Aimonetto v. Keepes
| Decision Date | 18 October 1972 |
| Docket Number | Nos. 4080,4081,s. 4080 |
| Citation | 501 P.2d 1017,11 UCC Rep. 1081 |
| Parties | 11 UCC Rep.Serv. 1081 Leo AIMONETTO and Genevieve Aimonetto, Appellants (Plaintiffs below), v. Joe KEEPES and Jane Keepes, Appellees (Defendants below). Joe KEEPES and Jane Keepes, Appellants (Defendants below), v. Leo AIMONETTO and Genevieve Aimonetto, Appellees (Plaintiffs below). |
| Court | Wyoming Supreme Court |
McClintock, Mai, Urbigkit & Moriarity and Edward P. Moriarity, Cheyenne, for Leo Aimonetto and Genevieve Aimonetto.
Jones & Dumbrill and Chester S. Jones, Newcastle, for Joe Keepes and Jane Keepes.
Before McINTYRE, C. J., and PARKER and McEWAN, JJ.
The litigation in this 1969 case arose as a result of several incidents occurring in the years 1962-1965, plaintiffs alleging an action in four counts that:
First, defendants had caused plaintiffs damage in the sum of $30,000 (less principal and accrued interest on note) in unlawfully converting to their own use by selling at private sale without notice a $30,000 diamond bracelet, pledged by plaintiffs on their $4,000 note to defendants.
Second, defendant Joe Keepes owed $4,557.30 as reasonable amount for 6,090 bales by hay taken from plaintiff Leo Aimonetto.
Third, defendant Joe Keepes owed $1,674 for 1,860 feet of upset tubing sold him by plaintiff Leo Aimonetto.
Fourth, defendant Joe Keepes hit plaintiff Leo Aimonetto's motor vehicle with a club and damaged it in the sum of $99.45.
Defendants denied and counterclaimed regarding the note for $1,205.55 deficiency of interest and $300 attorney fees.
Following trial of the cause without a jury, the court issued judgment allowing plaintiffs nothing on the first count; $1,500 on the second; $650 on the third; and $99.45 on the fourth; simultaneously granting judgment to defendants on their counterclaim for $933.33 interest and $300 attorney fees.
Although all dealings between the parties were most informal, the litigants seem to be agreed that the transactions concerning the pledge are to be governed by the provisions of Article 9, Chapter 22, Title 34, W.S.1957, 1971 Cum.Supp. (Uniform Commercial Code-Secured Transactions).
Significantly, on the first count the court found that plaintiff had 'constructive notice' 1 from the defendants that the pledged diamond bracelet would have to be sold to pay the obligations of plaintiffs to defendants, that plaintiffs waived the demand to redeem and the notice of time and place of sale, and that thus there was no conversion.
Plaintiffs appealed from the judgment as entered in favor of defendants; defendants appealed the judgment as to counts two and three and on the counterclaim.
Although the testimony was somewhat voluminous and conflicting, a skeletal statement of the facts is essential as background:
Plaintiffs borrowed $4,000 from defendants on January 23, 1962, on a note 2 and pledged a diamond bracelet as security, placing it in the hands of defendants. The note was not paid; and in 1965 after certain conversation between the parties regarding the necessity for sale of the bracelet, defendant Joe Keepes sold it at a private sale for $4,000 and applied this on the note.
As a separate transaction, in 1964 the parties made an oral agreement by which plaintiffs had on their ranch some one hundred and thirty head of defendants' cattle. Plaintiffs maintained that the cattle were on their property for grazing purposes only and that there were consumed or destroyed some 6,000 bales of their hay. Defendants claimed plaintiffs were to feed the cattle and be reimbursed by receiving half of the calves.
As to the third cause, it is undisputed that the plaintiffs in another arrangement sold some oil field tubing to defendants; and the only question raised before the trial court was as to the quantity sold, the amount to be paid, and whether payment had been made.
Concerning the bracelet, plaintiffs argue that the court erred in finding that they had constructive notice of the sale or waived the demand to redeem and the notice of time and place of sale, and further, that no deficiency judgment for interest or attorney fees was permissible on account of violation of § 34-9-504(3), W.S.1957, 1971 Cum.Supp. 3
In analysis of the authorities submitted on this aspect, it may be observed that each of the cases discussed by plaintiffs deals with actions of a seller where there was a default by the purchaser in an installment sales contract rather than as in this case with a pledge given to secure a loan from an individual. Moreover, the cited authorities deal with attempts of the creditor to secure a deficiency judgment and not with an alleged conversion by the creditor and consequent damages accruing to the debtor as in the present litigation. Hence the contended authorities are distinguishable to some extent. Even so, we are persuaded that one general principle upon which plaintiffs rely is applicable here, that is, compliance with § 34-9-504(3) is a condition precedent to recovery of any deficiency between sale price of collateral and the amount of the unpaid balance. C.I.T. Corporation v. Haynes, 161 Maine 353, 212 A.2d 436, 439; Braswell v. American National Bank, 117 Ga.App. 699, 161 S.E.2d 420, 422; Leasco Data Processing Equipment Corporation v. Atlas Shirt Company, 66 Misc.2d 1089, 323 N.Y.S.2d 13, 17; Skeels v. Universal C.I.T. Credit Corporation, W.D.Pa., 222 F.Supp. 696, 702 (vacated on other grounds, 3 Cir., 335 F.2d 846). 4
While there was substantial evidence to justify the court in saying that the $4,000 was the highest obtainable bid at the time of the sale, we are inclined to the view that the trial court was unsupported in a portion of the criticized findings concerning notice. Defendant Joe Keepes said when he received word from the bank that a subsequent note he had signed for Leo Aimonetto was due he told Aimonetto he would have to sell the bracelet to pay Aimonetto's debts. He did not recall Aimonetto's response. As to the time of that conversation, he said that 'just a little' after he talked with Aimonetto he had paid the note, his check to the bank being dated April 1, 1965. Admittedly, plaintiffs had not been informed as to whether defendants contemplated a private or public sale or the time thereof; but the trial court found that the plaintiffs had 'constructive notice' that the bracelet...
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