60 Ga. App. 780 | Ga. Ct. App. | 1939
Lead Opinion
The petition set forth a cause of action against the defendants. It alleged, that they were indebted to the plaintiff in a named sum on a contract and note executed on July 7, 1937, to Yarbrough Motor Company and by it sold, transferred, assigned, and set over to the plaintiff on July 12, 1937; that the defendants had defaulted in payment, and that after allowing credit for certain payments before default, and for the net amount received from the sale of a truck (provided for in the contract, a copy of which was attached to the petition as an exhibit), a certain sum with interest remained due and unpaid, for which judgment was prayed. Where the holder of an instrument payable to his order transfers it for value without indorsing it, the transfer vests in the transferee such title as the transferor had therein, and the transferee acquires, in addition, the right to have the indorsement of the transferor. For the purpose of determining whether the transferee is a holder in due course, the negotiation takes effect as of the time when the indorsement is actually made.” Code, § 14-420. As the holder of the note, the plaintiff had the right to bring the present suit thereon. Williams v. Whited, 41 Ga. App. 398 (153 S. E. 205).
The ground of the demurrer that the alleged indebtedness should be reduced by the amount of $608.30, which demurrants denominate “interest” added to the cash price of the truck, and which it is averred is at the rate of 41 per cent, per annum and is usurious, is without merit, for the following reasons: It is shown by the copy of contract attached to the petition, of which the note was a part, that the truck was purchased, not at a cash price, but at a “time price” of $3725.60, for which was executed a note payable in eighteen instalments of $149.25 each, for the unpaid portion. This amount was arrived at by using as a basis the “cash price” of $3117.30, and adding to it a differential of $608.30, according to a certain chart. It is shown that the defendants agreed to the time price thus arrived at by signing the contract and note.
The ground of the demurrer to the allegations as to the sale of the truck .after being repossessed, (a) that it was not alleged how or in what manner the truck was sold, (b) that the allegations do not show that the truck was sold in any legal manner, (c) that the allegations do not show what was the market value of the truck or that it was sold for its market value, (d) that it is not shown what part of the selling expense of $24 was for attorney’s fees and what part for advertising, and the allegations do not show any right to charge the defendants for either advertising costs or attorney’s fees in the sale of the truck, and (e) that the allegations show no right in the plaintiff to recover attorney’s fees, is without merit, for the following reason: Under the contract, on default in the payment of any instalment, the full amount automatically became due and payable forthwith, and the plaintiff had the right, among other things, without any notice or demand, to repossess the truck and sell it at public or private sale, with the right to purchase at such sale; and it was provided that the expense of taking, removing, holding, repairing, and selling, and attorney’s
The ground of demurrer to the allegations as to declaring the full amount due, that it was not shown when the right was exercised or how the defendants were notified, is without merit, for the reason that it is shown by the petition that the default occurred on October 7, 1937, and under the contract the full amount automatically became due and payable forthwith, and a formal declaration or notice to defendants that the entire balance had become due and payable was unnecessary, the allegation of having declared the full amount due being mere surplusage.
The ground of demurrer that it is shown by the allegations of the petition and the exhibit that “interest” was included in the note to maturity, and that defendants are entitled to a pro rata refund because the truck was repossessed before maturity, is without merit, for the reason that the note shows that interest is provided for only after maturity of the instalments, and the amount added to the list or cash price to establish the time price at which the truck was purchased was not interest, but was a differential used in arriving at the time price according to a chart, and to which the purchasers agreed by their act in signing the contract and note. The contract provided that any payments made were to be retained as compensation for the use of the truck while in the possession of the purchaser.
The ground of demurrer that that part of contract, “add, per
To the allegations as to the plaintiff having notified the defendants of its intention to bring suit and judgment be prayed, as shown by copy of notice attached to the petition, for 15 per cent, attorney’s fees in addition to the balance due, one ground of demurrer was that no right to recover attorney’s fees was shown. This ground is without merit, for the reason that the contract provided for 15 per cent, attorney’s fees, or, at the option of the plaintiff, a reasonable sum as attorney’s fees if the contract were placed with an attorney for suit.
