Opinion
No. 2040648.
Decided June 2, 2006.
Appeal from Jefferson Circuit Court (CV-03-4474).
Darryl Williams sued Pattans Ventures, Inc., doing business as Pattan Title Pawn ("Pattan"), Nathaniel Ellis, Alabama Auto Adjusters, and several fictitiously named parties, alleging that his vehicle was wrongfully repossessed and sold and claiming as grounds for relief breach of contract, conversion, and unjust enrichment. The trial court entered a judgment; however, based upon a postjudgment motion by Pattan, the trial court amended its judgment. The trial court's amended judgment determined that Williams's claims of conversion of his vehicle and breach of contract against Pattan were meritorious, entered a judgment against Pattan on the conversion and breach-of-contract claims, and assessed damages in the amount of $39,000. The trial court ruled in favor of Nathaniel Ellis on Williams's claims against him. Williams's claims against Alabama Auto Adjusters were dismissed without prejudice. Williams never substituted additional defendants for the fictitiously named parties in the complaint. Thus, the trial court's judgment is a final judgment. Pattan has timely appealed.
It is clear from our review of the record that Williams's unjust-enrichment claim was implicitly denied by the trial court.See generally 66 Am. Jur. 2d, Restitution and Implied Contracts, § 24 (2001) ("[A]n action for unjust enrichment cannot lie in the face of an express contract.").
I. Factual Background
Neither Pattan nor Williams disputes the factual determinations that the trial court made after hearing the testimony of the parties at trial. The trial court's judgment determined that Williams had purchased the vehicle in question, a 2001 BMW sport-utility vehicle, in April 2001, for the amount of $47,981.98. The State of Alabama Department of Revenue ("ADR") issued Williams the certificate of title to the vehicle in May 2001.
On December 13, 2001, Williams pawned the title to the vehicle to Pattan for the amount of $700. At that time, Williams also executed a pawn ticket for that amount. In order to redeem the title to the vehicle, Williams was required to pay $875 within 30 days of the date of the issuance of the pawn ticket. The pawn ticket, signed by a representative of Pattan and by Williams, provides the following relevant contract terms:
"This pawn is for one month. The pawnshop charge is deemed earned, due and owing as of the date of the pawn transaction and a like sum shall be deemed earned due and owing on the same day of the succeeding month. `Any personal property pledged to a pawnbroker within this state is subject to sale or disposal when there has been no payment made on the account for a period of 30 days post maturity date of the original contract, and no further notice is necessary.' Pledgor shall present this ticket when redeeming the pledged goods. Pawnbroker agrees to return the pledged goods to the pledgor upon payment of the amount loaned plus pawnshop charge and any other lawful charges.
"Any person identified as pledgor or as authorized representative of the pledgor and presenting a pawn ticket to the pawnbroker shall be entitled to redeem or repurchase goods described on the ticket. In the event pledged goods are lost or damaged while in the possession of the pawnbroker, it shall be the responsibility of the pawnbroker to replace the lost or damaged goods with like kinds of merchandise and proof of replacement shall be a defense to any prosecution. For the purpose of the provision, `lost' includes pledged goods that have been destroyed or have disappeared due to willful neglect that results in the pledged goods being unavailable for return to the pledgor."
(Emphasis added; internal quotations in original contract.)
Also on December 13, 2001, Williams executed a document styled "Bill of Sale of Motor Vehicle Pawned," which purported to evidence the sale of the vehicle to Pattan, with the sale to become effective if Williams failed to pay the $875 within 30 days.
Additionally, Williams executed a power of attorney, appointing Gabe Ellis, a representative of Pattan, as his attorney in fact for the purpose of applying for a new certificate of title and, among other things, placing a lien on the vehicle. The signature on the power-of-attorney document was not that of Gabe Ellis, however, but of James Bearden. Other documents obtained from ADR indicate that another power-of-attorney document was completed, apparently by Pattan, wherein Bearden was purportedly appointed to be Williams's attorney in fact. However, the trial court determined that Williams's purported signature on that document was an obvious forgery.
