Ronald V. Odette Family Ltd. Partnership v. AGCO Finance, LLC

129 P.3d 95, 35 Kan. App. 2d 1, 2005 Kan. App. LEXIS 1276
CourtCourt of Appeals of Kansas
DecidedDecember 2, 2005
DocketNo. 93,019
StatusPublished
Cited by1 cases

This text of 129 P.3d 95 (Ronald V. Odette Family Ltd. Partnership v. AGCO Finance, LLC) is published on Counsel Stack Legal Research, covering Court of Appeals of Kansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ronald V. Odette Family Ltd. Partnership v. AGCO Finance, LLC, 129 P.3d 95, 35 Kan. App. 2d 1, 2005 Kan. App. LEXIS 1276 (kanctapp 2005).

Opinion

Hill, J.:

The Ronald V. Odette Family Limited Partnership (Partnership) sued AGCO Finance, L.L.C., d/b/a Agricredit Acceptance Company (Agricredit), and Sweetland-PIinson Equipment Company, Inc. (Sweetland) for conversion and negligence based on their seizure of a tractor and loader. The district court [3]*3denied the Partnership’s claim by granting summary judgments to Agricredit and Sweetland, ruling that the finance company had obtained a security interest in the equipment when it was originally purchased by Ronald V. Odette. A security interest in collateral continues when it is sold to a third party unless the sale was authorized by the secured party. Since Odette later transferred ownership of the tractor and loader to the family partnership without the knowledge or consent of Agricredit, we affirm the district court’s ruling that the finance company and the equipment company that collected the machine have not converted the tractor and loader.

Case History

Ronald V. Odette purchased a Massey Ferguson tractor and loader from Jack Shields Sales and Service by signing a retail installment sales contract and security agreement. The sales contract granted the seller a security interest in both pieces of equipment. Odette indicated in the financing papers that he was engaged in an agricultural operation and that he was purchasing the equipment for his personal use in that operation. After the sale, Jack Shields Sales and Service assigned the contract to Agricredit.

The contract forms the basis of the relationship of the parties. It contained a cross-collateralization clause:

“SECURITY INTEREST Under the Uniform Commercial Code: In order to secure payment of the indebtedness contained herein and for all other amounts due or to become due hereunder and for each and every other indebtedness or obligation now or hereafter owing by the Buyer to the Seller and/or the Assignee, the undersigned Buyer hereby grants to the Seller a security interest in the above described property, including the proceeds thereof, together with all repairs, replacements and accessions now or thereafter appertaining thereto until all indebtedness is paid in full.”

Going further into the sales contract, clause 5 prohibits any transfers of ownership of the collateral without written consent by Agricredit:

“The Buyer shall keep said property free of all hens, taxes, encumbrances and seizures or levy, shall not use the same illegally, shall not damage, abuse, misuse, abandon or lose said property, shall not sell, lease or otherwise dispose of, or transfer any interest in said property or remove it out of the county or filing district [4]*4in which the Buyer resides as indicated herein, without the prior written approval of tire Seller.”

Despite this prohibition in the contract, Odette transferred the tractor and loader to the Partnership. The Partnership consists of two partners: Andrew Todd Odette and the irrevocable trust of Ronald V. Odette, administered by Paul J. Odette as trustee. Ronald Odette claims now to no longer have an ownership interest in the equipment'or the Partnership.

Ultimately, Agricredit obtained a default judgment against Ronald Odette personally for $5,931.49 in 2002 in Chautauqua County District Court. Agricredit then secured a writ of special execution, which was delivered to the sheriff of Chautauqua County, directing the sheriff to seize the tractor and loader. The actual seizure of the equipment was performed by Sweetland, who was hired by Agricredit but acting at the direction of the sheriff. Neither the Partnership nor Odette moved to quash the writ of execution.

After that, the Partnership sued Agricredit and Sweetland for conversion and negligence based on the seizure of the tractor and loader. The defendants filed motions to dismiss that included affidavits and additional documentary evidence. In one affidavit, Sweetland stated that the tractor and loader were not damaged during the seizure. But the Partnership maintains there is a good faith claim that the equipment was damaged due to its being dragged onto a trailer rather than driven in reverse. Agricredit denied the Partnership’s request to pay the amount due on the tractor and loader and the amount Sweetland charged for the seizure, pending an inspection of the equipment for damage.

Treating the motions to dismiss as motions for summary judgment because matters outside the pleadings were brought up by the parties and considered by the court when ruling, the district court made the following determinations: (1) A valid security interest in the equipment was violated when Odette made the transfer; (2) the security interest continued in the equipment when it passed into the hands of the Partnership; and (3) Sweetland was acting as the sheriff s agent when it made the seizure and could not be held liable for any negligence. The district court concluded [5]*5that there was no cause of action for conversion, and it granted the motions for summary judgment for both defendants.

In this appeal, the Partnership argues that the defendant’s motions were erroneously granted.

Standard of Review

We believe in this case that the district court granted summary judgment. This is disputed by the Partnership. In its letter decision, the court clearly indicated it was considering summary judgment. Treating the motions to dismiss as motions for summary judgment was correct under the circumstances. When matters outside the pleadings are presented in support of a motion to dismiss, as they were here, the district court shall treat the motion as one for summary judgment. K.S.A. 60-212(b); Dillard v. Strecker, 18 Kan. App. 2d 899, 901-02, 861 P.2d 1372 (1993), aff'd 255 Kan. 704, 877 P.2d 371 (1994).

This means we will follow the summary judgment standard of review. It is well established:

“Summary judgment is appropriate when the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. The trial court is required to resolve all facts and interferences which may reasonably be drawn from the evidence in favor of the party against whom the ruling is sought. When opposing a motion for summary judgment, an adverse party must come forward with evidence to establish a dispute as to a material fact. In order to preclude summary judgment, the facts subject to the dispute must be material to the conclusive issues in the case. On appeal, [an appellate court must] apply the same rules and where . . . reasonable minds could differ as to the conclusions drawn from the evidence, summary judgment must be denied.” [Citations omitted.]’ ” State ex rel. Stovall v. Reliance Ins. Co., 278 Kan. 777, 788, 107 P.3d 1219 (2005).

The Partnership also argues that summary judgment should not have been granted because of noncompliance with Supreme Court Rule 141 (2004 Kan. Ct. R. Annot. 199).

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Bluebook (online)
129 P.3d 95, 35 Kan. App. 2d 1, 2005 Kan. App. LEXIS 1276, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ronald-v-odette-family-ltd-partnership-v-agco-finance-llc-kanctapp-2005.