Stewart v. Smith 138 S.C. 124, 135 S.E. 801

The opinion of the Court was delivered by

Mr. Acting Associate Justice Ramage.

This action was begun on the 11th day of May, 1925, by the service of the summons and complaint based upon an alleged breach of implied warranty. The complaint alleged both express and implied warranties, but, upon motion of defendant’s attorneys, plaintiff was required to elect upon which warranty she would proceed to trial. She elected the implied warranty. The answer was duly served, setting forth both a defense and a counterclaim, to which the plaintiff replied in due time. The cause came up> for trial before his Honor, Judge W. H. Townsend and a jury, at the summer term of Court, 1925, and resulted in a verdict for the plaintiff in the sum of $400. During the course of the trial, *136two motions were made by the counsel for the defense, one for a nonsuit and another for a directed verdict, both of which were refused.

Upon rendition of the verdict, a motion for a new trial was made by defendant' which was denied by the Court, whereupon judgment was entered, and this appeal was taken.

Plaintiff contends that defendant, appellant, sold to the respondent an automatic electrical piano, in June, 1920, for which respondent agreed to pay $1,750, and executed a title retention agreement securing her notes, which she gave in payment of the purchase price. When the piano was delivered, it would not give satisfactory service; respondent made complaint to appellant, also to appellant’s agent and collector. Appellant sent his repairman to work on the piano several times. He would assure respondent that the piano only needed adjusting. After keeping the piano two months, respondent offered to return the piano to Mr. Moore, appellant’s repair man and collector; Before leaving Camden in March, 1921, respondent complained to appellant personally, and offered the piano to him, if he would return half the money she had paid on it. Appellant and his repair man and collector would assure respondent that the instrument would be adjusted. The piano was shipped to Greenville in 1921, and moved from there to Columbia in 1923. The piano was operated by putting a coin in the slot. Respondent made several attempts to place the piano at amusement places on a commission, but in each instance the piano would fail to operate satisfactorily. Respondent paid $1,552.25 on the piano; no payments were made after 1923; appellant repossessed the piano in December, 1924. The respondent had considerable dealings with the appellant prior to the purchase of the piano. The above mentioned action was begun five months after the piano was repossessed. The following questions are raised by the appeal:

*1371. Construction of the complaint: Does it contain a cause of action. independently of the allegations in paragraph 7, which are stated on information and belief? The first question is raised by exceptions 1 and 2. The cause of action stated in the complaint was based upon the breach of the implied warranty in the sale of an automatic electrical piano, as is alleged in paragraphs 4 and 5 of the complaint. The allegations contained in paragraph 7 of the complaint, referred to in appellant’s brief, as the basis of the said cause of action, are made upon information and .belief; and the cause of action stated in the balance of the complaint is sufficient to go to the jury; there being testimony to support the allegations contained therein. If respondent offered no testimony to prove that this piano was one of those designated in paragraph 7 of her complaint, this would not preclude her from offering testimony that this particular piano, purchased by her from appellant, was defective and did not give service, as is alleged in the other paragraphs of her complaint.

2. Can an action be maintained for damages for the breach of an implied warranty after the buyer has parted with possession of chattel either by sale or repossession by the seller ? The second question is raised by exceptions 2 and 3. At the time this suit was commenced, appellant had the piano in his possession. The fact that respondent did not have the piano in her possession at the time the suit was commenced does not preclude her from maintaining an action for damages for the breach of implied warranty; whether the buyer has sold chattels in the regular course of trade or exchanged them for others makes no difference, as a showing that the buyer has assumed payment is sufficient. 66 So., 848. If respondent were bringing this action for the rescission of the contract of sale, she would have waived her tender and offer to return the chattel, by selling same, for then it would be beyond .her power, to return the piano, if rescission were .allowed and her pay*138ment on the purchase price returned. Yancey v. Lumber Co., 133 S. C., 369; 131 S. E., 33. But this action is for damages for the breach of the implied warranty; the buyer has given her note in payment, and can set up damages for the breach of the implied warranty as a defense, if sued S. E., 547, that a buyer is not divested of his right of action for damages for the breach of the implied warranty in a separate action. Rawls v. White, 127 N. C., 17; 37 S. E., 68. It was held in Mauldin v. Milford, 127 S. C., 508; 121 S. E., 547, that a buyer is not divested of his right of action for breach of warranty of title, by a resale of the property. He has waived his right to rescission, but can bring action for damages for breach of implied warranty.