A January 25, 2002, application for a certificate of title to the vehicle filed with ADR, which identified Pattan as a lienholder on the vehicle, was signed by Bearden, under the forged power of attorney. In February 2002, ADR issued a new certificate of title to the vehicle, indicating that Williams was the owner and that Pattan was the first lienholder. That lien was released by Nathaniel Ellis, a representative of Pattan, on November 15, 2002, when Pattan took possession of the vehicle. The title document indicates that the vehicle was sold by Pattan on November 15, 2002, and that the title was subsequently reassigned in turn to three separate automobile dealers.
Nathaniel Ellis testified that the keys to the vehicle are with the vehicle and that he did not know the whereabouts of the vehicle. Nathaniel Ellis also testified that, at the time Williams pawned the title to the vehicle, he explained to Williams that the pawn ticket had to be redeemed within 30 days and that, if it was not redeemed within 30 days, Williams would have an additional 30 days to redeem it, but that, on the 61st day, title would pass to Pattan. Nathaniel Ellis claimed that Williams did not make or attempt to make any payments to Pattan.
Williams testified that he attempted to pay his pawn ticket 4 days before the 30-day pawn-transaction period expired. Williams stated that, despite the fact that he had enough cash to redeem his certificate of title, Nathaniel Ellis told him that he could not locate the certificate of title. According to Williams, Nathaniel Ellis added that, if Williams would pay the interest on the pawn ticket, Pattan would extend the time to pay the principle amount by another 30 days. Williams testified that he declined to pay only the interest and indicated that he was ready, willing, and able to pay the full amount of the pawn ticket upon Nathaniel's returning the certificate of title to him.
Two weeks later, Williams testified, he again attempted to tender full payment of the pawn ticket. Williams stated that Nathaniel Ellis told him again that he could not locate the certificate of title but that Williams could pay the interest on the pawn ticket to extend the transaction for 30 days. Williams stated that he again refused the alternative of paying only the interest and demanded return of the certificate of title in return for his full payment. Williams testified that he periodically spoke with Nathaniel Ellis by telephone between January 13, 2002, and up to February 13, 2002, but that the situation remained the same — Nathaniel Ellis claimed that he could not locate the certificate of title but offered to extend the transaction for 30 days if Williams would pay the interest due. Williams testified that he declined the offer each time. At the time Pattan took possession of the vehicle, about eight months after the pawn ticket had matured, the vehicle was valued at $39,000.
The trial court determined that Pattan had violated the Alabama Pawnshop Act, § 5-19A-1 et seq., Ala. Code 1975 ("the Act"), by selling the vehicle without waiting 30 days from the date it took physical possession of the vehicle. The trial court specifically held that Pattan's possession of the certificate of title was insufficient to start the 30-day grace period in which Williams could redeem the vehicle under the Act. The trial court concluded by stating that it was "reasonably satisfied of the truthfulness of [Williams's] claim for conversion of his motor vehicle and breach of contract," and it entered a "judgment for [Williams] and against [Pattan] for the conversion of [Williams's] said automobile and assess[ed] said [Williams's] damages at the value of the said vehicle at the time of its taking, $39,000.00."
II. Discussion
Pattan argues in its brief to this court that the trial court erred as a matter of law in determining that the legislature intended § 5-19A-5(c), Ala. Code 1975, when read in conjunction with § 5-19A-10(b), Ala. Code 1975, to require a pawnshop to hold a pledgor's vehicle for 30 days after it takes possession of the vehicle, even if more than 30 days have passed following the maturation of the pawn ticket. In short, Pattan asserts that it already owned the vehicle in this case by operation of law when it took possession of the vehicle, and, thus, that it could not be liable for conversion or breach of contract.
Williams argues that the 30-day time period in which he could redeem his vehicle began to run from the time the vehicle was repossessed, not — as Pattan claims — from the time the pawn ticket matured.
