Ore-Ida Potato Products, Inc. v. United Pac. Ins. Co.
| Citation | 87 Idaho 185,392 P.2d 191 |
| Decision Date | 30 April 1964 |
| Docket Number | ORE-IDA,No. 9267,9267 |
| Parties | POTATO PRODUCTS, INC., a corporation, Plaintiff-Appellant, v. UNITED PACIFIC INSURANCE COMPANY, a corporation, Defendant-Respondent. |
| Court | United States State Supreme Court of Idaho |
Elam, Burke, Jeppesen & Evans, Boise, Gallagher & Galey, Ontario, Or., for appellant.
Frank F. Kibler, Nampa, Wayne P. Fuller, Caldwell, for respondent.
This is an appeal from a judgment dismissing an action brought by appellant (plaintiff) to recover on a statutory farm produce dealer's bond, I.C. § 22-1304, issued by respondent (defendant) to Black Canyon Produce, Inc., hereinafter referred to as Black Canyon, a farm produce dealer, broker and commission merchant formerly doing business at Caldwell, Idaho.
Appellant, during the time of the present action, was engaged in growing, processing, buying and selling potatoes. Appellant sold and delivered bulk potatoes to Black Canyon, as follows:
On December 31, 1957, a railroad carload, f. o. b. Trout, Idaho, shipped from Trout, Idaho, to 'Black Canyon Produce, Kansas City, Mo.' (Pl. Exhibit 3).
On January 11, 1958, a truck load, f. o. b. Ontario, Oregon, shipped from Ontario, Oregon, to 'Black Canyon Produce, Kansas City, Kansas.' (Pl. Exhibit 4).
On January 25, 1958, a truck load, f. o. b. Ontario, Oregon, shipped from Ontario, Oregon, sold to 'Black Canyon Produce, Box 8, Caldwell, Idaho,' without indicating the place of destination. (Pl. Exhibit 5).
The sale price of the potatoes totalled $2,782. Terms of payment were 'Net Cash vs. Invoice,' shown on the invoices.
In compliance with the law governing dealers in farm produce, I.C. Title 22, ch. 13, Black Canyon filed with the Commissioner of Agriculture of the State of Idaho, a $2,500 surety bond issued to respondent. I.C. § 22-1304. Under the bond, respondent bound itself jointly and severally 'to the State of Idaho, and in favor of every consignor of farm products to said principal [Black Canyon], in the sum of Twenty-five Hundred Dollars ($2500.00) * * * for the license period commencing May 31, 1957, and ending May 30, 1958 * * *.' The language of the bond does not specify in what manner a consignor's claims were to be settled. I.C. § 22-1305 provides for payment of farm products, if not otherwise stated, 'within thirty days from the delivery or taking possession of such farm products'.
On February 13, 1958, negotiations between appellant's president and officers of Black Canyon resulted in Black Canyon's execution and delivery of a promissory note in the principal sum of $2,782, bearing interest at the rate of 6% per annum, to appellant at its office in Ontario. Black Canyon promised to pay the note in weekly installments of $50.00 'with final balance to be paid not later than 8/31/58.' Endorsements on the back of the note show payments of $50 each on February 24, and March 3, 1958, and a credit of $295.51 on March 7, 1958, leaving a balance of $2,386.49.
Respondent never received notice, either actual or constructive, of the above mentioned negotiations, the execution and delivery of the promissory note, nor of the payments and endorsements thereon.
No further payments on the note being made by Black Canyon, appellant commenced this action May 21, 1959, seeking recovery from respondent of $2,386.49, as the alleged balance owed by Black Canyon on the potato account, plus attorneys' fees.
Respondent by its answer admitted that Black Canyon was a produce dealer during the times mentioned in the complaint and that respondent had furnished Black Canyon's produce dealers bond, on file with the Commissioner of Agriculture, but denied any liability under the bond for payment of the debt and attorneys' fees. By affirmative defense, in further denial of liability, respondent alleged the execution and delivery of Black Canyon's promissory note to appellant, and payments made on the amount thereof; that the note evidences Black Canyon's valid obligation; that appellant is the owner and holder of the note; that all claims of appellant against Black Canyon became merged in the note, and that respondent's bond did not extend to nor guarantee payment of the note.
The trial court, after a trial without a jury, made findings of fact and conclusions of law, followed by entry of judgment dismissing the action. This appeal resulted.
Appellant by its assignments of error contends that the trial court erred in finding that appellant accepted the promissory note of Black Canyon in payment of its debt owed to appellant 'and that a novation transpired.' Since appellant thereby questions the sufficiency of the evidence to support the finding, we refer to the testimony of officers of appellant and Black Canyon.
