text:
    MILLER v. MARGOT.
    No. 3168.
    Court of Appeal of Louisiana. First Circuit
    Nov. 25, 1949.
    F. Louis Gonzales, Baton Rouge, for appellant.
    " Sanders, Miller, Downing & Rubin, Baton Rouge, for appellee.
   DORE, Judge.

This is a suit to recover the damages arising from an alleged negligent or unskilful repair job done on plaintiff’s automobile by the defendant’s garage. Plaintiff alleges that on March 26, 1948, he placed ' his automobile with the defendant for inspection of the steering mechanism, and with instructions to make all- necessary repairs thereto; that while - in the garage of the defendant, necessary repairs were made to the front steering system, including the installation of the two tie rod ends, át a total cost of $13.76, which has been paid by petitioner; that on the same date, March 26, 1948, at about 1:00 P.M., the car was returned to petitioner by defendant under representation of having been properly inspected, repaired and ready for use; that at about 2:30 P.M. -on the same date, relying on such representation, petitioner drove the car to Columbia, Mississippi, on an éxcellent hard surface highway and arrived there at about 6:00 P.M., where he spent the night1’with .his father-in-law; that the next morning, at about 9:00 A.M., he drove the car from Columbia along a gravel road known as the Bunker Hill Road, and as he had proceeded about three miles from Columbia, traveling approximately thirty to thirty-five miles per hour, and as he saw a bus approaching from the opposite direction, he lost control of his automobile because it would not steer properly, and as a result thereof, in spite of applying his brakes gradually, he went from his own right side where he had been driving, to his left side, and ran into the bus, striking it at the front and near the door of the driver, and scraping along the side of the bus to the rear. Plaintiff attributes the loss of .control of his car and the resulting collision to the failure of defendant’s agents or employees to properly connect the tie rod.

As a result of the accident, he claims damages of $105.70, which he paid to the owner of the bus for damage to the bus and for which he .received a subrogation, $500 for the damage to his own automobile, $300 for his personal injuries, and $700 for the aggravation of a prior' wartime nervous condition, making a total claim of $1605.70.

The defendant in his answer, admits that plaintiff’s car was placed with him on March 26, 1948 for certain repairs and-that it was returned to him at about 1:00 P.M. on March 26, 1947 (1948), after making the repairs authorized by the plaintiff. He denies all the other material allegations of the petition, and further answering, alleges that the repairs authorized by plaintiff, were done expertly by an experienced mechanic, installing new parts of approved quality, including cotter pins; and that all parts were checked by the mechanic as he went along and at the conclusion of the job; that if plaintiff was in any collision, it was due to his fault and negligence, and not to any fault or negligence of the defendant.

After trial of the case, the trial judge .rendered judgment in favor of the plaintiff in the sum of $468.22, “being the amount of the property damage sustained by plaintiff,” together with legal interest from judicial demand and all costs. The defendant has appealed. The plaintiff has answered the appeal, praying that the judgment be increased by $400 to cover the pam, suffering and shock sustained-by the plaintiff in the collision.

The general rule which has to be applied in cases o'f this type is succinctly set forth by the following: “As to actionable negligence in cases of this kind,- the general rule is that one who contracts to repair or service an automobile is liable for any damages proximately resulting from the the negligent or unskilful manner in which he makes the repairs or performs the services.” 24 Am.Jur. page 491, Garages, etc. Section 24, Defective Repairs.

1 This general' rule is in accord with our Civil Code, Article 2316, which states: “Every person is responsible for the damage he occasions not merely by his act, but by his negligence, his imprudence, or his want of skill.”

The evidence consists of the testimony in open court of plaintiff, and of Joel W. Snell, a mechanic, plaintiff’s brother-in-law, and of the depositions of Rossie Turnage and Ridgie Stamps, on behalf of plaintiff; and the testimony of the defendant and of Clay Weber, William B. May, and Anthony Polito on behalf of the defendant.

The plaintiff states that (as shown by the pleadings) on March 26, 1948, he took his car to defendant’s garage for inspection of the steering mechanism .and repair thereof; that he informed defendant that the car did not steer properly and that since he was going to take a trip, he wanted it inspected and any necessary repairs made; that at 1:00 P.M. on March 26th, -the car was delivered to him as being in good condition and that he thereupon paid his bill ánd drove off; that that afternoon, he drove to ■Columbia, Mississippi, arriving there at about 6 :00 P.M., and that the next morning, at about 9:00 A.M., he drove the car álong a smooth gravel road, and after •reaching a point about three miles away from Columbia, and while approaching an oncoming bus, he found that the steering was bad and lost control of his car; that ■when he lost control, he was on his right-hand side, driving about thirty to thirty-■five miles per hour, and that he thereupon gradually applied his brakes, but was unable to- stop the car or to keep it from going to the left and colliding with the bus which was approaching from the opposite direction; that he struck the bus with his left front on the left front of the bus near ¡¡he driver’s door, and that his car scraped along the bus and stopped almost immediately; that after the collision he noticed that the left tie rod was .underneath the front part of his car and had fallen off completely,and that he thereupon attributed his loss of .control of the car to the fact that the tie rod fell off.

Joel W. Snell, a mechanic 'of twenty years of experience,.testified as to the manner of replacing a tie rod. He stated that where a tie rod was properly placed and the bolt.holding it was screwed properly, it should not fall off and that in-the event that a cotter pin was placed also, as is the custom, it would be impossible for the tie rod to fall off.

The Other mechanic who testified for plaintiff was Ridgie Stamps, who examined the car at Columbia Motors in Columbia, shortly after the accident; and who made the repairs thereon. He corroborated plaintiff’s testimony as to the tie rod having fallen off and also testified similarly to mechanic .Snell with reference to'the procedure in replacing a tie rod and/or tie rod ends. He stated that this particular tie rod had no. cotter pin on it.

Witness Turnage, in his deposition, testified that he was sitting as á passenger on the left-hand side of the bus, directly behind the driver, and that he saw plaintiff approaching from the opposite direction; that plaintiff was driving at about twenty-five to thirty-five miles per hour on his right-hand side, and that he saw clearly that he lost control of his car and came on over to the left and collided with the bus as testified by plaintiff.

The defendant and his mechanic, Clay Weber, testified positively that the tie rod introduced in evidence was not the tie rod which they had placed on plaintiff’s car. Their reason for so testifying was the fact that the tie rod, including the tie rod end, was saturated with dirt and grease and . showed no recent tampering therewith. They also introduced the testimony .of mechanics May and Polito to the same effect. It may be noted that the tie rod had been kept wrapped , in a piece of paper for about a year prior to the' trial, and probably dirt accumulated on it during that time.

The defendant and his witnesses all testified to the effect that a car can be controlled even where only one tie rod is connected as long as it is rolling on a straight line. Apparently, by that line of testimony, they, are trying to show that plaintiff was guilty of negligence in applying his brakes and in not continuing along the straight road at least until after passing the bus. Their theory is that the free wheel will follow the other wheel as long as the car is moving straight ahead.

Be that' as it may, there is no doubt that the falling off of the tie rod created an emergency and that the plaintiff used his best judgment in' applying his brakes gradually when he saw that he was losing control of the steering. That, certainly, cannot be considered negligence on his part. ,

This is purely- a factual case. Although he gave no written reasons for his judgment, the trial judge must, of necessity, have come to the' conclusion that the proximate cause of the accident was the improper repairing" of the tie rod and/or the failure to properly install- a cotter pin. In order to reach this conclusion, he had to believe plaintiff and his witnesses and disbelieve defendant and his employee, Weber (who testified in addition to the fact that the tie rod produced was not the one placed by them, that the one placed by them was inserted according to the regular procedure including the insertion of a cotter pin). It must be noted that there is no evidence Or indication that anything further was done to plaintiff’s car after it was delivered to plaintiff on the afternoon prior to the accident, except for the driving thereof as intended. There is no-evidence or indication of any intervening cause. We can find no reversible error committed by the trial judge. Like he, we are not impressed by the testimony of the defendant and of Weber, especially their denial that the tie rod introduced in evidence was not the tie rod upon which Weber had worked; we cannot believe that the plaintiff and Stamps, the Columbia Motors mechanic, would have substituted an old tie rod in place of the one in question.

As to the liability for the accident, we are of the opinion that the judgment is correct and the amount awarded for the property damage sustained by plaintiff is not disputed.

As to the additional amount of $400 prayed for in the answer to the appeal, to cover the pain, suffering and shock sustained by plaintiff, it is our opinion that such alleged pain, shock and suffering has not been proved. The only testimony on that phase of the case is the mere statement of the plaintiff himself that he was shaken up and slightly bruised, and that ■it also aggravated a nervous condition for which he had been discharged from the army. He did not consult any physician, and, as a matter of fact, he was in Baton Rouge on the day after the accident, and apparently attended in a normal manner to the fixing of his automobile and did not have to absent himself from business. From the evidence, it appears to us that if he sustained any personal injury at all, it was inconsequential and obviously that was the opinion of the trial judge.

For the reasons set forth, the judgment appealed from is affirmed.


source: Caselaw Access Project

author: DORE, Judge.

license: Public Domain

text:
    MUSE v. HILL, (GULF STATES FINANCE CO., Intervener).
    No. 3165.
    Court of Appeal of Louisiana. First Circuit.
    Nov. 25, 1949.

      Robt. C. Taylor, Baton Rouge, for appellant.
    Weber & Weber, Baton Rouge, for plaintiff-appellee.
    Ashton L. Stewart, Baton Rouge, for defendant-appellee.
   DORE, Judge.

