Court Opinion

ID: 9744316
Source: CourtListenerOpinion
Date Created: 2023-08-26 22:00:32.751878+00
Date Added: 2024-06-11T07:24:48.521726
License: Public Domain

*595CONCURRING OPINION
Emmert, C. J.
The petition to transfer alleges but one cause, to-wit: that the opinion of the Appellate Court contravenes the ruling precedent announced by this court in Personal Finance Co. v. Flecknoe (1940), 216 Ind. 330, 24 N. E. 2d 694. The Fleeknoe case involved the priority of the lien of a chattel mortgage, which had been duly recorded, over a garageman’s common law lien for repairing the automobile covered by the mortgage, whereas in the appeal at bar the controversy arises between the assignee of a conditional seller and a garageman, who at the request of the conditional buyer, furnished necessary labor and material to keep a nine-year-old DeSoto automobile in operation. The Fleeknoe case decided that the lien of a chattel mortgage, duly recorded, was superior to the lien of a mechanic for repairs on the car, and under the facts it could not have decided priorities arising under an unrecorded conditional sale. Therefore the petition to transfer was insufficient to entitle the appellee to the transfer.
However, since a majority of this court have transferred the appeal, we then have jurisdiction to determine it on grounds, other than specified in the petition to transfer. We are entitled to base our opinion on the briefs without resort to the record. Appellees’ brief asserts, and it is not denied in appellant’s brief, that there was no evidence of the reasonable value of materials and labor required to repair the car. The conditional buyer, Otis Barnett, took the car to appellant’s garage and requested the repairs, but no contract was made for any definite price. In such cases the law implies a promise to pay the reasonable value of services. Louisville, New Albany & Chicago Ry. Co. v. Hubbard (1888), 116 Ind. 193, 195, 18 N. E. 611. Even if there *596had been a specific agreement as to the amount of compensation, the conditional seller’s assignee, if it had consented to the work being done, could only have had its interest made liable for the reasonable amount. Mann v. Schnarr (1950), 228 Ind. 654, 95 N. E. 2d 138. Proof of the price charged is not proof of the reason-: able value of services performed. Johnson v. Jones (1916), 62 Ind. App. 4, 6, 112 N. E. 830. Since there was a total failure of proof on the issue of the reasonable value of materials and labor furnished, the judgment of the trial court should be affirmed on this ground. ■
On January 11, 1949, the conditional buyer purchased the nine-year-old DeSoto automobile in controversy from an Indianapolis dealer. The agreed price for the DeSoto was $1,140.00. The contract recited a trade-in price of a Ford at $310.00, and cash in the sum of $100.00, leaving an unpaid cash balance of $730.00, to which was added a finance charge and insurance costs in the sum of $232.10, leaving a time balance in the sum of $962.10 to be paid in fifteen monthly installments of $64.14 beginning on February 15, 1949. The buyer promised not to sell or encumber said motor vehicle. The contract was silent as to the making of repairs, and there was'no promise or condition that the buyer would not use the car until the purchase price was paid in full. It was on a printed form, with various assignment forms on the back thereof, for assignment to Consolidated Finance Corporation to whom the dealer assigned it without recourse. The only possible inference is the form of the contract was drafted by Consolidated Finance Corporation. The contract, having been prepared by this appellee, should be construed most strongly against it if there is doubt as to the meaning of any provision. *597Jenkins v. King (1946), 224 Ind. 164, 65 N. E. 2d 121, 163 A. L. R. 397; Buanno v. Weinraub (1948), 226 Ind. 557, 81 N. E. 2d 600; Noblesville Milling Co. v. Johnson (1946), 116 Ind. App. 437, 65 N. E. 2d 250; 13 C. J. 545.
Under the common law if a mortgagee of a chattel mortgage permitted the mortgagor to retain possession of the chattels, the transaction was held fraudulent as to the mortgagor’s creditors. Jordan v. Turner (1833), 3 Blackf. 309, 10 Cornell L. Qr. p. 339 In order to permit the mortgagor to retain the possession of the chattels, and at the same time to protect the mortgagor’s creditors, the recording acts, when complied with, give notice of the lien to everyone. Section 2 of the Chattel Mortgage Act of 1935, §51-502, Burns’ 1951 Replacement, provides in part that the mortgage “shall be a good and valid lien against, and superior to all rights of any and all unsecured creditors of the mortgagor, and any and all subsequent purchasers, mortgagees, lienors and encumbrancers, including judgment creditors, of the mortgagor, and any and all third persons.” (Italics supplied.) Section 4 of the Act, §51-504, Burns’ 1951 Replacement, gives the recorded mortgage priority, and further provides that a chattel mortgage, not duly filed for record, “shall be invalid and ineffectual as against all subsequent mortgagees, purchasers and/or creditors of the mortgagor, without actual notice thereof.” Section 10 of the Act, §51-510, Burns’ 1951 Replacement, provides that “upon filing such instruments in the office of the county recorder, all persons shall thereby be charged with notice thereof and of the rights of the mortgagee, trustee, his or its assignee or representative thereunder.” In contemplation of law the garageman in the Flecknoe case had notice of the chattel mortgage.
