Rowell v. Carter Mobile Homes, Inc.

500 So. 2d 748, 55 U.S.L.W. 2424, 1987 La. LEXIS 8263
CourtSupreme Court of Louisiana
DecidedJanuary 12, 1987
Docket86-C-0381
StatusPublished
Cited by48 cases

This text of 500 So. 2d 748 (Rowell v. Carter Mobile Homes, Inc.) is published on Counsel Stack Legal Research, covering Supreme Court of Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Rowell v. Carter Mobile Homes, Inc., 500 So. 2d 748, 55 U.S.L.W. 2424, 1987 La. LEXIS 8263 (La. 1987).

Opinion

500 So.2d 748 (1987)

Ray and Annette ROWELL
v.
CARTER MOBILE HOMES, INC., et al.

No. 86-C-0381.

Supreme Court of Louisiana.

January 12, 1987.
Rehearing Denied February 12, 1987.

*749 Samuel Cashio, Jr., for applicant.

William Brough, Mark Surprenant, Adams & Reese, J. Michael Johnson, McGlinchey, Stafford, et al., Caleb Didriksen, III, Monroe & Lemann, Richard McShan, E. Clark Gaudin, Daniel Atkinson, H.F. Foster, III, Bienvenu, Foster, et al., for respondent.

DENNIS, Justice.[*]

The question in this case is whether a bank, which authorized a mobile home dealer to act as its undisclosed mandatary in reselling a repossessed mobile home, is liable for the buyer's personal injuries caused by the dealer's negligent repair of the mobile home floor. The trial court held the bank strictly liable as a mobile home manufacturer. The court of appeal reversed, holding that the bank was not strictly liable as a manufacturer, that instead the bank was liable as an undisclosed principal for the negligence of its mandatary, the dealer, but that the bank's obligation had been extinguished by a prior release which the plaintiffs had granted to the dealer. We affirm, but for different reasons. Because there was only an undisclosed principalmandatary relationship between the bank and the dealer, and not a master-servant relationship, the bank is not liable for the negligent physical acts of the dealer's employees in repairing the home. Moreover, the bank is not responsible for strict products liability in tort or warranty because it did not control or supervise the repairs, hold itself out as a manufacturer or dealer or vouch for the product, was not a professional vendor or merchant of the mobile homes, and was not aware of the defect before the injury. Because the bank is not liable under any legal theory, the questions raised in connection with the prior release are moot.

Facts

The court of appeal's succinct and accurate statement of the facts has not been disputed and is adopted herein. Due to a default in loan payments, Louisiana National Bank (LNB) initiated foreclosure proceedings in August of 1981 on a 1977 Tidwell Dorado mobile home upon which it held a chattel mortgage. LNB eventually acquired title to this mobile home at the sheriff's sale. It then requested that Carter Mobile Homes, Inc. (Carter), the original *750 vendor, pick up the mobile home and take it to Carter's lot in Greensburg for resale. This was the customary arrangement between LNB and Carter with respect to mobile homes repossessed by LNB. It was also part of their customary arrangement for Carter to attend to the performance of any repairs which might be necessary on mobile homes which had been repossessed by LNB. LNB relied entirely on Carter's expertise in this area.

In November of 1981, plaintiffs Ray and Annette Rowell were interested in purchasing a used mobile home. They visited the Carter lot in Greensburg for this purpose, but failed to find a suitable home on this occasion. On a second occasion, Mrs. Rowell returned alone and was shown the 1977 Tidwell mobile home repossessed by LNB. She was not informed of LNB's ownership of this mobile home.

Mrs. Rowell expressed interest in this mobile home, but noted certain areas of the floor were in very poor condition and badly in need of repair. The Carter salesperson assisting Mrs. Rowell assured her this flooring would be repaired prior to sale.

Sometime thereafter this mobile home was repaired by and/or under supervision of Mr. Calvin Cernich, an employee of Carter. These repairs were authorized by LNB under its customary arrangement with Carter. There is no indication LNB was actually involved or gave any specific instructions as to what repairs were to be performed on this particular mobile home. Cernich testified he generally either received his instruction from Carter or exercised his own discretion as to what repairs were necessary on a particular mobile home. He had no independent recollection of the repairs performed on the mobile home purchased by plaintiffs. However, the invoice prepared by him for these repairs indicates flooring in the living room, kitchen and bathroom was replaced. The charge for these repairs was $1,105.00 for labor and $369.21 for parts, a total of $1,474.21.

On November 23, 1981, after completion of the repairs, Carter executed a bill of sale in Greensburg purportedly transferring title of this mobile home to plaintiffs for a cash price of $10,500.00. Plaintiffs gave Carter a $1,000.00 cash down payment and executed a promissory note made out to the order of bearer for the remaining balance. They also executed a chattel mortgage on the mobile home, which listed Carter as the mortgagee/seller.

Shortly after these papers were signed, Carter contacted LNB's collection manager, Mr. Philip Stanley, in Baton Rouge and informed him of the execution of these documents. Mr. Stanley then had a bill of sale drawn up in authentic form, dated November 23, 1981, transferring title of the mobile home from LNB to Carter for a stated consideration of $10,500.00, receipt of which was acknowledged. On November 29, 1981, Carter assigned to LNB both the chattel mortgage and promissory note executed by plaintiffs. On December 8, 1981, Carter made out a check to LNB for $1,000.00, representing the down payment made by plaintiffs.

Upon initially taking possession of the mobile home, plaintiffs noted nothing amiss with the floors, which appeared to have been satisfactorily repaired. However, within two weeks plaintiffs began noticing weak spots in the floor, especially in the living room area. Mrs. Rowell testified she called Carter regarding this problem on several occasions, but no one was ever sent out in response. On January 5, 1982, as Mr. Rowell entered through the front door of the mobile home his left leg went completely through the floor, causing him to fall in a straddled position and severely injure his back. The point at which Mr. Rowell fell was not one of the weak spots previously noticed by plaintiffs.

Procedural History

The plaintiffs, Ray and Annette Rowell, brought suit for damages against the defendants, LNB, Carter and its insurers, Northeastern Fire Insurance Company of Pennsylvania, Commercial Union Insurance Company and Guaranty National Insurance Company; Tidwell Industries, Inc., the original manufacturer of the mobile home; *751 and Calvin Cernich. LNB filed a third party demand, naming Carter, Cernich and Tidwell as third party defendants, for any amount for which it might be liable to plaintiffs on the main demand. Prior to trial, plaintiffs settled with and released Tidwell, Carter, and Carter's insurers; subsequently, these defendants were dismissed from the main demand. LNB filed an amended answer, claiming its entitlement to a reduction in any judgment rendered against LNB in proportion to the responsibility of the released defendants. Upon oral motion, the dismissal of LNB's third party claim against Carter and its insurers was granted.

The trial proceeded against the two remaining defendants, LNB and Cernich. The trial court rendered judgment in favor of plaintiffs against LNB in the amount of $469,546.12; however, the trial court reduced recovery by 50% because of the prior release of Carter, which the trial court considered was solidarily liable with LNB for the plaintiffs' damages. The judgment also dismissed both the plaintiffs' claims and LNB's third party demands against Cernich.

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Bluebook (online)
500 So. 2d 748, 55 U.S.L.W. 2424, 1987 La. LEXIS 8263, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rowell-v-carter-mobile-homes-inc-la-1987.