Allis-Chalmers Manufacturing Co. v. Lowry

261 P. 828, 124 Kan. 566, 1927 Kan. LEXIS 380
CourtSupreme Court of Kansas
DecidedDecember 10, 1927
DocketNo. 27,525; No. 27,529; No. 27,621; No. 27,622
StatusPublished
Cited by1 cases

This text of 261 P. 828 (Allis-Chalmers Manufacturing Co. v. Lowry) is published on Counsel Stack Legal Research, covering Supreme Court of Kansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Allis-Chalmers Manufacturing Co. v. Lowry, 261 P. 828, 124 Kan. 566, 1927 Kan. LEXIS 380 (kan 1927).

Opinion

The opinion of the court was delivered by

Dawson, J.:

These four actions had their inception in certain business transactions between plaintiffs and defendants which eventually culminated in damage claims or cross claims for libel of the person and slander of title of personal property.

Briefly stated, in No. 27,525, the Allis-Chalmers Manufacturing Company sued R. F. Lowry, a Seward county farmer, on three overdue promissory notes aggregating $1,605.87, secured by a chattel mortgage on three-fourths interest in 320 acres of wheat, crop of 1926, for which it prayed judgment and to foreclose its mortgage.

Defendant Lowry filed an answer admitting the execution of the notes and mortgage. He also filed a cross petition in six counts for $66,494.13 as damages because the plaintiff had served a written notice on a half dozen Seward county grain buyers to the effect that it had a mortgage on defendant’s wheat crop grown on certain described lands, and requesting that if the mortgagor should deliver any of that wheat crop without a written release from the mortgagee the grain buyer addressed would please withhold payment therefor except to some authorized agent of the mortgagee, and also advise'the mortgagee of any other disposition of such wheat crop by the mortgagor. The text of this notice and request reads:

“You are hereby notified that the undersigned, Allis-Chalmers Manufacturing Company (Incorporated), has a mortgage on all crops of three-fourths of 320 acres of wheat raised during the season of 1926, on the south one-half (Mt) of section ten (10), township thirty (30), range thirty-three (33), Haskell county, Kansas, and we hereby respectfully request, if any of said crop is delivered at your elevator or warehouse by said R. F. Lowry, Liberal, Kansas, or anyone for him, without written release from said Allis-Chalmers Manufacturing Company (Incorporated), or its authorized agent, that you will mark the tickets therefor ‘mortgaged’ and make them out in the name of the said mortgagee, Allis-Chalmers Manufacturing Company (Incorporated); that you will not cash any of said tickets unless presented for payment by a duly [568]*568authorized agent of said mortgagee; that you will not pay for any of said crop in any manner without the consent of said mortgagee or its authorized agent, or until said crop is released from said lien, and that you will kindly notify said mortgagee when said crop is being delivered, whether to you or to someone else, or if it is being shipped direct by said mortgagor.
“Allis-Chalmers Manufacturing Company (Incorporated),
“By O. J. Thomas.”

Plaintiff’s demurrer to the several causes of action set up in defendant’s cross petition based on the foregoing writing was sustained. Defendant Lowry appeals.

In No. 27,529, the same plaintiff sued defendant R. P. Swartz on two promissory notes, amounting to $965.10, secured by a chattel mortgage on 160 acres of wheat and other chattels, for which judgment and foreclosure were prayed.

Defendant filed an answer and cross petition, admitting the execution of the notes and chattel mortgage, but setting up eight causes of action for damages in the sum of $85,861.99 on account of the publication among the Seward county grain buyers of a written notice and request similar to that set out above in Lowry’s case, except in matters of land description and other details of no present importance.

Plaintiff’s demurrer to this cross petition was sustained, and defendant Swartz appeals.

In cases No. 27,621 and No. 27,622, Jennie M. Neff and Charles Neff, her husband, brought separate actions for damages aggregating $152,870 for libel of the person and slander of title to personal property because of a publication among the Seward county grain buyers by the J. I. Case Threshing Machine Company similar to that of the Allis-Chalmers Company set out above, except as to land descriptions and other details of no present importance. Involved in these Neff cases, however, was one distinct feature growing out of certain misdescriptions of the luands on which the Neff wheat covered by the J. I. Case Company’s chattel mortgage was grown. These cases were tried separately and at the close of plaintiff’s, evidence in each case, a demurrer thereto was sustained. ' Plaintiffs appeal.

Touching so much of these appeals as questions the propriety of the trial court’s rulings on the demurrers to the causes of action or cross action for libel of the person and slander of title founded on the written notices sent to the several grain buyers in the local market centers where these mortgaged wheat crops were grown and [569]*569to some or all of whom those crops would most likely be marketed, and to whom they were in fact marketed, a careful reading of these notices discloses no defamatory matter (State v. Huff, 96 Kan. 632, 152 Pac. 642) nor anything fairly susceptible of such an interpretation. (Hanson v. Bristow, 87 Kan. 72, 123 Pac. 725.)

So far as the statement of facts therein is concerned, the pleadings of the appellants in each case admit that such statement was true. The authors of the written notices did have the interest in the wheat crops they claimed to have under their chattel mortgages. Touching the mortgagee’s, request that if the wheat were marketed to the grain buyer addressed without a written release of the mortgagee the scale tickets should be marked and payment withheld except to an authorized agent of the mortgagee, that was a perfectly proper, businesslike communication for the mortgagee to make. The specific terms of the chattel mortgages are not reproduced for our perusal, so we must assume they contained the usual recitals of such instruments, which in legal effect would vest title to the wheat in the mortgagee. (R. S. 58-307.) The mortgagor could not lawfully sell the mortgaged wheat without the written assent of the mortgagee and to' do so would be a penal offense. (R. S. 58-318.) So the mortgagee was quite within its legal rights in requesting the grain buyers to keep track of the scale tickets and to withhold payment except to its authorized agent. (Burton v. Dickson, 104 Kan. 594, 180 Pac. 216, 775.) The reqpest to be advised if the mortgaged wheat was otherwise disposed of by the mortgagor had no semblance of a defamatory writing. It was simply a request for a legitimate business favor, and the request itself, as well as any fair, truthful answer it might have elicited, was privileged under the well reasoned precedents. (Richardson v. Gunby, 88 Kan. 47, 127 Pac. 533; Kozel v. Kozel, 104 Kan. 530, 180 Pac. 278; High v. Hardware Co., 115 Kan. 400, 223 Pac. 264; 36 C. J. 1262.)

In the Lowry case, counsel for appellant urge particular attention to the fact that the appellant in 1926 had 2,000 acres of wheat which yielded 52,000 bushels, a major portion of which was marketed immediately after harvest and as it was incapable of segregation (by the wheat buyers, presumably) payment therefor was withheld because of the written notices served on the buyers. But the consequences of this circumstance cannot be laid to the mortgagee. A farmer having 52,000 bushels of -wheat needs a guardian and not a [570]*570lawyer if he cannot make satisfactory arrangements with his creditor-mortgagee to facilitate the marketing of that vast crop because of the comparative bagatelle of a $1,900 debt covering a mere fraction of it.

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Related

Sweeney & Co. v. Brown
60 S.W.2d 381 (Court of Appeals of Kentucky (pre-1976), 1933)

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Bluebook (online)
261 P. 828, 124 Kan. 566, 1927 Kan. LEXIS 380, Counsel Stack Legal Research, https://law.counselstack.com/opinion/allis-chalmers-manufacturing-co-v-lowry-kan-1927.