Plaintiff alleges that on the 17th day of January, 1949, he sold a 1947 Chevrolet convertible automobile to the defendant Hill, and for the purchase price, received a check from Hill in the amount of $1500. It appears that this check was not good and was given merely as evidence of indebtedness for- the purchase, price. It is also shown by the. evidence that at the time, Muse was indebted. unto Hill, a secondhand car dealer, as the result of a prior transaction, and that the car was sold to Hill in order to enable him to sell it or to borrow money under a chattel mortgage, so that Hill could take out the'money owed him by plaintiff Muse and 'turn the excess over to Muse on the purchase price. A bill of sale was executed by Muse to Hill under date of January 13, 1949 (the date on which the sale was apparently made — the check being executed some four days later). On this bill of sale, which evidenced a cash sale for $1400, Hill borrowed $1260 from E. J. Gonzales Finance Company and executed a chattel mortgage on the Chevrolet automobile as security for the loan. It appears that later on Muse finished paying in full his prior debt to Hill and he then instituted suit against Hill for $1500 for the purchase price of the Chevrolet automobile and prayed that he have judgment against Hill in that sum with recognition of his vendor’s lien and privilege on the automobile. In connection with his suit, he had the car -sequestered, and thereafter, the Gulf States Finance Corporation, doing business as the E. J. Gonzales Finance Company, filed a -petition of intervention, setting forth the chattel mortgage given it by Hill for the loan of $1260, and alleging further that on February 11, 1949, the defendant was indebted unto it on-ten other promissory notes- secured -by chattel mortgages on ten other vehicles, and that a dation en paiement was executed by the defendant Hill to the intervenor of eleven automobiles, including the Chevrolet convertible coupe in question, and that pursuant thereto, all of the vehicles were delivered and accepted by it, and thus, it became the owner of all these vehicles; and that, therefore, the vendor’s lien in favor of plaintiff, if it ever existed, was extinguished by the transfer of the title of the movable property unto it. It may be notedi that plaintiff Muse never filed any answer or pleading to the petition of intervention..

The defendant filed an answer to plaintiff’s petition, alleging that the consideration for the sale of the Chevrolet to him was the sum of $875 owed by plaintiff to him, plus the authority for him to sell the car for the best price obtainable and to deduct the $875 and commission and to thereupon turn the balance over to plaintiff; that in the deal, the defendant was further authorized to “floor-plan” the car if he so desired; that the act of sale was executed for the sum of $1400 on January 13, 1949, and that he gave a check to the plaintiff for the sum of $1500 on January 17, 1949, but that both he and plaintiff knew if was not good and was merely given as security. On the trial of the case, it was stipulated that defendant’s answer to inter-venor’s demand was a general denial.

The trial of the case resulted in a contest between the intervenor and the plaintiff, the intervenor contending that the act of agreement between it and Miles E. Hill, of February 11, 1949, constituted a dation en paiement, or in the alternative, a pledge, for the sum of $8200 owed to it by Hill, as shown by eleven notes secured by chattel mortgage, including the note of $1260 and chattel mortgage on the Chevrolet automobile in question; that this dation en paie-jnent, or pledge, had fully extinguished the vendor’s lien and privilege of the plaintiff. Plaintiff contended-that the agreement did not constitute either a dation en paiement or a pledge, and that consequently, his vendor’s lien and privilege was in full force and effect.

The trial court, giving a lengthy written ■opinion therefor, cáme' to the conclusion that the agreement did not constitute either a dation en paiément or a pledge, and accordingly, dismissed the intervenor’s petition of intervention at its cost and rendered judgment in favor of plaintiff and against the defendant for $1500 with legal interest from judicial demand until paid and recognizing plaintiff’s lien and privilege on the Chevrolet convertible coupe. The inter-venor has appealed.

Defendant Hill also appealed but has abandoned his appeal, and therefore, defendant Hill is an appellee, not an appellant, in this appeal, and the question for this court to decide is mainly between the intervenor and the plaintiff. The crux of that decision depends entirely on the interpretation to be given to the agreement between Miles E. Hill and Gulf States Finance Corporation, doing business as E. J. Gonzales Finance Company, said agreement being dated February 11, 1949, and being summarized as follows:

It is set forth that Miles E. Hill is indebted unto the Finance Company in the full sum of $8200 represented by demand notes secured by chattel mortgages, whiqh are listed in detail in the agreement.

It is further set forth that said notes are past due and that payment thereof has .been demanded and that to settle and compromise the matter, the parties have agreed as follows :

“First, said Miles E. Hill has and he does hereby transfer, surrender and release the aforedescribed automobiles to the said Finance Company;
“Second, for and in consideration of said transfer, release and surrender the said Finance Company has and it does hereby release said Miles E. Hill from any obligations upon the aforedescribed notes and does further agree as follows:
■ “(a) The-said Miles-E. Hill shall have sixty days from-date hereof in which to redeem said automobile;
“(b) The said Hill-may sell and dispose of any of said automobiles for not less than the amount of the mortgages above referred to resting thereon and the entire -proceeds of such sale, regardless of whether it exceeds the amount of said mortgage,- will be applied to the above referred to $8,200.-00;
. “(c) The said Finance Company .may at any time sell, any one or more of said automobiles- for not less than the current N.A. D.A. retail sales value and upon such sale, the entire proceeds of sale) less the.cost of sale including commission, shall be applied to ’ aforesaid $8,200.00;
. “(d) One per cent of the sale price of any automobiles sold during the existence of this agreement shall be applied-to the cost of insurance thereon;
“(e) At the expiration of this agreement, or at any time during the said sixty day period, the said Miles E. Hill shall have the right to redeem said automobiles upon payment of the remainder of 'said $8,200.00 after deduction of the proceeds of any such sales and insurance.” . ■

With reference to whether or not the agreement contitutes a dation en paiement, the trial court considered the following provisions of the Civil Code:

“Article 2655. The giving in payment is an act by which a debtor gives a thing to the creditor, who is willing to receive it, in payment of a sum which is due.”
. “Article 2567. The right of redemption is an agreement or paction, by which the vendor reserves to himself the power of taking back the thing sold by returning the price paid for it.”

It is to be noted that in this case there was no intention of passing the title to the creditor and that the debtor retained some control over the property, in that he had a right to sell the automobiles for the price of the chattel mortgages existing thereon. It is to be noted -also that- Mr. Gonzales, head of Gonzales Finance Company, admits in his testimony, that there was no intention of selling the property for the debt owed to the finance company.

It is true that in the case of Pomez v. J. B. Camors and Company, 36 La.Ann. 464, the court held that “a debtor who transfers securities in full ownership to his creditor in settlement of thie latter’s claim with the right of redemption yrithin a specified time, loses all rights and titles to the ownership of the property if he fails to redeem the property within the prescribed delay and that such a contract .is one of sale and not of pledge.”

In the case at bar, we do not have a transfer in full ownership for the reason that the debtor retained the right of selling the automobiles and applying the purchase prices to the debt.

See also Bourg v. Lopez et al., 36 La.Ann. 439,.which involves an agreement by which one transferred to another certain movable, property with the proviso and condition that the latter was to sell it, pay himself what the transferror owed him, and distribute the residue to certain named persons, apd wherein the court said: “This is not a sale. It has no element of that contract. It did not divest ownership and, therefore, did not transfer it. Neither is it a giving in payment. Full dominion over the property, with power to do , with it as he listed, is not conferred by that instrument. It cannot rightly be called .a pledge, but if it were that would not protect the property from thie pursuit of other creditors. Auge v. Variol, 31 [La.] Ann. [865], 866; Pickens v. Webster, [31 La.Ann.] 870; Horner v. Dennis, 34 [La.Ann.] 389. Like the contract in Herold v. Stockwell, 32 [La.Ann. 949], 951, it has no name a'nd is at most a bailment whereby Hobert bound himself to distribute the proceeds of the sale of named persons in sequence, and thus held as trustee for them. * * * ”

In the case of Allen, Nugent & Co. v. Buisson, 35 La.Ann. 108, as stated by the trial court:

“The plaintiff sold a number of bales of cotton to the defendant the price of which was never paid. .Thereafter the cotton was delivered by the' defendant under pressure to the intervenors,' the proceeds to be applied to an indebtedness of his to them, arising from the sale of other cotton which they hiad made to him at an earlier date. It was a suit between the plaintiff who had sold the cotton to the defendant and the intervenors, the defendant having failed to appear and make any answer. The inter-venors contended that the cotton was given to them in payment of their claim. The Court held that the burden was upon inter-venors ■ to show that the cotton had been transferred to them in payment of the indebtedness and held that they had failed to do so. In this connection the Court stated the following: Tt is true that the opponents were the creditors of the defendant and that the cotton was delivered to them by his order; but tbte circumstances under which the transaction took place do not establish an intention, a consent, in the parties to give and receive the cotton in payment of the debt. The evidence does not show that the cotton was transferred for any specified price, agreed upon and fixed for the giving in payment, which is assimilated to a sale.’
“The Court, accordingly, held that the fact that the vendee had delivered the cotton to a creditor of his, the proceeds to be applied to the payment of his debt, cannot •be set up by such creditor to justify a claim to the ownership of the cotton.”

It is upon these facts, reasoning and the cited, cases that the presiding judge ruled that the contract was neither a dation en paiement (giving in payment) or a pledge. Whatever may be the classification of this contract, it certainly is a legal and enforceable contract and not against public policy or morals.

The following facts are undisputed and are reflected by the record. On January 13, 1949, plaintiff Muse was indebted unto defendant Hill in the sum of $875. Hill was in need of money. In order to pay Hill, Muse delivered thie automobile in contest to Hill; at that time Muse executed a contract of sale, stating that Hill had purchased the automobile for $1400, Hill received the automobile with- the definite understanding between the plaintiff and defendant that Hill could sell Or mortgage the automobile. In the event of sale or mortgage, Hill was to pay himself and return to plaintiff the overplus of the proceeds. On the same day, Hill borrowed from the intervenor the sum of $1260, giving a chattel mortgage on the automobile in favor ■ of intervenor. Subsequently¡ Muse paid out his indebtedness to Hill and on January -17, 1949, Hill gave Muse his personal check, for the sum of $1500 as evidence of his indebtedness to Muse. Prior to February 11, 1949, Hill had become indebted to intervenor to the • amount :,of $8200, secured by chattel mortgages on eleven automobiles, one of which was, the automobile in question. Finding the 'relations unsatisfactory, intervenor had Hill to remove all of the eleven automobiles from his used car lot to intervenor’s used car lot, where they were under constant care and custody of intervenor’s employee or employees. On February 11, 1949, the contract under consideration was executed. The automobile, at the time of sequestration and seizure was on intervenor’s used car lot, where it had been prior to and after February 11, 1949. '

In considering this .contract, we have to find the intention of, ,the parties. From the evidence, it must be deduced that the parties did not construe the contract .in any other light but one of a conditional sale, not transferring title until the expiration of a sixty day period. By and under this contract, the evidence is uncontradict-ed that defendant' Hill parted absolutely with the possession of the automobiles, including the automobile in question, a requisite of a pledge, the subject matter being a movable. The defendant Hill parted with the possession of the automobiles for a definite sum, the stipulated consideration being $8,200, another requisite of a pledge. Therefore, the contract is in the nature of a pledge.

