Nelson v. Hy-Grade Const. & Materials, Inc., HY-GRADE

• Decision Date: 02 November 1974
• Docket Number: HY-GRADE,No. 47437,47437
• Citation: 527 P.2d 1059,215 Kan. 631
• Parties: , 15 UCC Rep.Serv. 1002 Howard NELSON, Appellee, v.CONSTRUCTION AND MATERIALS, INC., a corporation, Appellant.
• Court: Kansas Supreme Court

Page 1059

527 P.2d 1059

215 Kan. 631, 15 UCC Rep.Serv. 1002

Howard NELSON, Appellee, v. HY-GRADE CONSTRUCTION AND MATERIALS, INC., a corporation, Appellant.

No. 47437.

Supreme Court of Kansas.

Nov. 2, 1974.

Syllabus by the Court

1. A contract, not in writing, for the sale of personal property for a price of $500 or more is not enforceable as provided in K.S.A. 84-2-201(1).

2. A conversion is an unauthorized assumption and exercise of the right of ownership over goods or personal chattels belonging to another.

3. The measure of damages for the wrongful deprivation of the use of personal property is the rental value of the property.

4. The record is examined in an action to recover possession of two conveyors and damages for their wrongful detention and it is held: The trial court did not err in finding (1) the contract was unenforceable; (2) the plaintiff was entitled to possession of the two conveyors; and (3) the plaintiff was entitled to recover the rental value of the property.

Charles F. Forsyth and Richard G. Tucker, Erie, argued the cause and Clark M. Fleming, Erie, was with them on the brief for appellant.

Robert V. Talkington, Iola, argued the cause, and J. D. Conderman, Iola, was with him on the brief for appellee.

OWSLEY, Justice.

This is an action to recover possession of two conveyors, as well as damages for their wrongful detention. Plaintiff Howard Nelson was awarded possession of both conveyors and damages in the sum of $370.00 per month for the period of wrongful detention. Defendant Hy-Grade Construction & Materials, Inc., appeals, alleging there was a valid contract of sale for the conveyors and the detention was not wrongful.

Plaintiff Nelson is a material producer and contractor in the crushed rock and limestone business in the Iola, Kansas, area. Defendant Hy-Grade, a corporation, is in the crushed rock and limestone business in the Parsons, Kansas, area. Iola Industries, Inc., purchased the old Lehigh Portland Cement plant at Iola in early 1971 and on May 30 and 31, held an auction at the cement plant site. Prior to the auction, plaintiff purchased a 30 inch by 560 foot conveyor by private sale from Iola Industries. At the auction he purchased a 24 inch by 200 foot conveyor. Defendant, through its agent, George Burkhart, also attended the sale and purchased three conveyors from General Steel Company of Joplin, Missouri, a successful bidder at the sale.

After the sale, on or about June 9, 1971, plaintiff discussed with defendant his possible purchase of defendant's three conveyors. Defendant priced them at $8,000 and plaintiff agreed to buy them, payment to be made about June 20. This figure was written on a card, along with a description of the property, and initialed by plaintiff. The trial court found this to be an enforceable contract of sale, which was not questioned by either party.

A short time later plaintiff had another conversation with defendant concerning the sale of his two conveyors to defendant. At this point there is conflict of testimony as to the price. Apparently, plaintiff thought he was selling his conveyors for $10,500 in addition to the $8,000 he had contracted to pay defendant; and Burkhart, acting for defendant, thought plaintiff was selling said conveyors for $10,500, against which sum defendant would have an offset of $8,000 for the conveyors sold to plaintiff. Nothing in regard to this transaction was set down in writing.

Defendant, allegedly believing it had completed the sale, began removing the two conveyors from the Lehigh site, despite objections from plaintiff. After they were removed defendant sent a check to plaintiff for $2,500 as payment, but plaintiff returned it uncashed.

The trial court held that no valid contract for the sale of the two conveyors ever existed, and in any event enforcement was precluded by the statute of frauds. Judgment was rendered in favor of plaintiff for recovery of possession of the two conveyors and for damages in the sum of $370.00 per month for each month elapsing between July 14, 1971, and his recovery of possession; defendant, however, was to have credit on said damage amount for $8,000, together with interest thereon at eight percent per annum from July 14, 1971, to the date plaintiff took possession of his conveyors.

The recorded testimony clearly indicates that immediately upon agreeing on the sale of defendant's three conveyors to plaintiff a memorandum was exchanged and plaintiff agreed to pay defendant in full on June 20, 1971. At this point a final contract of sale was completed as to the first three conveyors. It was not until several days later that any mention was made of the sale of plaintiff's two conveyors to defendant. There was no written contract and no clear understanding was reached as to the terms of that sale. The trial court upheld the validity of the first contract, but refused to recognize the second.

There can be no question as to the validity of the first contract whereby plaintiff purchased the three conveyors from defendant for $8,000. All the elements of a valid contract were obviously met and neither party objected to the ruling of the trial court that it was a valid and enforceable contract. The controversy centers around the oral contract of sale of plaintiff's two conveyors to defendant. It is the contention of defendant that the trial court erred when it held there was no meeting of the minds and enforcement was precluded by the statute of frauds.

K.S.A. 84-2-204(1) provides a contract for the sale of goods may be formed by any manner of expression of the parties, including their actions. This section of the Uniform Commercial Code is expressly qualified by other provisions of the code. One of the provisions which limits this section is K.S.A. 84-2-201. Subsection (1) therein reads as follows:

'(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...