Opinion
June 14, 1961.
September 12, 1961.
Security Transactions — Financing — Motor Vehicles — Dealer transaction — Duty of financing agent to notify dealer of cancellation of insurance — Custom — Evidence.
In this case, in which it appeared that defendant A was the purchaser of an automobile from a company of which defendant, B, was president, and that the transaction for the purchase of the car was financed by plaintiff, a bank; that A executed a security agreement, A and B executed a security agreement note, and B arranged with an insurance broker for an insurance policy, which provided that any loss would be payable to A and to plaintiff as their interests might appear; that subsequently the automobile was damaged in a collision, but before the time of the collision the insurance had been cancelled by the carrier; that plaintiff had been notified of the cancellation but had failed to give defendant B notice; that the court below found that the transaction was in fact a "dealer" transaction with B's company, although it purported simply to be an ordinary security agreement guaranteed by B individually, and that a custom existed whereby the financing agent would notify a dealer of the lapse or cancellation of insurance so that the dealer could obtain a replacement of the policy in order to protect its interest; and that the court below held that provisions in a surety agreement signed by defendant B, waiving "all notices whatsoever in respect to this Agreement" and also providing that "the undersigned's liability under this agreement is absolute and unconditional and shall not be affected or released by reason of any action taken by Bank", applied to the text of the agreement and did not apply to a custom or usage of the trade; it was Held that the order of the court below opening judgment should be affirmed.
Before ERVIN, WRIGHT, WOODSIDE, WATKINS, MONTGOMERY, and FLOOD, JJ. (RHODES, P.J., absent).
Appeal, No. 143, Oct. T., 1961, from order of Municipal Court of Philadelphia County, Dec. T., 1959, No. 3398-C, in case of Provident Tradesmens Bank and Trust Company v. Mary L. Pemberton et al. Order affirmed.
Same case in court below: 24 Pa. D. C. 2d 720.
Proceeding upon petition of defendant Prusky and rule to show cause why judgment entered pursuant to written note should not be stricken off or opened.
Order entered discharging rule to strike off judgment but making absolute rule to open judgment, opinion by BURCH, J. Plaintiff appealed.
George F. Baer Appel, with him James J. Prendergast, Francis J. Carey, Jr., and Townsend, Elliott Munson, for appellant.
Howard Saul Marcu, with him Daniel Marcu, and Marcu, Marcu Marcu, for Prusky, appellee.
FLOOD, J., filed a dissenting opinion, in which ERVIN, J., joined.
Argued June 14, 1961.
The order is affirmed upon the opinion of Judge BURCH of the County Court of Philadelphia.
In the note signed by the defendant Prusky he waived "all notices to which [he] might be entitled". This clearly includes notices to which he might be entitled by custom of the trade as well as those to which he might have been entitled under the terms of the note or the security agreement signed by him. This waiver is reinforced by his waiver in the security agreement "of all notices whatsoever in respect of this agreement".
I see no justification for not giving to this explicit language its literal meaning in the case of this defendant who was an agent experienced in automobile sales transactions. Despite the contrary opinion of the majority of my colleagues and of the able and experienced trial judge, I feel obliged to dissent because I believe the language of this waiver is clear and capable of only one construction in this context.
ERVIN, J., joins in this dissent.