3. (a) Is it necessary for purchaser to complete payment on contract of sale before commencing action for damages for breach of the implied warranty?

(b) Does buyer waive right of action on the implied warranty by continuing to make payments, after notifying seller that piano was “shot,” and would not play satisfactory, and offering to rescind the contract, which seller refuses to do?

These two questions, raised by exceptions 4 and 7, can be taken together, as they present conflicting propositions of law. The case of Williamson Heater Co. v. Paxvitte School District, 102 S. C., 295; 87 S. E., 69, is directly in line with the case before the Court; the facts in that case are similar to those in the case at bar. The Court held that the Court could not have declared as a matter of law, that the failure of consideration had been waived; that the purchaser of the heating plant could pay a note for the purchase price and bring suit for breach of a guaranty of the plant, or set up such breach in an action on the notes. Kirven v. Chemical Co., 77 S. C., 493; 58 S. E., 424, supports the latter holding in the above case. “Waiver is ordinarily a question for the jury, and we do not see that it has become a question of law,” authorizing the Court “to declare as a matter of law that the defendants have waived the question *139of” breach of the implied warranty. Wiggins v. Hunter, Harp. (16 S. C. L.), 80. Actions for the breach of warranty of the soundness of a horse, for the purchase money of which a negotiable note has been given. Held, that the action might be maintained, though the note had not been paid. Parker v. Pringle, 2 Strob. (33 S. C. L.), 242.

“In this State, an action may be brought for a breach of the warranty, without a tender or return of the article purchased; and the same rule applies when the breach of warranty is made a defense under our discount law.” Cites Carter v. Walker, 2 Rich. (31 S. C. L.), 40.

4. Was the offer to return property made by buyer in a reasonable time? The fourth question is raised by exception 6. There is testimony that respondent offered to return the piano, and the question of the reasonableness of the time was for the jury. The testimony of the plaintiff, of R. R. Moore, of Wolfe and others, was sufficient to make this matter an issue for the jury, under the pleadings in this case.

5. There was sufficient evidence to support the submission of the issues to the jury and to sustain the verdict found. Exception 8 must be dismissed.

6. Was error committed by the presiding Judge in sustaining plaintiff’s councel’s objections to questions asked plaintiff on cross-examination, to wit, questions contained in appellant’s exceptions Nos. 9, 10, and 11? The sixth question is raised by the above exceptions. State v. Houx, 109 Mo., 654; 19 S. W., 35; 32 Am. St. Rep., 686, holds that a witness cannot be cross-examined as to the immorality of his previous life, unless his answers tend directly to prove some issue. It has been held that a witness may be asked whether he has been arrested or indicted, but it would seem that such inquiries would be excluded, since the fact of indictment or arrest is not inconsistent with innocence. The trial Judge has broad discretionary power in approving relevancy of evidence as is held in Southern Co. *140v. Rice, 122 S. C., 484; 115 S. E., 815. The case of State v. Hasty, 76 S. C., 105; 56 S. E., 669, holds questions similar to the above are not admissible.

7. Was error committed by his Honor in that part of his charge complained of in appellant’s exceptions Nos. 12, 13, and 14, when taken with his charge in its entirety? The seventh question is raised as above stated. A consideration of the following South Carolina cases will sohw that his Honor’s charge as excepted to in the above exceptions, is correct, and that the propositions insisted upon by appellant.in his exceptions are not the law in this State. The following cases differentiate between an action for rescission of a contract of sale and an action for damages for breach of the implied warranty of sale and state the rule in this State: Ramsey v. Hill, 92 146; 75 S. E., 366; Greenwood Cotton Mills v. Tolbert, 105 S. C., 273; 89 S. E., 653, Ann. Cas., 1917-C, 338; Carter & Harden v. Walker, 2 Rich. (31 S. C. L.), 40; Williamson Heater Co. v. Paxville School District, 102 S. C., 295; 87 S. E., 69, cites Kirven v. Virginia-Carolina Chemical Co., 77 S. C., 493; 58 S. E., 424; Wiggins v. Hunter, Harp. (16 S. C. L.), 80; Hurt v. Davis, 1 Brev. (4 S. C. L.), 304. The charge of his Honor will be set out in full, and it states the law so well on the questions raised, and with such precision and clearness, that it may well be termed a model.

