Chucovich v. San Francisco Securities Corp.
Chucovich v. San Francisco Securities Corp.
Opinion of the Court
This is an action in claim and delivery. Plaintiff had judgment and defendant, San Francisco Securities Corporation, appeals.
The appellant (hereafter referred to as the Securities Company) was engaged in the business of loaning money to automobile dealers upon conditional sales contracts, the payment of which was guaranteed by the dealers. On the twenty-first day of January, 1920, the Knox-Mundorff Company (hereafter referred to as the Knox Company) was a retail dealer in automobiles in Fresno, and at that time was the. owner and in possession of a certain Fageol truck. On the last-mentioned date it entered into a contract of conditional sale of this truck with one Willard Brooks for the sum of $3,600, $1,200 of which was paid by Brooks at the time the contract was entered into, and he agreed to pay the balance in installments at different times thereafter. Among other things, the contract provided that should Brooks make default in any payment or violate other provisions of the contract, the Knox Company might at its option, without previous notice or demand, retake possession of the property, and that the contract should be at an end and all rights of the purchaser terminate.
The day after this transaction was had this company assigned all its benefits in the contract to the defendant Securities Company, and guaranteed the amount due thereunder, which was the sum of $2,400. Several days later Brooks took delivery of the truck. On March 11, 1920, the Securities Company wrote to the Knox Company that Brooks was delinquent in his February payment, and that another installment would be due March 15, 1920. The company advised Knox that if payment was not received promptly on this last-named date it would take the necessary steps to repossess the truck and turn the same back to the Knox Company under its arrangement and have it close the account. No further payments having been made by Brooks the Knox Company, acting under instructions from the Securities Company, repossessed itself of the truck and made arrangements for its resale. At no time during these transactions did the Securities Company ever have or receive actual or physical possession of the automobile.
In October, 1920, Knox succeeded to all interest in the Knox-Mundorff Company and thereafter conducted the busi *702 ness in Ms own name. From the time this company repossessed itself of the truck up to April 11, 1921, it remained in the undisputed possession of the Knox Company at its place of business for the purpose of resale, with the full knowledge and consent, and under the express instructions of the Securities Company. On the last-mentioned date Knox made a conditional sale of the. truck to respondent Chucovich, who immediately took possession of the same. The purchase price was $2,567.50. Of this sum $1,567.50 was paid in cash, and the balance, amounting to the sum of $1,000, was to be paid in installments, for which promissory notes were given| The contract with respondent, together with the notes executed by him, were sold and assigned to the General Motor Acceptance Company. Thereafter plaintiff took up and paid the notes in full. Knox appropriated to his own use the $1,567.50 in cash paid by respondent, and also the proceeds of the notes, which he had sold to the Motor Acceptance Company. There is also evidence to indicate that in other transactions with the Securities Company the Knox Company had been delinquent, but it is unnecessary to discuss this feature of the case.
At the date of the resale of the truck respondent Chucovich was not known to appellant Securities Company, nor did that company learn of the sale until after it was consummated and respondent had the truck in Ms possession. On ascertaining the facts the Securities Company took possession of the property without the consent of respondent, and this action was brought by him to recover the same and damages for its detention.
It appeared in evidence that respondent had no knowledge whatever of any claims of any persons to the property in question, and that he purchased the same in good faith from Knox, in whose possession it was under instructions from the Securities Company to sell the same.
Upon these facts the court rendered judgment in favor of plaintiff together with damages in the sum of $1,080.10 for unlawful detention.
But whether authority was given to Knox personally or to the firm which he represented is to our minds of no consequence. The record does not disclose, so far as we have been able to ascertain, whether the Knox-Mundorff Company was a partnership or corporation; but, however that may be, as a member of that concern Knox had authority to make sales and to convey title. The Securities Company, having given it possession of the property for sale, ,was bound by its acts. It is a familiar maxim of jurisprudence that where one of two innocent persons must suffer by the act of a third he, by whose negligence it happened, must be the sufferer. (See. 3543, Civ. Code.) Appellant Securities Company had not only clothed Knox but also his company with control and possession and with express .power of disposition of the property; and under such circumstances appellant is estopped to deny the authority of Knox or his company as against an innocent purchaser. (Shirey v. All Day and All Night Bank, 166 Cal. 50 [134 Pac. 1001]; Fowles v. First Nat. Bank of Cal., 167 Cal. 653 [140 Pac. 271].)
I We conclude, therefore, upon this question that Knox had complete authority to and that he did convey a valid title in the property to the respondent.
For the reasons given the judgment is affirmed.
Richards, J., concurred.
Reference
- Full Case Name
- M. D. CHUCOVICH, Respondent, v. SAN FRANCISCO SECURITIES CORPORATION Et Al., Appellants
- Cited By
- 18 cases
- Status
- Published