State v. Phillips, 32138

• Citation: 253 P.2d 919,42 Wn.2d 137
• Decision Date: 27 February 1953
• Docket Number: No. 32138,32138
• Parties: STATE, v. PHILLIPS.
• Court: United States State Supreme Court of Washington

Page 137

42 Wn.2d 137

253 P.2d 919

STATE, v. PHILLIPS.

No. 32138.

Supreme Court of Washington, Department 2.

Feb. 27, 1953.

Tonkoff & Holst and Blaine Hopp, Jr., Yakima, for appellant.

W. R. Cole, Ellensburg, for respondent.

FINLEY, Justice.

This is an appeal from convictions on one information charging grand larceny and on two informations charging first degree forgery. On motion of the prosecution, the informations were consolidated and tried as separate counts in one case.

Ralph J. Phillips was the manager of Phillips Pontiac Co., Inc., a corporation, doing business in Yakima, Washington. In the grand larceny information, the state charged that defendant Phillips obtained $1,434.30 from the Yakima Branch of the General Motors Acceptance Corporation, hereinafter designated as G.M.A.C., by 'false and fraudulent pretenses, representations, trick and device, to-wit: That the said defendant * * * did falsely represent * * * that there was no other contract and/or obligation owing on a 1949 pontiac sedan * * *, that thereupon the said defendant thereupon assigned to' G.M.A.C. a conditional sale contract on the 1949 pontiac sedan. The information then refers to and contains a printed copy of the conditional sale contract. At the end of the conditional sale contract, but distinct therefrom, certain printed material appears, captioned 'Dealers' Recommendation, Assignment and Guaranty,' reading, in part, as follows:

'For value received, undersigned does hereby sell, assign and transfer to the General Motors Acceptance Corporation his, its or their right, title and interest in and to the within contract, herewith submitted for purchase by it, and the property covered thereby and authorizes said General Motors Acceptance Corporation to do every act and thing necessary to collect and discharge the same.

'The undersigned certifies that said contract arose from the sale of the within described property, warranting that title to said property was at time of sale and is now vested in the undersigned free of all liens and encumbrances; that said property is as represented to the purchaser of said property by the undersigned and that statements made by the purchaser of said property on the statement form attached hereto are true to the best of the knowledge and belief of the undersigned.' (Emphasis supplied.)

The grand larceny information then charges that, 'in truth and in fact, said pretenses and representations, trick and device, * * * were in all respects utterly false and untrue * * *' (emphasis supplied) in that the defendant previously had assigned a conditional sale contract on the same 1949 Pontiac sedan to the National Bank of Ellensburg, Washington. The information then refers to and contains a copy of the contract assigned to the bank. At the end of the latter-mentioned contract, but distinct therefrom, certain printed material appears, captioned, 'Assignment,' which, in part, reads as follows:

'For Value Received the undersigned does hereby sell, assign, and transfer to The Washington National Bank of Ellensburg, Wash., hereinafter called 'bank,' its successor and assigns, all of the right, title, and interest of the undersigned in and to the within conditional sale contract hereinafter called 'said contract,' in and to the property therein described, hereinafter called 'said property,' in and to the unpaid balance of the time price and all other moneys due or to become due on said contract; this assignment shall be

'Cross out the one not applicable}

with recourse against undersigned and with full guarantee of payment to bank of all installments and moneys due or to become due upon said contract

* * *

* * *

'The undersigned does hereby covenant and warrant that: (a) said contract is valid, binding, and enforcible and the same has been executed and delivered in accordance with the laws of the State of Washington; (b) said property was delivered into said purchaser's possession within twenty-four hours after date of said contract and is now in said purchaser's possession at purchaser's address herein given; (c) no liens nor claims against said property exist except the right of said purchaser as stated in said contract; and (d) said property has not been and is not being used for any unlawful purpose whatsoever.'

The assignment to the bank was executed in the name of Phillips Pontiac Co., Inc., signed R. J. Phillips. The assignment to G.M.A.C. was also executed by the Phillips Pontiac Co., Inc., and signed by R. J. Phillips, Manager. The name of Frank E. Schmoldt, defendant's brother-in-law, was written (admittedly forged by defendant Phillips) on the contract dated October 23, 1950, which was assigned to the bank. Similarly, Frank E. Schmoldt's name (admittedly forged by defendant) was written on the contract dated November 2, 1950, which was assigned to G.M.A.C. Thus, Frank E. Schmoldt's name appeared in both conditional sales contracts, and he was represented to be the purchaser of the 1949 Pontiac sedan, obligated to make payments to the owner or assignee of the contracts.

