Rundle v. Capitol Chevrolet, Inc.

• Decision Date: 25 March 1939
• Citation: 129 S.W.2d 217,23 Tenn.App. 151
• Parties: RUNDLE v. CAPITOL CHEVROLET, Inc.
• Court: Tennessee Court of Appeals

129 S.W.2d 217

23 Tenn.App. 151

RUNDLE v. CAPITOL CHEVROLET, Inc.

Court of Appeals of Tennessee, Middle Section.

March 25, 1939

Certiorari Denied by Supreme Court June 10, 1939.

Appeal in Error from Circuit Court, Davidson County; J. L. Reynolds Special Judge.

Suit by S. B. Rundle against the Capitol Chevrolet, Incorporated, in the Court of General Sessions to recover what he had paid on an automobile which he had purchased from the defendant and which had been repossessed, wherein the defendant filed a cross-action. To review an adverse judgment, the plaintiff brought certiorari to the Circuit Court. The Circuit Court found in favor of the defendant, and the plaintiff appeals in error.

Judgment of the Circuit Court reversed and judgment entered for the plaintiff.

Gordon B. Walker and J. P. Stallworth, Jr., both of Nashville, for appellant.

Jacobs H. Doyle, of Nashville, for appellee.

FELTS Judge.

S. B Rundle bought a second-hand automobile from the Capitol Chevrolet, Inc. The price was $150. He paid $50 cash and promised to pay the balance, plus a carrying charge of $29.60, in 12 monthly installments of $10.80 each. The sale was upon condition that title should not pass until the car was paid for, and was evidenced by a written contract to this effect.

Before the first installment came due Rundle learned that the Capitol Chevrolet, Inc., did not have title to two of the tires which it had sold him on the car. The Apex Oil Corporation had previously sold these tires under a conditional sale, and it still held the title to them and had a debt of $28.50 against them. It called on Rundle to pay this debt or surrender the tires. He notified the Capitol Chevrolet, Inc., and asked it to adjust the matter, which it declined to do. The Apex Oil Corporation came to replevy the tires, and he surrendered them. He thereupon asked the Capitol Chevrolet, Inc., to take back the car and refund the $50 he had paid it, which it also declined to do.

About a week later the first installment matured, and the General Motors Acceptance Corporation, to whom the Capitol Chevrolet Inc., had transferred the conditional sale contract, repossessed the car, stored it in the garage of the Capitol Chevrolet, Inc., advertised and sold it for $100 to the Capitol Chevrolet, Inc. This company paid the deficit of $29.60 to the General Motors Acceptance Corporation and took an assignment of the conditional sale contract.

Three days later Rundle brought this suit in the court of general sessions to recover what he had paid on the car. Defendant Capitol Chevrolet, Inc. denied his right to recover and by cross-action sought to recover of him the deficit of $29.60, plus interest and attorney's fees, under the conditional sale contract. That court allowed him a recovery of $28.50 and defendant a recovery of $29.60, and offset the latter against the former.

He brought the case to the circuit court by certiorari. That court, trying the case without a jury, held that he was entitled to recover $11, the amount the court found it would have cost to replace the tires; and that defendant was entitled to recover of him $39.60, the deficit of $29.60 and $10 attorney's fees; and the court, offsetting the $11 against $39.60, rendered judgment in favor of defendant against him for $28.60, taxing each party with one-half the costs.

Plaintiff appealed in error to this court and has assigned errors insisting that, upon the facts shown, defendant's breach of warranty of title entitled him to rescind the sale and recover the $50 he paid on the car; and that the circuit court should have so held and allowed him a judgment for this amount against defendant and should not have allowed it any recovery against him.

Defendant has moved to dismiss the appeal in error because it was not perfected in time. Plaintiff was allowed 30 days from June 4, 1938, in which to perfect his appeal in error either by giving bond or taking the oath. At the same term and on July 2 the court granted him "fifteen (15) days additional time within which to file his bill of exceptions and otherwise perfect his said appeal." He filed the oath on July 5, which was within the additional time allowed; and the court had power to grant such additional time. Physicians Mut. Health & Acc. Ins. Co. v. Grigsby, 165 Tenn. 151, 53 S.W.2d 381; Strain v. Roddy, 171 Tenn. 181, 101 S.W.2d 475. This additional time was allowed not only "to file his bill of exceptions," but also to "otherwise perfect his said appeal," which he did by taking the oath, as allowed by the orders of June 4 and July 2. Defendant's motion is denied.

