Commercial Credit Corp. v. State

McWilliams, J., delivered the opinion of the Court. What to do with a gold (not solid) Cadillac is the problem thrust upon us in this appeal. Shall it be handed over to the appellant, Commercial Credit Corporation (CCC) which, as assignee of a conditional contract of sale, claims to be the “owner,” or shall its present possessor, Anne ¹⁹⁴ Arundel County, be allowed to declare it forfeited as provided by Code, Art. 27, § 301 (1967 Repl. Vol.) ?

The facts are not in dispute. On 28 March 1968 Harold Leroy Scott (Scott) bought the Cadillac from Johnny’s Used Cars (Johnny) for $5195, $1250 of which he paid in cash. Johnny promptly passed on the details of the transaction to CCC which provided financing for most of his sales. The customary credit investigation followed.

CCC found Scott to be listed in the Baltimore telephone directory at the address given to Johnny. The Johns Hopkins School of Medicine confirmed the details of his employment, e.g., salary, position and length of service. A credit bureau reported no adverse information. CCC inquired of the Federal Narcotics Bureau whether Scott had any history of violation of the narcotics laws.

The district supervisor replied that the “files of the Bureau of Narcotics, Baltimore, Maryland disclose [d] no criminal record or reputation of [Scott]” but he disclaimed any knowledge of the existence of such a record “with State or City officials, or whether such a record exists in other parts of the country.” The security agreement executed by Scott was assigned to CCC. The $5144.40 which CCC in turn paid to Johnny included a “finance charge” of $979.90; the stated monthly payment was $142.90. The agreement was recorded among the financing records of Baltimore City on 2 April 1968. The Department of Motor Vehicles issued its certificate of title, showing a conditional sale to CCC for $5144.40, to Scott on 15 April 1968.

In the security agreement Scott agreed that he would not use the vehicle “for hire or illegally.” The agreement provides that title “shall remain in Seller until all amounts owing * * * are fully paid in cash” and that if Scott “defaults on any obligation or breaches any agreement or warranty * * * Seller may * * * take possession of it.” It is stipulated that Scott was “fronting” for Edward Trogden when he bought the Cadillac and that Trogden had the exclusive use of it. The State Police arrested ¹⁹⁵ Trogden in Anne Arundel County on 6 May 1968. They found narcotics in the car which he was driving at the time. As a result Trogden and Scott were convicted in the Circuit Court for Anne Arundel County of violating the narcotic laws.

CCC had no knowledge of the use being made of the car which, it is agreed, is worth less than the amount due. If CCC did not become entitled to possession by virtue of the violation of the covenant not to make illegal use of the car it surely did become so entitled on 1 June 1968 when the payment due on that date was not paid. Only one payment was made, on 6 May, and that was 90 cents short of the actual amount due. When CCC became aware of the intention of the State’s Attorney to declare the vehicle forfeited it filed its petition in the Circuit Court praying a stay of the forfeiture and the return of the vehicle.

The petition was dismissed with prejudice on 9 September 1969 after a hearing before the chancellor, Sachse, J. I. The parties agree that there is presented for our consideration and decision a very “narrow issue,” i.e., the meaning of “owner” as used in § 301; they agree also that until now we seem not to have considered the matter. The text of § 301 follows: “In addition to any other fines or penalties provided for a violation of the provisions of this subtitle, any motor vehicle or other vehicle, vessel or aircraft used or employed in the concealment, conveying or transporting of any such narcotic drugs, or used during the course of any violation of this subtitle by any person or persons convicted of the same, shall upon the conviction or convictions be declared by the court to be forfeited to the county or to Baltimore City, as the case may be; provided that no vehicle shall be forfeited hereunder unless the owner thereof authorized or permitted such use or employment. The county commissioners or the ¹⁹⁶ mayor and city council of Baltimore at their discretion may use the said vehicle for public purposes or may exchange, sell or convey it to another person or persons; and any cash or moneys received therefor shall be added to the general funds of the county or City of Baltimore.” (Emphasis added, see below.) Section 301 first saw the light of day in March 1951. Known as Senate Bill 406 it was passed by that body without a dissenting vote and sent to the House of Delegates where it was amended, passed as amended and returned to the Senate.

The Senate concurred in the amendment, the language of which is set out above in italics. Upon enactment it became Ch. 471 of the Laws of 1951. What sparked the amendment is, of course, beyond our ken because, as Chief Judge Hammond, for the Court, lately observed, in Unsatisfied Claim and Judgment Fund v. Hamilton, 256 Md. 56, 57 (1969), “in Maryland there usually is little prepassage evidence of intent.” He noted a “gratifying” compensation, however, in that “the usual paucity of objective evidence leaves room for the exercise of judicial perceptiveness and perspicacity in determining intent.” Ch. 471 of the Laws of 1951 (§ 301, supra) added a new section to the Uniform Narcotic Drug Act which was enacted by Ch. 59 of the Laws of 1935, now Code, Art. 27, §§ 276-305 (1967 Repl. Yol.).

