307 Mass. 577 | Mass. | 1940
This is an action begun November 5, 1937, for the conversion of an automobile. The plaintiff finances the purchase of automobiles by retail dealers. Grannone Motors, Inc., hereinafter called Grannone, was such a dealer. The defendant was the distributor in Boston of automobiles made by the manufacturer of the automobile in question. When the automobile ordered by Grannone arrived in Boston, the plaintiff paid for it by arrangement with Gran-none, and received a bill of sale of it dated July 16, 1937, from the defendant, which knew the relationship between the plaintiff and Grannone, and knew that while the plaintiff owned the automobile Grannone was to have possession of it for sale “under some agency agreement.” Accordingly the defendant delivered the automobile to Grannone. The understanding between the plaintiff and Grannone was that expressed in a certain form of document called a “ trust receipt,” which however happened not to be executed with respect to this particular automobile. The form of that document, except for a draft in favor of the plaintiff attached to it, to be accepted by Grannone, appears in a footnote.
The judge, sitting without a jury, found for the plaintiff, and assessed damages at the agreed amount of $614. The defendant alleged exceptions.
The essence of the transaction expressed in the form of “trust receipt” already set forth in full, is that the plaintiff owns the automobile; that Grannone holds possession of it “in trust” for the plaintiff, with power as agent for the plaintiff to sell it, on certain conditions, paying the proceeds to the plaintiff; and that the automobile is to be delivered to the plaintiff whenever it “shall feel insecure.” It is implied rather than expressed that the title to the automobile shall pass to Grannone whenever the draft is paid.
The transaction was not a pledge, for the plaintiff had full legal title and not a mere special property dependent on possession (Moors v. Drury, 186 Mass. 424, 425), to say nothing of the question whether the possession of Grannone could be considered that of the plaintiff. Moors v. Wyman, 146 Mass. 60, 63. Peoples National Bank v. Mulholland, 224 Mass. 448, 451. T. D. Downing Co. v. Shawmut Corp. of Boston, 245 Mass. 106, 113. Handy v. C. I. T. Corp. 291 Mass. 157, 160. The transaction was not a chattel mortgage, for the automobile never belonged to Grannone, and never was conveyed by it to the plaintiff. Moors v. Drury, 186 Mass. 424, 425. Peoples National Bank v. Mulholland, 224 Mass. 448, 452. Simons v. Northeastern Finance Corp. 271 Mass. 285, 291. Hartford Accident & Indemnity Co. v. Callahan, 271 Mass. 556. Handy v. C. I. T. Corp. 291 Mass. 157, 160, 161. The transaction was not a conditional sale by the plaintiff to Grannone, for Grannone was not to gain title upon paying a price to the plaintiff as a vendor. The event upon which the plaintiff was to lose title was not the payment of a price as such, but either the payment of an advance represented by a draft or a sale by Grannone under its power to some third person. Simons v. Northeastern Finance Corp. 271 Mass. 285, 290. Handy v. C. I. T.
The Uniform Trust Receipts Act, G. L. c. 255A, inserted by St. 1936, c. 264, makes for trust receipt transactions elaborate provisions which differ to some extent from common law requirements. For example, compare § 2, cl. 1 (a) (b) (ii) with Simons v. Northeastern Finance Corp. 271 Mass. 285, and Hartford Accident & Indemnity Co. v. Callahan, 271 Mass. 556, 562, 563. Section 1 contains this definition: “‘Trustee’ means the person having or taking possession of goods, documents or instruments under a trust receipt transaction, and any successor in interest of such person. The use of the word ‘trustee’ herein shall not of itself be interpreted or construed to imply the existence of a trust or any right or duty of a trustee in the sense of equity jurisprudence other than as provided by this chapter.” Section 2 restricts a “trust receipt transaction” to the delivery to the trustee of goods, documents or instruments “against the signing and delivery by the trustee of a writing” or “pursuant to a prior or concurrent written and signed agreement of the trustee to give such a writing.” The present case, in which there was no writing, falls outside the act. § 2, els. 1 (b) (i) (ii), 2; §4, cl. 1. It is left to be governed by the preexisting law. § 17. See 5 Fordham Law Review, 240, 246.
The so called factor’s act (G. L. [Ter. Ed.] c. 104) in § 1
The defendant was entitled to have its transaction with Grannone considered a “bona fide contract of sale” within
We think that the ruling requested by the defendant, that on all the evidence it was entitled to a finding as matter of law, should have been given.
Exceptions sustained.
Judgment for the defendant.
“Trust Receipt
“The undersigned dealer hereby acknowledges that the following chattels complete with all standard catalogue attachments and equipment are the
property of Associates Discount Corporation (hereinafter called ‘Company’) and represents that they are free from liens of every kind and agrees to hold said chattels at his (its) sole risk for the purpose of exhibiting and storing them with the understanding that none of said chattels shall be used for any other purpose except with the written consent of said Company.
“Should any of the said chattels be unsold at the end of..........days from and after the date hereof, the undersigned dealer agrees to make full payment of the unpaid balance of the accepted draft hereto attached, or, from time to time, to make partial payments, if and when requested so to do by said Company.
“The undersigned dealer agrees to keep a separate account of each of said chattels held in trust by him (it) for said Company; that said undersigned dealer shall furnish to said Company or its assigns on demand a true and complete report of all sales of chattels made by him during the preceding month; that the undersigned dealer shall also permit said Company, its representatives or assigns to examine the undersigned dealer’s books and the chattels in his (its) possession; that the undersigned dealer shall pay all costs, charges, expenses and disbursements, including reasonable attorney’s fees, 15% of the amount involved in any legal proceedings, if lawful.
“Should said Company, its successors or assigns, deem it necessary to protect its or their rights hereunder, or in said chattels or any of them, by legal proceedings, or if the undersigned dealer becomes insolvent or fails to pay any acceptances due said Company, its successors or assigns, or, if said Company shall feel insecure, or, if the undersigned dealer breaches any of the covenants of this agreement, then all acceptances of said dealer held by said Company, its successors or assigns, shall at its or their option immediately become due and payable without notice, and all chattels covered by this agreement shall immediately be delivered to said Company or its order; that the terms and conditions hereof shall apply to and be binding upon the undersigned dealer, his (its) successors and assigns, and shall inure to said Company, its successors and assigns.
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