Opinion
No. 28070.
March 20, 1951. Rehearing Denied April 20, 1951.
APPEAL FROM THE CIRCUIT COURT FOR THE CITY OF ST. LOUIS, JAMES F. McLAUGHLIN, J.
Peter Cosmas, S. C. Rogers, St. Louis, for appellants.
Hall, Reaban Seigel, and Eli C. Seigel, all of St. Louis, for respondent.
This is an action in replevin involving the right to the possession of an Autocar tractor chassis. The contest is between the assignee of a note and chattel mortgage on the tractor, which were executed and filed for record first in point of time, and the payee and holder of a second note and chattel mortgage thereon who reduced his claim to judgment and had the tractor in his possession under an attachment writ at the time of the issuance of the replevin writ.
On submission of the case to the trial judge on jury waiver the court found the issues for the plaintiff and against the defendants on plaintiff's cause of action and on defendants' counterclaim, fixed the value of the property at $2,600 and adjudged that the plaintiff retain the possession of the tractor. Our duty on this appeal is to review the case upon both the law and the evidence as in suits of an equitable nature, giving due regard to the opportunity of the trial court to judge of the credibility of the witnesses and not set aside the judgment unless clearly erroneous. Mo. R.S.A. § 847.114(d), Laws 1943, p. 353, Sec. 114, R.S. 1949, § 510.310, subd. 4. Mound City Finance Co. v. Frank, 239 Mo.App. 807, 199 S.W.2d 902, a replevin suit.
Howard C. Phipps purchased the tractor from Autocar Sales Service Company in June, 1947. According to Marie Clemens, accountant for Autocar company at that time, Phipps executed a note and chattel mortgage to Autocar company for $4,813.04 on June 5, 1947, to which she as a notary public took Phipps' acknowledgment; that the sale price to Phipps was $7,434.64 of which he paid $1,700 in cash and on which he was given a $921.60 allowance as a discount; that the sale was completed and the note and mortgage written up on June 5, 1947, on which date Phipps took possession of the tractor. In this mortgage (defendants' Exhibit 2) the mortgagee's corporate name was printed in the body of the document. It was filed for record with the recorder of deeds, on June 6, 1947. Miss Clemens testified that she prepared the application of Phipps for the certificate of title which was dated June 5, 1947.
The Autocar ledger sheet of accounts receivable showed a balance due on the tractor of $4,540.60.
Plaintiff's rights, however, do not arise out of the execution of the above mentioned chattel mortgage and note. In fact this evidence was not adduced by plaintiff but by defendants.
Plaintiff's evidence showed that on June 11, 1947 Howard C. Phipps executed a note and chattel mortgage to Autocar Sales Service Company for $5,084.60 to secure a promissory note in that sum payable in 15 consecutive monthly installments of $340, the first of which was due on July 11, 1947. This was plaintiff's Exhibit A. On June 13, 1947 Autocar Sales Service Company assigned the note and mortgage to Personal Finance Company of St. Louis for the sum of $4,540.60 for which sum the finance company issued its check dated June 13, 1947 payable to Autocar Sales Service Company, which was endorsed by the payee, canceled and perforated "Paid" on June 17, 1947.
Incidentally, Marie Clemens testified that the check for $4,540.60 from Personal Finance Company was credited to the purchase account of Phipps. Thomas J. Noble, an employee of Autocar company, testified that acting on orders of the branch manager of his company, he had the mortgage, defendants' Exhibit 2, released at the recorder's office when the Autocar company received the check aforesaid from the finance company.
Marie Clemens testified that she knew nothing about the preparation or the circumstances surrounding the execution of plaintiff's Exhibit A except that she identified the signature of Mr. Embry, the branch manager, on the endorsement of the note and mortgage. The chattel mortgage form used in the preparation of Exhibit A was a printed form, but the name Autocar Sales Service Company was not printed therein.
On June 16, 1947 a certificate of title to the tractor was issued by the State of Missouri to Howard C. Phipps showing that it was subject to a chattel mortgage in favor of Autocar Sales Service Company in the sum of $4,813.04.
