Chrysler Credit Corp. v. Bank of Wiggins

358 So. 2d 714, 24 U.C.C. Rep. Serv. (West) 455, 1978 Miss. LEXIS 2554
CourtMississippi Supreme Court
DecidedMay 10, 1978
Docket50264
StatusPublished
Cited by6 cases

This text of 358 So. 2d 714 (Chrysler Credit Corp. v. Bank of Wiggins) is published on Counsel Stack Legal Research, covering Mississippi Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Chrysler Credit Corp. v. Bank of Wiggins, 358 So. 2d 714, 24 U.C.C. Rep. Serv. (West) 455, 1978 Miss. LEXIS 2554 (Mich. 1978).

Opinion

358 So.2d 714 (1978)

CHRYSLER CREDIT CORPORATION
v.
BANK OF WIGGINS.

No. 50264.

Supreme Court of Mississippi.

May 10, 1978.

*715 Wells, Wells, Pittman & Wicker, William B. Wicker, Crymes G. Pittman, Calvin L. Wells, Jackson, Eaton, Cottrell, Galloway & Lang, Gulfport, for appellant.

Parsons & Matthews, Jack Parsons, Wiggins, for appellee.

Before ROBERTSON, LEE and BOWLING, JJ.

LEE, Justice, for the Court:

The Circuit Court of Stone County entered judgment against Chrysler Credit Corporation for Bank of Wiggins in the *716 amount of thirty-six thousand five hundred ninety dollars ninety cents ($36,590.90), upon a complaint for delivery and judgment. Chrysler appeals and assigns the following errors in the trial below:

(1) The decision of the court in finding the security interest of appellant to be subordinated to that of appellee is contrary to the law and the facts. (Also the court erred in overruling the motion of appellant for new trial and the judgment is against the great weight of the evidence).

(2) The court erred in admitting at the second trial, over the objection of appellant, Plaintiff's Exhibit # 1.

(3) The court erred in rejecting, or in refusing to allow appellant to lay a basis for, at the second trial, evidence on behalf of appellant, to-wit: a printout of an inventory of parts taken in October and November, 1975.

(4) The decision of the court giving appellee judgment for the used automobiles was contrary to the law and the facts.

(5) The verdict of the court was contrary to the law in denying appellant the option of returning the parts and the inventory.

(6) The actions of the court at the hearing of February 25, 1976, deprived appellant of its constitutional rights of due process and equal protection of the laws.

(7) The court erred in overruling the motion of appellant to dismiss for lack of jurisdiction.

The Bank of Wiggins filed a complaint for delivery and judgment against Barringer Motor Company [Barringer] and Chrysler Credit Corporation [Chrysler], alleging that certain property belonging to the bank under an installment promissory note and security agreement executed by Barringer on November 22, 1974, was removed from the business premises of Barringer by Chrysler without the consent or permission of the bank. Barringer released the property on February 20, 1975, to satisfy debts it owed Chrysler on the purchase of new automobiles. The bank demanded judgment for the outstanding balance due under the terms of the note and security agreement. Chrysler answered and alleged that Barringer granted unto Chrysler a security interest on February 20, 1975, in the property listed in the complaint, and that such security interest was perfected by filing a financing statement which entitled it to priority over the security interest of the Bank of Wiggins.

After trial, on December 8, 1975, judgment was entered in favor of the bank, since the court found Barringer in default under the terms of the note (Bank of Wiggins) when it released the property to Chrysler said property having been previously pledged by Barringer as security for the indebtedness to the Bank of Wiggins. A second trial was held on February 25, 1976, solely for the purpose of ascertaining the property involved and the amount of damages to be awarded the bank.

I.

Was the decision of the court in finding the security interest of appellant to be subordinated to that of appellee contrary to the law and the facts?

Barringer is a corporation which handled Chrysler-Plymouth products, and it financed the sales of new automobiles under a floor-plan agreement with Chrysler Credit Corporation. On November 22, 1974, Barringer obtained a loan in the sum of forty-one thousand nine hundred dollars ($41,900.00) through the Bank of Wiggins on a Small Business Administration note. The security agreement covered personal property described as: "All shop equipment, tools, furniture and fixtures, accounts receivable, office equipment, parts, and inventory ..." A financing statement was filed November 26, 1974, in the Chancery Clerk's office of Stone County pursuant to the Uniform Commercial Code. The statement showed that Barringer was indebted to the Bank of Wiggins, and it covered the property hereinabove described. The financing statement was not filed in the office of the Secretary of State.

Barringer was indebted to Chrysler on February 19, 1975, in the sum of approximately *717 twenty-eight thousand dollars ($28,000) on new automobiles under the floor-plan agreement. The property covered by the security agreement to the Bank of Wiggins was removed from Barringer's premises on February 19 and 20 by Chrysler. At that time, Barringer executed a release of the property and a security agreement on same to Chrysler. They were signed at the insistence of Russell Tatom, Branch Manager for Chrysler.

Barringer testified that he told Chrysler (Russell Tatom) he had secured the loan from Bank of Wiggins before the Chrysler loan was closed, that he had put up the entire corporate assets, including all inventory and parts, as security for the bank loan, except that such loan did not include new cars. Barringer further testified that, on the day Chrysler removed the property from the Barringer premises, he told Tatom the property was secured on a security instrument to the Bank of Wiggins, that he did not have a copy of the security agreement with him, but that he could obtain a copy the next day from the Bank of Wiggins. According to Barringer, Tatom replied that he was not interested. Ferris O'Neal, former owner of the dealership, testified that he was present when the business was closed on February 20, 1975, and he told Tatom that Barringer owed other people for the property; Tatom answered he could not care less who Barringer owed for the property and Chrysler was going to take it anyway. Tatom testified that Chrysler took possession of the property February 20, 1975, after releases for the new and used inventory, used cars, parts and furniture of the dealership, were signed by Barringer. He admitted he did not check the records in the chancery clerk's office to determine whether a financing statement covering the property had been filed, even though such was his responsibility. Further, the last check he made of the public records was in August of 1974. He did not see the financing statement prior to taking the assets of the dealership. Tatom also admitted Barringer told him the bank had made an SBA loan to the dealership and he (Barringer) put up all his property for the loan. Tatom stated he assumed it was Barringer's personal property and he did not inquire whether Barringer encumbered his business property. Section 75-9-401(1)(c) provides that the bank's financing statement be filed in the office of the Secretary of State and, in addition, in the office of the Chancery Clerk of Stone County, Mississippi. However, Subsection (2) provides the following:

"(2) Except as provided in subsection (4B) of Section 9-313 [§ 75-9-313], a filing which is made in good faith in an improper place or not in all of the places required by this section is nevertheless effective with regard to any collateral as to which the filing complied with the requirements of this chapter and is also effective with regard to collateral covered by the financing statement against any person who has knowledge of the contents of such financing statement."

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358 So. 2d 714, 24 U.C.C. Rep. Serv. (West) 455, 1978 Miss. LEXIS 2554, Counsel Stack Legal Research, https://law.counselstack.com/opinion/chrysler-credit-corp-v-bank-of-wiggins-miss-1978.