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Draper v. Minneapolis-moline

OCTOBER 14, 1968.




Appeal from the Circuit Court of Whiteside County, Twelfth Judicial Circuit; the Hon. L.L. WINN, Judge, presiding. Affirmed in part, reversed in part, and remanded with directions.


Rehearing denied November 19, 1968.

This appeal presents questions concerning the Uniform Commercial Code, (Ill Rev Stats 1965, c 26, pars 1-101 thru 10-104) and stems from a judgment for $2,396.70 entered in favor of the plaintiff, Robert Draper, against the defendant, Minneapolis-Moline, Inc., after a bench trial in the Circuit Court of Whiteside County.

On December 30, 1966, plaintiff entered into a written contract with Larry Meiners, a farm equipment dealer who handled defendant's products, for the purchase of a new Minneapolis-Moline tractor and a new six-bottom plow for use on plaintiff's farm. By the terms of the contract various extras, including a cab and radio, were to be installed on the tractor by the dealer; plaintiff was to trade in an old tractor and an old plow; and delivery was to be "by" April 1, 1967. The net purchase price of $5,300 was to be paid on delivery. Subsequently, on a date not entirely clear from the record, the old and the new plows were exchanged but nothing was paid on the contract.

At the time the contract was entered into, the dealer did not have the required tractor in stock, but received one from defendant on or about January 26, 1967. This machine was delivered under a trust receipt and a trust receipt financing agreement, both of which gave Meiners the right to sell the tractor at retail in the ordinary course of business, and provided that to the extent permitted by law, the security interest would attach to the proceeds of sale. In this regard, it is undisputed that defendant retained and perfected a valid security interest. By one of the provisions of the trust receipt, it was provided that the machine could be repossessed if the dealer defaulted in the terms for payment.

Shortly after the dealer received the machine, plaintiff came to the store and was shown the tractor and was told that it was his. At the trial plaintiff recalled that the last three digits of the serial number on the tractor shown to him were "804," and this coincided with the number shown on the purchase agreement between the dealer and defendant. The dealer had not as yet received the cab called for by the contract and this appears to have delayed delivery of the tractor to the plaintiff. On one occasion, apparently in February, 1967, the dealer offered to let plaintiff take the tractor without the cab but plaintiff refused the offer.

During the last week of February, 1967, the completion of a routine audit disclosed the dealer to be greatly in arrears for substantial sums of money owed to defendant. When it became apparent that he was not financially able to correct or alleviate the situation, defendant repossessed all of its products on the store premises for which it had not been paid, including the tractor plaintiff had been told would be delivered to him under his contract. At the time plaintiff had neither turned in his old tractor nor had he paid anything to the dealer. Plaintiff then negotiated directly with defendant to complete the deal, but the negotiations fell through because defendant, as a manufacturer, was in no position to accept a trade-in or to provide and install the contract extras. It is undisputed that plaintiff thereafter did his spring plowing with his old tractor, and that he incurred expenses of $396.70 he would not have had if the new tractor had been available to him. This action against defendant for damages soon followed.

The authority for plaintiff's action is found in section 2-722 of article 2 of the Uniform Commercial Code (hereinafter referred to as the Code), which, in substance, gives to one having a special property interest in goods a right of action against a third party who "so deals with goods which have been identified to a contract for sale as to cause actionable injury to a party to that contract." (Ill Rev Stats 1965, c 26, par 2-722.) The quoted language, we believe, intends that a third party would be liable for conversion, physical damage to the goods, or interference with the rights of a buyer in the goods. Section 2-103(1)(a) of article 2 states that in such article: "`Buyer' means a person who buys or contracts to buy goods," (Ill Rev Stats 1965, c 26, par 2-103 (1) (a); emphasis added), and it is thereafter provided in section 2-501(1) in pertinent part:

"The buyer obtains a special property and an insurable interest in goods by identification of existing goods as goods to which the contract refers even though the goods so identified are non-conforming and he has an option to return or reject them. Such identification can be made at any time and in any manner explicitly agreed to by the parties. In the absence of explicit agreement identification occurs

"(a) . . .

"(b) if the contract is for the sale of future goods . . ., when goods are shipped, marked or otherwise designated by the seller as goods to which the contract refers;

"(c) . . . ."

Ill Rev Stats 1965, c 26, par 2-501(1); emphasis added.

While defendant makes a mild argument that the tractor did not conform to the contract because the extras had not been installed when it was pointed out by the dealer, we think it manifest from the evidence that there was a complete and sufficient identification of the tractor to the contract within the purview of section 2-501(1). It is apparent, too, that defendant's conduct made it impossible for the dealer to deliver the tractor to plaintiff, and that defendant so dealt with the goods as to interfere with plaintiff's special property interest. And, without more, it could be said that plaintiff has standing to maintain an action for damages as authorized by section 2-722. ...

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