The plaintiff Muse contends, and which contention was. upheld by the District Judge, that by the provision (b) of the contract, supra, Hill had the tentative possession of the automobiles regardless of the fact that the said automobiles, prior' to and at the time of confection of said agreement, had been removed from Hill’s lot and placed on intervenor’s lot and in its possession, thereby destroying the effect of a pledge. . .

The law requires, as an essential element to the contract of pledge, that the creditor be put.in possession of the thing given to him.in pledge, and, consequently, that actual delivery of it be made to him. In the case at bar, the undisputed testimony is that the . automobiles were actually delivered to the intervenor. • There is no evidence in the record showing that any of the automobiles actually delivered to the intervenor was ever redelivered to defendant Hill. The automobile in question was always in the custody of the intervenor from the time of delivery prior to and on February 11, 1949, the date of contract, to the time of sequestration and thereafter to the trial of the suit. However; conceding for the mere sake of argument that Hill had the tenative possession under provision (b) of the 'contract of the'automobile in question, yet, under the ruling of the Supreme Court in the case of Foote v. Sun Life Assurance Co. of Canada, La.App., 173 So. 477, 481, “The law is also well settled that the'pledgee does not lose his pledge where he consents .that, for a limited time or for a specific purpose, the property pledged be placed in the hands of another person or even in the.hands of the pledgor himself.” Citing and quoting from the case of Conger v. City of New Orleans, 32 La.Ann. 1250, to this effect: “Possession, though essential to thie, validity of the pledge, need not be always in the creditor. It is sufficient that the thing pledged be in the possession of one occupying, ad hoc, tie position of a trustee. The debtor himself may,, in some cases, be considered as such trustee and lie given possession of the thing by him pledged, provided his tenure be precarious and clearly for accmnt of the creditor.” (Italics ours.)

Clearly under the provision (b.) the possession of Hill and his authority to sell the disputed automobile was precarious and for the account of intervenor; furthermore, it was for a limited time and for a specific purpose. It cannot be said that the intervenor ever lost any of its rights under this contract.

■Granting, for the mere sake of argument, that Muse had retained a vendor’s lien and privilege on the automobile when he parted with the title and possession of the automobile, we now pass to the effect to be given this contract in regard to the vendor’s lien and privilege quoad the intervenor. In other words, was the vendor’s lien and privilege lost by virtue of this contract and the facts in this case?

It is admitted that prior to the execution of the contract, but after the physical delivery of the contested automobile by Hill to intervenor, the intervenor had been informed by the plaintiff Muse that Hill had not paid Muse for the automobile. It is now well settled that the mere fact that a, person has knowledge of an existing vendor’s lien on a movable does not affect any rights that hie acquires in the property subject to such lien. The leading-case on this subject is the case of Pierson v. Carmouche, 146 La. 798, 84 So. 59, wherein the Supreme Court said in answer to the following question propounded to it by the Orleans’ Court of Appeal: ,

Q. “ ‘May a purchaser on ' credit of movable property validly give it in pledge to a third person, whio knows that he has not paid the price (but is otherwise in good faith), so as to vest in the pledgee a right superior ‘to that of the vendor, whose privilege thereupon ceases by reason of the property having passed out of the possession of the vendee?’
“We answer, Yes. In Dreyfous v. Cade, 138 La. [297], 298, 70 So. 231, this question was very fully discussed, withi full reference to authorities, and was decided in the affirmative.”

Whatever this contract be classified, we refuse to classify or determine it save to say that it is a valid and enforceable contract, under the decision quoted supra, and the case of Dreyfous v. Cade, 138 La. 297, 298, 70 So. 231, and the cases therein cited, we are of the opinion that the vendor’s lien and privilege on the contested automobile that the plaintiff Muse may have had was lost when the said automobile was delivered by Hill to intervenor and when the contract was executed; in other words, when Hill definitely delivered the possession of the said automobile to inter-venor and the contract was executed. The District Judge was therefore in error in recognizing plaintiff Muse’s vendor’s lien and privilege.

In so far as intervenor’s demand, since we do not classify this contract, we determine it best to dismiss its demand without prejudice.

As to the costs, it is our opinion that the costs of plaintiff’s demand be taxed against Hill and the costs of thie: intervention be equally divided "and paid by plaintiff Muse and the intervenor Gulf States Finance Corporation, including the costs of this appeal.

For these reasons assigned, it is ordered that the judgment appealed from is reversed, annulled and set aside; and it is further ordered, adjudged and decreed that the said judgment is recast to read as follows :

It is ordered, adjudged and decreed that there be judgment in favor of plaintiff, R. H. Muse, and against the defendant, Miles E. Hill, in the sum of $1500, with legal interest thereon from judicial demand until paid, with costs of this demand.

It is further ordered, adjudged and decreed that the intervention of Gulf States Finance Corporation, doing business as E. J. Gonzales Finance Company, is dismissed as in case of non-suit.

It is further ordered, adjudged and decreed that all costs of intervention be equally divided and paid by plaintiff Muse and- intervenor, Gulf States Finance Corporation, including the costs of this appeal.


author: REGAN, Judge.

text:
    MUSE v. STRUDWICK FAIR SERVICE INS. CO., Inc.
    No. 19005.
    Court of Appeal of Louisiana. Orleans.
    Nov. 28, 1949.
    Max Zelden and Sam, “Monk” Zelden, New Orleans, for appellant.
    Harry R. Cabral, New Orleans, for ap-pellee.
    Before McBRIDE and REGAN, JJ., and WALTER B. HAMLIN, Judge ad hoc. •
   REGAN, Judge.

This is a suit by the plaintiff, Mary Muse, beneficiary of a funeral insurance policy, for the face value thereof, $200, against the defendant, Strudwick Fair Service Insurance- Company, Inc. The defendant pleaded that the policy had lapsed at the time of- the déath of the insured, Arthur Coaley, brother of plaintiff.

From ,a judgment in"favor of defendant,plaintiff prosecutes this appeal.

While the ajppeal was pending in this court, the plaintiff, Mary Muse’ died and her sole and surviving heir, Bertha Coakely, wife of Eugene Thomas, was made party plaintiff.

The pertinent provision of the policy issued and relied upon by defendant reads as follows:

“A grace of four Mondays will be granted for the payment of every premium after the first, during which time this insurance shall continue in force; but if the assured becomes delinquent for more than four (4) weekly premium payments, this policy shall lapse and all such premiums theretofore paid shall be forfeited to the Company.
“Premiums on this policy are payable at the office of the Company, or its duly authorized representatives, and it is the duty of the assured to see that the premiums are paid in accordance with the terms of this policy. In the'event'the Company’s’representatives do riot call to collect the premiums, the assured is obligated to pay same at the office of the Company before same become delinquent.”

Defendant’s answer reads in part as follows : — “That the last premium payment made by the insured covered thie week ending Monday, June 23, 1947; that after June 23,- 1947, no premiums were paid; that four weeks, namely, the week ending June 30, July 7, July. 14, and July 21, 1947, passed without the payment of premiums and the policy automatically lapsed under the terms thereof, ori July 21, 1947; that decedent died on July 26, 1947, after the policy- had lapsed.”

-Plaintiff concedes that'more thian ’four weeks had elapsed without the payment of premiums by the insured but maintains that defendant is estopped from denying liability in connection with this policy of insurance because it has waived compliance with the provision of the policy relating to the payment of premiums as her.einabove quoted, by conduct inconsistent with its terms. In support of this contention plaintiff offered in evidence the premium receipt book beginning with date of January 7, 1946, and ending June 23, 1947 — and pointed out that on July 13, 1946, plaintiff paid the premiums due June 3, 10, 17, 24, July 1, 8, 15, 22 and 29, 1946, and' that on this occasion the policy was at least six weeks in arrears when the premiums were paid on July 13, 1946.

On February 21,, 1947, plaintiff or the insured paid the premiums due January 6, 13,, 20, 27, February 3, 10, 17 and 24, and that on this occasion the policy was in arrears at least seven or eight weeks when the premiums were paid'on February 21, 1947.

, On May 21, 1947, the insured paid the premiums due April 3, (referring to the calendar for the year 1947, this date should have been entered in the .receipt book as Monday, April 7) 14, 21, 28, May 5,' 12, 19 and 26, and that on this occasion the policy was at least seven or eight weeks in arrears when the premiums were paid on May 21, 1947.

Finally, plaintiff points out that the last premium payment made covered the week ending Monday, June 23, 1947; that four weeks, namely;, the week ending June 30, July 7, 14 and 21, 1947, passed without the payment of premiums and that the insured died on July 26, 1947, which is four weeks and five days from the date of the payment of the last premium.

In our opinion we find it unnecessary to pass upon thie alternative contentions of the litigants in order to decide the issues herein involved. We have carefully examined the premium receipt book and have ascertained therefrom that the insured died within the period of “grace” as set forth in the above quoted provision of the policy and, therefore, thie policy in question had not lapsed when the insured died.

