidner, Lee, Gunderson & Svoboda, Fremont, for appellee.

Heard before WHITE, C. J., and CARTER, MESSMORE, YEAGER, SPENCER, BOSLAUGH, and BROWER, JJ.

CARTER, Justice.

This is a suit in equity to have a conditional sales contract declared null and void under the Nebraska Installment Loan Act, sections 45-138 and 45-155, R.R.S.1943, and to recover payments made thereon. The defendant denied that a sale of the truck involved was consummated or that a loan was made. Defendant further alleged that he was engaged in the trucking business; that he was not engaged in the business of lending money within the provisions of the Nebraska Installment Loan Act; and that he was not therefore subject to its terms. Defendant filed a cross-petition seeking damages for the use of his truck for a period of 43 days and for damages sustained to the truck during the period of such use. The trial court found for the defendant, dismissed plaintiffs' petition, and entered judgment for the defendant on his cross-petition in the amount of $1,443.18. The plaintiffs appealed.

We shall hereafter refer to Ralph E. Metschke, the principal plaintiff, as Metschke, and to the defendant Leland Marxsen as Marxsen.

It is contended that the trial court erred in not finding that the contract was in violation of the Nebraska Installment Loan Act and subject to the penalties thereof. It is further contended that the trial court erred in not finding that Marxsen waived, or was estopped from asserting, the ineffectiveness of the contract by the acceptance of payments and the delivery of the truck into the possession of Metschke.

There is little dispute in the evidence as to the pertinent facts. They reveal the following situation. Marxsen was engaged in the transportation business and was the owner of trucks used in the business, including a 1954 International truck tractor. Metschke was employed by Marxsen as a truck driver. Metschke desired to go into the transportation business on his own, and on or about November 8, 1962, entered into negotiations with Marxsen for the purchase of the International truck tractor. Marxsen offered to sell the truck tractor to Metschke for $6,000. Metschke attempted to finance the transaction through his bank in Fremont and a finance company in Omaha. He was unable to secure a loan and Marxsen suggested that Metschke try his bank, the First State Bank of Fremont. Credit references and financial statements were required and furnished to the bank. The latter bank agreed to make the loan for $3,500, provided a cash payment of $2,500 was made and a contract entered into with Marxsen for the purpose of assignment to the bank.

Metschke advised Marxsen that he did not have $2,500 in cash, but that he had a pick-up truck and some vending machines which he could sell within a week or so and raise the money.

The bank made up a conditional sales contract in the principal amount of $3,500 to which was added $185.76 for insurance and a time price differential of $442.24, a total of $4,128. The conditional sales contract was signed by Marxsen and Metschke and the latter's wife. The contract was not dated for the reason, as stated by Marxsen, that it was to be dated and become effective only on the payment of the $2,500 in cash as the down payment.

Metschke was unable to sell the pick-up truck or the vending machines. Metschke paid $300 of the down payment. Marxsen kept pressing Metschke for the balance, advising him that the truck tractor was mortgaged to the bank and that the note was due. Marxsen asked Metschke what his pick-up truck was worth. Metschke said $900. Marxsen offered to take the pick-up at $900 to be applied on the down payment for the truck tractor. Metschke accepted the offer and delivered the pick-up truck to Marxsen, together with the certificate of title.

Marxsen thereupon permitted Metschke to use the International truck tractor with which to earn money to be applied on the balance of the cash payment. Metschke paid $300 to Marxsen out of the earnings made by the use of the truck tractor. He was also given credit for $96.20 for hauling performed for Marxsen...