8. Was error committed by his Honor in that part of the charge complained of in appellant’s exception No. 15? If so, is same not in response to- the issue raised by the pleadings so as to be prejudicial? Has appellant’s counsel waived right to complain of the Court’s instruction after failure to request additional instructions in apt time? said instruction having been given upon following request of appellant’s counsel: “Mr. De Roach: Yóur Honor, the defendant has a right to take the piano back under, his mortgage.’'

The eighth question is raised-by exception 15.- The ques*141tion of whether appellant had a right to repossess piano was not raised by the pleadings. The complaint states a cause of action for damages for breach of implied warranty in the sale of the piano; appellant’s answer set up a counterclaim for $352.95, alleged balance due on the purchase price. The request to charge on page 25 of the case is not in response to the issues in the case. It is as follows:

“Mr. De Loach: Your Honor, the. defendant had a right to take the piano back under his mortgage.

“The Court: After the condition was broken, failure of the plaintiff to pay the balance of the purchase money due, the defendant had a right to take back the piano, unless the plaintiff was then entitled to recover more damages than would have settled the balance due on the purchase money.”

Appellant’s counsel waived right to’ complaint of the Court’s instruction, after failure to request additional instructions in apt time. Watson v. Sprott, 134 S. C., 367; 133 S. E., 27.

Upon breach of implied warranty, buyer could hold piano against seller who had title retention agreement of sale until piano was put in condition. Millenson v. Lamp, 99 W. Va., 539; 130 S. E., 137. In this case the piano was in appellant’s possession,, and respondent was not asking for the return of piano; the instruction that the presiding Judge gave, at appellant’s counsel’s request taken with his charge, in its entirety, was the correct rule for the jury to be guided by.

We see no error in the trial; the pleadings, testimony, and charge of the Judge fairly submitted the question for the jury, and there was no error in the submission of the case, nor in a refusál to. set aside the verdict.

The judgment of this Court is that the judgment of the circuit Court be affirmed.

Messrs. Justices Watts, BeEasE, and StabeEr concur.

Mr. Justice Cothran

(dissenting) : The respondent states the case in part as follows:

*142“This action was begun on May 11, 1925, by the service of the summons and complaint, for damages on the alleged breach of an implied warranty. The appellant sold to respondent an automatic electrical piano in June, 1920, for which respondent agreed to pay $1,750.00, and executed a title-retention agreement securing her notes which she gave in payment of the purchase price.”

For the purposes of this appeal the construction placed upon the complaint by the counsel for the plaintiff, as an action for damages on account of the breach of an implied warranty, will be adopted, although the complaint alleges no damages, and sounds much more like an action for the rescission of the contract of sale and the return of the money paid by the plaintiff on account thereof; it appears to have been so considered by the circuit Judge. The counsel for the defendant also, in his printed argument, follows the construction of the complaint made by the counsel for the plaintiff, which doubly justifies the Court in adopting that construction.

The complaint alleges, in substance, that on June 9, 1920, the plaintiff bought from the defendant an automatic electrical piano at the price of $1,750, paying $175 cash, $157.-50 payable August 23, 1920, and the balance in ten notes of $141.75 each, payable in succeeding months, the deferred payments being secured by a title retention contract; that the piano was guaranteed by the defendant who agreed to return payments made by the plaintiff if it did not prove satisfactory; that the piano was worthless; that the plaintiff made various complaints of defects which the defendant attempted in vain-to correct; that the plaintiff offered to return the piano and demanded the return of her money, all of which was refused; that she had been put to considerable expenses in having the piano repaired; that in December, 1924, the defendant “repossessed himself of said piano under his title • retention contract of sale”; that the plaintiff has *143paid upon the piano $1,552.25, which she demands in the prayer for judgment be returned to her.