The policy ; stipulates , that " * * ■ * which said premium is payable in advance on or before each Monday in every week * * * ”. A thorough .analysis of the premium receipt book reveals that all premiums were due on a Monday. For the purpose of showing that the insured died within the period of grace as provided for in the policy we are relegated to the date of March 3, 1947.' On March 18, 1947, plaintiff paid the premiums due for Monday March 3, 1Ó, 17,'24 and 31. Referring to a calendar for the year 1947, we find that March 31, was a Monday, and that .the following Monday was April 7, 1947. The premium receipt book is in error in the entry of the date, as Monday, April 3, 1947. Therefore, on May 21, 1947, plaintiff paid the-premiums due for Monday, April 7, 14, 21, 28, May 5, 12; 19 arid 26. The premium receipt book again falls intó error when the entries reflect that on June 17;' 1947, plain-'tiif paid the' premiums due for Monday, !May 26, June 2,; 9,. 16 and 23 ; because on May 21, 1947, plaintiff had paid the premium for Monday, May 26, 1947. Accordingly, the proper .entry should have been as follows: that on June ■ 17, 1947, plaintiff paid the premiums, due for .Monday, June 2, 9, 16, 23 and 30. .The insured died on Saturday, July 26; 1947. Previous to the insured’s death the following premiums were due — Monday, July.6, 13 and 20 or a period of three weeks. The policy provides for a “grace” period of four weeks; a fortiori, the policy had not lapsed at the time of the death of the insured.'

Assuming arguendo, a position most favorable to the defendant, to ■ the effect that the insured died, more thian fpur weeks after the last premium was paid on account of this policy, we are of the opinion that the plaintiff, even in that event, should recover. The defendant- has, by pursuing its course of conduct, waived its right to a strict compliance with the letter of the contract of insurance, particularly thie provision which reads as follows: — “•* * * but if the assured becomes delinquent. for more than fpur (4) weekly premium payments, .this -policy shall,lapse and all such premiums theretofore paid shall be forfeited to the Company.”

The evidence reflects that within one year defendant acquiesced and.'permitted insured to becqme delinquent three .times, for mpre than four weekly premium payments, and that, therefore, the- repeated acceptance by the insurer, of payments tendered as premiums on a lapsed policy, must be construed as a waiver of the right of the insurer to insist upon the formal requirements contained in the contract of insurance relative to lapsing the policy in question. Mobley v. Universal Life Insurance Co., La.App., 167 So. 217; Anderson v. Life & Casualty Insurance Co., La.App., 158 So. 270; Jones v. First National Life, Health & Accident Ins. Co., 8 La.App. 691; Bush v. Liberty Industrial Life Insurance Company, Inc., 15 La.App. 269, 130 So. 839.

For the reasons assigned the judgment appealed from is annulled, avoided and ■reversed and it is now ordered that there be judgment herein in favor of Bertha Coakely, wife of Eugene Thomas, and against thie defendant, Strudwick Fair Service Insurance Company, Inc., in the full sum of $200 with legal interest from judicial demand and all costs.

Reversed.

JANVIER, J., absent, takes no part.


author: JONES, Justice. SHORES, Justice EMBRY, Justice

text:
    Bonnie HERRINGTON and Edgar Burt v. CENTRAL SOYA COMPANY, INC.
    No. 80-740.
    Supreme Court of Alabama.
    July 16, 1982.
    Rehearing Denied Sept. 17, 1982.
    Charles S. Doster of Merrill, Porch, Dosier & Dillon, Anniston, for appellants.
    C. E. Isom of Wilson, Bolt, Isom, Jackson & Bailey, Anniston, for appellee.
   JONES, Justice.

The trial of this cause resulted in a jury verdict for Defendants Herrington and Burt on their counterclaim alleging a contract between Defendants and another, the obligations of which Plaintiff Central Soya allegedly agreed to fulfill. Central Soya’s motion for a new trial was granted; Defendants’ motion for reconsideration of the order granting a new trial was denied; and Defendants filed this appeal.

In denying Defendants’ motion for reconsideration, the trial judge set out a summary of the facts of the case and the grounds for his decision to grant a new trial:

“Attached to the Plaintiffs’ Motion [for new trial] was a copy of the case of Gregory v. Hardy, 53 Ala.App. 705, [304 So.2d 209 (1974)], in which the case of Puckett v. Bates, 4 Ala. 390 [ (1842) ], was cited as controlling authority. The Court had never specifically considered these two cases previously. Upon consideration, the Court determined that it had erred in its charge to the jury of the trial of this case in regards to the Statute of Frauds issue in the same, that the error was to the severe detriment of the Plaintiff, and the Court, thereupon, set aside the Jury Verdict rendered against the Plaintiff, vacated its Judgment thereon and- ordered a new trial....
“The facts of this case are contested. The Court is not now passing upon the facts, but, when viewed in a light most favorable to the Defendants, the facts would show that the Defendants, Her-rington and Burt, entered into a contractual arrangement with Northeast Poultry and Egg Farm Co., Inc., wherein Her-rington and Burt would feed, house, and care for certain baby chickens supplied them by Northeast Poultry. In a separate agreement, Northeast Poultry purchased feed on credit for its chickens from Central Soya Co., Inc., (Plaintiff) and granted the said Plaintiff a security interest in the chickens as collateral for its feed debt. After the chickens were placed with the Defendants, Herrington and Burt, and after they had partially performed their agreed obligations in regard to the chickens, Northeast Poultry became insolvent, confessed possession of the chickens by Plaintiff, Central Soya Co., under their security interest, and filed for bankruptcy. It is undisputed that Central Soya Co. took possession of the said chickens by Court Order. It is further undisputed that Central Soya Co. entered into an oral agreement with Her-rington and Burt to pay them for continuing to care for the chickens in return for which Central Soya Co. would pay them for their services from the date Central Soya Co. took possession and control of the flock.[] (Central Soya Co. paid Her-rington and Burt for services rendered under this agreement.)' It is disputed, however, as to what promises, if any, were made by Central Soya Co. in regard to the debt owed to Herrington and Burt by Northeast Poultry for services rendered up to the time of seizure. Herring-ton and Burt allege that Central Soya Co., acting through an agent, promised to pay the debt of Northeast Poultry Co. under the terms of the agreement entered into between Central Soya Co. and them. Central Soya denies such a promise and goes on to assert that even if such a promise had been made, the Statute of Frauds would prevent its being enforced. Further, it was undisputed that Herring-ton and Burt never released Northeast Poultry from the debt they allege Central Soya agreed to pay and continued to attempt to collect the same by filing a claim with the Bankruptcy Court in which Northeast Poultry’s bankruptcy was pending. The issue of whether or not there was an agreement between Central Soya Co. and Herrington and Burt regarding Northeast Poultry’s debt, and whether or not any such agreement was within the Statute of Frauds were the only real issues raised at trial.”

The applicable portion of the Alabama Statute of Frauds (Code 1975, § 8-9-2) reads:

“In the following cases, every agreement is void unless such agreement or some note or memorandum thereof expressing the consideration is in writing and subscribed by the party to be charged therewith or some other person by him thereunto lawfully authorized in writing:
“(3) Every special promise to answer for the debt, default or miscarriage of another; ...”

The cases pointed out in Central Soya’s motion for new trial, and referred to by the trial judge, reflect this Court’s interpretation of subsection (3) of the Statute of Frauds. Those cases, and countless others, distinguish between a “collateral” agreement and an agreement that is “original” in nature:

“The doctrine which distinguishes between an original promise — a new debt of the promisor — and a collateral undertaking — a guarantee or suretyship for the debt of a third person, is often difficult of application; but there are some tests, which may be regarded of controlling, though not conclusive consideration. The true test appears to be, whether the undertaking of the promisor was essentially a new debt of his own, while the payment of the third person’s debt was a collateral or incidental consequence, or was the latter its principal and directed purpose. [Cite omitted.] Generally, any promise to pay another person’s debt, which is not discharged or released by the terms of the promise, or other contemporaneous arrangement, is within the statute. To this rule there are exceptions. A party may make a valid oral contract, which operates to create a new debt of his own, if founded on a new and independent consideration, though the effect of the payment is to pay another’s debt. In order, however, to have this effect, the essence of the new undertaking must be the payment of the promisor’s own debt, by paying the debt of a third person.” Clark & Wadsworth v. Jones, 85 Ala. 127, 130 (1887).

See, also, Gregory v. Hardy, 53 Ala.App. 705, 304 So.2d 209 (1974); Westmoreland v. Porter, 75 Ala. 452 (1883); Puckett v. Bates, 4 Ala. 390 (1842).

This distinction between “original” and “collateral,” focuses on the nature of the promise made.

“A promise which is within the Statute is often said to be ‘collateral’; if not within the Statute, it is called ‘original.’ ‘The terms collateral or original promise did not occur in the Statute, and have been introduced by courts of law to explain its objects and expound its true interpretation.’
“Although the terms ‘original’ and ‘collateral’ do not obviate the difficulty of determining the ultimate question as to whether a promise is or is not within the Statute, they afford a convenient mode of expression for distinguishing between the eases within and those without the Statute: ‘The terms original and collateral promise, though not used in the Statute, are convenient enough to distinguish between the cases where the direct and leading object of the promise is to become the surety or guarantor of another’s debt, and those where although the effect of the promise is to pay the debt of another, yet the leading object of the undertaker is to subserve or promote some interest or purpose of his own.’ ” (Emphasis supplied.) S. Williston, A Treatise on the Law of Contracts § 463 (W. Jaeger 2d ed. 1960).

The sole issue presented on this appeal, then, is the propriety of the trial judge’s. granting the motion for new trial on the grounds that his oral charge to the jury with regard to the Statute of Frauds aspect was erroneous and thus caused “severe detriment” to Central Soya.

It is unquestioned that:

“[t]he power of trial courts to set aside verdicts, while inherent in order to prevent irreparable injustice, is a power hesitantly exercised because of the solemnity of a jury verdict regarded in background of that most precious of rights, the right of trial by jury. ‘The power should be exercised only when it affirmatively appears that the substantial ends of justice require the examination of the facts by another jury.’ Cobb v. Malone, 92 Ala. 630, 9 So. 738 [ (1890) ].”

