Malone v. Meres , 91 Fla. 709 ( 1926 )

The contract of sale in this case does not stipulate that the parties respectively shall invoke only stated remedies in case of breach of the contract, but it is provided that at the option of the seller the contract shall "be forfeited and terminated" and the seller shall have "the right to re-enter and take possession * * * without being liable to an action therefor" and that payments made on the contract shall be forfeited to and retained by the seller "in full satisfaction and liquidation of all damages" sustained by the seller. The contract option of the seller was not exercised and remedies afforded by the law were open to the seller upon a breach of the contract by the purchaser.

Even if the signing of the contract by the purchaser did not under the statute make the contract a mortgage, the contract was signed by the purchaser and stated that the title remained in the seller, though the buyer had possession of and an interest in the goods, having paid a part of the purchase price. The retention of title by the seller was for the purpose of securing the payment of the entire purchase price of the property and such contract on the part of the purchaser is in effect a lien upon the equitable or other right of the purchaser who had partly paid for and was in possession of the property covered by the contract. It is a mortgage where the title is reserved as security. Chicago Ry. Equipment Co. v. Merchant's Bank, 136 U.S. 268, 10 Sup. Ct. Rep. 999; Ballinger v. West Publishing Co., 44 App. Cas. (D.C.) 49. See Howell v. Commercial Bank, 51 Fla. 460, 40 South. Rep. 76; Varn v Ashbrook, 84 Fla. 626, 94 South. Rep. 384; Gigray v. Mumper,141 Iowa 396, 118 N.W. Rep. 393; Campbell Printing Press Manuf'g Co. v. Powell, 78 Tx. 53, 14 S.W. Rep. 245; Hollenburg Music Co. v. Morris (Tex.Civ.App.) 35 S.W. Rep. 396; Singer Sewing Mach. Co. v. Leitzig, 113 N.Y. Supp. 916; 35 Cyc. 491, 696, 708; 11 C. J. 414; 17 A. L. R. 1421 Notes; In re National Cash Register, 98 C.C.A. 425, 174 Fed. Rep. 579.

Where goods upon partial payment of their price are delivered to a purchaser for his use under a contract of sale signed by the purchaser, which contract contains an unconditional promise by the purchaser to pay the entire unpaid purchase price, and also stipulates that the title to the goods delivered shall remain in the seller till full payment of the purchase price, or, as in this case, that the seller will convey the title to the purchaser upon payment of the purchase price, and further that the seller may retake the goods upon default of any payment on the purchase price and that the buyer shall then forfeit to the seller all payments that have been made on the purchase price, such a contract may at the option of the seller be regarded as an executory contract of sale and the rights of the seller thereunder may be enforced as provided in the contract or by law; or the contract may by the seller be regarded as security for the purchase price and enforced as may be provided by law.

Taken in connection with the delivery of the goods to the buyer, such a contract may, by the seller, be regarded as a reservation of the title with a right to retake the property under the contract or to replevy it under the law with a forfeiture in each case by the purchaser of all payments made; or, taken in connection with the delivery of the goods to the buyer, such a contract may, by the seller, be regarded as a transfer of the title to the goods to the buyer with a right of the seller to bring an action for the unpaid purchase price, on a judgment for which unpaid amount execution may issue generally, or the contract signed by the purchaser may be regarded as creating a lien upon the property as security for the payment of the entire purchase price. The seller cannot invoke inconsistent remedies, but must elect between inconsistent remedies. See American Process Co. v. Florida White Pressed Brick Co., 56 Fla. 116, 47 South. Rep. 942.

Upon default of the buyer, the seller may exercise his contract option to retake the property without suit or action, or he may elect to apply one of the remedies afforded by law, viz: the seller may assert title and right of possession by bringing replevin to recover possession of the goods, or he may elect to waive his right to assert title and recover the goods and bring an action for the purchase price, or he may enforce his security in equity, with such results as follow in each case under the law.

Under such a contract if the seller attempts to enforce an unconscionable forfeiture of payments made, by retaking or replevying the goods, after they have been in large part paid for, the buyer may appropriate equitable procedure to redeem the goods under the lien feature of the contract by paying the balance of the purchase price. Ragsdale v. Miami Cadillac Co.,88 Fla. 302, 102 South. Rep. 494. See also Bankston v. Hill,134 Miss. 288, 98 South. Rep. 689. Where the value of the goods greatly depreciates and the seller elects to sue for the purchase price or to enforce his lien, the buyer may perhaps have no relief from a general execution on a judgment for the balance of the purchase price or from a valid deficiency decree after a foreclosure sale for less than the balance due the seller. The courts cannot afford relief against improvident purchase of property that may lose its value before it is paid for as contracted.

In view of the statutory provisions that any instrument of writing conveying or selling property, either real or personal, for the purpose or with the intention of securing the payment of money, shall be deemed and held to be a mortgage; and that a mortgage is a lien and not a conveyance of the legal title or of the right of possession, Section 3836, 3837, Revised General Statutes, 1920, where a seller of goods delivers the possession of them to a buyer for his use, by which delivery the title ordinarily passes with the delivery, but by contract signed by both the seller and the purchaser, it is stipulated that the title to the goods shall remain in the seller till the entire purchase price thereof is paid or that the seller will convey the title to the purchaser upon payment of the entire purchase price, the title being retained by the seller to secure the payment of the balance of the purchase price, and the buyer promises unconditionally to pay the entire purchase price, the buyer thereby acquires a proprietary interest in the goods because of the delivery thereof to him and the possession thereof for his use and the payment of a part of the purchase price; and by signing such contract of sale, the purchaser in effect gives a lien in the nature of a mortgage on the property to secure the payment of the entire purchase price; and on default in payment by the purchaser the seller may enforce his lien with such results as follow under the law.

In Campbell Printing Press Manuf'g Co. v. Walker, 22 Fla. 412,1 South. Rep. 59, and Dodson Printers' Supply Co. v. Corbett, 78 Fla. 257, 82 South. Rep. 804, and similar cases the right to retake the property was asserted and sustained. See Aycock Bros. Lumber Co. v. First Nat. Bank of Dothan, 54 Fla. 604,45 South. Rep. 501; American Process Co. v. Florida White Pressed Brick Co., 56 Fla. 116, 47 South. Rep. 942.