STATE v. E. T. SWINEY MOTOR CO

HOUSER, Commissioner.

This is an appeal by E. T. Swiney Motor Co., Inc., a corporation, from a conviction for violation of R.S.Mo. 1949, § 563.800, which imposes a criminal penalty for taking or receiving interest at a rate greater than two per cent per month for the forbearance or use of money.

While not a companion case to State v. E. T. Swiney Motors, Inc., Mo.App., 240 S.W.2d 727, the charge and the evidence are of like nature, and the appellant is the same corporation. The cases are so nearly parallel on the facts that the respondent, The State of Missouri, has filed a written confession of error conceding that the same kind of evidence, the lack of which rendered the prior conviction erroneous, is lacking in the transcript of this record. Notwithstanding this concession on the part of the State it is our duty to search the record and review the matter in order to satisfy ourselves concerning the property or impropriety of the conviction.

The State introduced evidence showing that on November 23, 1949 Robert E. Knoten purchased a 1940 Plymouth automobile from appellant, E. T. Swiney Motor Co., Inc., a corporation, through its salesman Roy Schwarzkopf.

The price of the Plymouth was $495. Knoten was allowed $95 as the trade-in value of his 1931 model Ford. A "car order" (State's Exhibit 1) signed by both Knoten and Schwarzkopf recited the following:

"Cash price of car: 495.00 "Tax 9.90 "License, transfer, title, registration fee, etc., 3.00 ------ "Total Cash Delivered Price, 507.90 "Deposit on order, 10.00 "Used car allowance, 95.00 "Cash on delivery, 152.90 * * *

"Total credit: 257.90 ------ "Balance due: 250.00

"Contract to be paid in 12 installments of $29.15 each * * *."

On that day Knoten executed a note and chattel mortgage to E. T. Swincy Motor Co., Inc., in the sum of $349.80, payable in 12 monthly installments of $29.15. Knoten testified that the 12 installments of $29.15 each were to include insurance, interest and payments on the purchase price of the automobile. The chattel mortgage (State's Exhibit 2) recited the purchase of the Plymouth automobile "for a total time selling price equal to

"(A) Total Bona Fide Cash Price of Motor Vehicle $507.90

Trade-in Down 1931 Ford Coupe 95.00 Payment Cash 162.90

"(B) total Down Payment 257.90

"(C) Unpaid Cash Balance (Deferred Balance) 250.00

"(D) Total finance charge and Insurance premium for which credit is extended 99.80

"Type of Insurance _______ (No insurance included unless described above)

"The Time Balance (Sum of C and D) 349.80"

Later, through the mail, Knoten received an insurance policy (State's Exhibit 3) and a payment book (State's Exhibit 4) from Associates Discount Corporation. Knoten's note and chattel mortgage were sold by E. T. Swiney Motor Co., Inc., to Associates Discount Corporation on November 23, 1949. The insurance policy insured Associates Discount Corporation and Robert E. Knoten, as interest may appear, under coverage C, "Fire, Lightning and Transportation", reciting a total premium of $7 paid therefor.

After receiving Exhibit 4 Knoten made his payments to Associates Discount Corporation, paying off all installments on the mortgage in due time. Knoten paid E. T. Swiney Motor Co., Inc., none of the $349.80 due on the note, conceded that he did not make a loan from E. T. Swiney Motor Co., Inc., said that his sole purpose in going to that concern was to buy an automobile, and acknowledged that he received no money from E. T. Swiney Motor Co., Inc.

The State also offered in evidence the testimony of Edward Faith, an actuary, that an individual owing a $250 unpaid balance plus $7 for insurance, or a total of $257, who executes a note for $349.80 payable in 12 consecutive monthly installments of $29.15 each, would be charged a total of $64.20 in excess of two per cent per month interest. He stated that at two per cent per month the total amount of interest on a debt of $257 payable in 12 monthly installments of $29.15 would be $28.60.