Walker v. Henderson, 275 Ala. 541, 544, 156 So.2d 633 (1963). When it is apparent, then, that there has been a serious miscarriage or a total failure of justice, the trial judge is “under a duty to set aside [the verdict] and grant a new trial.” State v. Oliver, 288 Ala. 32, 256 So.2d 866 (1972). Further, once that power has been exercised by the trial judge, its consequences are attended by a presumption of correctness, and the trial judge’s decision will not be overturned by the appellate court unless the evidence of record plainly and palpably shows that the trial court was in error. Hill v. Cherry, 379 So.2d 590 (Ala.1980).

We recognize the long-standing rule as stated by the Court of Civil Appeals in American Service Mutual Insurance Company v. Grizzard, 356 So.2d 191 (Ala.Civ.App.1978):

“[A]n incorrect charge or even a misleading charge to the jury may be the basis for the granting of a new trial and, if such motion is granted, it will not be overturned on appeal. See Montgomery City Lines, Inc. v. Scott, 248 Ala. 27, 26 So.2d 200 (1946). See also Proctor v. Coffey, 227 Ala. 318, 321, 149 So. 838, 840—41 (1933), wherein the Supreme Court of Alabama stated:
‘Moreover, since the charge was misleading, if the trial court in its discretion found that by reason of such tendency a new trial should have been granted, his act in that respect will be reviewed with the same presumption as is usual in the exercise of such power....’ ”

356 So.2d at 193.

Furthermore, as stated in Montgomery City Lines, Inc. v. Scott, supra:

“Should we adopt the construction that, at most, the charge was merely misleading, a reversal would still be unwarranted in view of the favorable presumption attending the ruling of the trial court. By granting the new trial, the misleading and injurious tendencies of the charge were thus declared and no case is shown for overriding this presumption.”

248 Ala. at 31.

The discretionary power of the trial court, however, is not so broad as to obviate the basic principle expresed in A.R.C.P. 51:

“The refusal of a requested, written instruction, although a correct statement of the law, shall not be cause for reversal on appeal if it appears that the same rule of law was substantially and fairly given to the jury in the court’s oral charge or in charges given at the request of the parties.”

While this language from Rule 51 is stated in the context of an appellate review of a trial court’s refusal of a requested, written instruction, nonetheless, it is a correct statement of the polestar that guides the trial judge’s review of a refused, written instruction challenged by a ground of a motion for new trial. That is to say, where the trial court’s oral charge is a full, complete, and accurate statement of the applicable law, the trial judge’s refusal of a requested, written instruction, although a correct statement of the law, serves as no legal basis for the granting of a new trial. For an analogous situation, in which the trial judge was reversed for granting a new trial to one of several defendants, see Harnischfeger Corporation v. Harris, 280 Ala. 93, 190 So.2d 286 (1966).

When considering a motion for new trial raising the refusal of a requested, written instruction as a ground, the trial judge, of course, may compare the refused instruction with his oral charge in determining whether the same rule of law was substantially and fairly given to the jury. But when such comparison does not disclose that the oral charge was either incorrect or, in some material aspect, incomplete or misleading, the trial judge is not authorized to grant a new trial on such ground.

We have reviewed the trial court’s oral charge and have extracted those portions dealing with the Statute of Frauds aspect of Defendants’ counterclaim against Central Soya:

“[Sjection 8-9-2 of the Code of Alabama contains a Statute that is commonly known [as] the Statute of Frauds.. .. That Statute states in substance as follows: ‘In the following cases, every agreement is void unless such agreement or some note or memorandum thereof expressing the consideration is in writing and subscribed by the party to be charged therewith or some other person by him thereunto lawfully authorized in writing every special promise to answer for the debt, default or miscarriage of a note.’ . . . [T]he general rule in the State of Alabama, and I instruct you that it is the law in the State of Alabama, . . . that an oral promise by one person or one party to another person or another party to pay the debt or answer for the default of a third person, without more, is not valid and it is not enforceable. However, . . . the promise of one person to pay the debt of another, made upon a new and valuable consideration beneficial to the promis- or — the promisor is the person making the promise — is not within the Statute of Frauds. Thus, Ladies and Gentlemen, if you find in this case that . .. Defendants have proven to your reasonable satisfaction that Central Soya Company entered into an agreement with them whereby Central Soya Company promised to answer for the debt of Northeast Poultry, that is, promised to pay some sum of money which may have been owed to the Defendants by Northeast Poultry Company prior to the date of that agreement. Then, unless you find that any such promise was made without a new and valuable consideration beneficial to Central Soya Company, and flowing to it from [Defendants], then such promise to pay the debt of Northeast Poultry Company to [Defendants], if there be any, would not be enforceable under Alabama law. It would be void within the meaning of, or within the terms of the Statute of Frauds. If, however, . . . you find that there was such a promise, that is, the promise to answer for the debt of Northeast Poultry Company to [Defendants] and that such promise was based upon a new and valuable consideration flowing from [Defendants] to Central Soya Company and which was beneficial to Central Soya Company, then such promise or such agreement would not be within the voiding provisions of the Statute of Frauds.” (Emphasis supplied.)

We find no error in the charges quoted from. While the terms “original” and “collateral” do not appear in the trial judge’s charges, the distinction between the two are clearly set out by the judge. The nature of both a “collateral” and an “original” promise or agreement are sufficiently defined by the trial judge so as to give the jury an adequate legal foundation upon which to base their deliberations and ultimate verdict in the case. The court’s use of the emphasized portion of the charge, when taken in full context with the entire instruction, can hardly be said to be either incomplete or misleading. Indeed, these definitive terms are even more explanatory of the applicable legal principles than are the words “collateral” and “original” — the terms used in the requested, written instruction.

The trial judge’s failure to use “collateral/original” language in his charge did not diminish the sufficiency of his interpretation of § 8 — 9—2(3) and, therefore, did not cause “severe detriment” to Central Soya, nor did it result in the serious miscarriage or total failure of justice which ordinarily warrants the granting of a motion for new trial.

We hold, then, that the oral charge of the trial judge was proper in its definition of the legal distinction between an “original” and “collateral” promise or agreement as contemplated by § 8-9-2(3), and that the motion for new trial was improperly granted. This cause, therefore, is reversed and remanded with instructions to reinstate the judgment appealed from, in accordance with this opinion.

REVERSED AND REMANDED.

TORBERT, C. J., and MADDOX, FAULKNER and ADAMS, JJ., concur.

ALMON, SHORES, EMBRY and BEAT-TY, JJ., dissent.

SHORES, Justice

(dissenting).

I respectfully dissent.

Because the trial judge specifically found that the charge “was to the severe detriment of the Plaintiff,” I would affirm his decision granting a new trial.

ALMON and BEATTY, JJ., concur.

EMBRY, Justice

(dissenting):

Because I interpret the trial court’s recitations respecting a summary of the facts in this case, and the grounds for its decision to grant a new trial, differently from the majority, I am compelled to dissent. I read those recitations to mean nothing more than a statement to the effect that the trial court deemed his actions to have caused the jury to return an unjust verdict substantially prejudicial to plaintiff’s rights. For this reason, I would affirm the trial court’s order granting a new trial. See Cobb v. Malone, 92 Ala. 630, 9 So. 738 (1891), and its progeny.

      . Defendants claim that an “agreement” was not reached between Defendants and Central Soya as to this aspect of the process. Rather, say Defendants, they were told by an agent of Central Soya, on January 16, 1980, that Defendants would care for the birds, under the terms of the court’s TRO, and that Defendants would be compensated by Central Soya for such care from the time when the TRO went into effect (January 10, 1980).


author: SHORES, Justice. SHORES, Justice.

text:
    The CITY OF BESSEMER, a municipal corporation v. The PERSONNEL BOARD OF JEFFERSON COUNTY, et al.
    80-831.
    Supreme Court of Alabama.
    Aug. 6, 1982.
    As Modified on Denial of Rehearing Oct. 1, 1982.
    Norman K. Brown, Bessemer, for appellant.
    James R. Clifton of Stone, Patton & Kierce, Bessemer, for appellees.
   SHORES, Justice.

This is an appeal from an order granting summary judgment to defendants Personnel Board of Jefferson County (personnel board) and John C. Nixon in an action for declaratory judgment.

Nixon, an employee of the street department of the city of Bessemer, filed employee grievances pursuant to Rule 8.6 of the Rules and Regulations of the Personnel Board of Jefferson County. The grievances stemmed from: (1) removal of Mr. Nixon’s lead worker designation; and (2) change of Mr. Nixon’s duty assignment. Upon reevaluation, the issue of lead worker designation was removed from the grievance system and investigated by the personnel board. The director of the personnel board determined, however, that the question of the change of Mr. Nixon’s duty assignment from sewer crew to another position was a grievance as defined by Rule 8.6(a) and was subject to review under the rule.

Bessemer then filed an action in circuit court seeking a declaratory judgment to determine the enforceability of Rule 8.6. The trial court granted summary judgment in favor of both defendants, finding that: (1) the grievance procedure is a valid exercise of the personnel board’s rulemaking authority; and (2) Mr. Nixon’s complaints were grievable within the definition contained in the rule.

From that judgment, Bessemer appealed. We affirm.

