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Campbell v. Yokel

JUNE 28, 1974.

MAURICE CAMPBELL ET AL., D/B/A CAMPBELL GRAIN & SEED COMPANY, PLAINTIFFS-APPELLANTS,

v.

FRANK YOKEL ET AL., DEFENDANTS-APPELLEES.



APPEAL from the Circuit Court of Edwards County; the Hon. CARRIE WINTER, Judge, presiding.

MR. JUSTICE CREBS DELIVERED THE OPINION OF THE COURT:

This is an appeal from an order of the Circuit Court of Edwards County granting defendants' motion for a summary judgment and dismissing plaintiffs' complaint.

Plaintiffs, owners and operators of the Campbell Grain and Seed Company, alleged in the complaint that they had reached an oral agreement on February 7, 1973, with the defendant farmers. It was alleged that the defendants agreed to sell and the plaintiffs agreed to purchase 6,800 to 7,200 bushels of yellow soybeans at a price of $5.30 per bushel. Defendants admit that such an agreement was reached but maintain that the agreement was tentative and was not intended to be binding unless a written contract was signed. After the conversation between plaintiffs and defendants on February 7, 1973, the plaintiffs signed and mailed to the defendants a written confirmation of the oral agreement. Defendants received the written confirmation but did not sign it or give any notice of objection to its contents to the plaintiffs.

On March 9, 1973, the defendants signed a written request with the Agricultural Stabilization and Conservation Service seeking permission to sell 6,900 bushels of soybeans. The Agricultural Stabilization and Conservation Service possessed a lien on the soybeans, and its permission was needed before the defendants could sell. The request form signed by the defendants did not mention the plaintiffs, but, for an unknown reason, the Agricultural Stabilization and Conservation Service mailed a copy of the form to the plaintiffs.

Defendants refused to deliver any soybeans to the plaintiffs and on April 30, 1973, informed the plaintiffs that, since the defendants did not sign the written confirmation, they did not feel bound by any agreement.

Plaintiffs' complaint requested damages or, in the alternative, specific performance of the alleged contract. Defendants' motion for summary judgment was based upon the pleadings and asserted the statute of frauds as a defense. The circuit court granted the summary judgment motion holding that, because the statute of frauds was a defense to the complaint, there was no genuine issue as to any material fact and that the defendants were not "merchants" within the meaning of section 2-201(2) the Uniform Commercial Code (Ill. Rev. Stat. ch. 26, sec. 2-201(2)).

Section 2-201 of the Code (Ill. Rev. Stat. ch. 26, sec. 2-201) provides:

"(1) Except as otherwise provided in this section a contract for the sale of goods for the price of $500 or more is not enforceable by way of action or defense unless there is some writing sufficient to indicate that a contract for sale has been made between the parties and signed by the party against whom enforcement is sought or by his authorized agent or broker. A writing is not insufficient because it omits or incorrectly states a term agreed upon but the contract is not enforceable under this paragraph beyond the quantity of goods shown in such writing.

(2) Between merchants if within a reasonable time a writing in confirmation of the contract and sufficient against the sender is received and the party receiving it has reason to know its contents, it satisfies the requirements of subsection (1) against such party unless written notice of objection to its contents is given within 10 days after it is received."

Plaintiffs contend that the court erred in finding that the defendant farmers were not "merchants" and that section 2-201(2) was not applicable. We agree.

Very few reviewing courts have attempted to resolve the question of whether a farmer is a "merchant" within the meaning of the various provisions of the Uniform Commercial Code. In Cook Grains, Inc. v. Fallis, 239 Ark. 962, 395 S.W.2d 555, a case factually similar to the instant case, the Arkansas Supreme Court held that a farmer is not a "merchant" when he is acting in the capacity of a farmer and that he is acting in such a capacity when he is attempting to sell the commodities that he has raised. In Oloffson v. Coomer, 11 Ill. App.3d 918, 296 N.E.2d 871, the appellate court stated, by dictum, that a farmer in the business of growing grain is not a "merchant" with respect to the merchandising of that grain.

We disagree with the decisions in Cook Grains and Oloffson and feel that the reviewing courts in those cases failed to properly interpret the Uniform Commercial Code definition of "merchant." Section 2-104(1) of the Code (Ill. Rev. Stat. ch. 26, sec. 2-104(1)) states:

"(1) `Merchant' means a person who deals in goods of the kind or otherwise by his occupation holds himself out as having knowledge or skill peculiar to the practices or goods involved in the transaction or to whom such knowledge or skill may be attributed by his employment of an agent or broker or other intermediary who by his occupation holds himself out as having such knowledge or skill."

Growing crops are "goods" within the meaning of article 2 of the Commercial Code (Ill. Rev. Stat., ch. 26, sec. 2-105(1)). The above definition of "merchant" leads us to the conclusion that a farmer may be considered a merchant in some instances and that one of those instances exists when the farmer is ...


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