Neither the trial court's judgment nor the parties on appeal address in significant detail what consequences flow from Pattan's not providing Williams with the certificate of title when he offered to pay the required $875 before the end of the initial 30-day period during which he could redeem the vehicle pursuant to the terms of the pawn ticket.
In this case, the parties do not dispute the trial court's factual findings. Therefore, we apply a de novo standard of review to the trial court's application of law to those undisputed factual findings. E.g., Carter v. City of Haleyville, 669 So. 2d 812, 815 (Ala. 1995). As long as contractual terms are clear and unambiguous, questions as to their legal effect are questions of law. Winkleblack v. Murphy, 811 So. 2d 521, 525 (Ala. 2001) (citing Commercial Credit Corp. v. Leggett, 744 So. 2d 890 (Ala. 1999)). Thus, we apply a de novo review to a trial court's determination of the legal effect of an unambiguous contract term. Winkleblack, 811 So. 2d at 525-26.
In Floyd v. Title Exchange Pawn of Anniston, Inc., 620 So. 2d 576 (Ala. 1993), and subsequently in Blackmon v. Downey, 624 So. 2d 1374 (Ala. 1993), our supreme court held that a certificate of title to an automobile is "tangible personable property" within the meaning of the Act. Blackmon, 624 So. 2d at 1376. Thus, this type of transaction is properly covered under the Act, and not under Alabama's Small Loan Act. Id.
The portions of the Act relied upon by the trial court in determining that Pattan did not have a right to sell Williams's vehicle are § 5-19A-5(c) and § 5-19A-10(b). Section 5-19A-5(c), Ala. Code 1975, provides:
"All goods purchased by the pawnbroker except for automobiles, trucks, and similar vehicles shall be maintained on the premises by the pawnbroker for at least fifteen business days before the goods may be offered for resale. Automobiles, trucks, and similar vehicles shall be maintained on the premises for 21 calendar days."
Section 5-19A-10(b), Ala. Code 1975, provides:
"Pledged goods not redeemed on or before the maturity date if fixed and set out in the pawn ticket issued in connection with any transaction shall be held by the pawnbroker for 30 days following that date and may be redeemed or repurchased by the pledgor or seller within the period by the payment of the originally agreed redemption price, and by the payment of an additional pawnshop charge equal to the original pawnshop charge."
Contrary to the trial court, we agree with Pattan concerning one argument: that the 30-day time period in which Williams could redeem his vehicle began not on the day the vehicle was repossessed, but on the day the pawn ticket matured.
Ultimately, an analysis regarding any potential violations of the Act and the possible conversion of the vehicle by Pattan is unnecessary, because we affirm the trial court's judgment on the ground that Pattan breached its contract with Williams. See Ferguson v. Baptist Health Sys., Inc., 910 So. 2d 85, 96 (Ala. 2005) (stating that, in general, an appellate court can affirm the judgment of the trial court if that judgment is supported by any valid legal ground).
In fact, it appears that we could not rely on the trial court's analysis of the Act to affirm the trial court's judgment. The trial court relied on Ex parte Coleman, 861 So. 2d 1080 (Ala. 2003) in determining that our courts have not previously addressed the issue of whether, under the Act, a pawnshop must retain physical possession of a vehicle for 30 days to allow the pledgor the opportunity to redeem the vehicle. Although the trial court determined otherwise, our previous cases have in fact addressed this issue, if only implicitly.
In Ex parte Coleman, the supreme court determined that, in that case, the pawnshop had taken possession of the pawned vehicle within the 30-day period following the maturity date of the pawn ticket. Ex parte Coleman, 861 So. 2d at 1085. The court calculated the last day on which the pledgor in that case could redeem his vehicle as being the 30th day following the maturity date of the pawn ticket. By doing so, our supreme court implicitly held that the pawnshop was not required to first repossess the vehicle and then to give the pledgor a 30-day grace period in which to redeem the vehicle. Thus, the argument that Pattan did not provide Williams with a 30-day grace period in which to redeem his vehicle is unconvincing, particularly when Pattan took possession of the vehicle in November 2002, at least 8 months after the maturity date of the pawn ticket and 7 months after the end of the grace period following the maturation of the pawn ticket.
