Thompson v. Murdock Acceptance Corp., 5-386

• Decision Date: 12 April 1954
• Docket Number: No. 5-386,5-386
• Citation: 267 S.W.2d 11,223 Ark. 483
• Parties: THOMPSON v. MURDOCK ACCEPTANCE CORP.
• Court: Arkansas Supreme Court

Page 11

267 S.W.2d 11

223 Ark. 483

THOMPSON v. MURDOCK ACCEPTANCE CORP.

No. 5-386.

Supreme Court of Arkansas.

April 12, 1954.

Rehearing Denied May 10, 1954.

S.L. White, Little Rock, for appellant.

Lowell W. Taylor, Memphis, Tenn., Owens, Ehrman & McHaney, Little Rock, for appellee.

ROBINSON, Justice.

Appellant Gladys M. Thompson filed suit against James Hampton, doing business as Public Auto Company, and Murdock Acceptance Corporation, alleging she was charged a usurious rate of interest on the unpaid balance of the purchase price of an automobile. Upon completion of the introduction of evidence by the plaintiff, the defendant Murdock Acceptance Corporation moved that the cause be dismissed due to insufficiency of the evidence to prove usury. The motion was sustained, and plaintiff has appealed.

On the 11th day of October, 1952, which was subsequent to the decision in Hare v. General Contract Purchase Corp., 220 Ark. 601, 249 S.W.2d 973, James Hampton sold an automobile to appellant, and as part of the purchase price of $1460 Mrs. Thompson delivered to him a used truck, paid $53 in cash, and signed a title-retaining contract for the unpaid balance. Hampton transferred this contract to appellee Murdock Acceptance Corporation. It shows an unpaid balance at the time of transfer of $1244.04. Mrs. Thompson contends on appeal that the correct balance owed after the down payment, including interest at 10 per cent per annum, was $1083.06; and that the difference of $160.98 is a usurious charge.

Appellant contends that in preparing the written contract, Hampton showed a balance due of $1244.04 when in truth and fact the balance should have been $1083.06. Appellant arrives at the total of $1083.06 in this manner; she states that it was agreed she was to receive credit in the sum of $600 for the old truck traded in; that $53 was paid in cash which was to reduce an existing mortgage in the sum of $203 down to $150; and that in addition to allowing her $600 on the old truck, Hampton assumed the burden of paying off the $150 balance on the mortgage. She also says that she agreed to buy certain insurance for which the premium was $174.40 and that the interest at 10 per cent per annum is $101.66, and all of this considered together leaves a total of $1083.06. She makes no contention in this court that the sale of the insurance was a device or scheme to evade the usury laws. The motion to dismiss was not in writing, but she did not object to the motion for that reason at the time it was made. Although Act 470 of 1949, Ark.Stats. § 27-1729 as amended, provides for a written motion challenging the sufficiency of the evidence, the party resisting the motion in the trial court would be in no position to complain here of the motion being oral when no objection had been made on that ground in the trial court.

Mrs. Thompson testified that she did not receive a copy of the contract which she signed at the time of the consummation of the transaction. Also she says it was in blank. However, she testified that she did receive an invoice and that it shows she was not allowed a credit of $600 on the old truck, but was allowed $490 thereon; and that the invoice further shows she owed a balance of $1244.04 instead of $1083.06 which she claims is the correct amount.

According to Mrs. Thompson's version of the transaction, it was agreed she was to receive a total allowance of $750 on the old truck, $600 to be credited on the purchase price of the automobile, and payment by Hampton of a mortgage on the truck in the sum of $150.00--total $750. Actually she was allowed a credit of $490. The sale contract shows a total time price of $1734.04, with $490.00 paid thereon at time of delivery, leaving a balance of $1244.04 payable in 21 monthly installments of $59.24 each.

If Mrs. Thompson's conception of the transaction is correct that she was to receive a total credit of $750 on the truck traded in, and Hampton for the purpose of exacting interest greater than 10 per cent per annum prepared the contract in a manner calculated to deceive the purchaser and thereby charge more than the legal rate of interest, it would be usury. In Strickler v. State Auto Finance Co., 220 Ark. 565, 249 S.W.2d 307, 313, this court quoted with approval from Wilson v. Whitworth, 197 Ark. 675, 125 S.W.2d 112, as follows: " 'This constitutional inhibition cannot be avoided by any trick or device, and the courts will closely scrutinize every suspicious transaction in order to ascertain its real nature; and, if it appears that the contract is merely one for the loan of money with the intention on the part of the lender to exact more than the lawful rate of interest, the contract will be declared usurious and void.' "

Counsel for appellee makes a reasonable and plausible explanation of the transaction going to show that no usurious rate of interest was charged; but the weakness in the argument is that it is assumed Hampton's understanding of the transaction was that a net credit of $450 instead of $750 was to be allowed on the truck traded in. However, there is no evidence of what Hampton understood, and Mrs. Thompson's evidence is sufficient to make out a prima facie case of usury. In Werbe v. Holt, 217 Ark. 198, 229 S.W.2d 225, 227, this court said: "What, then, is the effect of a demurrer to the evidence or a similar pleading in jurisdictions recognizing that practice? The question may arise either in equity cases, where the chancellor is the arbiter of the facts, or in cases tried at law without a jury, where also the trial judge decides all issues of fact. By the overwhelming weight of authority it is the trial court's duty, in passing upon either a demurrer to the evidence or a motion for judgment in law cases tried without a jury, to give the evidence its strongest probative force in favor of the plaintiff and to rule against the plaintiff only...