Jones v. Morris Plan Bank of Portsmouth

168 Va. 284, 191 S.E. 608 (1937)



Virginia has definitely recognized and upheld a provision in a note accelerating its maturity on non-payment of interest or installments. Under an unconditional acceleration provision in a note and in the absence of the usual optional provision reserved to the holder, the entire amount due upon the note may become due and payable when default is made in paying an installment.


The buyer financed the purchase of his car with a note containing an acceleration clause. Also, the sales contract provided that title would remain in the seller until the entire purchase price was paid. The note was assigned to the lender and when the buyer missed two payments, the lender sued and obtained a judgment for two installment payments. The buyer satisfied the judgment but then missed another payment. The lender sued again, but took a non-suit when the buyer raised a plea of res judicata. Shortly thereafter, the lender caused the physical repossession of the vehicle. The buyer sued the lender for conversion and judgment was entered for the lender after the trial court struck the evidence of the buyer. 


Upon the default of the buyer, was the entire amount to be paid considered due and demandable? 




In the case at bar, all of the installments were due. The evidence essential to support the action on the two installments for which the action was brought would be the identical evidence necessary to maintain an action upon all of the installments. All installments having matured at the time the action was begun, under well-settled principles, those not embraced in that action are now barred.

The defendant did not deny that the acceleration clause matured all installments upon the default in the payment of the May and June payments. Thus, the court had decided that under the unconditional acceleration provision in the note involved here and in the absence of the usual optional provision reserved to the holder, the entire amount due upon the note became due and payable when default was made in paying an installment. Therefore, when the action before the Civil and Police Justice of Suffolk was instituted, all the installments were due and payable.

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