"In the ordinary breach of contract action, the claimant must prove: (1) the existence of a valid contract binding the parties in the action, (2) his own performance under the contract, (3) the defendant's nonperformance, and (4) damages." Southern Med. Health Sys., Inc. v. Vaughn, 669 So. 2d 98, 99 (Ala. 1995). In order to establish that a defendant is liable for a breach of a bilateral contract, a plaintiff must establish that he has performed, or that he is ready, willing, and able to perform under the contract. Winkleblack, 811 So. 2d at 529.
In this case, the parties do not dispute the trial court's factual findings, such as the existence of the contract; thus, the first element of an ordinary breach-of-contract action is met. The trial court's judgment also indicates that the trial court found that Williams made an offer to a representative of Pattan to pay back the entire $875. This occurred before the maturity date of Williams's pawn ticket and, of course, also before the 30-day grace period even began to run. The trial court appears to have believed Williams's testimony that when he attempted to pay his pawn ticket and thereby take possession of his certificate of title, Nathaniel Ellis, a representative of Pattan, told him that the certificate of title could not be found. Instead of taking Williams's money and providing Williams with the certificate of title, Nathaniel Ellis told Williams only that Williams could extend the maturity date of the ticket by 30 days if Williams paid the interest on the ticket. Not surprisingly, Williams refused to pay to extend the time forPattan to correct its failure to perform its obligations under the contract.
The contract provides, in relevant part:
"Pawnbroker agrees to return the pledged goods to the pledgor upon payment of the amount loaned plus pawnshop charge and any other lawful charges.
"Any person identified as pledgor or as authorized representative of the pledgor and presenting a pawn ticket to the pawnbroker shall be entitled to redeem or repurchase goods described on the ticket. In the event pledged goods are lost or damaged while in the possession of the pawnbroker, it shall be the responsibility of the pawnbroker to replace the lost or damaged goods with like kinds of merchandise and proof of replacement shall be a defense to any prosecution. For the purpose of the provision, `lost' includes pledged goods that have been destroyed or have disappeared due to willful neglect that results in the pledged goods being unavailable for return to the pledgor."
Thus, it is evident that Williams performed under the contract and that Pattan failed to perform its obligation under the contract when it did not provide Williams with the certificate of title to the vehicle when he presented his payment with his pawn ticket. When Pattan subsequently took possession of Williams's vehicle, and then sold it the same day, Williams's damages were concrete.
In several respects, this case is similar to Rapaco, Inc. v. Agee, 453 So. 2d 1048 (Ala.Civ.App. 1984), in which this court held that the plaintiffs in that case could be excused from paying the remainder of the earnest money they owed on a contract when the defendant had not responded to any of their attempts to contact the defendant. More specifically, this court noted:
"[T]he plaintiffs certainly acted reasonably and prudently in not paying [the remainder of the earnest money] because of the lack of cooperation by the defendants. When it was due, the money was in their bank account. They had previously attempted about twenty times to contact [the defendant] but to no avail. The law can properly excuse a promisor from performing whenever justice requires it if the failure of performance was caused by the fault, actions, or inactions of the other party."
Rapaco, Inc. v. Agee, 453 So. 2d at 1050. This court affirmed the trial court's judgment in Rapaco, in which the court awarded as damages to the plaintiffs the first installment they had paid as earnest money.
III. Conclusion
Although the trial court and the parties appear to have been primarily concerned about whether the Act was violated when Pattan sold the vehicle the same day it took possession of it, we affirm the trial court based upon an ordinary contract theory of relief. Williams met his obligation under the contract — he attempted to pay but was met with a refusal by Pattan to produce the certificate of title. Williams suffered damage when Pattan sold his vehicle, and thus the trial court correctly applied the law to the facts of this case in adjudicating Pattan to be liable to Williams in the amount of $39,000.
AFFIRMED.
Bryan, J., concurs.
Thompson, Pittman, and Murdock, JJ., concur in the result, without opinion.