Defendant insists that it made no warranty of title to the car but that plaintiff purchased from it at his peril. We can not assent to this. Under the circumstances here appearing, the law raised a warranty of title by defendant. Note, 16 Ann.Cas. 59; Mechem on Sales, vol. 2, secs. 1300-1302; Benjamin on Sales, 6th Am. ed., sec. 639; Williston on Sales, 2d. ed., vol. 1, secs. 216-218.

Mechem says (vol. 2, sec. 1300): "It is also everywhere agreed that, in a sale of a specific and ascertained chattel, any affirmation by the seller that the chattel is his is equivalent to an express warranty of title; and that this affirmation may be implied from his conduct as well as from his words, and may also result from the nature and circumstances of the sale."

Benjamin says (sec. 639): "A sale of personal chattels implies an affirmation by the vendor that the chattel is his, and therefore he warrants the title, unless it be shown by the facts and circumstances of the sale that the vendor did not intend to assert ownership, but only to transfer such interest as he might have in the chattel sold."

Summing up his discussion of the rule in United States, Mechem states (vol. 2, sec. 1302): "It seems universally to be conceded here that where the seller is in possession of the goods a warranty of title accompanies the sale, upon the ground that his undertaking to sell under such circumstances is of itself an affirmation of his title" (citing many authorities).

In Trigg v. Faris, 5 Humph. 343, 24 Tenn. 343, the Court said: "It is a well settled principle, applicable to all sales of chattels in the possession of the vendor, that the act, or fact of sale, of itself, by operation of law, implies and involves a warranty of the title. This principle operates with as much force when the sale and transfer of the property is evidenced by writing, or by deed, as if the evidence of sale were merely verbal. And this principle does not contravene the general rule of evidence, alluded to by the judge; because the warranty of his title is as strongly implied from the fact of sale, which fact is proved by deed, as if it were proved otherwise. It does not enlarge the writing; it arises by operation of law, from the act or fact of sale itself."

The Court in Gookin v. Graham, 5 Humph. 480, 24 Tenn. 480, page 484, said: "In a sale of personal property there is always an implied warranty of title, unless it be purchased under such circumstances as clearly show that the vendee intended to risk the title; as if the vendor be not in the possession, but the same be adversely in another." Where one in possession of goods sells them as owner, the law, in order to discourage dishonesty and fraud, will import into his contract of sale a warranty of title by him. On this point the Court in Word v. Cavin, 1 Head 506, 38 Tenn. 506, 509, said:

"And it is clear, that although the terms of a written contract, though it be under seal, do not in themselves, contain or import any express covenant as to the title, yet the law, in order to give a proper force and effect to the contract, and to discourage dishonesty and bad faith, will create and supply as a necessary result and consequence of the contract, certain covenants and obligations, which will bind the parties as effectually as if they had been expressed in the strongest and most explicit terms. Id. [Addison on Con.], 49.

"This doctrine is not at variance with any established principle of the law. It is not adding a new term to the agreement of the parties, in the sense of the law; nor is it any infringement of the principle that parol evidence is inadmissible to enlarge or vary the written agreement of the parties, because such implied covenant is regarded as an inherent term of the contract, not necessary to be expressed, and having the same force as if stated in terms."

Defendant was a dealer in automobiles, new and used, having them in its possession, holding itself out as owner and as having the right to sell them, and selling them to the public in general. It sold the car here in question to plaintiff in the ordinary course of its business, retaining the title thereto in itself to secure the balance of the purchase price. To permit a vendor under such circumstances to say it did not warrant the title and its vendee purchased at his peril, would open the door to imposition and fraud upon the public. In Gross v. Kierski, 41 Cal. 111, it is said:

"When the goods are at the time in the possession of the vendor, who deals with them as owner, and under such circumstances sells and delivers them to the purchaser, the law will imply against the vendor that he warrants the title to the property sold. This implication is indulged for the protection of the purchaser against what would otherwise be the fraud of the vendor, practiced upon him when he is himself not chargeable with negligence; for it is unreasonable to exact of the purchaser of goods that he is in every case to institute an inquiry into the title of his merchant, upon pain of losing both the goods and their price. The purpose of the law in implying the warranty is the protection of the purchaser;

...