Rule 8.6 provides:

“8.6 GRIEVANCES. The most effective accomplishment of the work of the various jurisdictions and departments requires prompt consideration and equitable adjustment of employee grievances. It is the desire of all parties to adjust grievances informally, and both supervisors and employees are expected to make every effort to resolve problems as they arise. However, it is recognized that there will be grievances which will be resolved only after a formal appeal and review.
“a) DEFINITION OF GRIEVANCE. A grievance is a wrong, real or fancied, considered by an employee as grounds for complaint. Matters dealing with classification, pay, compensation, examination, leave, discipline, and related actions specifically set forth in the Personnel rules and regulations, shall not be considered under grievance procedures, but shall be adjusted in accordance with the provisions set forth in these rules and regulations. Any question as to what constitutes a grievance or what should be processed as a matter subject to these rules and regulations, shall be determined by the Director, subject to the review of the Board.
“b) GRIEVANCE PROCEDURE. Any employee may register a grievance. In the presentation of grievances, employees are assured of freedom from restraint, interference, discrimination or reprisal. All adjustments of grievances processed under this rule shall be retroactive to the time the grievance is first submitted in writing by the aggrieved employee. The aggrieved employee may be represented by counsel or other person of his choosing.
“Step 1. (1) The grievance must be submitted in writing to the immediate supervisor within five (5) days of the occurrence of the incident. A copy of the complaint must also be filed with the Employee Relations Division of the Personnel Board. All such complaints shall cite the reasons and nature of complaint and must be signed by the employee.
“(2) The immediate supervisor shall within three (3) days, reply in writing, with a copy furnished to the Employee Relations Division of the Personnel Board, his answer to the complaint or grievance.
“Step II. If unresolved in five (5) days, the written grievance, and the supervisor’s answer shall be submitted to the department head. The department head, shall within five (5) days, reply in writing to all parties concerned and forward a copy of his answer to the Employee Relations Division of the Personnel Board.
“Step III. If unresolved, the grievance shall be submitted to a Grievance Committee, composed as follows:
“(1) One (1) member elected by the classified employees of the jurisdiction in question. , The term of the employee elected member shall be for a period of twelve months. One (1) member designated by the appointing authority of the jurisdiction in question. The third member shall be a mutually agreed upon person selected by the first two members.
“(2) In the event no mutual party can be agreed upon by members one and two within a period of ten (10) days, the Personnel Board shall designate member number three.
“(3) The Grievance Committee as constituted shall review the findings of all parties concerned and may obtain additional information as they deem necessary. They shall render a decision concerning the unresolved grievance within thirty (30) days after receipt of such grievance. The decision shall be binding on all concerned parties.
“(4) The Director of Personnel shall provide such minimal administration services as may be necessary and shall exercise his authority to require the production of records or appearance of witnesses as may be required to carry out the provisions of this rule.”

Bessemer contends that the rule, by binding all parties to the decision of the grievance committee, constitutes compulsory arbitration in violation of Art. IV, § 84, Ala. Const.1901. We disagree.

Appellant correctly cites the law generally in this country and specifically in Alabama that compulsory arbitration is against public policy. See, e.g., Wells v. Mobile County Board of Realtors, 387 So.2d 140 (Ala.1980). We find, however, that Rule 8.6 does not authorize arbitration, compulsory or otherwise, but merely provides an administrative procedure for grievance resolution for public employees.

As stated in Wells, supra:

“The public policy of this state is to encourage arbitration and amicable settlements of differences between parties; but public policy also holds void an agreement in advance to oust or defeat the jurisdiction of all courts, as to all differences between parties.”

387 So.2d at 144.

The evil we condemned in Wells was that any dispute, whenever it arose between the parties, was required to be submitted to arbitration. In the instant case, however, the. definition of “grievance” contained in part (a) of Rule 8.6 limits the application of the rule so as to exclude all but day-to-day employee complaints that are more efficiently and economically handled extrajudi-cially. The implementation of Rule 8.6 affords a practical means of dispute resolution that would otherwise not be available to public employees.

Because we find Rule 8.6 violates no constitutional provisions and does not subvert nor enlarge upon any statutory policy, as Bessemer contends, it necessarily follows that the personnel board was within its rulemaking authority in passage of the rule. The power and authority of the personnel board, granted by the legislature, to make such rules have been upheld by this Court on numerous occasions.

In McMahan v. Yeilding, 270 Ala. 504, 120 So.2d 429 (1960), we stated:

“Title 62, § 330(22), Code of Alabama of 1940 (General Acts of Alabama 1945, p. 377) vests the Personnel Board of Jefferson County with the authority to ‘make rules and regulations,’ etc., governing all civil service employees.
“We have previously held in Ex Parte Darnell, 262 Ala. 71, 76 So.2d 770, that in its broadest terms the statute vests the government and control of employees in classified civil service in the Board. The Personnel Director is authorized to submit to the Board for its consideration and approval such rules and regulations as are necessary to carry out the provisions of the act, ‘including the rules governing examinations, appointments, suspensions, dismissals, certification of eligibles, reduction in force, sick leave, leave of absence, resignation, reinstatements, promotions, demotions, transfers, salary adjustments, and any and all other rules and regulations necessary for administering a scientific and economical personnel system.’ (Emphasis supplied). Title 62, § 330(32), Code of Alabama of 1940 (General Acts of Alabama 1947, p. 227).”

120 So.2d at 431.

Bessemer next contends that the personnel board has no authority to delegate the power to settle grievances to the grievance committee. We disagree.

The delegation of rulemaking authority given the personnel board is necessarily broad so as not to unduly hamper the board in administering the personnel system. It is within that broad power to redelegate the power to settle grievances to a grievance committee.

The Court of Civil Appeals has previously held that “there is nothing inherently wrong with the subdelegation of power and authority by agencies created and empowered by legislative act to serve a public purpose.” Alabama Surface Mining Reclamation Commission v. Jolly, 362 So.2d 919, 920 (Ala.Civ.App.1978). We agree with that decision, and, finding no specific limitation on the personnel board’s power to subdelegate, hold that it is within its broad grant of power to subdelegate in order to effect an efficient and economical personnel system. The public purpose is clear that, without Rule 8.6, there would be no forum for most of the day-to-day grievances of the public employees of Jefferson County. The rule establishes a practical means of hearing these complaints.

We do not agree with Bessemer’s argument that the associate commissioner of the city of Bessemer has authority over the matters complained of in Nixon’s grievances and that Rule 8.6, therefore, violates some “home-rule” doctrine. While we recognize the responsibility of the associate commissioner for the operation of the Department of Public Improvements, that responsibility does not defeat the authority of the personnel board in the administration of the personnel system.

We have spoken to the conflict between a city department and a county personnel board previously. In Hudson v. Sparks, 272 Ala. 203, 129 So.2d 664 (1961), reviewing the relationship between the park board of the city of Birmingham and the Jefferson County personnel board, we held:

“Since both Boards are creatures of the legislature, the Personnel Board has no voice in the policies and decisions of the Park Board except as they relate to personnel under the classified service." (Emphasis added.)

129 So.2d at 668.

Likewise, in the case before us, the personnel board has no voice in the policies and decisions of the Bessemer Street Department, except as they relate to personnel under the classified service. Rule 8.6 is a valid exercise of that voice.

The judgment of the circuit court, finding the matters complained of to be grieva-ble within Rule 8.6 and that rule to be constitutional, is correct and due to be affirmed.

AFFIRMED.

TORBERT, C. J., and FAULKNER, JONES, ALMON, EMBRY, BEATTY, and ADAMS, JJ., concur.

On Application for Rehearing

SHORES, Justice.

At the insistence of appellant, we have modified our opinion of August 6, 1982, to include all provisions of Rule 8.6 of the Rules and Regulations of the Personnel Board of Jefferson County. The appellant says that this is necessary to render the opinion comprehensible. The application for rehearing is denied.

OPINION MODIFIED; APPLICATION FOR REHEARING OVERRULED.

TORBERT, C. J., and FAULKNER, JONES, ALMON, EMBRY, BEATTY and ADAMS, JJ., concur.


author: EMBRY, Justice.

text:
    TRUST COMPANY BANK v. STATE of Alabama, et al.
    81-39.
    Supreme Court of Alabama.
    Aug. 27, 1982.
    Rehearing Denied Sept. 24, 1982.

      James A. Byram, Jr. of Steiner, Crum & Baker, Montgomery, for appellant.
    William T. Stephens, Montgomery, for appellees.
    F. Michael Haney, of Inzer, Suttle, Swann & Stivender, Gadsden, for amicus curiae Central Bank of Alabama, N. A.
   EMBRY, Justice.

Plaintiffs, State of Alabama, Teachers’ Retirement System of Alabama (TRS), and others, filed suit against defendant, Trust Company Bank, a Georgia chartered state bank, for breach of statutory warranty under § 7-4-207, Code 1975. The gravamen of the complaint alleged that between February 1972 and August 1980, plaintiff, State of Alabama, issued warrants on the Alabama state treasury for retirement benefits to Jacob T. Williams, a retired teacher who died 7 January 1971. The warrants were sent through the United States mail to the payee in Gadsden, Alabama, at the address printed on the warrants. Defendant, as a collecting bank, from time to time, presented to the Treasurer of the State of Alabama for payment certain of those warrants drawn on the Teachers’ Retirement System Funds on deposit with the State Treasurer and received payment for them in spite of the fact they bore forged endorsements of the payee, in breach of the warranty provided by § 7-4-207.

In its answer, the Bank admitted the breach, but denied liability on the basis of one of several affirmative defenses: (1) those warrants presented and paid more than six years next before the filing of this action were barred by the statute of limitations; (2) plaintiffs failed to make a claim for breach of warranty within a reasonable time after they learned or should have learned of the breach; and (8) plaintiffs are barred from asserting the forgery because they were guilty of negligence substantially contributing to the making of the forged endorsements.

Upon completion of discovery, both plaintiffs and defendant filed motions for summary judgment supported by the pleadings and their respective affidavits. By order dated 28 September 1981, as amended 8 October 1981, the trial court granted plaintiffs’ motion for summary judgment and entered judgment in their behalf for the sum of $28,115.24 plus interest and denied the Bank’s motion for summary judgment. This appeal by the Bank is from the 8 October 1981 order.

The facts on which the trial court based its order are as follows: Jacob T. Williams, a teacher and principal in the Gadsden city school system, became a member of TRS on 25 January 1941, and continued a member thereof until his death. He retired on disability in December of 1968, at which time TRS began sending monthly retirement warrants payable to him to 804 North Eighth Street, Gadsden. Although he died on 7 January 1971, the retirement system was not notified of his death and continued to send his retirement benefits to his home address noted above.

Beginning in November of 1973, Lewis Williams, a resident of Atlanta and the son of Jacob T. Williams, deposited these warrants into his, Lewis’s, account with defendant Bank in Atlanta, after first forging the endorsement of his deceased father. Lewis continued this practice monthly until 31 December 1979, by which time TRS warrants totalling $28,115.24 had been deposited into his account.

