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General Grocer Co. v. Bachar

OPINION FILED JULY 11, 1977.

GENERAL GROCER COMPANY OF ILLINOIS, PLAINTIFF-APPELLEE,

v.

BRUCE A. BACHAR ET AL., DEFENDANTS-APPELLANTS.



APPEAL from the Circuit Court of Bureau County; the Hon. JAMES J. WIMBISCUS, Judge, presiding.

MR. JUSTICE SCOTT DELIVERED THE OPINION OF THE COURT:

This is an appeal from an order of the Circuit Court of Bureau County which after hearing in a replevin action awarded possession of a grocery store inventory to General Grocer Company of Illinois, hereinafter referred to as the plaintiff, on the grounds that Bruce A. Bachar and Mary Bachar, hereinafter referred to as the defendants, had defaulted in a security agreement which they had entered into with the plaintiff.

The factual situation which ultimately resulted in the litigation commenced in the year 1975 when the defendant Bruce A. Bachar purchased a grocery store in Spring Valley, Illinois. The plaintiff financed this purchase and the original amount owed by the defendants was the sum of $115,909.10. From the record we fail to find that there was any written instrument entered into by the parties regarding this indebtedness as to the time and manner of paying it. In September 1975 the defendants paid the sum of $20,000 on their purchase price indebtedness, thereby leaving a balance to be paid in the sum of $95,909.10.

The defendants purchased groceries from the plaintiff each week and every Monday the plaintiff would compute a bill for the amount of the preceding week's grocery shipment. The plaintiff after performing such accounting work would write a check payable to itself on an account in the joint names of itself and the defendants. After the check had been presented for payment and honored a copy of the paid bill would then be mailed to the defendants' store.

The plaintiff and defendants did enter into a written security agreement, the pertinent provisions of which are as follows:

"V. Until default or breach by the undersigned of any provision hereof, or until notified by Lender to the contrary, the undersigned may use, consume, exhibit, sell or otherwise dispose of the Inventory in carrying on the business of the undersigned in the ordinary course substantially in the manner as now conducted * * *.

VI. If the undersigned shall fail to pay when due, any note or any other of the undersigned's indebtedness to Lender, or should breach any other provision hereof, Lender shall have the right to proceed against the collateral or any part thereof.

VII. No failure or delay by Lender in exercising any right or remedy hereunder or otherwise shall operate as a waiver thereof. A waiver of any such right or remedy must be in writing and shall be limited to the specific instance and to the right or remedy expressly waived * * *."

The store's inventory merchandise and certain fixtures were collateral for the security agreement.

While the defendants may have been tardy in two or possibly three instances in making a deposit in the joint account for the payment of the groceries received by them for the preceding week from the plaintiff, the great majority of the time the defendants conformed to the agreement and practice of making the required deposit on each Monday.

Grocery shipments were made by the plaintiff to the defendants for the week of January 5, 1976; however, on Monday, January 12, 1976, the defendants failed to deposit in the joint account a sum of money sufficient to pay the plaintiff's billing in the amount of $8,587.12 for the preceding week's delivery. The defendants had used some of the proceeds from the sale of groceries for the preceding week to pay other creditors.

On January 13, 1976, Mr. Hargis, representing the plaintiff, went to the defendants' store and requested payment of the $8,587.12. The defendant Bruce A. Bachar indicated that he did not have the money since he was paying other creditors. On the following day Hargis again saw the defendant and both orally and in writing gave the defendants notice of their default in payment of the underlying obligation of $95,909.10 and of the payment of $8,587.12. Hargis further demanded possession of the collateral and directed the defendants to cease selling the pledged collateral. The defendant Bruce A. Bachar indicated that he couldn't pay the amounts owed and that he would continue to sell collateral and he in fact continued to do so until January 16, 1976, on which date a writ of replevin was issued against the defendants. The writ was served on the defendants the following day.

On February 18, 1976, after a trial on the issues the trial court ruled that the plaintiff was entitled to possession of the grocery store's inventory and other collateral set forth in the security agreement because the defendants were in default in two respects, first in continuing to sell collateral after the demand of January 14, 1976, and secondly in failing to pay the sum of $8,587.12. The trial court expressly stated that it was not making any ruling as to whether there was a default for failure to pay the underlying obligation of $95,909.10. This appeal ensued.

The defendants raise several issues in this appeal, the first being that there was not sufficient evidence adduced during the course of the trial to establish an agreement requiring the defendants to ...


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