The June 11 mortgage was filed for record in the office of the Recorder of Deeds of the City of St. Louis on July 17, 1947.
Phipps paid plaintiff the August and September installments due on the note.
On September 25, 1947 Phipps executed six promissory notes totaling $2,400 and a chattel mortgage on the tractor to William Norman Endicott. Endicott testified that when he loaned Phipps the $2,400 the latter had a bill of sale to the tractor marked "paid in full." On September 26, 1947 Endicott's mortgage was filed for record with the Recorder of Deeds of the City of St. Louis.
After the August payment Phipps continued to make payments on the first mortgage to Personal Finance Company of St. Louis as follows:
10-22-47 $164.54 11-20-47 340.00 12-26-47 187.09 1-26-48 200.00 2- 3-48 201.32
The February payment was the last one made and the balance owing on that date was $3,307.61.
Phipps paid three of the $400 notes due Endicott, then defaulted, and on March 22, 1948, on the application of Endicott in a suit by him against Phipps in the magistrate court, an attachment writ issued, which was executed on March 23, 1948 by serving the writ on Phipps and taking from him the possession of the tractor which was thereupon stored with defendant Frank Kindler and parked on the latter's service station lot. The deputy constable pasted a notice on the inside of the windshield stating that the tractor was attached on a court order and could not be moved by anyone other than Endicott or his attorney.
On May 14, 1948 Endicott secured a default judgment in the magistrate court against Phipps for the $1,200 balance due on the notes and $200 as attorney's fees.
The transcript of judgment from the magistrate court does not indicate that there were any subsequent proceedings sustaining the attachment.
On May 21, 1948 Personal Finance Company of St. Louis brought the present replevin suit against William Endicott and Frank Kindler, and the sheriff under the writ placed the tractor in the possession of plaintiff. Respondent had actual knowledge of the Endicott suit and judgment before the replevin suit was filed. Through the Truck Sales Company the tractor was sold to Toberman Hay Grain Company for $3,000. The sales company received a commission of $150 for making the sale, an additional $250 was paid for repairs made on the tractor prior to sale, and the plaintiff received a net of $2,600 from the sale of the tractor.
The evidence showed that a reasonable charge for the storing of the tractor is 50 ¢ per day; that although defendant Kindler stored the tractor approximately 60 days, plaintiff did not pay this charge.
Appellants assign as error the insufficiency of the petition to state facts constituting a claim. The gist of the petition follows: "3. Plaintiff for its cause of action * * * states that it is entitled to the immediate and exclusive possession of the property hereinafter set out and has a special interest in said property, and that the plaintiff is lawfully entitled to the possession thereof."
This contention is disallowed on the authority of First Nat. Bank v. Ragsdale, 158 Mo. 668, loc.cit. 681, 59 S.W. 987, loc. cit. 989, a replevin suit, in which the court said: "It is objected that the petition does not state facts showing either special or general interest in plaintiff in the property. The plaintiff is not required to, and should not, set out in his petition the evidence of his title. The petition avers that the plaintiff is the owner and lawfully entitled to the possession of the property, and that is sufficient on that point."
Appellants assign as error the admission of plaintiff's Exhibit A in evidence without proof of its execution. While it is true that plaintiff's Exhibit A, which purports to be the note and chattel mortgage on which plaintiff bases its claims, was admitted in evidence over the objection of the appellants without proof of its execution and signature by Howard C. Phipps, we deem that the error, if indeed it constituted error, does not require a reversal of the case. Defendants' Exhibit 6, which is the note and chattel mortgage executed by Howard C. Phipps to William Norman Endicott, was admitted in evidence. There was preliminary proof that it was signed by Howard C. Phipps. The signatures thereon are conceded to be the genuine signatures of Phipps. The parties hereto agreed that the original exhibits might be omitted from the transcript on appeal and be separately filed in the appellate court. We have the advantage of seeing and examining these original exhibits. We are at liberty to compare the admittedly genuine signatures of Howard C. Phipps appearing on defendants' Exhibit 6 with the purported signatures of Howard C. Phipps appearing on plaintiff's Exhibit A. The appellate court in the appeal of a nonjury case is obliged to come to its own conclusions on the facts. A careful comparison of these signatures convinces us that the signatures on the note and mortgage, plaintiff's Exhibit A, were made by one and the same person who signed the note and mortgage constituting defendants' Exhibit 6. This assignment is ruled against appellants.