That a forfeiture provision was not included in the Uniform Act may seem, at first blush, a little strange. It appears to have been so intended, however. According to a note to the Uniform Law “* * * it was deemed best that each state provide such methods for search, seizure and forfeiture as would best harmonize with its constitution and laws already enacted.” 9B U.L.A. 411 (1966). But the need for deterring the use of motor vehicles in the drug traffic was not overlooked entirely.

Section 291 of Art. 27 provides that “[a]ny * * * vehicle * * * which is resorted to by narcotic drug addicts for the purpose of using narcotic drugs or which is used for the illegal keeping or selling of the ¹⁹⁷ same, shall be deemed a common nuisance. No person shall keep or maintain such a common nuisance.” It seems fair to say that § 301 is aimed not at the innocent but at the guilty. Clearly it is intended to provide “[i]n addition to any other fines or penalties * * *” (e.g., §§ 291 and 300) a deterrent to the relentless and satanic traffic in addictive drugs. Equally clearly the proviso was inserted by the Legislature to preclude the confiscation of a vehicle whose owner neither “authorized [n] or permitted such use or employment.” II.

The question whether a conditional vendor can be held to be an “owner” as the word is used in § 301 must now be dealt with. While, as we have noted, the question is novel to us, counsel have pointed to one nisi prius decision (Sherbow, J., in the Criminal Court of Baltimore, 1952) which, relying to some extent upon an unreported memorandum of an Assistant Attorney General, held that “the word ‘owner’ as used * * * [in § 301] includes the holders of conditional contracts of sale * * *” who had no knowledge of the unlawful use of the vehicles. In Black’s Law Dictionary (4th ed. 1951) it is said that the term “owner” is a “nomen generalissimum, and [that] its meaning is to be gathered from the connection in which it is used, and from the subject matter to which it is applied.” In Weinberg v. Baltimore & Annapolis R.R., 200 Md. 160 (1952), Judge Collins, for the Court, quoting from B & O R.R. v. Walker, 45 Ohio St. 577 , 16 N. E. 475 (1888), said: “ ‘The terms “owner” and “owning” depend somewhat for their signification upon the connection in which they are used. “To own” is defined, “to hold as property; to have a legal or rightful title to; to have; to possess.” And an owner is “one who owns; a rightful proprietor.” An owner is not necessarily one otvning the fee-simple, or one having in the property the highest estate it tvill admit of. One having a lesser ¹⁹⁸ estate may be an owner, and, indeed, there may be different estates in the same property, vested in different persons, and each be an owner thereof.’ (Emphasis supplied.) ” Id. 200 Md. at 166 .

In Mayor & City Council v. Groh, 101 Md. 560 (1905), we held that a mortgagee was an “owner” within the meaning of a local condemnation statute and as such entitled to damages for the taking of his interest. On the other hand, in Alban Tractor Co., Inc. v. State Tax Comm’n, 219 Md. 593 (1959), we held that “one who holds the legal title to tangible personal property only as security has never been, and is not now to be, taxed as an owner under the statutory scheme of taxation in this State.” Id. at 599 . But in Weinberg v. Baltimore & Annapolis R.R., supra, a lease which gave the railroad the right to terminate it before the end of the term should it “acquire its own bus terminal” was held to have come to an end despite the fact that it acquired only a leasehold interest in “its own bus terminal.” We held that the words “ ‘acquire its own bus terminal’ mean that the railroad must become the owner of the bus terminal, not necessarily in fee simple but by ownership of an interest or estate therein as here acquired * * *.” Id. at 167. In this regard, it should be noted that § 301 does not specify the kind of interest one must own to be protected from a forfeiture.

What Judge Horney, for the Court, said in Huettner v. Savings Bank of Baltimore, 242 Md. 477 (1966), seems especially applicable here. He said that where there is a conditional sales contract “possession * * * [is] delivered to the buyer but title and general ownership * * * [remain] in the seller, or the * * * assignee, pending payment of the purchase price by the buyer * * Id. at 481 (emphasis added). See Beckwith Mach. Co. v. Matthews, 190 Md. 182 (1948) ; and 41 Op.

Att. Gen. 115, 118 (1956). He said also in Huettner that “[t]he certificate of title issued by the D.M.V. is not a warrant of absolute ownership but is merely an indicia of ownership, which, like possession, may be rebutted by other evidence.” Id. at 481-82 . The certificate in the instant case, ¹⁹⁹ of course, bears the notation that CCC holds a lien on the Cadillac.

We think the Legislature intended the proviso to embrace innocent conditional vendors. Whether the assignees of all conditional vendors, in any and all circumstances, also were meant to be protected against forfeiture we are not now called upon to say and it should be understood that we refrain from so holding. Given the circumstances of the instant case, however, we see no reason why the fact that CCC is technically Johnny’s assignee should deprive it of immunity from forfeiture. Huettner v. Savings Bank of Baltimore, supra.

After all, without its money Scott could not have bought the car.