The single interruption in this monthly deposit of warrants was in April of 1974. The warrant sent at that time, addressed to “Jacob T. Williams, 804 North Eighth Street, Gadsden, Alabama 35901”, was returned to TRS with the post-office stamp “undeliverable as addressed.” On 8 May 1974, M. E. Thomas, TRS Retirement Executive, sent a letter to Jacob Williams at the same address, requesting that he “please acknowledge receipt of this letter by sending us your correct address.” TRS received no response to that letter and, on 20 May 1974, TRS sent a similar letter to Dorothy Williams, Jacob Williams’s wife and death beneficiary, at the same address, requesting that she send TRS Williams’s correct address. Unknown to TRS, Mrs. Williams had died in April of 1973. On 6 June 1974, TRS received an undated and unsigned typewritten letter from “J. T. Williams”, providing a new address as requested. Acting upon this letter, TRS changed Jacob Williams’s address on its records and continued mailing the monthly warrants.

On or about 1 October 1980, a U. S. Postal Service Inspector at Gadsden contacted the superintendent of schools there and informed him the retirement benefit checks were being mailed and delivered to a person whom the post office suspected was deceased: Jacob T. Williams. The superintendent confirmed Mr. Williams’s death and immediately notified the Teachers’ Retirement System in Montgomery. TRS turned the matter over to the Alabama Bureau of Investigation and notified the State Treasurer of the forgeries. Following an indictment of Lewis Williams, the State Treasurer made a demand upon the Bank for repayment of the warrants. The Bank refused to do so. As a result, plaintiffs filed this suit.

Appellant Bank’s first assignment of error is that the trial court erred in failing to grant its motion for summary judgment based on the assertion of the statute of limitations as a bar to recovery for warrants paid prior to 6 March 1975, more than six years before this action was filed. The Bank’s contention is that TRS cannot recover for the warrants paid prior to 6 March 1975 because, as a matter of law, any recovery is barred by § 6-2-34, Code 1975, which provides: “The following must be commenced within six years: (9) Actions upon any simple contract or specialty not specifically enumerated in this section.” We agree and reverse as to that question.

The Alabama Uniform Commercial Code (Alabama’s codification of its version of the Uniform Commercial Code) does not have an express statute of limitations governing actions for breach of warranty; the general statute of limitations governing action on contracts controls. See, Winkie v. Heritage Bank of Whitefish Bay, 99 Wis.2d 616, 299 N.W.2d 829 (1981); Lewittes Furniture v. Peoples Nat’l Bank of Long Island, 82 Misc.2d 1013, 372 N.Y.S.2d 830 (1975); 2 Bender’s, Uniform Commercial Code, § 10.-05 (1982). The present rule is in accord with pre-code cases that still reflect the correct rule of law. See also, Houston v. Lawhead, 116 W.Va. 652, 182 S.E. 780 (1935); Home Ins. Co. v. Mercantile Trust Co., 219 Mo.App. 645, 284 S.W. 834 (1926). A warranty of good title under § 7-4-207 is an implied contractual warranty of the genuineness of the endorsement. The contract being implied rather than under seal, § 6-2-34, Code 1975, is controlling. Consistent with this view is Spragins v. McCaleb, 237 Ala. 658, 188 So. 251 (1939). The period of limitation governing this cause of action begins to run from the time of the wrongful payment, not from the time of the discovery of the breach. Birmingham Trust Nat’l Bank v. Central Bank and Trust, 49 Ala.App. 630, 275 So.2d 148, cert. den., 290 Ala. 372, 275 So.2d 153 (1973).

The plaintiffs contend that: (1) the sole limitation upon actions for breach of warranty is § 7-4-207(4), providing that an action for breach of warranty must be brought within a reasonable time after learning of the breach, and (2) if the six-year statute is applicable, it is tolled by the fraud of the forger until discovery of that fraud. We find both of these contentions erroneous. First, § 7-4-207 is a separate limitation in the nature of laches or estop-pel, quite different from the ordinary statute of limitations. Second, plaintiffs’ cause of action is against the Bank for breach of warranty, not fraud. The applicable fraud statute, § 6-2-3, Code 1975, applies only in case of defendant’s fraud. In this case, we do not find any evidence that the Bank committed fraud in connection with its breach of warranty.

Appellant’s second and third assignments of error are that the trial court erred in finding there was no genuine issue as to any material fact and that plaintiffs were entitled to judgment as a matter of law. The Bank contends there is evidence that TRS failed to make a claim for breach of warranty within a reasonable time after it knew or should have known of the breach, and, therefore, that under § 7-4-207(4), Code 1975, the Bank is discharged from liability. It further contends there is evidence that TRS was negligent in issuing warrants after it knew or should have known of Jacob T. Williams’s death. Accordingly, it concludes that § 7-3-406, Code 1975, precludes recovery by TRS from the Bank.

We need not address the issue of negligence or whether the claim for breach of warranty was made within a reasonable time, because a thorough review of the record indicates there are triable issues of fact with respect to appellant’s contentions. In light of this, we conclude that summary judgment was inappropriate. The law in Alabama is clear, and there is little need for citation of authority for the rule, that summary judgment is only proper where it is clear what the truth is; there must not be a genuine issue as to any material fact. Rule 56, A.R.Civ.P. It is the burden of the moving party to clearly show that the other party cannot recover under any discernable set of circumstances; if there is any evidence of substance worthy of consideration supporting the position of the nonmoving party, summary judgment may not properly be entered. Oliver v. Taylor, 394 So.2d 945 (Ala.1981). Consequently, in determining the existence of a genuine issue of material fact, the record on motion for summary judgment must be viewed by this court in a light most favorable to the nonmoving party. Ryan v. Charles Townsend Ford, Inc., 409 So.2d 784 (Ala.1981).

For the reasons stated, this case is remanded to the trial court for trial on its merits except as to those claims involving the warrants presented, and paid, more than six years next before the filing of this action. Further, judgment as to those warrants should be entered in favor of the Trust Company Bank by the trial court upon the receipt of certificate of judgment.

REVERSED AND REMANDED WITH DIRECTIONS.

TORBERT, C. J., and FAULKNER, AL-MON and ADAMS, JJ., concur.

      . “§ 7-4-207. Warranties of customer and collecting bank on transfer or presentment of items; time for claims.
      “(1) Each customer or collecting bank who obtains payment or acceptance of an item and each prior customer and collecting bank warrants to the payor bank or other payor who in good faith pays or accepts the item that:
      “(a) He has a good title to the item or is authorized to obtain payment or acceptance on behalf of one who has a good title; and
      “(b) He has no knowledge that the signature of the maker or drawer is unauthorized, except that this warranty is not given by any customer or collecting bank that is a holder in due course and acts in good faith:
      “(i) To a maker with respect to the maker’s own signature; or
      “(ii) To a drawer with respect to the drawer’s own signature, whether or not the drawer is also the drawee; or
      “(iii) To an acceptor of an item if the holder in due course took the item after the acceptance or obtained the acceptance without knowledge that the drawer’s signature was unauthorized; and
      “(c) The item has not been materially altered, except that this warranty is not given by any customer or collecting bank that is a holder in due course and acts in good faith:
      “(i) To the maker of a note; or
      “(ii) To the drawer of a draft whether or not the drawer is also the drawee; or
      “(iii) To the acceptor of an item with respect to an alteration made prior to the acceptance if the holder in due course took the item after the acceptance, even though the acceptance provided ‘payable as originally drawn’ or equivalent terms; or
      “(iv) To the acceptor of an item with respect to an alteration made after the acceptance.
      “(2) Each customer and collecting bank who transfers an item and receives a settlement or other consideration for it warrants to his transferee and to any subsequent collecting bank who takes the item in good faith that:
      “(a) He has a good title to the item or is authorized to obtain payment or acceptance on behalf of one who has a good title and the transfer is otherwise rightful; and
      “(b) All signatures are genuine or authorized; and
      “(c) The item has not been materially altered; and
      “(d) No defense of any party is good against him; and
      “(e) He has no knowledge of any insolvency proceeding instituted with respect to the maker or acceptor or the drawer of an unaccepted item.
      “In addition each customer and collecting bank so transferring an item and receiving a settlement or other consideration engages that upon dishonor and any necessary notice of dishonor and protest he will take up the item.
      “(3) The warranties and the engagement to honor set forth in subsections (1) and (2) arise notwithstanding the absence of indorsement or words of guaranty or warranty in the transfer or presentment and a collecting bank remains liable for their breach despite remittance to its transferor. Damages for breach of such warranties or engagement to honor shall not exceed the consideration received by the customer or collecting bank responsible plus finance charges and expenses related to the item, if any.
      “(4) Unless a claim for breach of warranty under this section is made within a reasonable time after the person claiming learns of the breach, the person liable is discharged to the extent of any loss caused by the delay in making claim. (Acts 1965, No. 549, p. 811.)”


author: ADAMS, Justice.

text:
    FORD MOTOR CREDIT COMPANY v. Robert L. WASHINGTON.
    80-449.
    Supreme Court of Alabama.
    Sept. 17, 1982.

      William L. Howell and Vincent A. Nolet-to, Jr., Mobile, for appellant.
    Grover S. McLeod, Birmingham, for ap-pellee.
   ADAMS, Justice.

This appeal involves an action by Robert L. Washington (plaintiff) against Ford Motor Credit Company (FMCC) alleging fraudulent suppression of facts material to the financing of an automobile purchased by plaintiff. This case previously was before us in Jim Short Ford Sales, Inc. v. Washington, 384 So.2d 83 (Ala.1980), where we reversed the judgment of the trial court and remanded for a new trial as to FMCC. On retrial, the case again was tried before a jury in the Circuit Court for Jefferson County. Plaintiff received a verdict and judgment in the amount of $75,000.00. After FMCC’s unsuccessful motion for judgment notwithstanding the verdict, or in the alternative for a new trial, it appealed.

FMCC raises four issues on this appeal:

1. Whether plaintiff failed to establish reliance on the allegedly suppressed material facts, thereby requiring that the trial court grant FMCC’s motions for a directed verdict or JNOV.

