Harris v. Bower

McWilliams, J., delivered the opinion of the Court. The appellant’s late husband (Harris) seems to have become enthralled by the notion that “[t]here is nothing —absolutely nothing — half so much worth doing as simply messing about in boats . ...” 1 That this delightful and absorbing pursuit was beyond his means has required us to consider whether Code (1964 Repl. Vol.), Art. 95B, the Uniform Commercial Code (UCC), should control our resolution of a situation both antic and novel. We think it should control.

Early in 1964 the appellee (Bower), an Oxon Hill plumbing contractor, bought a new twin-screw Chris-Craft “Roamer” cruiser from the Kentmorr Marina in Stevensville. Its steel hull was 36 feet long; it was powered by gasoline engines. He could not remember the purchase price but he thought it was “less than $20,000.” In April 1966 Bower sold the boat to Harris for $17,000. He said its condition was “like new”; that he had used it for only “26 hours for the time [he] had it.” The appellant said “he (Harris) had the bottom painted and he had an awning made to enclose the back of the boat (the Barbara K), and he had a new electric toilet put in the head. ...

He kept it up to date.” Asked how much time he spent on the Barbara K, she said “ [h] e would be gone during Friday evening and [he] would come back Monday and . . . [she thought] most of his time was spent polishing it, looking after it.” Although she was “not too crazy about boats” she did go with him “on several occasions.” She described its 1969 condition as being ⁵⁸¹ “perfect. ... In fact [she said] it could have been better than when Jack [Harris] got it because of the repairs he put on it.” John S. Harris testified that in May 1969, just before his father’s death, the “boat was in perfect shape. It was like new. ... He [Harris] took exceptional care of the boat, spent a lot of money putting things on it and taking care of it. . . .

He spent a lot of time cleaning it, maintaining it.” He thought his father got more enjoyment out of taking care of the boat “than actually using it.” The appellant testified that after her husband’s death in June 1969 a neighbor named Carter, who “was just as crazy about the boat as Jack [Harris] was . . . [worked] on it every weekend, or every other weekend, just to make sure the boat was all right.” Irving Yochelson, Esq., appellant’s counsel both here and below, testified that after Harris died he had a “number of conversations” with Wilfred M. Dyer, Jr., who said he was Bower’s attorney. In his letter of 16 September 1969 to Dyer he told him “[t]here is just no way in which the note can be paid at this time.” He quoted John, Jr., as having said “the boat is in excellent condition, ... [a substantial sum having] recently been spent on it.” He asked if Bower “would be willing to accept the return of the boat in exchange for the cancellation of the note” and the payment of the interest. Dyer “phoned [him] and said he no longer represented Bower.” Bower denied that Dyer had been his attorney but he said he had been shown the letter from Yochelson. In February 1970 Charles Sollers went to Solomon’s Island to inspect the Barbara K. He owns and operates a marina at Edgewater.

He buys, sells and repairs boats and engines. He testified that in his opinion the boat, when he examined it, “would bring about $13,900 in the open market.” His qualifications were not controverted, nor was his appraisal challenged. The entire purchase price ($17,000) was evidenced by the promissory note of Harris and the appellant dated ⁵⁸² 22 April 1966 and payable two years thereafter. The note was secured by a chattel mortgage on the boat signed by both Harris and the appellant.

It is conceded to be a UCC Security Agreement. While Harris never reduced the principal of the note, he did pay interest in July 1967 and August 1968. In mid-October 1969 Bower sued to reduce the note to judgment. Two months later a summary judgment in the amount of $19,762.50, $1,976.25 attorneys’ fees and costs was entered against the appellant and her husband’s estate.

That the estate is insolvent is undisputed. Bower recounted his efforts to find a buyer for the boat. He said he “talked to every physical person . . . [he] could think of who would be interested . . ., all boat dealers . . . [he] knew of” and he thought he put one advertisement in the Washington Star. He said his efforts in this regard brought forth but three offers.

Since later we shall have more to say about them, they appear below verbatim. “JANUARY 4th 1970 MR. DONALD W BOWER 11200 RIVERVIEW ROAD S E WASH D C 20022 DEAR MR. BOWER, I AM INTERESTED IN PURCHASING YOUR 36 FT ROMA YACHT AND AM PREPARED TO OFFER THIRTY FIVE HUNDRED CASH ($3500.00). HOPING THAT YOU WILL REPLY AT YOUR EARLIEST CONVENIENCE, I REMAIN, JOSEPH C. BAUMANN /s/ Joseph C. Baumann 5416 WHITFIELD CHAPEL RD LANHAM MD 20801” ⁵⁸³ “Charles E. Callow Certified Public Accountant 3902-04 Rhode Island Avenue Brentwood, Maryland 20722 January 5, 1970 Mr. Donald W. Bower 5306 Indian Head Highway Oxon Hill Washington, D.C. 20021 Dear Donald: I would like to submit an offer of $4,200.00 for your thirty six (36) foot Roma Steel Hull boat.