The court passed on the general demurrers of the plaintiff to the pleas and answers of the defendants as amended, before the time the case came on for trial, and sustained the same as to the grounds of the pleas that the defendants were entitled to a credit of $509 as a pro rata part of “interest” included in the selling price, and that the amount of $608.30 was added as a scheme and device to charge 41 per cent, interest, which was usurious, for which reason the said amount should be canceled, and overruled the demurrer as to the grounds of the pleas that the plaintiff, well knowing that the truck was worth the market value of $2500, fraudulently sold it for $1000. It is contended that the court erred in striking portions of the pleas, while at the same time holding other parts of the pleas to be good. While it is the general rule that if any portion of a plea is good a general demurrer thereto should be overruled, still in the present case the action of the court was not harmful to the defendants, inasmuch as the • grounds stricken were contentions which could not by proof establish the right of the defendants to a pro rata credit of the so-called “interest” charge of $608.30, or to the total elimination of the amount, on the ground that it was usurious interest. As hereinbefore shown, this amount was not interest, but was a sum which the purchasers agreed should be added to a base price to establish
After the rulings on the demurrers the case went to trial before the judge and a jury on the petition of the plaintiff and the pleas of the defendant unstricken. The defendants assumed the burden of proving their pleas, and the issues presented were whether or not the plaintiff had acted fraudulently in the sale of the truck, and whether or not Mrs. Richardson signed the contract and note only as surety for her husband, H. H. Richardson, the other defendant. Upon the conclusion of the introduction of evidence in their behalf, as hereinbefore set forth, the court directed a verdict in favor of the plaintiff, upon which error is assigned, and thereafter overruled the defendants’ motion for new trial, on which error is also assigned. The grounds of the motion for new trial, besides the general grounds, are that the court erred in directing the verdict for the plaintiff, because the undisputed evidence showed, according to movants, that the market value of the truck at the time of its resale was $2500, and there was no proof that it was sold under the provisions of the contract or for its market value or fair valuation; that the court erred in directing the verdict for the plaintiff against Mrs. Richardson, because, as movants contend, the undisputed evidence showed that she was a married woman, signed the contract and note as surety for her husband, H. H. Richardson, and consequently she was not bound thereby, fox certain reasons, which in substance were to the effect that the plaintiff, while holding such title as the seller had, was not a holder in due course, the note itself not having been indorsed although transferred and assigned by the seller, and that the note was taken by the plaintiff subject to any defenses that might be urged against the seller, and she was shown by the evidence to have been only a surety for her husband.
The contention that the sale of the truck was fraudulent is without merit. The contract provided that upon default the seller might repossess the truck and sell the same publicly or privately, with the right to purchase at such sale, the proceeds, less certain expenses, to be credited against the amount unpaid. It did not provide that the “market value” must be obtained at the sale, such value to be taken into account only in the event the seller desired to retain the truck after repossession. In either case the purchaser
The direction of the verdict against H. H. Eiehardson was in all respects demanded. It follows that as to Mrs. Eichardson’s plea of a fraudulent sale a verdict in favor of the plaintiff was demanded. On the question of suretyship,- however, the evidence in her behalf, together with the fact that the exhibit attached to the pleadings of the plaintiff showed that the note had not been indorsed, was such as to make an issue for the jury’s determination; and in this respect the court erred in directing the verdict against her. The negotiation of a note takes effect as of the time when the indorsement of the note is actually .made (Code, § 14-420), and “In th.e hands of any holder other than a holder in due course, a negotiable instrument is subject to the same defenses as if it were non-negotiable.” (§ 14-508). “No one can be a holder in due course of an instrument payable to a named payee or order, without the indorsement of the payee.” Fourth National Bank v. Lattimore, 168 Ga. 547, 550 (148 S. E. 396). “The indorsement must be written on the instrument itself or upon a paper attached thereto. The signature of the indorser, without additional words, is a sufficient indorsement.” Code, § 14-402. “To enable the holder of a promissory note payable to the order of a named payee to assert successfully the rights of a bona fide purchaser for value, it must appear that the note was formally indorsed by the payee in writing before its maturity.” Lowry Na
Examining the evidence to which the above principles of law are applicable, the following facts appear: The exhibit attached to the petition shows that the note sued on has never been indorsed; and as the plaintiff is bound by the facts pleaded, it was unnecessary for the defendant to show that the note was not indorsed. It follows that the plaintiff is shown not to be a holder in due course, and that all defenses which might be urged against Yarbrough Motor Company, the seller of the truck, are available against the plaintiff. It was shown by the evidence, that in the sale of the truck the seller dealt exclusively with the husband until the time of the actual signing of the papers, and that Mrs. Richardson, the wife, had opposed, though unknown to the seller, the purchase of the truck; that he was asked il: his wife would sign
The court did not err, in respect to H. H. Richardson, in overruling the motion for new trial, but erred in not granting a new trial as to Mrs. Richardson.
Judgment affirmed in part, and reversed in part.
Concurrence Opinion
I concur in the judgment, except as to that part which holds that the direction of the verdict against Mrs. Eichardson was error. I dissent from that ruling, for the reason that there is not one scintilla of evidence, either positive or circumstantial, which would authorize the inference that Mrs. Eichardson signed or agreed to sign in the capacity of surety. Her testimony is all to the effect that in signing she did not intend to be bound at all. Since this is true, the question arises as to whether she is to be bound as a purchaser. I do not think that under the facts such an emergency was shown as will relieve her of her obligation. There is no charge that the opposite party created any emergency or was guilty of any fraud which prevented her from reading the contract. If an emergency of her own making could excuse her, such a one as is contended for in this case will not suffice. If it were permitted, the enforcement of solemn written obligations would become exceedingly difficult.
