Owen v. Bradley

• Decision Date: 23 May 1962
• Citation: 371 P.2d 966,231 Or. 94
• Parties: George E. OWEN, Respondent, v. J. G. BRADLEY, Defendant, and Juanita Bradley, Appellant.
• Court: Oregon Supreme Court

Page 966

371 P.2d 966

231 Or. 94

George E. OWEN, Respondent, v.J. G. BRADLEY, Defendant, and Juanita Bradley, Appellant.

Supreme Court of Oregon, Department 2.

Argued and Submitted Feb. 8, 1962.

Decided May 23, 1962.

Arthur C. Johnson, Eugene, argued the cause for appellant.On the brief were Johnson, Johnson & Harrang, Eugene.

Thomas E. Brownhill, Eugene, argued the cause for respondent.On the brief were Riddlesbarger, Pederson, Brownhill & Ingerson, Eugene.

Before McALLISTER, C. J., and WARNER, PERRY, SLOAN and LUSK, JJ.

WARNER, Justice.

This is a suit in equity brought by plaintiff, George Owen, to foreclose a chattel mortgage upon a Sterling logging truck and trailer owned by defendantJuanita Bradley and managed and operated by her husband, defendantJ. G. Bradley.The trial court found against Juanita Bradley¹ for the amount alleged to be due upon the second note, together with attorney fees, and also decreed that the chattel mortgage be foreclosed.From that judgment and decree, defendantJuanita Bradley, alone, appealed.

Plaintiff was guarantor on the promissory note of defendants Bradley and later by payment became the assignee of the mortgage and note.

The material averments of the pleadings are as follows:

The complaint alleged that on January 2, 1953, defendants, for value received, executed and delivered to one Juanita Gale the promissory note above referred to and described haec verba in paragraph II thereof.In paragraph IIIwe find the only allegation respecting the mortgage.It reads:

'That at the same time that the said note was executed and delivered as above set out and as a part of the same transaction, Defendants executed and delivered to Juanita Gale a chattel mortgage lien on a 1948 Sterling Truck, MotorNo. 63387, FactoryNo. 16RWS6675 and a Trailer, Utility, 4 wheels, FactoryNo. W516217, to secure the payment of said note.'

The complaint then averred that on August 26, 1958, Juanita Gale, as the payee, for a valuable consideration, delivered the note and chattel mortgage lien to plaintiff and that he was thus the lawful owner and holder of the note and mortgage, and that defendants failed to pay the balance due on said note in the sum of $2,976.63, plus interest.Plaintiff prayed for a judgment against defendants Bradley for the unpaid balance, plus interest, and $450 as reasonable attorney fees, and for a decree foreclosing the chattel mortgage lien and ordering that the proceeds of the sale of the truck and trailer be applied to the payment of plaintiff's judgment.

In their amended answer, defendants admitted the execution and delivery of the note and chattel mortgage as described in paragraphs II and III of the complaint, but denied that any balance was due on the note.For a separate affirmative answer, defendants set up matter relative to alleged oral leases of the truck made by and between plaintiff and Juanita Bradley.They prayed: (1) that the complaint be dismissed; (2) that the court require an accounting of the moneys allegedly due defendantJuanita Bradley from plaintiff for the rental of the truck and trailer; and (3) that defendantJuanita Bradley recover for damage done to the truck while in plaintiff's possession.Plaintiff replied, denying the affirmative allegations of the answer.

The argument of defendant-appellant, for the purpose of our consideration, may be divided conveniently into two parts: her claim of the insufficiency of the pleading and proof of plaintiff's chattel mortgage, and her claims arising from plaintiff's alleged operation and possession of the truck.

We now give attention to the first part, wherein it is contended by defendant-appellant that the decree was in error due to the fact that the complaint failed to allege and the plaintiff failed to prove the terms and conditions or breach by defendants of the terms and conditions of the chattel mortgage.

