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GALATI v. POTAMKIN CHEVROLET CO. (06/13/62)

June 13, 1962

GALATI
v.
POTAMKIN CHEVROLET CO., INC., APPELLANT.



Appeal, No. 9, Oct. T., 1962, from decree of County Court of Philadelphia, Aug. T., 1959, No. 907, in equity, in case of Michael Galati v. Potamkin Chevrolet Co., Inc. Decree reversed.

COUNSEL

Michael von Moschzisker, with him Michael L. Temin, and Wolf, Block, Schorr and Solis-Cohen, for appellant.

Samuel B. Brenner, with him Brenner and Brenner, for appellee.

Before Rhodes, P.j., Ervin, Wright, Woodside, Watkins, Montgomery, and Flood, JJ.

Author: Flood

[ 198 Pa. Super. Page 534]

OPINION BY FLOOD, J.

The plaintiff brought suit in equity to rescind an installment sales contract covering the purchase of an automobile alleging that the defendant completed the blanks in the instrument in an excessive amount, contrary to the terms of a prior oral agreement, as a result of which he became obligated to pay $427.42 more than the amount which would have been payable under his oral agreement with the defendant. In his complaint he requested that the contract be declared fraudulent and void and that the defendant be directed to refund to him $1,717.51, together with interest from July 12, 1957.

The chancellor found that the plaintiff agreed to purchase the automobile for $1800, that he paid $300 in cash and received credit for $400 as a trade-in allowance for another vehicle so that the balance due was $1100 plus financing and other charges, that the plaintiff signed an installment sales contract in blank, and that it was later filled in by the defendant for $1538.10 plus financing and other charges. The chancellor further found that, while this may have been a mistake in the first instance, the defendant thereafter refused to rectify the mistake and tried to collect the full amount due. The court, holding that these circumstances

[ 198 Pa. Super. Page 535]

    entitled the plaintiff to rescind the contract, ordered the defendant to pay the plaintiff the sum of $1,639.14, which represents $700 paid to the defendant on account plus $939.14 paid in installments under the contract. The court en banc affirmed the adjudication and decree of the chancellor. The defendant has appealed upon the ground that the plaintiff lost his right to rescind by failing to notify the defendant of his decision within a reasonable time after learning the facts and by continuing to use the vehicle and to make payments with knowledge of the fraud or mistake.

The plaintiff discovered that he was being charged a price in excess of what he alleged had been agreed upon or about August 1, 1957, approximately two weeks after the contract had been entered into. At this time he received notification of the amount due from the bank which had purchased the installment sales contract from the defendant. On August 20, 1957, the plaintiff paid the first installment, due August 18, 1957. Thereafter he continued to make payments, the last of which, covering the installment due for the month of August 1958, was made on October 10, 1958. On November 10, 1958, the automobile was repossessed. At this time the installment payable in the month of September 1958 was in default. On August 7, 1959, the plaintiff instituted this action to rescind the contract.

The plaintiff seeks to avoid the effect of the long delay between his discovery of the excess charge and the institution of this action to rescind by testimony that he got in touch with the salesman with whom he had negotiated the deal immediately after he learned of the higher price from the bank, that the salesman told him "there was a mistake and we'll straighten it out", and that the plaintiff, ...


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