Defendant refers to and lifts out of context that portion of the information which charges him with falsely representing to G.M.A.C., 'that there was no other contract and/or obligation owing on' the 1949 Pontiac sedan. The contention is made that a seller who represents there are no outstanding encumbrances against the property sold is not guilty of the crime of larceny by false pretenses, where the only encumbrance against such property is void because of forgery. Defendant cites State v. Matthews, 44 Kan. 596, 25 P. 36, 10 L.R.A. 308, and State v. Wilson, 73 Kan. 334, 80 P. 639, 84 P. 737, in support of his contention. In further support thereof, in his supplemental memorandum of authorities, defendant refers to RCW 62.01.023, which reads:

'Forgery--Effect. Where a signature is forged or made without the authority of the person whose signature it purports to be, it is wholly inoperative, and no right to retain the instrument, or to give a discharge therefor, or to enforce payment thereof against any party thereto, can be acquired through or under such signature, unless the party, against whom it is sought to enforce such right, is precluded from setting up the forgery or want of authority.'

The gist of this contention of defendant is that there was no misrepresentation or false pretense as a result of the assignment of the contract to G.M.A.C., because, by operation of law and in fact, there was no valid contract or obligation owing on the 1949 Pontiac sedan except the first Schmoldt contract, dated October 23, 1950, which was a forgery, and consequently, a nullity and of no legal effect whatsoever; and thus, in the absence of proof of misrepresentation or false pretense, the state failed to prove the commission of the crime of grand larceny, as charged in the information.

Defendant's contention is ingenious, diverting and distracting. At first blush and even after considerable consideration, the logic of defendant's contention seems compelling. However, upon analysis, we think this contention breaks down. The portion of the information charging defendant with the misrepresentation or false pretense, 'that there was no other contract and/or obligation owing' on the 1949 Pontiac sedan, actually charges him with making an implied warranty that the defendant had good legal title to the automobile. State v. Johnston, 6 Wash.2d 141, 106 P.2d 1067. This language contained in the information is not found in the G.M.A.C. assignment. The particular language of the information merely paraphrases the language of the G.M.A.C. assignment, which warrants 'that title to' the Pontiac sedan 'was at the time of sale and is now vested in the undersigned free of all liens and encumbrances.' When the phrase, 'there was no other contract and/or obligation owing,' is lifted out of context, some considerable significance can be attributed to it. However, in the information, the particular phraseology is irrevocably tied up with the other language of the G.M.A.C. assignment and with other language in the charging parts of the information. With respect to the latter, we note and emphasize the information charges that 'in truth and in fact,' the false pretenses and misrepresentations, trick, and device, so made by defendant to G.M.A.C., were in all respects utterly false and untrue in this, 'that there was outstanding at that time a prior conditional sale contract which had been assigned to the Washington National Bank of Ellensburg, Washington, on the same vehicle, in words and figures as follows.' (Emphasis supplied.) The conditional sale contract, together with the assignment to the bank, is thereupon set out in the information.

Assuming that the conditional sale contract, sold or assigned to the bank, was a forgery, it does not follow that the assignment was forged, or that it was invalid or a legal nullity. In fact it was not. As worded, the assignment constituted a purported sale of both, (1) a conditional sale contract to G.M.A.C., and (2) the property covered thereby, namely, the 1949 Pontiac sedan. In addition to this, the assignment warranted that the assignor had title to the property described in the forged conditional sale contract. The assignment to G.M.A.C. was executed after a comparable assignment, covering the same identical vehicle, had been executed to the bank, in which the assignor had warranted that he had good title to the automobile, and in which the assignor sold to the bank, not only a conditional sale contract but the 1949 Pontiac automobile itself, divesting himself of any title to the automobile.

The provisions of the negotiable instrument law, RCW 62.01.023, have no application to the assignments executed by defendant to the bank and to G.M.A.C. These were not forged. Because of the circumstances indicated, we do not choose to follow the Wilson case, supra, cited by defendant. In analyzing the problem...