The defendant in his answer admits the execution of the sale contract and that the plaintiff has paid upon it the amount alleged, but denies all other allegations of the complaint. He also sets up a counterclaim for $352.95; that being the balance due upon the unpaid notes with interest, less $75, proceeds of sale of the piano made by him after seizure under the contract. The plaintiff replied to the counterclaim and denied the same.

The case was tried before His Honor, Judge Townsend, and a jury at the summer term, 1925, resulting in a verdict in favor of the plaintiff for $400. The defendant has appealed.

The undisputed facts appear to be as follows:

On June 9, 1920, the defendant sold to the plaintiff an electrical automatic piano, at the price and upon the terms stated, taking from her a title retention agreement as security for the unpaid portion of the purchase price; the plaintiff made the cash payment required of $175, and the payment due August 23d of $157.50, leaving $1,417.50 unpaid, for which she gave ten notes of $141.75 each, payable in successive months, upon which she has paid from time to time, all but $325.23, as of May 30, 1925, as claimed by the defendant. She claims to have paid all but $197.75.

Soon after the delivery of the piano the plaintiff made complaint that it would not operate satisfactorily, and the defendant sent his man to repair it. She claims to have made complaints continually, and was assured that the defects could be remedied; she also claims that she offered to return the piano and recover back payments she had made; she, however, continued to pay the notes as they matured, at least six of them. She moved the piano to Greenville and rented it there to a bathing pool proprietor; she then moved it to Columbia and rented it there to various amusement places; she then sold it to the proprietor of Moore’s *144bathing pool for $275. Then in December, 1924, the defendant seized and sold it under his title retention contract for $75.

Upon the trial of the case, the defendant moved for a nonsuit and for a directed verdict, upon various grounds; both motions were refused. The only matter deemed necessary to consider is that the motion for a nonsuit should have been granted upon the ground that the title to the piano, having been reserved in the defendant by the title retention agreement, it became essential to the maintenance of an action upon the implied warranty that the notes remaining unpaid be paid, so that the title would thereby vest in the buyer; the law being that the buyer cannot maintain an action upon the implied warranty unless the title to the subj ect of the sale be vested in him.

There can be no doubt of the proposition that a title retention agreement, taken as security for the purchase price of a chattel, is, for all legal purposes, a chattel mortgage. Talbott v. Sandifer, 27 S. C., 624; 4 S. E., 152; Perkins v. Bank, 43 S. C., 39; 20 S. E., 759; Hill v. Winnsboro Co., 112 S. C., 243; 99 S. E., 836; and nine South Carolina cases cited in opinion.

It is equally well established that, even before the note secured by a chattel mortgage becomes due, the title to' the chattel is in the mortgagee, with usually the right of possession until maturity of the debt, vested by the mortgagee in the mortgagor. In Hill v. Winnsboro Co., 112 S. C., 243; 99 S. E., 836, the Court said:

“As a general proposition, the execution of a mortgage vests the legal title to the property in the mortgagee; and likewise gives him the right to the possession of the property, unless there are circumstances indicating that such was not the intention of the parties.”

This necessarily follows from the fact that, prior to the Act of 1797 (Code, § 5223), the title to all property, real and personal, was transferred to the mortgagee. Under that Act *145the title to real estate remains in the mortgagor. Nothing is said about personal property; hence in the absence of a similar statute applying to personal property, the law as to it remains as theretofore. See innumerable cases cited in First and Second Decennial Digest, “Chattel Mortgages,” Key No. 159.

If there should be any doubt as to this proposition, there can be none as to the proposition that upon condition broken both the right of possession and the title unite in the mortgagee. Martin v. Jenkins, 51 S. C., 42; 27 S. E., 947; Rainwater v. Bank, 108 S. C., 206; 93 S. E., 770; Greene v. Washington, 105 S. C., 137; 89 S. E., 649; Bank v. Brigiman, 106 S. C., 362; 91 S. E., 332; L. R. A, 1917 E. 925; Dickerson v. Cleland, 120 S. C., 221; 112. S. E., 920.

It is also true that, where the mortgagor sells the property covered by the mortgage, even his right of possession is gone.

