Opinion
No. 35843.
May 14, 1945. Suggestion of Error Overruled May 28, 1945.
1. SALES.
Upon justifiable rescission by buyer of sale of house trailer, seller was bound to return portion of purchase price paid and notes and conditional sales contract evidencing balance of purchase price, or, if such notes and contract could not be returned, to pay buyer the value thereof, which was their face value in absence of contrary showing.
2. APPEAL AND ERROR.
Supreme Court would make correction in form of judgment of county court which could have been made by circuit court (Code 1942, sec. 1616).
3. SALES.
Judgment that buyer, having rescinded conditional sale of house trailer, recover from seller notes and sales contract evidencing balance of purchase price and in default thereof a specified sum which represented face value of notes and contract, though in the alternative, was sufficient.
4. SALES.
Portion of action, by which buyer having rescinded conditional sale of house trailer sought recovery of notes and contract evidencing balance of purchase price, was analogous to action of detinue in which judgment for plaintiff is for recovery of the property involved or its value.
APPEAL from the circuit court of Yazoo county, HON. H.B. GILLESPIE, Judge.
Dabney Dabney, of Vicksburg, and Campbell Campbell, of Yazoo City, for appellant.
This was not a case for rescission. A contract for the purchase and sale of a motor vehicle may be rescinded at any time by mutual agreement of the parties, made before as well as after the sale, and in a proper case may be rescinded by either without the consent of the other, unless the right to do so has been waived. However, where the interest of seller or buyer has been assigned to a third person, the assignor is not entitled to rescind without the assignee's consent.
42 C.J. 771, Sec. 296; 55 C.J. 1340, Sec. 1434.
A company, selling an automobile on a deferred payment plan and accepting a note for the unpaid installments, cannot, after assigning the contract and note to a finance corporation, rescind the contract without the consent of such corporation, and an action by the vendee to recover back his money could not be based on such rescission by the vendor, unless necessary consent was shown.
Beam Motor Car Co. v. Narer et ux. (Md.), 118 A. 401.
If rescission has no part in this case, then so far as the appellee is concerned nothing he could do respecting the attempted return of the trailer to which he did not hold legal title, to the appellant would put him in any better position than that of one who had bought an article such as a machine or the like and retained it and instituted his suit for damages because of the defect in the property. It has been held that where the property may be repaired and put in first class condition, the measure of damage is the cost of these repairs. The evidence shows that the cost of these repairs will not exceed $10. This amount and costs were tendered prior to the trial, and is all that appellee is entitled to recover.
Pascagoula Hardwood Co. v. Chisholm, 164 Miss. 242, 144 So. 710; Attala County v. Morrissey-Easton Tractor Co., Inc., 162 Miss. 768, 139 So. 866; King v. Manning, 128 Miss. 186, 90 So. 728; J.B. Colt Co. v. Mazingo, 141 Miss. 402, 106 So. 533; Viking Refrigerators v. Farrell, 180 Miss. 181, 176 So. 910; National Cash Register Co. v. Hude, 119 Miss. 36, 80 So. 378, 7 A.L.R. 990; Alig v. Lackey, 114 Miss. 392, 75 So. 139; 41 C.J. 35.
The trial court erred in rendering a conditional judgment.
J.G. Holmes, of Yazoo City, for appellee.
All jurisdictions concur in holding that a manufacturer warrants the fitness of goods he manufactures for a particular purpose of which he is expressly or impliedly informed at the time, if the buyer relies upon the manufacturer's skill and judgment in furnishing the goods. The implied warranty of fitness is independent of the manufacturer's negligence or of a stipulation for trial and approval by the buyer, and does not depend upon fraud or lack of good faith. Even if the particular purpose is not known to the manufacturer who is the seller, there is an implied warranty that the goods are reasonably fit for the purpose for which they are manufactured and designed to be used.
Otts v. Alderson, 10 Smedes M. (18 Miss.) 476; 55 C.J. 748, 750.
The remedies of a buyer on a breach of warranty are no longer open to question, either under the decisions of our own court, or under the overwhelming weight of authorities. The law is well established that in such situation the buyer may elect to return the property and consider the contract wholly void, or may retain the property and recover the difference between the actual value of the property if sound and the value if unsound.
Westmoreland et al. v. Walker et al., 25 Miss. 76.
The buyer upon rescission being, as has been heretofore noted, ordinarily entitled to a return of the purchase price which he has paid, he may, upon a rescission of the contract, maintain an action to recover the purchase price, or any part of it paid or to secure the return of notes given in payment, and this is true, whether the rescission is by mutual consent, or by the purchaser with a legal right to do so, or where the acts of the seller amount to a rescission.
55 C.J. 1076.
First, the appellant contends that the only right which the appellee had was to recover the costs of restoring the property to a sound condition. Of course, the appellee, if such costs represented the difference in the value of the property if sound and the value if unsound, might have sought such recovery if he had elected to do so, but he did not elect this remedy, but exercised his right to elect the remedy accorded him under the law to rescind the contract and demand the return of the purchase money. All of the cases which counsel opposite cite on this proposition are therefore inapplicable and require no discussion, because such a case is not before the court.
