American Air Equipment, Inc. v. Pacific Employers Insurance

This is an appeal by the defendant Pacific Employers Insurance Company from a judgment holding it liable to' the plaintiff American Air Equipment, Inc., on a so-called Vehicle Dealer Bond, furnished pursuant to section 11710 of the Vehicle Code. The penal sum of the bond was the statutory $5,000. The judgment in favor of plaintiff and against the defendant bonding company was for $4,575.

The basic facts are quite simple. The bonded dealer was Roy J. Banks, doing business as Banks Auto Sales. Plaintiff, who did business as Mac Motors, is a wholesale dealer in cars who sold vehicles to Banks. Most of the pertinent dealings were between one Palozie, the president of plaintiff, and one Tankersley, the manager of the Banks lot.

Between October 1968 and March 1969 Banks purchased a number of cars from plaintiff. In March 1969 when plaintiff stopped doing business with Banks, Banks had failed to pay for seven cars, the total price of which was about $7,000. In the process of appearing to pay for these cars Banks had given plaintiff a series of checks, none of which was honored. The total amount of worthless checks given to plaintiff considerably exceeded $7,000, the…