Wilson Bros. Sand & Gravel Co. v. Cheyenne Nat. Bank
| Decision Date | 25 February 1964 |
| Docket Number | No. 3203,3203 |
| Parties | WILSON BROS. SAND & GRAVEL COMPANY, Appellant (Defendant below), v. CHEYENNE NATIONAL BANK, Appellee (Plaintiff below). |
| Court | Wyoming Supreme Court |
Patto & Norris, Cheyenne, for appellant.
Roncalio, Graves & Smyth, Cheyenne, for appellee.
Before PARKER, C. J., and HARNSBERGER, GRAY, and McINTYRE, JJ.
This case is an appeal from a summary judgment in favor of the Cheyenne National Bank, the indorsee of a $9800 promissory note given by the Wilson Brothers Sand & Gravel Company to O'Dell Motor Company (Jack O'Dell, owner) for a truck-tractor. The instrument, not titled, was executed December 13, 1961, and assigned to the bank the same day. It was contained on one page and bore only one signature, the first three paragraphs in the upper portion relating to a promissory installment note with the printed portion showing it to be payable at the Cheyenne National Bank. Thereafter followed the words, 'To secure the payment of the foregoing indebtedness * * *,' and continuing in a common form of chattel mortgage, in the body of which was contained one of the controversial provisions, '* * * whenever the said mortgagee, or its assigns, shall feel insecure or unsafe in the security, said indebtedness shall without notice become due and payable at once in full * * *.' On the reverse side the instrument was entitled, 'Chattel Mortgage.' There was a space for assignment with printed portion reading, '* * * unto Cheyenne National Bank of Cheyenne * * *.' On the bottom portion of the reverse side was printed, 'Cheyenne National Bank Cheyenne, Wyoming.'
The complaint contained merely the routine allegations, execution and delivery by defendant of the note to O'Dell Motor Company; assignment by O'Dell to the bank; delinquency of defendant; and claimed balance due with interest and attorneys' fees. The answer was a general denial and alleged a failure of consideration; fraud in the inducement and execution of 'all instruments'; the transaction was incomplete as a matter of law; the complaint failed to state a claim upon which relief could be granted; the note was not negotiable; and plaintiff took subject to existing defenses. Defendant also counterclaimed for the installments which had been paid on the note. After defendant made demand for a jury and had answered certain interrogatories, plaintiff filed a motion to strike the defense alleging nonnegotiability, which after a hearing was granted. Thereafter, plaintiff moved for a summary judgment with annexed affidavits, which were resisted by cross-affidavits. These showed generally that the note in question was negotiated by O'Dell to the plaintiff bank on December 13, 1961, at a standard bank discount; that at the time of negotiation the bank did not demand the title to the truck but did verify that the chattel mortgage executed by the defendant was filed of record and did according to the bank's officers rely solely on the credit record of Wilson; that the January and February payments were made on the note; that no question was raised by defendant until March 16, 1962; that at about that time O'Dell had sisappeared and an officer of the bank called his bookkeeper to ascertain about the title; that it thereafter developed the truck for which the note in question had been given had, unknown to Wilson, been previously mortgaged; that the referee in bankruptcy had interviewed a bank officer, finding that it had never had the certificate of title to the truck but that when O'Dell had negotiated the loan he had promised he would bring the title in next day but did not do so; that Wayne Wilson, a partner in Wilson Brothers Sand & Gravel Company, had signed the note and mortgage in blank and Leonard E. Brain, the person whose name appears on the affidavit, was not present and did not acknowledge his signature in his presence; that Wilson received possession of the truck from O'Dell, made a number of repairs, at his own expense, was led by O'Dell to believe that plaintiff had the certificate of title to this truck but thereafter found it did not; that according to an official of another Cheyenne bank it is standard bank policy for the area of Cheyenne not to advance money on a loan on a motor vehicle without presentation and proof of an unencumbered title to said vehicle; that during the period of April 1, 1961, and March 3, 1962, the Cheyenne National Bank furnished O'Dell with note and mortgage forms indorsed directly to the bank for his use in financing the motor vehicles which he sold; and that the title to the truck-tractor showed no indorsement by O'Dell of assignment and warranty of title to the vehicle as required by § 31-37, W.S.1957.
Three questions are presented by this appeal:
Is the alleged promissory note a negotiable instrument?
Was there an issue of fact so as to preclude the entry of a summary judgment?
Was plaintiff a holder of the note in due course?
It is contended by the defendant that the instrument in question did not meet the third requisite of a negotiable instrument under § 13-287, W.S.1957, that it 'Must be payable on demand or at a fixed or determinable future time' because of the provision in the latter part of the instrument that:
'Until default is made in the payment of the instalments above recited, or breach of any covenant herein, it shall be lawful for the undersigned mortgagor(s) to retain possession of said property and use and enjoy the same; but in case of default in the payment of the instalments aforesaid, or any of the covenants expressed herein, or if said property or any part thereof shall be attached or claimed by any other person or persons, or shall be misued, or whenever the said mortgagee, or its assigns, shall feel insecure or unsafe in the security, said indebtedness shall without notice become due and payable at once in full, and said mortgagee or assigns shall thereupon have the right to take immediate possession thereof and remove the same to such other place as it may be deemed most convenient and for such time as may be deemed best at the risk and expense of the undersigned;...
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Westring v. Cheyenne Nat. Bank
...time engaged in the business of selling new and used trucks under the name of O'Dell Motor Company. See Wilson Bros. Sand & Gravel Company v. Cheyenne National Bank, Wyo., 389 P.2d 681, and also Cheyenne National Bank v. Citizens Savings Bank, Wyo., 391 P.2d 933. Actually there is little di......