Henderson v. Allis-Chalmers Manufacturing Co.

This action was brought by respondent, L.E. Henderson, under section 44-815, I. C. A.,1 to recover from appellant, Allis-Chalmers Manufacturing Company, penalties and damages for failure to satisfy various chattel mortgages and conditional sales contracts. Respondent, doing business as Henderson Equipment Company, was from January, 1932, to May, 1940, a dealer for appellant in Pocatello and adjacent counties, having the right to sell certain products manufactured by appellant. Respondent would purchase machinery from appellant for resale, in some cases giving a note secured by a chattel mortgage on the machinery furnished, and in some cases entering into conditional sales contracts. When re-sales were made and these mortgages and contracts paid, appellant would release them. 'When the agency of respondent was discontinued, it was discovered certain chattel mortgages and conditional sales contracts had not been released of record. Respondent, contending he had made demand for the release of these instruments and that appellant failed to deliver releases to respondent or satisfy the instruments of record, filed suit, asking $800 penalty provided by statute for failure to release four chattel mortgages and four conditional sales contracts, $10,000 general damages for injury to his credit rating and his good name as a dealer in farm implements, which prevented him from securing other agencies or dealers' contracts, as well as for humiliation and embarrassment, also, for $1600 attorney's fees, and for a decree of court directing satisfaction of said instruments. At the trial respondent confessed the motion for nonsuit on the causes of action covering the four conditional *Page 574 sales contracts. The jury returned a verdict finding for respondent on the causes of action covering the four chattel mortgages, assessing his damages at $200 on each mortgage, and awarding $1500 damages on the cause of action asking for general damages, making a total verdict in favor of respondent of $2300. This appeal is from the judgment accordingly entered. Appellant in effect raises five questions: first, the failure to specify the mortgages which respondent wanted released. The record shows that between thirty and forty mortgages had been given by respondent. All of these had been released except the four involved herein. The action herein originally involved four conditional sales contracts which were considered by respondent to fall within the category of chattel mortgages. They were not, however, so considered by the court, and upon appellant's motion were removed from the jury's consideration. The statute does not require a written request, and we believe a fair statement of the sufficiency of a notice under a statute like ours is contained in International Harvester C. v.Simpson, 222 Ala. 493, 133 So. 4, at 5, as follows: "The right to recover is dependent upon the one question of whether the notice was sufficiently definite to point clearly to the requirement that the older mortgage or both of them were referred to. We may repeat here that this statute is highly penal and to be strictly construed so as to accomplish its legitimate purpose, and not as one of oppression to accomplish a purpose not intended. [citing authorities] "A notice to the mortgagee by the mortgagor directing the satisfaction on the record of all recorded mortgages given by the mortgagor to the mortgagee, which have been paid, is sufficiently definite. [citing authorities]" The cases cited by appellant in support of its contention in this regard concerned notices which were not as complete as the one herein, and it will be noticed that the record discloses that respondent testified he called upon different officers of appellant's company at different times asking that these mortgages be released, and at no time did they indicate that they did not know what mortgages he referred to, nor, though they contended releases had been sent him, did they at any time advise him that such was the situation, but their own testimony was to the effect that *Page 575 they would look into the matter and let him know. In view of these circumstances we cannot say that, as a matter of law, the request was insufficient. It it urged that even though the conditional sales contracts were removed from the jury's consideration, their baneful effect remained and requires a reversal. We do not believe the record justifies this conclusion. Appellant also urges that a mortgagor has no right to bring a suit under the statute after he has disposed of the property but that the cause of action is then in the owner of the property. It will be noticed that our statute expressly gives the right of action to any mortgagor, or his grantee, or heirs. [emphasis ours] Appellant relies strongly upon the case ofThomas v. Reynolds, 29 Kan. 304, 32 P. St. Rep. 216, in support of its contention. As pointed out, however, in Jones v.Fidelity Loan Trust Co., 7 S. Dak. 122, 63 N.W. 