The defendant's evidence indicated that its representative Schwarzkopf sold Knoten an automobile, but did not lend him any money, or receive any interest from Knoten; took no commission or brokerage charge for selling him the automobile; informed Knoten of the cash price of $495 and the time price; that its representative Rosso figured the time price and advised him that the full time sales price "would run around $607.70"; that Knoten seemed satisfied; that an order blank was written out showing 12 payments of $29.15 each, and showing the total balance. Rosso arrived at the figure $99.80 by looking it up in the Associates Discount rate book. An objection to this evidence was sustained and defendant made the following offer of proof: "I want to show by this witness * * * that $99.80 was the usual charge published by the Associate Discount Corporation in a chart, for the purpose of selling the mortgage to the Associate Discount Corporation and * * * that E. T. Swiney (received?) no money from the $99.80, and received no commission or retained any part of said amount."

Rosso did not figure any interest in arriving at the figure $99.80. Rosso testified that he caused the chattel mortgage and note to be prepared and signed by Knoten, but that Knoten had a right to refuse to sign that Knoten was not required to sign nor was he threatened in any way. Rosso was unable to explain the meaning of the $99.80 finance charge but stated that E. T. Swiney Motor Co., Inc. received no commission or brokerage charge from Knoten; that Knoten was "to get fire and theft insurance" but Rosso did not know whether Knoten was to get any other insurance.

E. T. Swiney, president of the defendant corporation, testified that the company received no commission or brokerage charge as a result of the sale of the automobile to Knoten; that E. T. Swiney Motor Co., Inc. received a check for $250 from Associates Discount Corporation on the same day the note and chattel mortgage were executed; that the procedure in a part payment plan is to take the customer's order, prepare it for his signature, figure out the "time price", and call the Associates Discount Corporation (the finance company) to get the credit rating.

Edward Dorham, an employee of Associates Discount Corporation, testified that he "O.K.'d the purchase" of this note and chattel mortgage; that he dealt with E. T. Swiney Motor Co., Inc.; that his transaction was with E. T. Swiney Motor Co., Inc.; that he did not deal with Mr. Knoten; that he did not know Mr. Knoten; that Associates Discount Corporation paid E. T. Swiney no rebate on the purchase of this chattel mortgage.

The appeal reported in 240 S.W.2d 727 resulted in a reversal of the conviction for failure on the part of the State to prove that interest in excess of two per cent a month was charged for the forbearance of the money due on the unpaid purchase price of an automobile. The evidence in that case showed that the difference between the cash price of $350 and the time price of $500.25, to wit, the sum of $150.25, represented the interest and cost of collision insurance which was to be provided, but there was no segregation of the two items — no proof of the exact amount charged for interest or of the exact amount charged for insurance. There was therefore no basis to determine whether the interest charged exceeded the sum of $49.28, which was proved to be the maximum interest chargeable at the legal rate.

In the case at bar the difference between the cash price of $250 and the time price of $349.80, to wit, the sum of $99.80, was shown to represent the total "finance charge and insurance premium." There was no evidence in this case of any obligation to provide collision insurance. The payments were to include "fire and theft" insurance. The cost of the fire insurance was $7. There was no proof of the exact cost of theft insurance and no proof of the exact amount of interest included in the finance charge. Again, there was no segregation of the two items and no basis to determine whether the interest charged (if indeed interest was charged) exceeded the sum of $28.60, which was provide to be the maximum interest chargeable at the legal rate.

This analysis of the case leads to the same result reached in State v. E. T. Swiney Motors, Mo.App., 240 S.W.2d 727 unless we can take judicial notice of the fact that the cost of the theft insurance would not have increased the $7 fire premium to an amount exceeding the figure $28.60, supra. We cannot take judicial notice of automobile theft insurance rates.

The State therefore having failed to sustain its burden of proof in this case, it is the recommendation of the Commissioner that the judgment of conviction be reversed.