Universal C. I. T. Credit Corp. v. State Farm Mut. Auto. Ins. Co., s. 25934

CourtCourt of Appeal of Missouri (US)
Citation493 S.W.2d 385
Docket NumberNos. 25934,25963,25955,s. 25934
Parties12 UCC Rep.Serv. 648 UNIVERSAL C.I.T. CREDIT CORPORATION, Plaintiff-Respondent, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant, and Donald L. SENSENICH, Defendant and Third-Party Plaintiff, Appellant-Respondent, v. JACK BANNING FORD SALES, INC., Third-Party Defendant and Fourth-Party Plaintiff-Appellant-Respondent, v. KANSAS CITY AUTOMOBILE AUCTION COMPANY, Fourth-Party Defendant-Appellant-Respondent.
Decision Date19 January 1973

Page 385

493 S.W.2d 385
12 UCC Rep.Serv. 648
Donald L. SENSENICH, Defendant and Third-Party Plaintiff,
JACK BANNING FORD SALES, INC., Third-Party Defendant and
Fourth-Party Plaintiff-Appellant-Respondent,
Nos. 25934, 25955, 25963.
Missouri Court of Appeals, Kansas City District.
Jan. 19, 1973.
Motion for Rehearing and/or Transfer to Supreme Court Denied
March 6, 1973.
Application to Transfer Denied May 14, 1973.

Page 388

Robert Devoy and Richard N. Brown, Brookfield, for appellant, Donald L. Sensenich.

Frederick Beihl, Sam L. Colville, Kansas City, for K.C. Auto Auction Co.



This four-party litigation poses the always difficult question of which one of several innocent parties should bear the loss of stolen goods. The specific factual context in which that question question arises here is undisputed.

Kansas City Automobile Auction Company is engaged in a business of conducting sales at auction on behalf of automobile dealers having surplus automobiles. The bidders who attend these weekly auctions are also automobile dealers. On September 24, 1969, one of these auctions was conducted by Auction Company, and the Dodge automobile that is the subject of present controversy was sold to Jack Banning Ford Sales, Inc.

Thereafter, Banning resold this Dodge automobile to Donald L. Sensenich. This purchase was financed by Universal C.I.T. Credit Corporation. The credit transaction was in the form of a Security Agreement signed by Banning and Sensenich, which was then assigned by Banning to C.I.T. Sensenich also procured collision insurance covering the automobile, with a loss payable clause to C.I.T.

Subsequently, the Dodge automobile in question was demolished in a highway accident. In connection with the investigation accompanying the wreck, it was discovered that the automobile had been stolen prior to the time that it came into the hands of Auction Company, and that therefore, the auction sale on September 24, 1969, did not convey good title.

Upon acquiring the information concerning this insufficiency of title, Sensenich terminated any further payment to C.I.T., and he promptly gave notice to Banning of revocation of his acceptance of the automobile. Banning in turn gave notice to Auction Company and requested that Auction Company satisfy the demands of Sensenich. Auction Company denied liability.

Faced with this impasse, C.I.T. filed suit against Sensenich in Count I on the Security Agreement, and against the insurance company in Count II on the insurance policy. A settlement (accomplished in some manner not disclosed by the transcript on appeal) was made with the insurance company, and Count II of the C.I.T. petition was dismissed before trial.

Sensenich filed answer to Count I of the C.I.T. petition, and also filed a third-party petition bringing in Banning as a third-party defendant. Sensenich's third-party petition against Banning alleged generally the suit against him by C.I.T. and claimed indemnity from Banning under an implied warranty of title. Banning in turn filed a fourth-party petition against Auction Company alleging a right to reimbursement under an implied warranty of title from Auction Company to Banning.

The case was tried without a jury, and the trial court entered judgment for C.I.T. against Sensenich for the balance due under the Security Agreement, after giving credit for the insurance recovery, and also allowed attorney's fees in favor of C.I.T. of 15% as provided in the Security Agreement, the total so allowed to C.I.T. being $2,207.78. 1 Judgment was also entered in

Page 389

favor of Sensenich against Banning in the sum of $2,998.50. The exact manner of computation of the latter figure is not disclosed by the abbreviated record filed on this appeal, but Sensenich states in his briefs, and his after-trial motion and the court's ruling thereon support the inference, that the sum awarded to Sensenich did not include any allowance for attorney's fee to him, either in resisting the C.I.T. suit or in pressing the third-party claim against Banning.

The judgment further awarded Banning the sum of $3,523.50 against Auction Company. While the abbreviated transcript on appeal does not show how this figure was computed, the parties in their briefs are in agreement that the award to Banning consisted of the judgment against him in favor of Sensenich plus an allowance of $525.00 as an attorney's fee to Banning in defending against the Sensenich claim.

Appeals were filed by Sensenich, Banning and Auction Company, and all three have been consolidated by order of this Court. Banning has filed no brief and has made no appearance here. The record indicates that it has gone out of business.

Auction Company, on its appeal, presents these points: (1) that there is no legal basis for liability against it, for the reason that an auctioneer acts solely as an agent and cannot be held to have given any implied warranty; and (2) that if it is liable at all, its liability must be confined to the value of the automobile at the time of the auction sale, which was the price paid by Banning of $2,415.00.