553, the Kansas statute did not give the cause of action to anyone but the mortgagor. Our statute, therefore, clearly recognizes that this cause of action is not confined to the instant owner of the property. Two purposes are to be served by the statute: first, affecting the business standing and reputation of the person who gave the mortgage, and, second, title to the property. The first operates as to the person who gave the mortgage, hence, to give effect to the remedial feature of the statute, cause of action must exist in the mortgagor even though he has disposed of the property. (Capps v. United StatesBond Mtg. Co., 274 Fed. 357.) Appellant offered in evidence copies of letters which it contended had been sent from the local office in Pocatello to respondent containing releases. The stenographer in the office at Pocatello testified that it was the custom to send these letters and that the particular letters had been written by her and when sent were sent with releases. No copy of the releases was presented, nor was she able to testify as to the exact terms of the releases which she says were mailed with the letters, nor was other secondary proof as to the contents or terms of the releases offered. Upon objection by the respondent the letters were restrictively admitted under this instruction by the court: "XII. You are instructed that defendant's exhibits seven, eleven and fifteen were admitted in evidence for limited purposes and you will recall that at the time of their acceptance *Page 576 you were instructed by the court that they were not to be considered by you at all as proving the delivery to the plaintiff of a duly acknowledged and certified satisfaction of any mortgage therein referred to; the same were admitted as evidence only for the purpose of being considered by you as impeachment of the testimony of the plaintiff." Respondent denied that he had ever received releases and took the position that the releases had always been filed directly by appellant when the mortgages were paid. Respondent argues that the letters together with the testimony of the party who wrote them did not show that correct and valid releases were enclosed. It was, of course, incumbent upon the jury to find whether appellant's defense that valid releases had been sent and received was established. Appellant relies upon authorities to the effect that when the original is not produced the contents of a written document may be recited in evidence by a witness who may not distinctly remember the exact document. These authorities are insufficient, however, to justify the consideration of these letters as evidence that valid releases were therein contained. Secondary evidence of the terms of the releases of a more definite nature or copies of the releases should have been presented. The last point urged by appellant is that the damages of $1500 were insufficiently proved. Respondent testified and offered evidence of other parties that because these chattel mortgages had not been released he failed to secure contracts of employment with other implement companies. There was no evidence, however, as to what these contracts of employment would reasonably or probably have been worth either at a fixed or definite salary or on a commission basis. Respondent argues that it is only when the cause of damages is uncertain that the element of damages may be uncertain. On the other hand, damages, in this instance, to the business reputation and standing of respondent must have some basis for computation by the jury, and neither it nor the court could take judicial notice of what a contract of employment of this kind might be worth in the absence of any evidence along that line. The $1500 is more than mere nominal damage, which might be sustained on the ground that the jury was justified in concluding that the appellant had not released the mortgages. Therefore, there was not sufficient evidence to sustain the *Page 577 $1500. (Boise Street Car Co. v. Van Avery, 61 Idaho 502,103 P.2d 1107; 25 C.J.S. 816, sec. 162 (2).) The judgment must therefore be reversed and the cause remanded with instructions to grant a new trial. Holden, C.J., and Dunlap, J., concur. 1 "44-815. Refusal to satisfy mortgage — Penalty. — When any mortgage has been satisfied, the mortgagee or his assignee must immediately, on the demand of the mortgagor, execute, acknowledge, and deliver to him a certificate of the discharge thereof so as to entitle it to be recorded, or he must enter satisfaction or cause satisfaction of such mortgage to be entered of record; and any mortgagee, or assignee of such mortgagee, who refuses to execute, acknowledge, and deliver to the mortgagor, the certificate of discharge, or to enter satisfaction, or cause satisfaction of the mortgage to be entered, as provided in this chapter, is liable to the mortgagor or his grantee or heirs, for all damages which he or they may sustain by reason of such refusal, and shall also forfeit to him or them the sum of $100.00."