C. I. T. CORPORATION, Appellant,
S. W. SEANEY, Assignee for the Benefit of Creditors of CARL E. MOLLING and HERLINDA B. MOLLING, Doing Business as MOLLING APPLIANCE COMPANY, Appellee
APPEAL from a judgment of the Superior Court of the County of Pima. Wm. G. Hall, Judge. Judgment affirmed.
Mr. T. G. McKesson, for Appellant.
Messrs. Krucker & Fowler, for Appellee.
[53 Ariz. 73] LOCKWOOD, J.
This is an appeal from a judgment of the superior court denying a petition of the C.I.T. Corporation, hereinafter called petitioner, for the reclamation of eighteen Servel refrigerators from the possession of S.W. Seaney, as assignee for the benefit of the creditors of Carl E. Molling and Herlinda B. Molling, doing business as Molling Appliance Company, hereinafter called the company, and from the court's order denying a new trial.
The facts of the case are not in dispute, and may be stated as follows: Carl E. Molling and Herlinda B. Molling for several years last past have been engaged in the electric appliance business in Tucson, under the name of Molling Appliance Company. The company had an agency for the sale of Servel electric refrigerators, and during the year 1937 and a part of the year 1938 arrangements were made by the company with the Servel factory at Evansville, Indiana, and with petitioner, for the handling of said agency and the financing of the company therein. This arrangement was, in substance, as follows: The Servel company shipped to the company at Tucson a number of its electric refrigerators, shipper's order, bill of lading with draft attached. The company was unable to pay the draft so it paid to petitioner ten per cent. of the factory invoice price of the refrigerators, together with a sum sufficient to pay the freight charges thereon, whereupon the petitioner issued its check for the entire amount of the draft, [53 Ariz. 74] and secured the bill of lading. At the same time the company executed certain so-called trust receipts in favor of petitioner. These trust receipts are all similar in form. On the face of the receipt is a description of the refrigerators covered thereby, together with the invoice price. On the back is found the following language:
"Received from C.I.T. Corporation (Hereinafter termed C.I.T.) each of the chattels described on the reverse hereof, complete with all standard attachments and equipment, in consideration whereof we agree, at our expense, to hold said chattels in trust for C.I.T. as its property, and agree to return the same on demand in good order and unused but with liberty to us to exhibit and, the written consent of C.I.T. having first been obtained, to sell the same for its account for cash for not less than, as to each chattel, the minimum sale price (the value thereof) set forth as to the respective chattel on the reverse hereof, and we further agree in the case of such sale to hold in trust for C.I.T. the proceeds separate from our funds and immediately hand such proceeds to C.I.T. without expense or cost to C.I.T. C.I.T. may at any time cancel this trust and repossess itself of said chattels or the proceeds thereof.
"We further agree to keep a separate account of all chattels delivered to us under this or any like receipt and of the proceeds thereof when sold, to report any sale to C.I.T. immediately after the same is made, and to furnish to it on demand a true and complete report for the preceding month. We will also permit C.I.T. or its duly accredited representatives to examine our books and the chattels in our possession at all reasonable times during business hours.
"Unless we have arranged with C.I.T. ourselves to provide insurance, C.I.T. shall, during the entire time said chattels are held hereunder, keep same insured against loss by fire and theft, and in the event of our failure to redeliver the same on demand we shall, until redelivery thereof, pay as damages for detention [53 Ariz. 75] for each month or portion thereof after demand one per cent of said sale price.
"We further agree to pay all taxes, costs, charges, expenses and disbursements, including a reasonable attorney's fee (15% of sale price of said chattels, if permitted by law) should C.I.T. find it necessary to protect its property in same by legal proceedings involving the employment of an attorney-at-law, and that the waiver of any default shall not operate as a waiver of subsequent defaults, but all rights hereunder shall continue notwithstanding any one or more waivers. We acknowledge receipt of a true copy of this agreement, which shall be construed according to the laws of the State of California.
"The chattels above referred to are listed on face of this form. The acceptance of Time Draft in the above amount shall not be effective to terminate this trust. At C.I.T.'s election any interest ...