I will pay the cost of transportation. /s/ Charles E. Callow Charles E. Callow” “John Sharper, Inc. Florist 2101 Brinkley Road — Oxon Hill, Md. 20022 Store and Greenhouses January 11, 1970 Mr. Donald W. Bower 5306 Indianhead Hwy. Oxon Hill, Maryland 20021 Dear Mr. Bower: I have had two (2) Cris Craft boat dealers examine the inside of your steel Cris Craft Cruiser, Maryland #3758-H and they tell me that none of the yearly maintenance inside of the hull have been kept up in accordance with the manual and now I find it quite expensive to have it done at this time, however the outside of the hull looks quite good. I am willing to make an offer of $4,500.00 ⁵⁸⁴ where is and as is. Enclosed is my check in the amount of $4,500.00.

Hoping to hear from you at your earliest convenience. Very truly, JOHN SHARPER, INC. FLORIST /s/ Helen L. Sharper Secretary” Bower could not recall but we think it likely he sent the three letters (or copies thereof) to the appellant and her attorney during the last week in February. Yochelson said that is when he received them and on 11 March he wrote to Bower as follows: “I attempted without success to reach you by phone in connection with the copies of the offers you have received for the sale of the boat owned by Jack Harris.

Certainly, we cannot consent to the acceptance of any such offer. According to the best information I can obtain, the boat should be worth in the range of $12,000.00 to $15,000.00.” Despite the unconditional tenor of the Sharper letter Bower testified he held the $4,500 check “until after they [Sharper] had a chance to look at . . . [the boat].” He did not know how long he kept the check — three or four weeks was his guess — but when “they said there was too much work to be done on it . . . [and that they] didn’t want it” he returned the check. It seems reasonable to suppose that Bower’s guess in respect of the date the check was returned was wide of the mark because on 1 May 1970 his attorney filed a praecipe entering a credit of $4,500 upon the judgment against the appellant. He testified he directed the entry of the credit because he “thought he had it sold at that time.” According to the records of the Boating Division of the Department of Chesapeake Bay Affairs (DCBA), ⁵⁸⁵ Bower “repossessed” the boat on 30 March 1970.

He recited in the “Report: Repossession of Vessel” that “[because of non-payment [he] took it back.” A Certifícate of Title was issued to him on 9 April 1970. It seems that sometime thereafter Bower had the boat moved from Solomon’s Island to the Fort Washington Marina; later he had it moved to the Oxon Hill Marina. In January of 1971 he filed with DCBA an application for the renewal of the registration. In the block “Owner write signature below” he signed his name.

At trial he admitted he had been the owner since April 1970. Nonetheless, Bower insisted he had the boat titled in his name so he could “sell it and give people a clear title.” Oddly enough there is little, if any, credible evidence of any effort on his part to sell the boat after he had obtained title and possession. Bower testified that he had not yet paid the bill ($1,800) from the Oxon Hill Marina. The bill was not introduced in evidence nor have we found in the record anything to suggest how much of it was for storage ($45 to $60 per month), how much for repairs or how much for maintenance.

This aspect of the situation is further obscured by Bower’s testimony that he repossessed the boat “so . . . [he] could put it back in condition to sell it and when . . . [he] found out what it cost . . . [he] stopped.” At trial he testified he thought he could “sell it for scrap iron, scrap steel.” The appellant filed her bill of complaint for an accounting, damages and other relief in March 1971. The case came on for trial before the chancellor, Bowie, J., on 15 September 1971. On 13 October he filed his opinion and decree, the relevant parts of which follow: “There is conflicting testimony as to the present value of the boat, but whatever its value, it apparently no longer equals the amount of the judgment (less the credit entered by praecipe May 1, 1970, in Law No. 42,061) which now is in the amount of $17,238.75 plus costs. Thus ⁵⁸⁶ it is not reasonable to expect the defendant to retain the boat in complete satisfaction of the obligation.

Maryland Annotated Code, Art. 95B, § 9-505(2) (Repl. Vol. 1964). This is one of his options under the Uniform Commercial Code. His other alternative is to dispose of the boat according to § 9-504, in a commercially reasonable manner and to apply the proceeds as provided therein. “Accordingly, for the reasons stated above, the relief prayed in the plaintiffs Bill of Complaint is denied and the case is determined based on the entire record in these proceedings, and it is this 13th day of October, 1971, by the Circuit Court for Prince George’s County, Maryland, “ADJUDGED, ORDERED and DECREED, that the aforesaid boat (described as a 1964 Chris-Craft Roamer (steel hull) Cruiser, Mfg.

Hull No. RXD36032OR, Maryland No. 3758H) be sold at a Judicial Sale, pursuant to Maryland Rules, Subtitle BR, within 30 days from date of this Decree; and it is further “DECREED, that the proceeds of said Sale be applied according to Maryland Code Annotated, Art. 95B, § 9-504(1) (Repl. Vol. 1964) ; and it is further, “DECREED, that if said proceeds are less than the amount of $17,238.75, the provisions of §