Brown v. Green

618 P.2d 140, 30 U.C.C. Rep. Serv. (West) 340, 1980 Wyo. LEXIS 313
CourtWyoming Supreme Court
DecidedOctober 21, 1980
Docket5281
StatusPublished
Cited by5 cases

This text of 618 P.2d 140 (Brown v. Green) is published on Counsel Stack Legal Research, covering Wyoming Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Brown v. Green, 618 P.2d 140, 30 U.C.C. Rep. Serv. (West) 340, 1980 Wyo. LEXIS 313 (Wyo. 1980).

Opinions

RAPER, Chief Justice.

This appeal is from a summary judgment entered February 5, 1980 ordering the dismissal of appellant’s complaint in replevin which had alleged the conversion of an Ide-co rotary table by appellees. Appellant states the issue on appeal is whether the trial court correctly determined that the security agreement between appellee-Keck Drilling, Inc. (Keck) and a third party established a security interest in the particular rotary table in question as after-acquired property. The appellees state the issue to be whether appellant had any interest in the property which he could assert. We will hold appellant had no interest in the property and affirm.

Jerry McCutchin, Jr., though not a party to the suit, is the focal figure in the development of the dispute. As a general part[141]*141ner in Mustang Drilling, Ltd., a Texas limited partnership, he entered into a contract with Keck for the purchase by Mustang of “one U-15 Drawworks and related equipment,” which language describes a drilling rig. The purchase price was set at $551,-000; $51,000 was paid as a downpayment and a promissory note was given for the balance.

On August 25, 1978, in order to secure payment of the promissory note, a security agreement was executed which granted Keck a security interest in:

“ * * ⅜ the equipment described in the schedule attached as Exhibit A’ hereto * * * and any and all accessions and additions thereto to secure the indebtedness arising under the Note.”1 (Emphasis added.)

Keck perfected its security interest by filing a financing statement with the Wyoming Secretary of State on September 5, 1978 in accordance with §§ 34-21-950 and 34-21-951, W.S.1977, 1980 Cum.Supp.2 In September, 1978, the rig was moved to a well location in Campbell County.

On or about October 3, 1978, McCutchin agreed to purchase the Ideco rotary table, which is the subject of this suit from appellant for a price of $27,904.30. The transaction was to be a cash sale, and it was understood that a check was to be tendered upon delivery. At no time during the negotiations did McCutchin disclose his relationship with Mustang.

When the rotary table was delivered to Gillette, in accord with the agreement, McCutchin informed appellant’s agent that he did not have the check for the purchase price with him but that he would forward it in a few days. Appellant’s agent was agreeable to this and left the rotary table with McCutchin. The check was never received despite numerous demands for payment. No attempt was made by appellant to perfect a security interest in the rotary table.

After receipt of the rotary table, Mustang mounted it, by welding, on the U-15 drilling rig. The drilling rig, as modified, was then used to drill three wells. When around the first of November, 1978, Mustang experienced financial difficulties, the rig was transported to and stored at the Getter Trucking Yard in Gillette.

In December of 1978, Mustang went into default on its security agreement with Keck. Keck repossessed the rig with all attachments, including the rotary table, and, to foreclose its security interest, scheduled a sale for March 23, 1979.

On March 20, 1979, Mustang signed an agreement and authorization whereby it specifically “ratifies and confirms such private sale and gives authority to KECK DRILLING CORPORATION to convey full title to any purchaser at such foreclosure sale.” The agreement recognized that the sale included “a certain unit 15 drilling rig together with appurtenant and accessory equipment.”

On March 23, 1979, the highest bid received was $500,000.00. Keck rejected it as too low. Appellant appeared at the sale and claimed ownership of the rotary table. Keck refused to relinquish possession.

Appellant claims to have obtained, on May 31, 1979, a default judgment against McCutchin. In the judgment the court found that the appellant had canceled the sale of the rotary table and, accordingly, awarded appellant possession of it or, in the alternative, judgment for a monetary amount if possession of the rotary table could not be obtained. The appellant in the caption of the case before us on appeal is shown as Harold Brown, d/b/a Well Servicing Equipment and Supply.3 The judgment [142]*142referred to was obtained in the name of Well Servicing, Inc., d/b/a Well Servicing Equipment and Supply. This makes no difference as far as this case is concerned, except that in the absence of some assignment from Well Servicing, Inc. to the appellant, the judgment on its face would supply no interest whatsoever on the part of the appellant with respect to the subject matter of that action. It would be a nullity as to the appellees here in that they were not parties to that action, even if it had been brought in the name of appellant as shown in this case. The facts disclosed here would, at the most, support only a money judgment for the seller of the rotary table against McCutchin for its price, with the right of execution. We know of no judgment lien on personal property.

On June 1, 1979, at a private foreclosure sale, Keck sold the U-15 drilling rig, including the rotary table, to the appellee Green Drilling (Green) for $750,000.00. Proceeds of the sale were prorated among various secured creditors, leaving Keck with a deficiency of $250,000.00. Mustang had executed a ratification agreement and authorization on May 29, 1979, in advance ratifying and confirming this sale. On June 12, 1979, appellee Green sold the rig to appellee Jim’s Water Service. Included in these sales was the rotary table in question.

On June 26, 1979 appellant commenced this action against Keck, Green and Jim’s Water Service. After completion of discovery, appellees filed separate motions for summary judgment. On November 20, 1979 appellant responded with a cross motion for summary judgment. The motions were argued before the district court on January 7, 1980. The court entered a summary judgment in favor of appellees on February 5, 1980. The court explained its ruling by noting that the rotary table was sold, without any type of encumbrance to Mustang by appellant; and further, that because of the security agreement between Mustang and Keck, once the rotary table was attached to the drilling rig, Mustang, who had title to the rotary table, gave Keck a security interest in it.

Appellant wisely does not challenge the district court’s finding that he had sold the rotary table to McCutchin without retaining any kind of an encumbrance. This conclusion is dictated by § 34-21-246(a)(ii), W.S. 1977 4 and § 34-21-913, W.S.1977.5

First, § 34 — 21—246(a)(ii), W.S.1977 provides:

“(Ü) Unless otherwise explicitly agreed title passes to the buyer at the time and place at which the seller completes his performance with reference to the physical delivery of the goods, despite any reservation of a security interest and even though a document of title is to be delivered at a different time or place. % * *

Thus, at the time of delivery of the rotary table to Mustang, title passed and was vested in Mustang.

Section 34-21-913, states:

“(a) A security interest arising solely under the article on sales (article 2) is subject to the provisions of this article except that to the extent that and

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Brown v. Green
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Cite This Page — Counsel Stack

Bluebook (online)
618 P.2d 140, 30 U.C.C. Rep. Serv. (West) 340, 1980 Wyo. LEXIS 313, Counsel Stack Legal Research, https://law.counselstack.com/opinion/brown-v-green-wyo-1980.