Tom Benson Chevrolet, Inc. v. Alvarado

BASKIN, Justice,

dissenting.

I concur in part and I dissent in part.

Alvarado alleged, and the jury found, that Tom Benson failed to set out the “true” cash price in the retail installment contract. The evidence showed that in the instrument introduced as plaintiff’s exhibit 3 headed MOTOR VEHICLE RETAIL IN-STALMENT CONTRACT — SECURITY AGREEMENT AND FEDERAL TRUTH-IN-LENDING DISCLOSURE STATEMENT the cash price was shown to be $4,756.52 and, after subtracting the total down payment plus trade-in, insurance, fees, taxes, license and registration fees and certificate of title fee, the unpaid balance was $4,309.36. This document was executed by Alvarado and by Tom Benson’s business manager. An additional instrument, to which Benson timely objected, was entitled “Purchase Agreement,” which was signed by Alvarado but was not signed by anyone at Tom Benson Chevrolet. It showed a “unit price” of $4,610.15; and with reduction for license fees, trade-in allowance and the like, the balance due would be $4,393.45.

*825The jury found in answer to special issue no. 1 that Tom Benson failed to state the “true cash sale price” in the retail installment contract entered into with Mary Esther Alvarado.1 The trial court entered judgment for double the amount of the time price differential in this cause of action. The time price differential is shown on plaintiff’s exhibit 3, the MOTOR VEHICLE RETAIL INSTALMENT CONTRACT-SECURITY AGREEMENT AND FEDERAL TRUTH-IN-LENDING DISCLOSURE STATEMENT, as “FINANCE CHARGE”, in the amount of $1,077.98. Double that amount is $2,155.96.

By its first two points of error, Tom Benson avers that there was no evidence or insufficient evidence to support the jury’s finding to special issue no. 1. By its third point of error, Tom Benson says that the trial court erred in admitting plaintiff’s exhibit 1, an instrument called Buyer’s Purchase Order, over Tom Benson’s objection that admission of the instrument violated the parol evidence rule and that buyer failed to prove that the seller executed that instrument.

I would sustain appellant’s third point of error. The parol evidence rule, which is a substantive rule of law and not a rule of evidence, prevented the purchase order from being introduced or being considered as an agreement by the parties on the case sale price; and whatever agreement there might have been with regard to the purchase order, it merged into the retail installment contract. Hubacek v. Ennis State Bank, 159 Tex. 166, 317 S.W.2d 30, 32 (Tex.1958). If it be concluded that the purchase order was a contract,2 it was obviously in conflict with the provisions of the MOTOR VEHICLE RETAIL INSTALMENT CONTRACT-SECURITY AGREEMENT AND FEDERAL TRUTH-IN-LENDING DISCLOSURE STATEMENT as regards the case sale price. Where two contracts are by their terms inconsistent, the one later made is conclusively presumed to supersede the other. Willeke v. Bailey, 144 Tex. 157, 189 S.W.2d 477 (1945); Ed Hoffman Motors v. G. F. C. Corporation, 304 S.W.2d 216 (Tex.Civ.App.—San Antonio 1957, writ ref’d n.r. e.). Therefore, while the trial court should have sustained Tom Benson’s objection to the tender into evidence of the purchase order, the result is the same. Parol evidence may not be used to vary the terms of the MOTOR VEHICLE RETAIL INSTALMENT CONTRACT.

*826The majority opinion argues that the purchase order agreement was admissible to show the price the buyer would have paid to the seller. The parol evidence rule and the rule regarding merger finally and conclusively require that we look to the MOTOR VEHICLE RETAIL INSTALMENT CONTRACT for the determination of what the buyer would have paid and did pay the seller.

If I am correct that the doctrine of merger and the parol evidence rule govern, then it goes without argument that points of error 1 and 2 asserting no evidence or insufficient evidence to support the jury’s finding to special issue 1 must be sustained. They should be sustained independently as well.

Article 5069-7.02(6)(a) requires that the retail installment contract shall set out the “cash price as defined in art. 7.01.” Article 5069-7.01 contains the following definition:

(f) “Cash Sale Price” means the price stated in a retail installment contract for which the seller would have sold to the buyer and the buyer would have bought from the seller, the motor vehicle which is the subject matter of such contract if such sale had been a sale for cash. The cash sale price may include any taxes, registration, certificate of title and license fees, and charges for delivering, servicing, repairing, altering or improving the motor vehicle. (Emphasis supplied.)

The retail installment contract, as defined in the Consumer Credit Act, did contain the cash sale price as defined in the Act.

