Securities Inv. Co. v. White

91 S.W.2d 581, 19 Tenn. App. 540, 1935 Tenn. App. LEXIS 66
CourtCourt of Appeals of Tennessee
DecidedAugust 10, 1935
StatusPublished
Cited by7 cases

This text of 91 S.W.2d 581 (Securities Inv. Co. v. White) is published on Counsel Stack Legal Research, covering Court of Appeals of Tennessee primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Securities Inv. Co. v. White, 91 S.W.2d 581, 19 Tenn. App. 540, 1935 Tenn. App. LEXIS 66 (Tenn. Ct. App. 1935).

Opinion

FAW, P. J.

This is the second appeal of this case to this court. Upon our former opinion and judgment, the case was removed to the Supreme Court by certiorari, and was by that court remanded to the circuit court for further proceedings as directed in a written opinion which accompanied the procedendo on the remand and which is in the transcript and made a part of the record on the present appeal in error.

The aforesaid opinion of the Supreme Court states the facts out of which this litigation arose and the principles of law applied to those facts by the Supreme Court. And, as a convenient method of stating the case down to the time of the remand, we quote the opinion of the Supreme Court as follows:

“This is a replevin suit involving the right of possession of one Chevrolet automobile.
“On June 10th, 1931, defendant purchased this automobile from the Jim Reed Chevrolet Company, of Nashville, under a conditional sales contract, for $645. She paid $125 in cash and executed a note for $497.90, the balance of the purchase price, plus $67.90 for ‘handling charges,’ said note being payable in monthly installments of $41.56. The payee negotiated said notes to the plaintiff. Defendant met the first two deferred payments promptly, but before the third became due plaintiff instituted this suit upon the ground that defendant was attempting to dispose of said automobile in violation of her contract. This conclusion was based upon the fact that defendant and a young' man named Herring drove said automobile to the sales room of Parnell, an automobile dealer, and Herring stated to Parnell that they wished to sell tlie car as they intended to leave the state; that the car was purchased in the name of defendant under a conditional sales contract; that the purchase money notes were held by the plaintiff and stated the amount thereof. Parnell telephoned the plaintiff, ascertained the statement of Herring to be correct, asked plaintiff what it would discount the notes for, and was offered a very small discount. Parnell thereupon stated to Herring that he would pay off the debt to plaintiff for the car, but that he could pay them nothing for their equity in the car. This ended the matter and no sale was made. We are unable to see anything in this incident to indicate any bad faith on the part of the defendant, or any purpose to impair or endanger plaintiff’s security. Plaintiff, in *543 effect, seems to have recognized the right of defendant to consummate such a deal because, being advised that defendant wished to realize on her equity in the car, it agreed with -Parnell if he would take up-the notes it would allow him a discount.
“The provision of the contract relied upon by plaintiff is as follows:
“ ‘Should the buyer fail to keep and perform any or all of his-agreements herein contained,- and to promptly pay at maturity any and all sums hereunder, or if said Car is removed or attempted to be removed from the State in which the Buyer now resides, or to-be otherwise disposed of, or if Buyer shall lend, sell, or encumber, or-shall attempt to sell or encumber said Car or in case of misuse or abuse thereof, or whenever the Seller or his assigns shall deem the-debt insecure, said Seller may without any demand or notice take possession of said Car and equipment, wherever found and without process of law, and all rights of the Buyer hereunder shall cease and terminate thereupon absolutely.’
“This court has held repeatedly that, notwithstanding the foregoing provision, possession, authorizing or requiring a sale by the conditional vendor under the statute, must be regained by process of law (by replevin usually) or by agreement of the parties, Mitchell v. Automobile Sales Co., 161 Tenn., 1, 4, 28 S. W. (2d), 51, 83 A. L. R., 955, and cases cited therein.
“By section 7293, Code 1932, it is provided:
“ ‘If the purchaser of personal property, under a written and/or printed contract of such a conditional sale, shall, without having paid for the same, and without the consent of the seller or assignee, sell, give away, or otherwise dispose of or conceal such personal property, with the intention of depriving the seller or his assignee of such property, or of its proceeds so that said seller or assignee cannot, by due process of law, recover possession of said property, when so-entitled under the terms of his said contract, said purchaser -shall be guilty of a misdemeanor, and be confined in the county jail or workhouse for a period of not more than six months, or shall be fined not more than fifty dollars, or both.’
“Construing the contract here involved in conjunction with the-foregoing statute, it appears to us that it was -the intention of the parties that the right of the seller, to repossess the car should be accelerated whenever -the buyer committed or attempted to commit an act which would tend to endanger or destroy the seller’s security for his debt. Any bad faith act for such purpose would empower the seller to repossess the car. Ordinarily that would be a question for the jury. But where, as in this case, a situation is presented as to which reasonable minds could not reach different conclusions, it then becomes a question of law for the courts.
*544 “In 13 Corpus Juris, 540-541, it is said:
‘ ‘ ‘ The words of a contract will be given a reasonable construction, where that is possible, rather -than an unreasonable one, and the court will likewise endeavor to give a construction most equitable to the parties, and which will not give one of them an unfair or unreasonable advantage over the other. So that interpretation which evolves the more reasonable and probable contract should be adopted and a construction leading to an absurd result should be avoided.’
“It would be both unreasonable and inequitable to hold that a party who has purchased an automobile for $1,000 and owes $100 thereon, cannot realize on his equity therein in a manner that works no detriment or prejudice to the seller. In this case the buyer, desiring to leave the state, made inquiry of Parnell as to the value of her equity in the car. Parnell, being informed as to the state of the title, communicated with the seller for the purpose of ascertaining the balance of the unpaid purchase money, and obtaining the information, reported to. defendant that she had no equity in the ear. Suppose, on the other hand, Parnell had reported that he would pay the debt and give defendant $50, and such an agreement had been made and executed, could it be said that the buyer was actuated by bad faith in the transaction, or that she purposed to impair or endanger the seller’s security? We think not. The situation would be different where a buyer was clandestinely, or under suspicious circumstances, endeavoring to dispose of such property without disclosing the existence of outstanding right and title notes and the true facts regarding the title. Another well recognized rule of construction is that where a contract is susceptible of two constructions, one of which will work a ’ forfeiture and the other will not, that construction should be adopted which will prevent the forfeiture and preserve the rights of the parties.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Deidra Kay Minor v. Melvin Richard Nichols
Court of Appeals of Tennessee, 2014
State v. Boggs
932 S.W.2d 467 (Court of Criminal Appeals of Tennessee, 1996)
Ware v. Meharry Medical College
898 S.W.2d 181 (Tennessee Supreme Court, 1995)
Cook v. McCullough
735 S.W.2d 464 (Court of Appeals of Tennessee, 1987)
Lee v. Melson
387 S.W.2d 838 (Court of Appeals of Tennessee, 1964)
Mazikowski v. Central Mutual Insurance
312 S.W.2d 867 (Court of Appeals of Tennessee, 1958)
Pruitt v. Cantrell
264 S.W.2d 793 (Tennessee Supreme Court, 1954)

Cite This Page — Counsel Stack

Bluebook (online)
91 S.W.2d 581, 19 Tenn. App. 540, 1935 Tenn. App. LEXIS 66, Counsel Stack Legal Research, https://law.counselstack.com/opinion/securities-inv-co-v-white-tennctapp-1935.