Court Opinion

ID: 3996738
Source: CourtListenerOpinion
Date Created: 2016-07-06 10:54:51.069332+00
Date Added: 2024-06-11T07:44:29.109678
License: Public Domain

I fear that the majority has not given sufficient weight to the facts as found by the trial court. Here at the very foundation of the vital question is the good faith, or lack of it, which entered into the transaction between the Yakima Automobile Company and its employee Daggett. The trial court found against such good faith, and that is the finding which the majority has overruled.
In addition to the facts recited by the majority, there are some others which are very pertinent to be here considered; and I think also some of the facts recited have not been given the prominence or weight which they deserve. The trial court found that the Yakima *Page 431 
Automobile Company was the exclusive sales agent for this type of car in Yakima and vicinity, that it had possession of this car at all times here in question, held itself out as the owner and displayed it for sale at its place of business bearing its dealer's license. In addition to that, and as showing the purpose which actuated both the automobile company and its employee Daggett, the president of the automobile company acted with Daggett throughout in making the sale of this car to the respondent, an innocent purchaser for value.
As I read the evidence, it does not preponderate against these findings, and we are therefore bound by them.
Without reference to the question of whether, at that particular time, there was a well-defined purpose to defraud some one, it is a fact beyond question that it was the intention from the beginning that the automobile company should retain apparent possession, apparent title, and the apparent right to sell, and should sell the car to some innocent purchaser. That it may have then been intended to use the purchase money received from such an innocent purchaser to extinguish the interest of the finance company, is wholly immaterial. The fraudulent purpose was to deceive the general public and cause prospective purchasers to believe that the automobile company had a good right to sell the car and transfer an unencumbered title. The fraud consisted in the purpose so to sell the car, and that fraud was fully consummated. It may be that the automobile company would, if financially able, have paid out and extinguished the title of the finance company, but such an intention in no way mitigates or excuses the actual fraud of selling as its own an automobile to which it had no title.
In my opinion, therefore, there was actual fraud and a lack of good faith inherent in the transaction from *Page 432 
the inception, and that fraud was consummated when the automobile company purported to transfer the car with full title to the respondent and received from him the full purchase price.
Respondent was certainly an innocent party. We see no way where, by the exercise of reasonable care, he could have possibly protected himself. Presumably, he wanted this type of car. There was no other agency in Yakima from whom it could be purchased. He went to the recognized and authorized dealer, found this car in its possession bearing its license plates, and found in it every evidence of full title and the right to sell and transfer such title. Had he searched the records for a chattel mortgage or any other lien on the car given by the automobile company, he would have found nothing. Had he searched for a conditional bill of sale to the automobile company, he would have found nothing.
There was absolutely nothing, as I see it, to even suggest to him that he should search the records for a bill of sale given by the automobile company. Why should he? The automobile company was apparently in full possession; and who, finding a car in the possession of an authorized dealer, and bearing his license plates, would ever think to search the index of grantors in conditional bills of sale before purchasing?
Upon the other hand, the appellant was advised before it parted with its money that Daggett was a salesman in the employ of the automobile company, and knowing that fact, and before parting with its money, it demanded and received from the automobile company a full, complete and absolute guaranty of the whole transaction; something far beyond the ordinary limited guaranty exacted by this finance company and all other finance companies in the ordinary and regular transaction. Having been so advised of a setup which, *Page 433 
on its face, would permit a fraud to be perpetrated upon an innocent purchaser, it ought in good conscience to refuse to lend itself to the plan, or should have taken precautions to prevent the carrying out, by and with its aid, of any such plan.
It is said that the finance company had the right to purchase such a contract. Very true, but it had no right to lend itself to the perpetration of a fraud; and when it decided to enter into a picture which it knew was designed to deceive, it should be held bound to take all possible precautions, ordinary and extraordinary, necessary to prevent its participation being used as a part of the plan to deceive an innocent purchaser who, even though diligent, had no opportunity to protect himself.
Because, with knowledge, the finance company lent itself to a plan known to be inimical to the rights of innocent purchasers, and also under the rule of comparative innocence and the authority of Northwestern Finance Co. v. Russell, 161 Wash. 389,297 P. 186, the judgment should, in my opinion, be affirmed.
BEALS, C.J., and HOLCOMB, J., concur with TOLMAN, J. *Page 434