Appellants next assert that the mortgage assigned to plaintiff is void because of usury. It recites the following:
Cash Price and Taxes $7,162.20 Cash Down and Discount 2,621.60 --------- Deferred Balance 4,540.60 Time Price Addition 500.00 (Finance Charge) 44.00 --------- Time Balance $5,084.60
The usury statutes apply to transactions involving a loan or forbearance of money. There was ample evidence to justify a finding by the trial court that this transaction was a sale, not a loan; that Phipps was a purchaser from Autocar Sales Service Company and not a borrower from Personal Finance Company of St. Louis, and that the finance company was buying commercial paper from Autocar at a discount, and not extending a loan to Phipps. On the other hand, there is not sufficient evidence in this record to sustain a finding that the transaction was a ruse or device concocted in such a manner as to circumvent the usury statute by garbing a loan in the cloak of a sale. There was nothing to show that the Autocar company had any interest in the matter other than that of selling its merchandise in good faith, or that plaintiff was a party to or had any knowledge of usury in the transaction or that there was any "oppressive exaction" in the dealings between Autocar company and Phipps. See in this connection General Motors Acceptance Corporation v. Weinrich, 218 Mo.App. 68, 262 S.W. 425; 143 A.L.R. 242; 165 A.L.R. 629, 649.
Appellants next urge that ever after October 11, 1947 Phipps was in default on the note assigned to plaintiff and that, having made no effort to take possession prior to the attachment, plaintiff thereafter was not entitled to the immediate and exclusive possession of the property. We have examined the cases cited by appellants in support of this argument. They are cases in which plaintiff as owner of the property placed it in the hands of an agister, Anthony v. Carp, 90 Mo.App. 387, or carrier, Sutton v. St. Louis San-Francisco R. Co., 159 Mo.App. 685, 140 S.W. 76, or artisan, McCluskey v. De Long, 239 Mo.App. 1026, 198 S.W.2d 673, and thus created a lien on the property defeating plaintiff's possessory action; or in which the condition of the mortgage was not broken at the time the mortgagee sought relief, Wyeth Hardware Co. v. Carthage Hardware Co., 75 Mo.App. 518, as a consequence of which plaintiff was not entitled to possession. None of these cases touch the point raised by appellants, that of delay, and we find nothing in the case to justify a reversal of the judgment on this ground.
Appellants deny plaintiff's right to possession until the lien of Frank Kindler for storage charges was paid. In support of this proposition appellants cite R.S.Mo. 1939, § 1466, Mo.R.S.A. § 1466, R.S. 1949, § 521.290, which gives the court authority in attachment cases to allow the officer in charge of property seized compensation for his trouble and expenses, which section is not involved in this case, and R.S.Mo. 1939, § 3608, Mo.R.S.A. § 3608, R.S. 1949, § 430.020, which allows a lien to persons who keep or store motor vehicles. Appellants entirely overlook, however, the proviso of Section 3610, R.S. 1949, § 430.040, as follows: "* * * such lien shall not take precedence over or be superior to any prior lien on said property, created by any chattel mortgage on the same, duly field or recorded in accordance with the laws of this state, without the written consent of the mortgagee or the legal holder of said chattel mortgage."