“This right to the possession of the property until condition broken, is personal to the mortgagor, and may be forfeited by him, if he should sell the property or otherwise dispose of its possession.” Hill v. Winnsboro Co., 112 S. C., 243; 99 S. E., 836.

So that, in the case at bar, the plaintiff was divested of title by the title retention contract; In fact, she never has been vested with the title to the piano. She has lost the right to the possession of it both by selling the piano and by defaulting in the payment of the last notes. Both the right to the possession and the title having been lost, she cannot maintain an action upon the implied warranty, as title is essential to such an action. In Bunday v. Columbus Co., 143 Mich., 10; 106 N. W., 397; 5 L. R. A. (N. S.), 475, quoting syllabus, it is held:

“The-title does not pass at the time of installation, by a contract for the sale of machinery which stipulates that, until the price is paid, the title and ownership shall remain in the *146vendor; so that before such payment the purchaser cannot maintain an action for breach of warranty of quality.”

See Jones, Chat. Mortg. (2d Ed.), § 426.

“And payment of the purchase price is not a condition precedent to an action for damages, unless the sale is conditional and title does not pass until payment.” 35 Cyc., 445.

“As the plaintiff never acquired title to the wagon, he can have no action for breach of warranty.” Stearns v. Drake, 24 R. I., 272; 52 A., 1082; Benj. Sales (7th Ed), 962.

“An action for breach of warranty will not lie where the sale was conditional on payment of the full price due in installment and the last installment has not been paid.” English v. Hanford, 75 Hun., 428; 27 N. Y. S., 672.

“A purchaser who does not fulfill the terms of his contract of purchase can maintain no action for breach of an implied warranty.” Reynolds v. Roberts, 57 Vt., 392.

“In a case of a conditional sale an action for breach of warranty cannot be maintained in the absence of statute, until the price is paid and title has fully passed.” Shearer v. Kakoulis (Co. Ct), 144 N. Y. S., 1077.

“It has been held that, where the title is reserved by the seller until the price is paid, the buyer cannot before payment maintain an action for breach of a warranty of quality contained in the contract.” 24 R. C. L., 156,

“A conditional vendee cannot before title is vested in him, recover general damages for a breach of warranty.” Baca v. Fleming, 25 N. M., 643; 187 P., 277; Penser v. March Ass’n. Ann. Cas., 1918-B, 914; Levis v. Pope Co., 202 N. Y., 402; 95 N. E., 815; Blair v. Johnson, 111 Tenn., 111; 76 S. W., 912; Dearing v. Thompson, 156 Mich., 365; 120 N. W., 801; 24 L. R. A. (N. S.), 748; Moneyweight v. Davis, 180 Mich., 8; 146 N. W., 391; People’s Co. v, MeKeen, 214 F., 73; 130 C. C. A., 513; Singer v. Smith, 40 S. C., 529; 19 S. E., 132; 42 Am. St. Rep., 897.

*147As the plaintiff never had the title to the piano, her only remedy was a rescission of the contract of sale and a return of what she had paid on the purchase price. Manifestly under the circumstances of this case she could not maintain an action for rescission, having sold the piano and placed it beyond her power to return to the seller. Ebner v. Haverty, 128 S. C., 151; 122 S. E., 578. It is not questioned that in a case of ordinary sale, where the title has passed to the buyer, the fact that he has sold the property, or the fact that he still owes notes for the purchase price, will not affect his right to sue upon the breach of either an express or an implied warranty. Williamson v. Paxville, 102 S. C., 295; 87 S. E., 69; Kirven v. Chem. Co., 77 S. C., 493; 58 S. E., 424 (in opinion of Justice Wood); Wiggins v. Hunter, Harp 80; Parker v. Pringle, 2 Strob. 242; Carter v. Walker, 2 Rich., 40; Mauldin v. Milford, 127 S. C., 508; 121 S. E., 547; Ellison v. Johnson, 74 S. C., 202; 54 S. E., 202; 5 L. R. A. (N. S.), 1151.

The judgment of this Court should be that the judgment >.,f the circuit Court be reversed, and that the case be remanded to that Court for judgment of nonsuit under Rule 27.