*598There is no provision in the Conditional Sales Act of Indiana, §§58-801 to 58-829, Burns’ 1951 Replacement, which give the appellant Champa any constructive notice of the title asserted by the appellee. Nor do the certificate of title provisions of the Motor Vehicle Act, §47-2501, Burns’ 1952 Replacement, provide any constructive notice to any garageman. If the General Assembly had intended to give constructive notice to the garageman, it would have so stated as in the case of a recorded chattel mortgage. Or third persons dealing with the apparent owner of the vehicle could have been amply protected by a provision in the certificate of registration statute, §§47-2602, 2603, 2604, 2605, Burns’ 1952 Replacement, which could have required that the security title of the seller be noted on the certificate of registration card, which under the statute is required to be carried in the vehicle or on the person driving or in control of such vehicle.
The evident purpose of the certificate of title statutes enacted from time to time was not to give additional protection to an unrecorded conditional seller or a recorded chattel mortgagee. The property interests of each were adequately protected against fraudulent acts or assignments by the owner or mortgagor. Our Legislature sought to protect the buyers of automobiles by providing them a better title with notice of any defects in the seller’s title. Before the certificate of title requirements, there were wholesale thefts of cars, and no one could be positive he was not buying a stolen automobile. The certificate of title acts made it more difficult to dispose of stolen automobiles in the state, and greatly increased the risk of conviction for the guilty. There is nothing in the title provisions that indicates an intention that the garageman’s lien should *599be subordinate to the interest of either a conditional seller or a mortgagee.
The economic as well as the legal justification for the widespread use of conditional sales contracts to market used automobiles is that it permits the buyer to use the car while he is paying for it. If the buyer had the money to pay the cash for the car, it would be no violent presumption to presume he would do so and save the finance charge, which in this case was $232.10. No buyer of a used car by a conditional sales contract buys the car to put in his garage and never use it until he pays the contract in full. Consolidated had no provision in its contract prohibiting the use of the car. If Consolidated had desired to protect itself against the ordinary wear and use of this nine-year-old automobile, it could have provided the car was not to be used, but we could hardly assume that such a contract would have helped to sell any used automobiles. When we apply the well settled rule that doubtful provisions in the contract will be construed against the party who drafted it, it must have been within the contemplation of the parties that this nine-year-old car was going to be used by the buyer, and that Consolidated assented to that use.
It is common experience that any automobile in use is going to require repairs, and the older the car the more likely repairs will become necessary in order to keep it in operation. Even in the case of a chattel covered by a recorded mortgage, this court has held that it is proper to infer that the mortgagee assented to the repairs. Watts v. Sweeney (1891), 127 Ind. 116, 26 N. E. 680, 22 Am. St. 615; Grusin v. Stutz Motor Car Co. (1933), 206 Ind. 296, 187 N. E. 382; Personal Finance Co. v. Flecknoe (1940), 216 Ind. 330, 24 N. E. *6002d 694, supra. Assent to the repairs is all that is necessary, for the lien is then created by operation of law. Grusin v. Stutz Motor Car Co. (1933), 206 Ind. 296, 300, 187 N. E. 382, supra; Yellow Mfg. Acceptance Corp. v. Linsky (1934), 99 Ind. App. 691, 699, 190 N. E. 379, 192 N. E. 715.
As was stated by the court in Watts v. Sweeney (1891), 127 Ind. 116, 123, 124, 26 N. E. 680, 22 Am. St. 615, supra, “Where property is to be retained and used by the mortgagor for a long period of time, it will be presumed to have been the intention of the parties to the mortgage, where it is property liable to such repairs, that it is to be kept in repair, and when the property is machinery, or property of a character which renders it necessary to intrust it to a mechanic or machinist to make such repairs, the mortgagor in possession will be constituted the agent of the mortgagee to procure the repairs to be made, and as such necessary repairs are for the betterment of the property, and add to its value to the gain of the mortgagee, the common law lien in favor of the mechanic for the value of the repairs is paramount and superior to the lien of the mortgagee. The mortgagee is presumed in such case to have contracted with a knowledge of the law giving to a mechanic a lien.”
“Where the mortgagor is given the right or charged with the duty of procuring repairs, or where the contract is silent upon the subject and the property is a vehicle or machinery of such a nature that it is apparent that the object complete and fit for use, and not its component or broken parts, is relied upon by the mortgagee as security, and when it is contemplated that the property is to be used by the mortgagor, and it is of such a character that the necessity of repairs may be reasonably anticipated, necessary repairs which add *601to the value of the property are required to preserve the security of the mortgagee and are a benefit to him, and authority for the mortgagor to have such repairs made will be implied from the circumstances. In either case the mortgagor will be constituted the agent of the mortgagee for the purpose of procuring repairs.” Grusin v. Stutz Motor Car Co. (1933), 206 Ind. 296, 301, 187 N. E. 382, supra.