A consideration of the legislative intent in enacting the Consumer Credit Act is helpful in understanding why there was no evidence or insufficient evidence to support the finding of the jury to special issue no. 1. Legislative intent is to be determined from the entire statute and the statute is to be construed so as to give effect to the purpose of the legislature. Citizens Bank of Bryan v. First State Bank, 580 S.W.2d 344 (Tex.1979); Flowers v. Dempsey-Tegeler & Co., 472 S.W.2d 112 (Tex.1971). It is also held that it is the duty of the court to give a statute a reasonable construction consistent with general principles of law and where an adherence to the strict letter of the statute would lead to injustice or absurdity, the duty devolves on the court to ascertain the true meaning consistent with the purposes to be accomplished. Knight v. Hicks, 505 S.W.2d 638 (Tex.Civ.App.—Amarillo 1974, writ ref’d n.r.e.).

The purpose of the Texas Consumer Credit Act and particularly of the Motor Vehicle Instalment Sales Act, is to protect consumers from abusive and deceptive practices in the extension of credit. This is borne out by the determination of the legislature to impose a penalty of double the amount of the time price differential for violation of the provisions of the Act. As this court held in O. R. Mitchell Motors, Inc. v. Bell, 528 S.W.2d 856, 860 (Tex.Civ.App.— San Antonio 1974, writ ref’d n.r.e.), the purpose of art. 5069-7.02 was to impose duties on sellers who in the ordinary course of business present to a buyer a document ready for the buyer’s signature.

In this case Tom Benson presented to Alvarado a document ready for the buyer’s signature; and the buyer signed it. It was the only contract of sale into which both of the parties entered.

In my opinion Tom Benson did not violate the Consumer Credit Code but instead complied with it. Therefore there was no evidence or alternatively insufficient evidence to support the jury’s finding on special issue no. 1.

Since the finding on special issue no. 1 cannot stand, the judgment should be reduced by the amount of $2,155.96, or double the amount of the time price differential found in the installment contract.

Point of error 18 attacks special issue 4e and instructions thereunder on the ground that the “diminished market value” of the automobile is not a controlling issue made by the pleadings and the evidence. Tom Benson says that the appropriate measure of damages and hence the controlling issue is the difference between the market value of the vehicle at the time and place of *827delivery and its market value if it had been delivered in the condition as warranted.

“Actual damages” under the Deceptive Trade Practices Act are those recoverable at common law.” Brown v. American Transfer & Storage Co., 601 S.W.2d 931 (Tex.1980). The correct measure of damages is the difference between the amount paid and the fair market of the automobile as delivered to plaintiff. Sobel v. Jenkins, 477 S.W.2d 863 (Tex.1972); Scholtz v. Sigel, 601 S.W.2d 516 (Tex.Civ.App.—Dallas 1980, no writ). However, I can find no indication in the record that Tom Benson objected to the form of special issue 4e. The objection is therefore waived, and point of error 18 is appropriately overruled. Notwithstanding, the jury’s answer to special issue 4e may not stand.

In points of error 19e and 20e, Tom Benson claims that there is no evidence or insufficient evidence to support the jury finding in answer to special issue 4e of $4,100.00 as the amount of money which would reasonably compensate plaintiff for the “diminished market value” of the automobile. The evidence does not support the jury’s finding of $4,100.00 in diminished market value.

An expert witness call by Alvarado testified that the fair market value of Alvarado’s car in San Antonio, Bexar County, Texas, in May of 1978 with defects was not more than $2,000.00. Tom Benson’s sales manager testified that the fair market value of Alvarado’s car in Bexar County, Texas, in May 1978 was approximately $4,500.00.

The only evidence to support the jury’s finding of $4,100.00 diminution in value of the car, was plaintiff’s own testimony as follows:

“Q: O.K. Then having looked around, Mary Esther, at used cars and new cars and prices, having become aware of the prices of used and new cars, if you had known of the defects that that car had, what would that car be worth in Bexar County, Texas?
A: To me, about $500.00.”

This is the only testimony in the record upon which the jury could have reached its verdict that the “diminished market value, if any, of the automobile in question as a result of any defects at the time of delivery” was $4,100.00. (Emphasis added.)

The plaintiff testified as to what the car was worth to her rather than the reasonable market value of the car at the time and place of its purchase. Such a measure of damages can be utilized only in special situations. In International-Great Northern Railroad Co. v. Casey, 46 S.W.2d 669, at 670 (Tex.Comm’n App.1932), Judge Sharp wrote:

“The rule is settled that, where property is destroyed or injured, which has a market value, this must be shown by the owner as the measure of damages; where it has neither a market value nor a real value, but it is shown what it would cost to replace or reproduce the article, then such cost is the measure of recovery. Where it has neither a market value nor a real value, and it cannot be reproduced or replaced, then in that event it would be proper to show what it was worth to the owner.”