The other contention of appellant is that this was not a case for rescission because the notes and contract had been transferred and assigned to the Warren Credit Corporation, and therefore the offer of appellee to return the trailer to the appellant is of no avail for the reason that appellant had assigned all of its rights to the Warren Credit Corporation. This, of course, is wholly untenable because it is agreed in the record that the Warren Credit Corporation immediately upon the consummation of the sale took the notes and contract with full knowledge of the fact that the trailer had been manufactured and sold by the appellant to the appellee for use as a house trailer, and therefore the Warren Credit Corporation took the notes and contract, with recourse on the appellant, charged with knowledge of the law that a manufacturer who sells an article for a particular purpose impliedly warrants that it is of good material and workmanship and fit for the purpose for which it was manufactured and sold. The Warren Credit Corporation, therefore, cannot assert any rights in this matter superior to those which might be asserted by the appellant. If such were the law, a manufacturer by assigning the purchase money notes and contract even to one who knew the facts, might thus escape the liability that the law solemnly imposes upon a manufacturer. The law does not tolerate such a means of subterfuge.
Warren Credit Corporation was not a holder in due course.
McKinnon v. Gowan Bros., 127 Miss. 545, 90 So. 243; Cook v. American Tubing, etc., Co., 28 R.I. 41, 9 L.R.A. (N.S.) 193; Code of 1930, Sec. 2708; 8 C.J. 496, 499.
See also Everett v. Williamson, 163 Miss. 848, 143 So. 690; Pearl Realty Co. v. State Highway Commission, 170 Miss. 103, 154 So. 292; McCarty v. Love, 145 Miss. 330, 110 So. 795; Industrial Finance Corporation v. Wheat, 142 Miss. 536, 107 So. 382.
There is neither indefiniteness nor uncertainty in the judgment rendered, but it specifically determines the rights of the parties in a definite manner, and is therefore in all respects valid.
55 C.J. 1076.
The appellee purchased an automobile house trailer from the appellant, which had manufactured the trailer, paying it therefor $123.41 in cash and agreeing to pay the remainder in 18 monthly installments evidenced by promissory notes and a written contract in which the appellant retained title to the trailer until these deferred payments were made. Immediately after sale of the trailer the notes and conditional sales contract were assigned by the appellant to the Warren Credit Corporation for value. Shortly after the purchase of the trailer the appellee says that he discovered that it was in very bad condition, and if what he says about it is true, which question was one of fact for the determination of the County Court, he had the right to rescind the sale. This he did, offered to return the trailer to the appellant and requested it to return the money he had paid it and the notes and contract he had executed to it. This offer and request were declined by the appellant. The appellee having declined to pay the Warren Credit Corporation any of the monthly payments he agreed to make on the trailer, it instituted a suit in replevin against him for the recovery of the trailer. He then, or shortly prior thereto, brought an action at law in the County Court against the appellant for the recovery of the money he had paid it for the trailer and the notes and contract he had executed to it. Both of these actions came on to be heard in the County Court at the same time and by agreement, though not consolidated, were heard together by the County Judge without a jury, resulting in a judgment for the Warren Credit Corporation in the action of the replevin, from which no appeal has been taken, and for the appellee in his action against this appellant. The judgment for the appellee provides that he recover from the appellant "the sum of $123.41 together with legal interest from date hereof . . . that the defendant forthwith return to the plaintiff his said notes, and that upon default of the defendant in returning the same the said plaintiff do have and recover of the said defendant as damage the total amount of said notes, to-wit, the sum of $772.50, with interest at the rate of 6% per annum on the amount of each of the aforesaid installments after maturity of each such installment, and together with 15% of the aforesaid total principal and interest as attorney's fees." This judgment was affirmed by the Circuit Court.
On the rescission of this sale by the appellee, which the County Court on supporting evidence held he had the right to do, it became the duty of the appellant to return to him the money paid it by him on the trailer and also the notes and contract executed by him evidencing the balance of the purchase price of the trailer, or, if it could not return the notes and contract, to pay the appellee the value thereof, which, nothing to the contrary here appearing, is their face value, $772.50. Such was the judgment which the County Court should have rendered. The only error, therefore, in its judgment is that the provision therein for the return of the notes by the appellant should have been simply that the plaintiff recover of and from the defendant the notes and sales contract executed by the plaintiff to the defendant on the 6th day of May, 1940, and in default thereof the sum of $772.50. This correction in the judgment the Circuit Court could have made under Section 1616, Code 1942, consequently it will be made here.
But counsel for the appellant say that a judgment in an action at law must not only be definite and certain but must also not be in the alternative. The judgment we are to here render, as above set out, while in the alternative, is definite and certain and the alternative feature of it is the correct form here. That portion of the appellee's action by which he seeks, and will be awarded, the recovery of his notes and contract is analogous to an action of detinue in which a judgment for the plaintiff is always for the recovery of the property involved or its value. 33 C.J. 1197; 26 C.J.S., Detinue, Sec. 22, par. 8; and cases cited in 5 Miss. Digest, subject Detinue. This objection to the form and contents of the judgment was made to the one rendered by the County Court and probably would not have been made had that Court rendered the judgment we are to here render.
It may be, as to which there is no way of ascertaining now, that the Warren Credit Corporation will recover more from the appellee than the face value of these notes, and whether he can then recover this excess from this appellant is, of course, not before us and we express no opinion thereon.
Reversed in part and judgment here for the appellee.