Northeast Kansas Production Credit Ass'n v. Ferbrache, 56276

• Decision Date: 26 January 1985
• Docket Number: No. 56276,56276
• Citation: 236 Kan. 491,693 P.2d 1152
• Parties: NORTHEAST KANSAS PRODUCTION CREDIT ASSOCIATION, Plaintiff/Appellee, v. W.J. FERBRACHE, Grace Ferbrache, and James L. Ferbrache, Defendants/Appellees, and Dan V. Groth, D.V.M., Animal Health Center, P.A., Lien Claimant/Appellant.
• Court: Kansas Supreme Court

Page 1152

693 P.2d 1152

236 Kan. 491

NORTHEAST KANSAS PRODUCTION CREDIT ASSOCIATION, Plaintiff/Appellee, v. W.J. FERBRACHE, Grace Ferbrache, and James L. Ferbrache Defendants/Appellees and Dan V. Groth, D.V.M., Animal Health Center, P.A., Lien Claimant/Appellant.

No. 56276.

Supreme Court of Kansas.

Jan. 26, 1985.

Syllabus by the Court

1. The policy of the law is against secret liens on personal property. The validity of such a lien is dependent either on possession by the lien claimant or on some form of statutory notice.

2. The veterinarian lien for services on an animal provided for in K.S.A. 47-836 is a possessory lien and, in order to enforce the lien, a veterinarian must retain possession of the animal until the charges are paid.

3. Under K.S.A. 47-836, a veterinarian lien covers only services provided the particular animal actually in the possession of the veterinarian and does not include services provided other animals no longer in his possession.

Ron Gooding, of Gooding Law Office, Chartered, Topeka, argued the cause and was on briefs for lien claimant/appellant.

Marlin A. White, Holton, argued the cause, and Dennis A. White, Holton, was with him on brief for plaintiff/appellee Northeast Kansas Production Credit Association.

PRAGER, Justice:

This case involves a dispute between two lien claimants over the priority of their lien interests in the proceeds from the sale of 85 cattle belonging to the debtors, W.J. Ferbrache, Grace Ferbrache, and James L. Ferbrache. Northeast Kansas Production Credit Association (PCA) is the owner of a security interest in the cattle which was perfected in January of 1981. Dan V. Groth, D.V.M., claims a veterinarian lien on the 85 cattle pursuant to K.S.A. 47-836.

The facts in the case are not disputed and are as follows: On or about January 30, 1981, the Ferbraches, farmers and cattlemen, executed two security agreements with Northeast Kansas Production Credit Association (PCA) pledging as collateral, among other items, all livestock now owned or hereafter acquired by way of replacement, substitution, increase, or addition. The Ferbraches also executed a financing statement covering the same property which was filed with the Brown County Register of Deeds, thereby perfecting the security interest of PCA. On or about February 5, 1981, the Ferbraches executed a promissory note to PCA in the amount of $283,894.23 which was due on February 1, 1982. The Ferbraches failed to pay the indebtedness due on the note and, in November of 1982, PCA filed an action for foreclosure of the security agreement.

From January 1977 to July 1983, Dr. Groth performed veterinary services on 2,000 to 3,000 head of Ferbrache cattle. The Ferbraches failed to keep their account current, and, as a result, by August of 1983, the unpaid bill for services performed on the cattle for the six-year period totaled $21,334.15. On August 18, 1983, Dr. Groth executed and filed a lien statement for his services with the Register of Deeds. On the same day, the Ferbraches voluntarily delivered 85 head of cattle to Groth to prepare them for sale. At the time, Groth claimed a veterinarian lien on the 85 cattle pursuant to K.S.A. 47-836. The 85 head of cattle were later sold by agreement with all parties in PCA's foreclosure action. The proceeds from the sale of the 85 cattle, in the amount of $24,356.79, were paid into court. This dispute is over who is entitled to the proceeds of the sale. PCA claimed that it was entitled to the proceeds in order to satisfy its security agreement. Dr. Groth claimed that he had a prior veterinarian lien on the proceeds which should be applied to satisfy his total claim of $21,334.15. The parties agreed that Dr. Groth had a prior veterinarian lien on the 85 head of cattle at least for his services in preparing them for sale, since he had possession of the cattle when they were sold by agreement of the parties. They disagreed as to the amount of his lien.

The case was tried by the Brown County District Court which awarded Dr. Groth $1,027.70 for presale expenses and veterinary services to the 85 head of cattle incurred during the last period he had possession of the cattle from August 18, 1983, until they were sold on September 17, 1983. The remainder of the proceeds of the sale of the cattle was awarded by the trial court to PCA in partial satisfaction of its security agreement. Dr. Groth then appealed.

Dr. Groth claims that he is entitled to $21,334.15 for his veterinary services rendered to the 2,000 to 3,000 head of cattle of the Ferbraches from 1977 to 1983. Dr. Groth bases his claim on K.S.A. 47-836 which provides for a lien for veterinary services in the following language:

"47-836. Lien for veterinary services; preference. A veterinarian, or a veterinary partnership offering veterinary service to animals in the field or otherwise, who shall, at the request of the owner or lawful possessor of any animal, bestow any professional attention, care, vaccines, antisera, virus, antibiotics, or other medical treatment, food or service upon the same shall have a lien upon such animal for the just and reasonable charges therefor, and may hold and retain possession of such animal until such charges are paid. The lien hereby created shall have preference over any and all other liens or encumbrances upon such animal or animals, regardless of where such veterinary service has been rendered."

In this case, the court is required to interpret K.S.A. 47-836 and to apply it to the facts now before us. At the outset, it would be helpful to review some of the basic legal principles which are applicable to liens on personal property. Certain liens on personal property for services rendered in repairing or improving the same were recognized at common law. All of these liens were possessory liens which required the lien claimant to retain possession of the property and then to enforce his lien by proceeding with a civil action. If the lien claimant voluntarily delivered possession of the personal property to the owner, the lien was deemed to be extinguished. Later, various state legislatures, including the Kansas legislature, enacted statutes which provided for statutory liens on personal property. Many of these statutes expanded the scope of the common-law liens...