The record here contains no evidence of the market value of plaintiff’s car which would support the verdict of $4,100.00 “diminution in value.” Plaintiff’s testimony that the car, to her, was worth only $500.00 would have been appropriate only after it had been established that the car had no market value and could not be reproduced or replaced. Allis-Chalmers Manufacturing Co. v. Board, 118 S.W.2d 996 (Tex.Civ.App.— Amarillo 1938, no writ). I would hold that there is no evidence or insufficient evidence to support the jury’s finding on special issue number 4e. I would sustain points of error 19e and 20e for these reasons. As a result, the amount of the judgment should be reduced by treble the jury’s finding of $4,100.00 or $12,300.00.

Tom Benson’s point of error number twenty-one asserts that the trial court erred by awarding prejudgment interest on an unliquidated amount. Prejudgment interest is recoverable when damages are estab*828lished at a definite time and the amount of damages is definitely determinable. Black Lake Pipe Line Co. v. Union Construction Co. Inc., 538 S.W.2d 80, 95-96 (Tex.1976). Here, where the amount of damages was not definitely determinable, prejudgment interest is not recoverable. Exxon Corp. v. Middleton, 613 S.W.2d 240, 252 (Tex.1981).

The majority agrees except that they maintain that prejudgment interest was appropriately recoverable on the amount of money awarded for double the amount of the time price differential in connection with the answer of the jury to special issue no. 1. I have already expressed the opinion that the granting of this penalty by the trial court was error. If I am correct in that assertion, then of course there' will be no interest on that amount, but even if I am incorrect, there still should be no prejudgment interest. The award of double the amount of the time price differential under the Consumer Credit Act was a penalty and not damages. Penalties do not draw prejudgment interest because a penalty does not reflect damage to the plaintiff. Penalties are assessed to discourage certain conduct on the part of the party penalized. As the Court of Appeals for the Fifth Circuit has said, “interest on a penalty does not further the purpose of making an injured party whole.” Illinois Central Railroad Company v. Texas Eastern Transmission Corp., 533 F.2d 272 (5th Cir. 1976) aff’d in part, rev’d in part, 551 F.2d 943 (5th Cir.1977).

For the reasons stated above, I would reform the judgment by reducing the money award of $25,270.96 to $10,815.00 and by awarding interest on that amount from the date of judgment, May 19, 1980, and, as reformed, I would affirm the judgment.

. Answers to Special Issues were as follows:

# 1. Benson failed to state the true cash sale price in the retail installment contract entered into with Mary Esther Alvarado.
# 2. Benson engaged in deceptive trade practices in connection with the sale, service and warranty of the automobile in question.
# 3. Such deceptive trade practices were a producing cause of adverse effects upon Mary Esther Alvarado.
# 4. The sum of money which would fairly and reasonably compensate Mary Esther Alvarado for damages resulting from the deceptive trade practices of Benson were: (a) Medical expenses, $75,000; (b) physical pain and mental anguish, $3,000; (c) loss of use of automobile, $330; (d) loss of wages, $200; (e) diminished market value, $4,100.
# 4A. The reasonable attorney’s fees for Mary Esther Alvarado’s attorneys were: (a) preparation and trial, $7,300; (b) for appeal to the Court of Civil Appeals, $2,500; (c) for appeal to Supreme Court of Texas, $5,000; (d) for additional work in connection with any appeal of the Supreme Court of Texas, if writ of error should be granted, $1,500.
# 5. Mary Esther Alvarado received the 1978 Monza on or about May 10, 1978, from Benson in substantially the same condition that Benson received it from General Motors.
# 6. Benson failed to perform all required service on the 1978 Monza in question in good and workmanlike manner.
# 7. Benson’s failure to perform all required service on the 1978 Monza in question in a good and workmanlike manner was a producing cause of Mary Esther Alvarado’s damages.
# 8. Benson did not fail to perform pre-de-livery inspections and adjustment on Mary Esther Alvarado’s 1978 Monza in a good and workmanlike manner.
# 10. General Motors Corporation received no written notice of Benson’s complaint before May 23, 1979.
#11. General Motors was not given a reasonable opportunity by Benson to cure the defects or the malfunctions in the 1978 Monzas automobile in question before May 23, 1979.

. The purchase order was signed by Alvarado but not by Tom Benson.