The points upon which Sensenich relies on his appeal are: (1) that he should have been awarded attorney's fees both in resisting the C.I.T. claim and also for prosecuting his third-party claim against Banning; and (2) that all judgments should have been as net damages directly against Auction Company for each of the three claimants.


Preliminary to a discussion of the points assigned as error, certain pending motions which were taken for decision with the case must be disposed of. Each of the pending motions is hereby overruled for reasons as follows:

A. Auction Company has moved for an order in its favor (meaning a reversal of the judgment against it) on the ground that Banning has defaulted in the filing of any brief in this Court. That default is sufficient ground for the dismissal of Banning's separate appeal, and we now do so pursuant to the provisions of Rule 84.08 V.A.M.R. However, the failure of Banning to file a respondent's brief in connection with Auction Company's appeal, while subject to condemnation, does not carry any penalty other than a forfeiture of the right to be heard. Superior Loan Corp. v. Robie, Mo.App., 476 S.W.2d 144; State ex rel. Rhine v. Montgomery, Mo.App., 422 S.W.2d 661; Hunter v. Schwertfeger, Mo.App., 407 S.W.2d 606.

B. Auction Company has also moved to strike the brief and to bar argument by Sensenich, purportedly as respondent in behalf of Banning, in connection with Auction Company's appeal. Sensenich does appear to have a legitimate interest in making this argument for Banning, since Sensenich has a judgment herein against Banning which it may not be able to collect except through execution and garnishment on the judgment in favor of Banning against Auction Company. In any event, the brief and argument, in this respect by Sensenich will be accepted and considered in the nature of a brief amicus curiae.

C. Sensenich has filed motion for damages against Auction Company under Rule 84.19 V.A.M.R. on the allegation that Auction Company's appeal is frivolous. As set forth in greater detail in subsequent portions of this opinion, we hold that the claims of error made by Auction Company

Page 390

on this appeal cannot be sustained. Nevertheless, Auction Company cannot be said to have acted vexatiously, since the points which it raises have never been decided under the Uniform Commercial Code by any court in this State. The courts were reluctant to apply the penalty provisions of the predecessor Rule 83.13(d), and we have a like reluctance to do so under the new Rule 84.19. We are unwilling on the whole record to say that Auction Company 'has prosecuted an appeal so meritless as to negative all reasonable theories of honest mistake regarding the application of law to the facts, and has knowingly done so in bad faith and for mere vexation and delay.' Bidleman v. Morrison Motor Freight, Mo.App., 273 S.W.2d 745, l.c. 750--751. Accord: DeMayo v. Lyons, Mo.,243 S.W.2d 967; St. Louis-San Francisco Ry. Co. v. Morrison, Mo.App., 439 S.W.2d 27; Butler v. Butler, Mo.App., 379 S.W.2d 175.

D. Sensenich has filed a motion for the allowance of attorney's fees and other expenditures in connection with this appeal....

To continue reading

Request your trial
18 cases
  • Crook Motor Co., Inc. v. Goolsby, Civ. A. No. WC 84-72-D-D.
    • United States
    • United States District Courts. 5th Circuit. United States District Courts. 5th Circuit. Northern District of Mississippi
    • 21 Diciembre 1988
    ...the chattel...." 2 Anderson on the Uniform Commercial Code, § 2-312.5; Universal CIT Credit Corp. v. State Farm Mutual Auto. Ins. Co., 493 S.W.2d 385 (Mo.App.1973); Hertz Corp. v. Hardy, 197 Pa.Super. 466, 178 A.2d 833 (1962). This court adopts the view taken in those cases, and thereby den......
  • Funding Systems Leasing Corp. v. King Louie Intern., Inc., KCD
    • United States
    • Court of Appeal of Missouri (US)
    • 11 Junio 1979
    ...that part of its attorneys' fees representing its cost of enforcing warranties against IGM. Universal C.I.T. Cr. Corp. v. State Farm Mut. A. Ins. Co., 493 S.W.2d 385, 393(10) (Mo.App.1973). King Louie has not disentangled what its attorneys did in those two different respects and has made n......
  • Ala. Powersport Auction, LLC v. Wiese
    • United States
    • Supreme Court of Alabama
    • 8 Noviembre 2013
    ...disclose to the buyer the identity of the principal. E.g., Universal C.I.T. Credit Corp. v. State Farm Mutual Automobile Insurance Co., 493 S.W.2d 385, 390 (Mo.Ct.App.1973); Itoh v. Kimi Sales, Ltd., 74 Misc.2d 402, 345 N.Y.S.2d 416, 420 (Civ.Ct.N.Y.1973); Hagen v. Brzozowski, 336 S.W.2d 21......
  • Indiana Glass Co. v. Indiana Michigan Power Co., 27A02-9707-CV-479
    • United States
    • Court of Appeals of Indiana
    • 11 Marzo 1998
    ...Roofing and Sheet Metal, Inc., 26 Md.App. 452, 339 A.2d 302 (1975); Universal C.I.T. Credit Corp. v. State Farm Mut. Auto. Ins. Co., 493 S.W.2d 385 (Mo.Ct.App.1973); Equitable Lumber Corp. v. IPA Land Dev. Corp., 38 N.Y.2d 516, 381 N.Y.S.2d 459, 344 N.E.2d 391 (1976); Hardwick v. Dravo Equi......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT