Court Opinion

ID: 3715431
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:48:35.976727+00
Date Added: 2024-06-11T15:46:53.605165
License: Public Domain

Although I concur in the opinion and judgment, there are some additional pertinent observations. Defendant executed a note payable to plaintiff bank in consideration for which plaintiff bank was to pay a stated sum of money to an automobile dealer in partial payment of an automobile being purchased by defendant.
Prior to such payment being made by the plaintiff bank, defendant notified plaintiff bank not to make the payment because defendant had discovered that the automobile being purchased was defective. Plaintiff bank refused to follow defendant's instructions, and, after such notice, made the payment to the automobile agency. (It might be noted that defendant's affidavit refers to the automobile agency as "Rutherford Bros., Inc."; whereas, plaintiff's affidavit refers to payment being made to "United Auto Sales.")
Plaintiff bank contends that it was entitled to make *Page 330 
payment to the automobile agency and hold defendant liable therefor, despite defendant's instructions to the contrary (which plaintiff does not concede it received), because the automobile agency was a third-party beneficiary of the contract (note) between plaintiff and defendant.
Assuming that the automobile agency was a third-party beneficiary, plaintiff bank acted at its peril if it paid the agency after notification not to do so from defendant. Plaintiff bank, merely because it possesses a promissory note executed by defendant, is not entitled to, in effect, act as judge and jury and determine favorable to the agency the dispute between defendant and the automobile agency over the proceeds of the loan.
When notified of the dispute as to whom the loan proceeds should be paid, plaintiff bank could no longer rely upon the original instructions from, and understanding with, defendant that the loan proceeds should be paid to the auto agency.
The controlling issue is whether the automobile agency is entitled to the loan proceeds by virtue of being a third-party beneficiary of the agreement between plaintiff bank and defendant. Obviously, if, as defendant contends, the circumstances are such as to justify cancellation of the purchase of the automobile, or that the sale contract was materially breached by the agency, then the agency would not be entitled to the loan proceeds. Plaintiff bank was not entitled to make this determination. Having done so, plaintiff bank can recover on the note only if it is determined to have made the correct determination of the dispute between defendant and the agency as to the agency's right to the loan proceeds. This issue cannot be resolved upon summary judgment predicated upon what was before the trial court.
The foregoing is, of course, predicated upon construing the evidence favorable to defendant. The ultimate factual determinations may well reveal a different fact situation than that set forth above. However, at this stage of this case, there are most clearly genuine issues of material facts that must be resolved in plaintiff's favor before it could possibly be entitled to summary judgment. *Page 331