Title: Securities Acceptance Corporation v. Perkins

State: kansas

Issuer: Kansas Supreme Court

Document:

182 Kan. 169 (1957)
318 P.2d 1058
SECURITIES ACCEPTANCE CORPORATION, Appellee,
v.
DWAINE R. PERKINS, d/b/a Perkins Pontiac Company, Appellant.
No. 40,712

Supreme Court of Kansas.
Opinion filed December 7, 1957.
Charles Boyle, of Russell, argued the cause and was on the briefs for the appellant.
H. Lee Turner, of Great Bend, argued the cause and was on the briefs for the appellee.
The opinion of the court was delivered by
ROBB, J.:
This is an appeal from a judgment of the trial court in favor of plaintiff and against the defendant for the unpaid balance due on a promissory note which had been secured by a chattel mortgage on a new automobile that defendant had sold to a purchaser.
The defendant, Dwaine R. Perkins, doing business as the Perkins Pontiac Company, was a dealer in new Pontiac cars. Plaintiff, a Nebraska corporation, was a finance company obligated by contract to purchase notes and mortgages executed by purchasers of new cars from defendant. The notes and mortgages represented the balance due upon the purchase price of the new cars after the down payment had been made. Defendant endorsed the notes and mortgages to plaintiff without recourse.
The pertinent part of the authorized dealer's reserve agreement controlling the dealings between plaintiff and defendant provided:
On April 30, 1954, defendant sold a new Pontiac to Walter Kleweno and received Kleweno's personal check in the sum of $1,000 as the down payment. The balance was covered by a note in the amount of $2,456.40 which was secured by a mortgage on the new Pontiac. Both the note and mortgage dated April 30, 1954, were payable to defendant. When Kleweno's check was presented for payment, it developed the check was no good whereupon defendant refused to complete the sale until May 4, 1954, when Kleweno paid $600.00 to pick up the bad check.
On May 5, 1954, defendant and Kleweno went to the office of the treasurer of Rush county who testified as follows during the trial:
"Mr. Boyle: Object until it is shown who `He' was.
The record shows by the testimony of plaintiff's branch manager that on May 4, 1954, the note and mortgage were presented at that office by defendant and plaintiff's check in the amount of $1,900.00 was executed to defendant. From the record this is the only evidence bearing on the date the actual assignment took place, pursuant to the authorized dealer's reserve agreement.
*172 Under G.S. 1949, 8-127, every owner of a motor vehicle before operation thereof on any Kansas highway, shall apply for and obtain the registration of the vehicle as provided in G.S. 1949, 8-135 (c) which, in part, reads:
On May 20, 1954, Kleweno surrendered his Kansas certificate of title free and clear of any lien and obtained a Colorado license on the automobile in question.
The testimony of plaintiff's branch manager further showed that he had made demand on Kleweno for the balance of the note and after default by Kleweno, defendant was notified of plaintiff's election to proceed against defendant under the exception provision of the authorized dealer's reserve agreement.
After judgment was granted to plaintiff for the unpaid balance of the note, interest, and costs, the defendant filed a motion for new trial which was overruled. This appeal followed. Defendant claimed six specifications of error but stated that in the appeal only two questions need be answered under the terms of the authorized dealer's reserve agreement. They are:
The terms of the contract between defendant and plaintiff were unambiguous and were conclusive as to their rights and liabilities. (7 Blashfield on Automobiles, § 4615, p. 520.) Laws in effect at the time of a transaction are a part of a contract (2 Hatcher's Kansas Digest, rev. ed., Contracts, § 48, p. 27) and, as can be seen in the exception clause in our case, state laws were specifically referred to. Thus defendant was required not only to execute a bill of sale at the time he delivered the car to Kleweno, but he was also *173 required to state the lien thereon. This served as a protection to defendant and protected the plaintiff as well.
It is a general rule of law that an assignee acquires no greater rights from the assignment of a note and mortgage than those possessed by the assignor (7 Blashfield on Automobiles, § 4613, p. 506) and this rule is followed in Kansas. (Commercial Credit Corporation v. Kemp, 176 Kan. 350, 270 P.2d 209.) When defendant gave Kleweno a clear bill of sale, it necessarily followed that a clear certificate of title would be forthcoming and this afforded Kleweno the opportunity thereafter to do anything that he pleased with the car. A subsequent sale to an innocent purchaser cut off any rights of repossession of either plaintiff or defendant and gave clear title to the innocent purchaser. (Sorensen v. Pagenkopf, 151 Kan. 913, 101 P.2d 928; General Motors Acceptance Corp. v. Davis, 169 Kan. 220, 218 P.2d 181, 18 A.L.R.2d 808, and see anno. pp. 813, 816, for a good discussion on the subject; Ruth v. Dumler, 170 Kan. 698, 228 P.2d 694; Universal Finance Corp. v. Schmid, 177 Kan. 414, 280 P.2d 577.)
There is no reason or justification shown in the record for defendant executing a clear bill of sale and actively assisting Kleweno in obtaining a clear certificate of title. Defendant could have so easily protected himself by showing the lien on the note and mortgage. His theory that Kleweno did not own the car on April 30, 1954, avails him nothing. (Bankers Investment Co. v. Meeker, 166 Kan. 209, 201 P.2d 117.) When defendant failed to show the lien on the bill of sale, as already stated, he brought himself within the exception clause of his contract with plaintiff and he cannot now be heard to complain of plaintiff's acting thereunder. We certainly are not impressed with his theory that the words "when required by statute" apply only when a dealer is required to apply for a certificate of title. That is not the law and it was not the clear meaning of the contract. We will labor the point no further.
Defendant complains that the trial court considered erroneous statements in arriving at its decision. On appellate review this court is concerned only with the correctness of a decision of a trial court and not with the precise correctness of the reasoning of that court in so deciding. One of our many cases so holding is Rauh v. Dumler, supra, where it was said:
Other contentions of defendant raised herein are not material and, therefore, do not merit discussion in this particular case. Nothing approaching reversible error is shown in the decision of the trial court and the judgment is affirmed.