In Personal Finance Co. v. Flecknoe (1940), 216 Ind. 330, 338, 339, 24 N. E. 2d 694, supra, the court classified the various cases in which a mechanic’s lien might have priority over the interest of a mortgagee as follows: “The majority of the courts have granted priority to the mechanic as against the mortgagee only in those cases (1) where the repairs would constitute a real benefit to the mortgagee by preserving the chattel covered by the mortgage, (2) where the mortgagee had a beneficial interest in the continued use of the mortgaged chattel and the repairs were necessary to such continued use, or (3) where the mortgagee had actual knowledge of the repairs being made or there were circumstances, or language in the mortgage, from which such knowledge could be presumed. An artisan claiming priority for his lien must bring his case within one of these classes. The burden is upon him to show facts from which the consent of the mortgagee may properly be implied.” In the next paragraph the court held, “There is no showing that the repairs were necessary to preserve the automobile for the mortgagee.” It is difficult to understand how the court arrived at this conclusion in view of the stipulation that “said automobile was then ‘badly in need of repairs, and the same could no longer be operated or driven about as an automobile.’ ” It would seem obvious that when an automobile will not run or operate, and certain repairs *602are necessary to put it in condition to operate with reasonable safety, and no more repairs are made than necessary to restore it to this condition, value to the car has been added by the artisan which inures to the benefit of the mortgagee or conditional seller thus increasing his security title to his benefit. The authority of the Flecknoe case should be confined to its specific facts, and should not be extended as a ruling precedent when the rights of the conditional seller or his assignee are involved.
In the appeal at bar the engine knocked, had a rod out, the crankshaft was not true, and it had to be towed to the garage. If the repairs were reasonably necessary to make the car operate, the security of the conditional seller’s assignee was enhanced, and I can see no reason in law or equity why a garageman who does nothing more than furnish necessary labor and materials to keep the car in operation, so that it can be used as contemplated by the contract of the parties, should be forced to contribute a windfall to a conditional seller or his assignee, of whom he had no notice, when the seller must have known that any nine-year-old automobile if operated was going to need some repairs.
There is nothing in any of the motor vehicle statutes concerning certificates of title, certificates of registration, or in the conditional sales act which gave constructive notice of the seller’s security title. If the seller had wanted to give notice to the world that it had an unpaid debt secured by a lien against the car, it could have sold the car outright and have taken back a chattel mortgage, which when recorded would have put the appellant on notice. In view of the obvious danger to creditors of the buyer when he is permitted to have possession of the chattel sold under an un*603recorded conditional sale contract,1 the rights of the conditional seller ought not be extended further by permitting his unjust enrichment when the chattel is improved by necessary repairs, done at the expense of an artisan who acted in good faith and without notice, either actual or constructive.
Nor can I agree with the limited construction given the word “owner” in §47-552, Burns’ 1952 Replacement, which is §56 of Ch. 213 of the 1925 Acts. This section as well as other sections of other statutes providing for liens is merely declaratory in the common law as to the creation of the lien, but it does provide a procedure for the foreclosure thereof. See Grusin v. Stutz Motor Car Co. (1933), 206 Ind. 296, 187 N. E. 382, supra. The definition of the word “owner” given in §1 of Ch. 213 of the 1925 Acts does not purport to limit the term to the owner of the fee of the car, or a lessee for a period longer than thirty days. Other provisions of the act, §§10084 to 10101, Burns’ 1926 R. S., provide for the registration of the car in the name of the owner, and the issuance to him of a certificate of registration and two number plates for each motor vehicle. But Ch. 213 of the 1925 Acts must be construed in pari materia with Ch. 265 of the 1921 Acts, which was then in force.
Section 1 of the 1921 Acts, §10110, Burns’ 1926 R. S.; prohibited the issuance of any certificate of registration until an official certificate of title had been issued upon an application showing the applicant’s title *604and any liens, or encumbrances upon the vehicle. Section 1 of this act provided: “The secretary of state shall use reasonable diligence in ascertaining whether or not the facts stated in said application for a certificate of title are true, and, if satisfied that the applicant is the lawful owner of such motor vehicle, or is otherwise entitled to have the same registered in his name, he shall thereupon issue an appropriate certificate, over his signature, and sealed with the seal of his office, procured and used for such purpose.”
From the provisions of both acts it is quite clear that the certificate of title, the certificate of registration and the license plates were all to be issued to the same person, whether his title was absolute, conditional or subject to liens or encumbrances, and this person throughout Ch. 213 of the 1925 Acts was referred to as the owner. Hence, it seems clear to me that a conditional buyer is an owner within §56 of the 1925 Acts, which is §47-552, Burns’ 1952 Replacement, declaring the common law lien and providing an additional method for its enforcement. Moreover, the car had not left the possession of the appellant, and whether or not the buyer was the absolute owner, the appellant’s common law lien was not in any way impaired as long as this possession continued.
Gilkison, J., concurs.
Note.—Reported in 110 N. E. 2d 289.

 “Conditional sales have become so common under modern methods of business and are so deceptive both to purchasers from the buyer and to the buyer’s creditors, since the buyer not only has possession of the property but ordinarily is entitled to use it and does use it as if it were his own, that recording acts have been passed in almost all the States.” 2 Williston, Sales (Rev. Ed.) §327, p. 276.