Snyder v. Guider
| Decision Date | 29 April 1959 |
| Citation | 17 Misc.2d 558,185 N.Y.S.2d 110 |
| Parties | Frank H. SNYDER, Middle Road, Silver Creek, New York, Plaintiff, v. Clem GUIDER, Fredonia, New York, and Universal CIT Credit Corp. 220 Delaware Avenue, Buffalo, New York, Defendants. |
| Court | New York Supreme Court |
Dunn, Reingold & Bestry, Buffalo, for plaintiff.
Saperston, McNaughtan & Saperston, Buffalo, for defendant, Universal CIT Credit Corp.
Ambrusko, Cohen & Rooney, North Tonawanda, for defendant, Clem Guider.
The defendant corporation (herein called the 'Corporation') moves for, '* * * an order dismissing the second and third causes of action appearing therein, on the ground that it appears on the face of the complaint that it does not state facts sufficient to constitute a cause of action against this defendant * * *'
The second cause of action in the complaint alleges, in effect: That on April 10, 1956, the plaintiff purchased, on a written conditional sale contract from the defendant Guider (herein called 'Guider'), a 1956 Ford automobile for the purchase price of $2,962, $800 was paid down, $100 to be paid April 30, 1956, the balance of $2,062 together with finance, interest and insurance charges amounting to $2,814.94 to be paid in monthly installments of $78.19 starting May 24, 1956; that it was agreed that title to the Ford should remain in Guider, or his representative, successors and assigns, until paid in full; that the plaintiff paid $1,240.05; that Guider assigned the contract to the Corporation; that the Service Fire Insurance Company (herein called the 'Company') insured the plaintiff and the Corporation for damage to the Ford; that on November 21, 1956, the Ford was damaged; that on December 3, 1956, the Corporation re-possessed the Ford upon the plaintiff's default in payment; that the Corporation did not notify the plaintiff of its intention to retake the Ford, did not hold it for ten days to allow the plaintiff to redeem on payment of the balance due plus charges; that the Corporation did not re-sell the Ford publicly within thirty days after the retaking; that the Corporation did not give the plaintiff at least ten days' notice of the re-sale; that, although the plaintiff had paid more than $500, the Corporation did not give at least five days' notice by publication of the re-sale; that accordingly, the plaintiff was discharged; that on December 11, 1956, the Corporation filed proof of loss with the Company for $1,177.37, assigning its claim for damages to the Ford to the Company; that on January 4, 1957, the Company paid the Corporation $1,177.37; that the plaintiff is entitled to said $1,177.37 which it duly demanded of the Corporation which did not pay it to the plaintiff.
The third cause of action re-alleges said facts, adding: That if the Corporation be entitled to said $1,177.37, then more than fifty percent of the purchase price was paid to the Corporation at the time of the retaking; that accordingly, the plaintiff has been damaged and is entitled to at least twenty-five percent of the amount he has paid, with interest, and $2,962, the reasonable value of the Ford at the time of the retaking, with interest from December 3, 1956.
Generally, when the buyer, under a conditional sale contract, shall be in default in the payment of any sum due under the contract, the seller may retake possession thereof. Personal Property Law, § 76. The assignee of the seller has all the rights of his assignor. Kaufman v. Simons Motor Sales Co., 261 N.Y. 146, 149, 184 N.E. 739, 740.
Here, the Corporation, generally, had the right to retake upon the plaintiff's default.
Generally, not more than forty nor less than twenty days prior to the retaking, the seller, if he so desires, may serve upon the buyer a notice of intention to retake the goods on account of the buyer's default. Personal Property Law, § 77. If the seller does not so notify the buyer, he shall retain the goods for ten days after the retaking, during which time the buyer, upon payment or tender of the amount due under the contract at the time of retaking and interest, and upon payment of the reasonable expense of retaking, keeping and storage, may redeem the goods and continue in the performance of the contract, provided that to be entitled to such expenses, the seller shall notify the buyer of his default at least five days before the retaking. Ibid., § 78.
Here, the Corporation gave no notice to the plaintiff, did not hold the Ford for the ten-day redemption period, yet no sale, private or public, was made by the Corporation. The plaintiff did not, at any time, make payment or tender of the amount due at the time of retaking.
Section 78 of the Personal Property Law provides for a method to avoid forfeiture of the amount paid by the buyer and to prevent unjust enrichment of the seller by permitting the buyer to redeem upon the affirmative act of payment or tender of payment within a limited time. See: Clark v. Tri-State Discount Co., Inc., App.Term, 2nd Dept., 151 Misc. 679, 682, 271 N.Y.S. 779, 783. The failure of the buyer to do either affirmative act within the ten-day redemption period gives him no further rights under section 78, Ibid.
Section 79 of the Personal Property Law provides, in part, as follows:
'If the buyer does not redeem the goods within ten days after the seller has retaken possession, and the buyer has paid at least fifty per centum of the purchase price at the time of the retaking the seller shall sell them at public auction in the state where they were at the time of the retaking, such sale to be held not more than thirty days after the retaking.'
The primary purpose of this section 79 of protect the buyer. Freeman v. Engel, 185 App.Div. 218, 219, 172 N.Y.S. 715; Fisher v. Stewart Motor Corp., 132 Misc. 225, 229, 228 N.Y.S. 549, 553.
Section 80 of the Personal Property Law provides, in part, as follows:
'If the buyer has not paid at least fifty per centum of the purchase price at the time of the retaking, the seller shall not be under a duty to resell the goods as prescribed in section seventy-nine unless the buyer serves upon the seller, within ten days after the retaking, a written notice demanding a resale, delivered personally or by registered mail.' (Emphasis supplied.)
Section 80-c, Ibid., provides:
'Where there is no resale, the seller may retain the goods as his own property without obligation to account to the buyer except as provided in section eighty-e, and the buyer shall be discharged of all obligations.'
Section 80-e, Ibid., provides:
'If the seller fails to comply with the provisions of sections seventy-eight, seventy-nine, eighty, eighty-a and eighty-c, after retaking the goods, the buyer may recover from the seller his actual damages, if any, and in no event less than one-fourth of the sum of all payments which have been made under the contract, with interest.'
There seems to be little question, therefore, that the failure of the seller to comply with these sections has discharged the buyer of all obligations.
The remaining question involves the insurance payment of $1,177.37. Does it belong to the plaintiff or the Corporation? If it belongs to the Corporation, may it be applied to the purchase price in order to constitute total payment by the buyer of at least per centum at the time of the retaking?
Since no provision therefor has been made in Article 4, 'Uniform Conditional Sales Law,' (Personal Property Law, §§ 60-81) the rules of law and equity shall continue to apply to conditional sales. (Ibid., Section 80-h.)
Essentially, a conditional sale is a credit device, whereby the buyer is the substantial owner, enjoying possession, use, control...
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