Wednesday, December 11, 2013

Associates Loan Co. v. Walker case brief

Associates Loan Co. v. Walker case brief summary
416 P.2d 529 (1966)

Appellant sought review of a District Court of Bernalillo County (New Mexico) judgment rejecting its claim as assignee on a retail installment sales contact. Appellant contended that the contract was subject to the Uniform Commercial Code, the parol evidence rule, and that appellees were estopped to deny that the written contract represented a complete agreement.

Appellees orally agreed to purchase a water softener to improve the drinking water for their dairy herd, if after installation on a trial basis by appellant's assignee, it actually increased milk production. It did not increase production, and was ultimately removed. Appellant brought suit on the written contract, and the trial court entered judgment for appellees. Appellant challenged the ruling, contending that appellees' defense, that the sale was contingent on increased production, should not have been recognized under the Uniform Commercial Code (Code) or the parol evidence rule, and that appellees were estopped from asserting their defense.


  • The court affirmed. 
  • The contract did not provide for the preclusion of defenses arising out of the sale, thus the portion of the Code relied upon by appellant was not involved. 
  • The fundamental rule was that all equities and defenses that could have been raised by a debtor against an assignor were available to the debtor against an assignee. 
  • Appellant took the contract subject to the same contingency as for the assignor. 
  • The remaining grounds for review were not considered because they were raised for the first time on appeal.

The judgment was affirmed for appellees because nothing removed the case from the effect of the general rule that an assignee took a chose in action subject to the same defenses as were available to the assignor.

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