Appellants maintain, however, that the property was in custodia legis at the time the sheriff seized it under the replevin writ; that therefore it was beyond the reach of plaintiff; that the proper course for plaintiff to have pursued would have been to let the property sell under the attachment; that the buyer at the sale would have taken the property subject to the mortgage. The cases cited by appellants in support of this position involve the rights of creditors causing successive attachments to issue against the same property. They hold, pursuant to the statutory enactment of the common law rule, R.S.Mo. 1939, § 1487, Mo.R.S.A. § 1487, R.S. 1949, § 521.500, that where two attachment writs issue (1) from a justice and a circuit court, respectively, the former must be transferred to the latter court, state Bank of St. Louis v. Steinberg, 44 Mo.App. 401; Patterson v. Stephenson, 77 Mo. 329, or (2) from courts of co-ordinate jurisdiction, the court in which jurisdiction first attached should prevail, Metzner v. Graham, 57 Mo. 404, as the forum for the determination of priority of the conflicting claims. Whatever the state of the law may be on that question, the case at bar is not analogous on the facts and calls into play an entirely different rule of law.
At least for the purpose of possession and foreclosure the mortgagee of personal property, after condition broken, is regarded as the absolute owner. Day v. National Bond Investment Co., Mo.App., 99 S.W.2d 117; First Nat. Bank v. Witherspoon Livestock Comm. Co., 230 Mo.App. 285, 90 S.W.2d 453; Zahner Mfg. Co. v. Harnish, 224 Mo.App. 870, 24 S.W.2d 641. Each of the mortgagees in the case at bar had a right to possession superior to that of the mortgagor, because both mortgages were in default. Their rights inter sese depend upon the order in which the respective mortgages were filed for record, and in that order the right of the junior mortgagee to possession must yield to the right of the senior mortgagee.
In Wangler v. Franklin, 70 Mo. 659, personal property was sold under a conditional sales contract whereby title remained in the seller until the purchase price was paid. A creditor of the buyer attached the property which was in the possession of the buyer, whereupon the seller successfully maintained a replevin suit for the property against the sheriff. The court ruled that in such a case the seller could either interplead for the property under the attachment statutes, or resort to his action in replevin. This decision confirmed a previous expression by the court by way of obiter dictum in Burgert v. Borchert, 59 Mo. 80, loc.cit. 85: "The right to interplead is in the nature of an action of replevin engrafted upon a suit by attachment. If the interpleaders had neglected to avail themselves of their statutory privilege of filing an interplea, no doubt would be entertained, but that they might still assert their claims to the property seized in an action of replevin; * * *."
54 Corpus Juris 430, Sec. 33: "* * * the weight of authority is that if an officer, in attempting to execute process of attachment, by mistake or design, takes goods not the property of defendant in such writ, he is a trespasser and acquires no right to the goods seized, and the injured party may have replevin for their recovery (citing Wangler v. Franklin, 70 Mo. 659; Anchor Milling Co. v. Walsh, 20 Mo.App. 107), without regard to whether the property was taken from the possession of the party claiming it or from the defendant in attachment * * *."
Although these authorities involve the liability of officers for wrongful attachment, the attachment plaintiff is equally liable to respond in replevin, where he directs, consents, and actively participates in the seizure and storage of the property of another. In this case the attachment plaintiff, accompanied by this lawyer and the deputy constable and armed with the attachment writ, went to the home of the judgment debtor, where the keys to the tractor were procured, and the officer took possession of the tractor, and drove it to a filling station lot where it was stored. The attachment plaintiff, Endicott, followed in an automobile with his lawyer. At that time Endicott was charged with record notice of the previous mortgage on the same property. In legal contemplation the finance company was the owner of the property and had superior rights of possession. The trial court did not err in holding that the finance company as the senior mortgagee had the legal right under the facts of this case to replevy the property from Endicott, the junior mortgagee, and Frank Kindler, the bailee of the deputy constable.
Appellants assign as error the failure and refusal of the trial court to give nine instructions in the nature of declarations of law. Instead of extending this opinion by reproducing them we will summarize by saying generally that these instructions embody the appellants' theory of the case and that our analysis of the various assignments of error disposes of these contentions without the necessity of reiteration.
Finding no error in this record the Commissioner recommends that the judgment of the trial court be affirmed.
The foregoing opinion of HOUSER, C., is adopted as the opinion of the court.
The judgment of the circuit court is, accordingly, affirmed.
ANDERSON, P. J., and McCULLEN and BENNICK, JJ., concur.