Opinion
37217.
DECIDED JULY 16, 1958.
Breach of implied warranty. Fulton Civil Court. Before Judge Etheridge. April 9, 1958.
Joel J. Fryer, Sam G. Dettelbach, for plaintiff in error.
Zachary Hunter, W. E. Zachary, John C. Hunter, contra.
1. The elements of an action for breach of the seller's title to personalty are the invalidity of the title and loss to the buyer.
2. The holder of a conditional-sale contract, duly recorded in compliance with the statutes pertaining to recordation of such instruments, may, in an action of trover, recover a money verdict against any person who subsequently to the recordation of the contract possessed and disposed of the chattels described therein.
DECIDED JULY 16, 1958.
Clyde Waters d/b/a Clyde Waters Motor Company sued Welfare Finance Corporation d/b/a Progressive Finance Company, in the Civil Court of Fulton County.
The petition in its final form alleged: that the defendant is Welfare Finance Corporation, a corporation of the state of Ohio d/b/a Progressive Finance Company, which has a place of business in Fulton County, Georgia, and is subject to the jurisdiction of the court; that on or about the 19th day of July, 1956, W. F. Wright was manager of the Hapeville office of the defendant located at 583 S. Central Avenue in the city of Hapeville, Georgia; that the defendant corporation is in the business of making loans on personal property such as automobiles, diamonds and live stock and furniture and taking the same as collateral for said loans; as manager of the office W. F. Wright had authority to authorize loans, repossess property where the company considered the loan in default, sell repossessed property to others and generally to manage and supervise the activities of the company; that on or about the 19th day of July, 1956, the defendant through its manager, W. F. Wright, sold to your petitioner an automobile, the same being a Ford with eight cylinders of the year of 1955 of Victoria model with Motor No. U5MV-120811; that the manager of the defendant held said property out to be that of the property of the defendant; that the said W. F. Wright at the time of the sale of the automobile heretofore referred to held the same out to be repossessed property of the defendant company; that your petitioner sold the Ford automobile to a third party in good faith; that at the time, the property was encumbered with a contract, the same being a conditional-sale contract, the same having been executed by a previous owner Louie H. Edwards to Adams Motor Company of East Point, Georgia, and transferred to Associates Discount Corporation by transfer, the transfer having been made on May 3, 1955, and a recording certificate filed of record in the county wherein Louie H. Edwards resided at the time, the same being Clayton County, Georgia, the same being filed for record May 21, 1955, and recorded on May 24, 1955; that the said Associate Discount Corporation made demand upon your petitioner and your petitioner was forced to pay the Associate Discount Corporation the sum of $1,200.85; that as a result of said action of the defendant your petitioner has been damaged in the sum of $1,200.85; that the plaintiff notified the defendant corporation of said outstanding contract by a letter dated May 20, 1957, the letter having been received by the defendant, a copy of the letter being attached hereto, made a part hereof and marked Exhibit "a". Exhibit "a" read:
Re: 1955 Ford Victoria.
"May 20, 1957. "Progressive Finance Company, 583 Central Avenue, Hapeville, Georgia. "Gentlemen: "Please be advised that our client, Clyde Waters Motor Company of Tucker, Georgia, purchased from the Progressive Finance Company the above stated motor vehicle for the sum of $1375 through your manager, W. F. Wright, who held the car out to be a foreclosure. Thereupon the client, Clyde Waters Motor Company, issued their check No. 742 on the First National Bank of Atlanta in the sum of $1375 to Progressive Finance Company, the same having been endorsed Progressive Finance Company and under it W. F. Wright. Please be further advised that the Associates Loan Company has given us notice that they hold a contract against said property on which there is a present balance of $1224.56, the contract having been dated May 3, 1955 filed for record in Clayton Superior Court May 21, 1955 and recorded in Mortgage Book 42, page 40, said contract being executed by Louie H. Edwards of 147 Spring Street, Jonesboro, Georgia."Unless the above contract is paid in full immediately, this office will file suit against the Progressive Finance Company to recover the amount and cost above stated.
Yours very truly, Zachary Hunter. "WEZ: fjb W. E. Zachary." The defendant demurred on the grounds: "Defendant demurs generally to plaintiff's petition as amended and shows that said petition does not set forth a cause of action against the defendant."The trial court overruled the demurrer. The defendant excepted.
1. In the interest of clarity this opinion refers to Welfare Finance Corporation as the defendant, and Clyde Waters as the plaintiff, the parties having occupied in the trial court the relations to the case indicated.
The one question for decision by this court is whether the judgment of the trial court overruling the general demurrer to the petition was right or wrong.
The suit is for the breach of the implied warranty, which under the provisions of Code § 96-301 is attached to every sale of personalty, that the seller has a valid title to the chattel sold. The elements of an action of this nature are the invalidity of the seller's title and loss to the buyer. A petition which by its allegations makes both of these elements appear is not subject to demurrer.
If the automobile was encumbered by the conditional-sale contract the instrument would necessarily be a valid legal document. This is true because legal lexicographers define the word encumber to mean the placing of the burden of a legal liability upon property. Words and Phrases, Volume 20, p. 588. The legal efficacy of the instrument could also be inferred from the alleged fact that the plaintiff was forced to satisfy the same in order to protect the title of his vendee.
2. The petition shows a breach of the warranty, and loss to plaintiff appears from its allegations. Where through the failure of a warranty in the sale of personalty the vendee becomes liable to pay a sum of money and discharges the liability by paying the money he has unquestionably sustained a loss. The holder of a conditional-sale contract, duly recorded in compliance with the statutes pertaining to recordation of such instrument, may, in an action of trover, recover a money verdict against any person who subsequently to the recordation of the contract has possessed and disposed of the chattels described therein. Branch v. Planters Loan c. Bank, 75 Ga. 342.
Judgment affirmed. Felton, C. J., and Nichols, J., concur.