2. Whether this court’s opinion in Jim Short Ford Sales, Inc. v. Washington, supra, is in error and should be reversed.

3. Whether plaintiff failed to establish facts entitling him to have the case submitted to the jury on the issue of punitive damages.

4. Whether the jury’s award was excessive so as to require this court to grant an order of remittitur.

After reviewing the evidence adduced at trial we answer the questions posed by the above issues in the negative and we, therefore, affirm the judgment of the trial court.

The facts established at trial were substantially similar to those noted in the earlier appeal of this case. Jim Short Ford Sales, Inc. v. Washington, supra. In that earlier consolidated appeal, we affirmed judgments against co-defendants James E. (Jim) Short, Norman Smoake, and Jim Short Ford Sales, Inc. Plaintiff’s action against FMCC had been severed and tried separately. It resulted in a judgment favorable to FMCC when it obtained a directed verdict at the close of plaintiff’s case. We reversed, holding that plaintiff adduced sufficient evidence to go to the jury on plaintiff’s theory of fraudulent suppression:

In the instant case, there is evidence which indicates that (1) FMCC required insurance on automobiles which it financed and was aware that the insurance on many, if not all, installment sales contracts which it purchased from Jim Short Ford was written by Norman Smoake, (2) the manager of FMCC knew that Smoake was under investigation by the Department of Insurance and was provided with evidence that Smoake was not only grossly overcharging clients, but, in some cases, actually writing no insurance on them at all; (3) while not directly participating in plaintiff’s sales and insurance transaction, FMCC made it possible by financing the purchase, providing the forms, and approving the transaction by telephone before its completion. We hold that this evidence is sufficient to create a jury question as to the existence of a duty to disclose on FMCC’s part.

Jim Short Ford Sales, Inc. v. Washington, at 87.

On retrial, the facts adduced again showed the following: Plaintiff purchased a 1972 Pontiac Ventura automobile from Jim Short Ford Sales, Inc., on January 7, 1974. Plaintiff paid $300.00 and financed the balance of the purchase price, which included a $520.00 charge for automobile insurance. Harry Ort, of Jim Short Ford Sales, Inc., obtained financing for plaintiff. Ort called FMCC in plaintiff’s presence and arranged a loan. Plaintiff testified that Ort told him the automobile insurance could be obtained through Norman Smoake. Plaintiff obtained his automobile, but never received his insurance policy. Upon investigation he learned that no policy had ever been written for him. FMCC knew, at the time, that Smoake was overcharging on premiums and selling insurance without writing the policies. Smoake testified that he was involved in a kickback scheme with Harry Ort and Short. The kickback was in return for Smoake’s being sent customers. Plaintiff confronted FMCC. They acknowledged that he was uninsured, but declined to refund his $520.00 or to finance more insurance. In his complaint, plaintiff alleged that FMCC knew or should have known of the fraudulent scheme, and that it had a duty to demand that its dealer, Jim Short Ford Sales, Inc., furnish an effective insurance policy.

Plaintiff’s action is based upon Code 1975, § 6-5-102, which provides:

Suppression of a material fact which the party is under an obligation to communicate constitutes fraud. The obligation to communicate may arise from the confidential relations of the parties or from the particular circumstances of the case.

FMCC argues that the jury had no evidence before them from which they could reasonably infer that FMCC suppressed material facts. It contends, therefore, that the trial court erroneously denied its motions for a directed verdict or for JNOV. Central to FMCC’s argument is the contention that the facts adduced at trial failed to show that plaintiff relied on the alleged suppression of facts by FMCC concerning Smoake’s fraudulent insurance activities. We have reviewed the record and find FMCC’s argument to be without merit. The facts clearly establish detrimental reliance by plaintiff. A contention to the contrary is simply at odds with the record.

In the first appeal of this case, supra, where the facts were substantially the same as those adduced on retrial, this court held that a case of fraudulent suppression was made out under § 6-5-102, and that the trial court erroneously granted FMCC's motion for a directed verdict. The similarity of the present facts to those of the first trial leads us to conclude that a case of fraudulent suppression again was made out. We, therefore, decline to re-examine this court’s holding in the first appeal.

FMCC argues that the trial court should have granted its motion for a directed verdict on the issue of punitive damages. It theorizes that plaintiff adduced no evidence to support such an award. We disagree. In the first appeal of this case, this court opined that FMCC’s actions brought it within the ambit of § 6-5-102. Thus, if “gross or oppressive” conduct on the part of FMCC can be shown, an award of punitive damages is proper. Mobile Dodge, Inc. v. Waters, 404 So.2d 26 (Ala.1981); Freeman v. First State Bank of Albertville, 401 So.2d 11 (Ala.1981); Winn-Dixie Montgomery, Inc. v. Henderson, 395 So.2d 475 (Ala.1981); Boulevard Chrysler-Plymouth v. Richardson, 374 So.2d 857 (Ala.1979).

The record discloses the following facts: Michael DeBellis, an investigator for the State Department of Insurance, began investigating Smoake in September 1973. He went to Birmingham, Alabama, and checked 50 to 60 of Smoake’s insurance applications at the office of Special Risk Covers, Inc., an insurance broker. He took the applications to FMCC where he spoke with Ralph Cochran, FMCC’s assistant branch manager in Birmingham. DeBellis asked Cochran to pull 50 files. None had insurance and each had an invoice from Smoake. DeBellis informed Cochran that the invoices were not certificates of insurance and that customers’ claims probably could not be collected. Overcharging on insurance premiums was present in all 50 files. DeBellis called that to Cochran’s attention. One customer had been overcharged by $1,100.00. In November 1973, DeBellis returned to FMCC. He found no change in its operation. Cochran was still accepting Smoake’s ineffective “binders.” DeBellis informed Cochran that numerous complaints had been filed against Smoake.

Thorpe Forester testified that he was Deputy Insurance Commissioner in 1973. In September 1973, he spoke with Cochran and asked him to pull at random 10 to 15 files of customers whose loans were financed as the result of sales through Jim Short Ford. He pointed out that the Smoake binders, in fact, bound no one.

Cochran testified that FMCC continued to do business with Smoake until he could no longer write insurance:

Q. All right. Now, in other words, you quit doing business with him when he was out of business?
A. That’s a logical conclusion.
Q. And that is a good terminology, isn’t it?
A. Yes, sir.
Q. And in other words, he was no longer there for you to do business with, so you could not do business with him?
A. Yes.
Q. And you never really quit accepting Smoake’s binders, did you?
A. No, sir, not till he was out of business.

Cochran testified that he knew some of the Smoake “binders” were not signed. He stated that he really did not care if they were legal binders and that he knew in October 1973 that Smoake was not writing insurance on all transactions in which he was involved.

When plaintiff went to FMCC, after learning that he had no insurance, FMCC acknowledged that he was uninsured. FMCC refused to reimburse plaintiff the $520.00 he had borrowed for the premium, and told him that his vehicle had to have insurance coverage.

The imposition of punitive damages in a fraud case is discretionary with the jury, which considers the question “with regard to the enormity of the wrong and the necessity of preventing a similar wrong.” Neil Huffman Volkswagen Corporation v. Ridolphi, 378 So.2d 700 (Ala.1979); quoted with approval in Cecil Crews Chevrolet-Oldsmobile, Inc. v. Williams, 394 So.2d 912 (Ala.1981). Under the facts described above, we find that the jury could infer FMCC’s actions were gross or oppressive. Likewise, we find no abuse of the jury’s discretion in its award of punitive damages. It appears that almost all of the $75,000.00 awarded by the jury was for punitive damages. The jury could have found FMCC’s actions worthy of a deterrent in the amount of damages awarded. Accordingly, we find no merit to FMCC’s argument on this point.

FMCC also argues that the jury’s award of $75,000.00 was excessive and that this court should enter an order of remittitur. In Carlisle v. Miller, 275 Ala. 440 at 444, 155 So.2d 689 at 692 (1963), this court stated:

It is almost platitudinous to restate the guiding rules, but here they are: The verdict of a jury should not be interfered with merely because in the opinion of the court the jury gave too little or too much (Vest v. Gay [275 Ala. 286, 154 So.2d 297] supra; Airheart v. Green, 267 Ala. 689, 104 So.2d 687; Alabama Great Southern Ry. Co. v. Baum, 249 Ala. 442, 31 So.2d 366); and the authority vested in the courts to disturb a verdict of the jury on the ground of excessiveness is one which should be exercised with great caution. Airheart v. Green, id.; McLaney v. Turner, 267 Ala. 588, 104 So.2d 315; Louisville & Nashville Ry. Co. v. Tucker, 262 Ala. 570, 80 So.2d 288, 298. Where, as here, there is no set standard for the admea-surement of damages but the damages to be awarded are left to the sound discretion of the jury, remittur [sic] or a new trial should not be ordered on the ground of excessiveness of the jury’s verdict except in those cases where the court can clearly see that the verdict has been reached on account of bias, passion, prejudice, corruption, or other improper motive or cause. Airheart v. Green, supra; Yarbrough v. Mallory, 225 Ala. 579, 144 So. 447. And only where the damages allowed are so excessive as to warrant the belief that the jury must have been misled by some mistaken view of the merits of the case should the court interfere and set the verdict aside (National Surety Co. v. Mabry, 139 Ala. 217, 35 So. 698); also, where the trial court refuses to grant a new trial because he does not believe the verdict is excessive the favorable presumption attending the jury’s verdict is thereby strengthened. International Union, etc. v. Palmer, 267 Ala. 683, 104 So.2d 691; Birmingham Electric Co. v. Howard, 250 Ala. 421, 34 So.2d 830.

Cited with approval in Aspinwall v. Gowens, 405 So.2d 134 (Ala.1981).

As we stated regarding the previous issue, we find the jury’s award to be proper and we decline to set it aside. The jury’s award falls within the rules stated in Car-lisle v. Miller, supra. Consequently, we cannot find reversible error as FMCC contends.

For all of the foregoing reasons, the judgment of the trial court is affirmed.

AFFIRMED.

TORBERT, C. J., and FAULKNER, JONES, ALMON, SHORES, EMBRY and BEATTY, JJ., concur.