Procedural Posture
Plaintiff seller filed suit against defendant purchaser to recover the proceeds remaining from the sale of collateral which had secured a third party's note which had been given by the purchaser in exchange for the seller's stock. The Superior Court of Los Angeles County (California) entered a judgment for the seller and the purchaser appealed.
Overview:
business and professions code 17200 jury instructions
The purchaser gave the seller a note executed by a third party in exchange for the seller's stock. The purchaser endorsed and tendered the note to a trust company. When the third party defaulted on the note, the collateral which secured it was sold. The seller filed suit to recover the proceeds of the sale which remained after the note was satisfied. The trial court's judgment for the seller was affirmed. The trial court did not err in not making findings of fact on transactions relative to the note which occurred before it was transferred to the seller because those transactions were irrelevant to the seller's claims. Further, as the trial court found that the note was properly transferred to the seller, findings on the issues of presentment, demand, protest, and notice of dishonor were immaterial. The evidence established that the purchaser owned and duly endorsed the note. As the seller was entitled to rely on the face of the note, the purchaser's motives in transferring the note to the trust company were immaterial. The trial court did not abuse its discretion in refusing to allow the purchaser to amend his answer and file a counterclaim.
Outcome
The judgment for the seller was affirmed.