The sufficiency of the complaint was not raised in the court below.However, under ORS 16.330, a defendant by failing to raise this question, either by demurrer or answer, does not waive his objection that the complaint fails to state a cause of suit.Under such a state of the record every reasonable inference will be resolved in support of the complaint in this court unless it has omitted an allegation material and necessary to a maintenance of the suit.Washington Nat. Building, Loan & Investment Association v. Stanley, 38 Or. 319, 326, 63 P. 489, 58 L.R.A. 819, 84 Am.St.Rep. 793(1901);Dippold v. Cathlamet Timber Co., 98 Or. 183, 191, 193 P. 909(1920), and cases there cited;Blue River Sawmills v. Gates, 225 Or. 439, 474, 358 P.2d 239(1961).We have held that if the allegations of the complaint state sufficient facts in general form to enable one to comprehend their fair and reasonable intendment, then the allegations are sufficient after trial on the merits.Mills v. Liquidators, 206 Or. 212, 216, 288 P.2d 1060(1956);Hill v. G & W Development Corp., Or., 363 P.2d 763, 764(1961).

A ground for dismissal identical to that now urged by defendant has been denied by this court in two prior mortgage foreclosure suits: Berry v. King, 15 Or. 165, 167, 13 P. 772(1887);andWashington Investment Association v. Stanley, supra(38 Or. at 326-327, 63 P. at 490).In the Stanley case, the defendant argued, as does defendant in the case at bar, that the complaint 'neither set up the mortgage by copy or exhibit, nor stated the substance or purport of its provisions, and that, therefore, the court cannot determine what are its conditions, or whether or not they, or any of them, have been broken so as to entitle the plaintiff to a foreclosure.'(38 Or. at 326, 63 P. 490)In each of these casesthis court conceded that the complaints were defectively stated in that they failed to either set forth copies or the substance of the respective mortgages.Nevertheless, in both instances it was held that in the absence of a demurrer, the respective plaintiffs would be given the advantage of all intendments and although each complaint was defectively stated, neither omitted any of the general requisites of a complaint and each thus showed a cause of suit which would support a decree.See, also, Winters v. Privett, 86 Or. 501, 506, 168 P. 942(1917);Pearson v. Richards, 106 Or. 78, 85, 211 P. 167(1922);Rayburn v. Crawford, 187 Or. 386, 394, 211 P.2d 483(1949).

There was not an entire omission to state an essential element in plaintiff's suit, but at best only a defective statement.From the complaint we derive the following elements sufficient to support an equitable lien, and in this instance a lien as security for the debt represented by the note.They are: (1) the specific character of the debt; (2) the property against which the lien is asserted; (3) a specific designation of the debtor-mortgagors; (4) a specific designation of the creditor seeking to foreclose the lien; (5) a clear and positive statement of the intent of the debtor to subject the property described to the lien of the mortgage; and (6) the want of any other parties who might suffer inequitably if the lien were foreclosed.Certainly, there was enough in the complaint to notify defendants in general terms that plaintiff claimed a chattel mortgage lien to secure any payments found due on the note and that he sought a decree foreclosing the same because of their default in the payment of the note.

We also take note that plaintiff is not depending upon any special covenant or condition in the mortgage, if any there are, to enhance his recovery or expand his relief against defendants.The only default asserted by him arises from the alleged nonpayment of the note according to its terms.The only relief sought is for a judgment for the unpaid balance due on that obligation and a foreclosure sale of the truck under the lien of the mortgage to satisfy in whole or part the judgment ordered.

We think plaintiff made a prima facie case under his pleading, notwithstanding defendant's argument to the contrary, which rests entirely upon the claim that plaintiff failed to prove the contents of the mortgage.This, of course, he was relieved from doing by defendants' answer, wherein they admitted the allegations of paragraphs II and III of plaintiff's complaint, respectively relating to the note and the mortgage lien given as security for its payment.

If there were any special provisions within the mortgage accruing to the benefit of defendants, which, if pleaded and proved, would have abated plaintiff's suit or barred the relief he...