Mr. Call, appellant's secretary, testified on cross-examination:
* * *
* * *
* * *
* * *
* * *
* * *
* * *
* * *
Mr. Huizinga, Black Canyon's President, called by respondent, testified on direct examination:
Additional testimony of those same witnesses support the trial court's finding that respondent had no notice of the negotiations between Ore-Ida and Black Canyon relative to the execution and delivery of the promissory note. All of those transactions were for the purpose of 'trying to work out a way with Black Canyon where they could pay that indebtedness.'
The testimony of appellant's officer, Mr. Call, emphasizes that appellant did not, and in no way intended to, accept Black Canyon's promissory note as payment of its obligation. The testimony of respondent's witness, Mr. Huizinga, to the effect that the note was executed 'to make payments of the obligation of Black Canyon to Ore-Ida' and to settle the account is insufficient, without more, to sustain the trial court's finding that these acts constituted a novation between the parties and discharged respondent's obligation in the premises. A novation requires the assent of all the parties thereto; the original debtor must be fully discharged and the debt as to him extinguished. First National Bank in Evanston v. Sims, 78 Idaho 286, 301 P.2d 1103 (1956); Exchange Lumber & Mfg. Co. v. Thomas, 71 Idaho 391, 233 P.2d 406 (1951).
We are therefore constrained to the view that the evidence is insufficient to support the finding that the parties intended the promissory note to be in satisfaction of Black Canyon's debts owed to appellantg and that a novation resulted. Appellant's assignments in the premises are meritorious.
Appellant next contends that respondent's bond covered the two Oregon transactions. In that connection appellant assigns as error the trial court's finding that those transactions as regards two carloads of potatoes (Exhibits 4 and 5), including the sale and delivery thereof 'were fully, wholly and entirely consummated between the parties in the State of Oregon, and that said transactions did not occur in the State of Idaho', but in Ontario, Oregon, on January 11 and 25, 1958, (Findings 6 and 7), in that the finding is 'contrary to the law the the evidence.'
Appellant also assigns as error the trial court's finding that 'the State of Idaho had no jurisdiction or authority to regulate transactions taking place in another state * * * for the reason that said finding is contrary to the law.'
Appellant does not argue the question of insufficiency of the evidence to support the finding that the two so-called Oregon transactions were fully, wholly and entirely consummated in the State of Oregon, thus precluding review on appeal in the premises. Supreme Court Rule 41; Batchelder v. City of Coeur d'Alene, 85 Idaho 90, 375 P.2d 1001 (1962); Jewett v. Williams, 84 Idaho 93, 369 P.2d 590 (1962).
Appellant argues as a matter of law that I.C. Title 22, ch. 13, applies to all transactions of a produce dealer licensed and bonded in this state. Appellant points to I.C. § 22-1301 as defining a consignor, as 'any person who ships or delivers to any * * * dealer any farm products for handling, sale, or resale'; and as defining a dealer as one who obtains from the producer possession of farm products 'without paying * * * the full agreed price.' Appellant also points to I.C. § 22-1304, which requires a produce dealer to supply the bond for the benefit of 'any and all consignors having any cause of action against the broker, dealer * * * arising out of a breach of contract * * * of such broker, dealer * * * with a consignor'; also to I.C. § 22-1305, which requires 'every dealer' to pay for farm products...
To continue reading
Request your trial
-
Structures v. Insurance Co. of the West
...contracts, Nat'l Bank of Wash. v. Equity Invs., 86 Wash.2d 545, 553, 546 P.2d 440 (1976) (quoting Ore-Ida Potato Prods., Inc. v. United Pac. Ins. Co., 87 Idaho 185, 199, 392 P.2d 191 (1964)), and subject to the rules "applicable to simple contract law." Nat'l Bank, 86 Wash.2d at 551, 546 P.......
-
Chevron Chemical Co. v. Mecham
...P.2d 20 (1980); Annot., 100 A.L.R. 1236 (1936). This would appear to be the Idaho rule as well. Cf. Ore-Ida Potato Products v. United Pacific Ins. Co., 87 Idaho 185, 392 P.2d 191, 199 (1964).15 This Court need not resolve this theoretical conflict; liability of Mecham as guarantor turns on ......
-
Minidoka County for Use and Benefit of Detweiler Bros., Inc. v. Krieger
...show prejudice or injury when there has been a material alteration of the suretyship contract. Ore-Ida Potato Products, Inc. v. United Pacific Insurance Company, 87 Idaho--, 392 P.2d 191 (1964). Appellants alleged that Krieger gave its promissory notes to respondents, Detweiler, Associated ......
-
National Bank of Washington v. Equity Investors
...its promise should operate as a discharge, the scope of the risk assumed is first determined. In Ore-Ida Potato Products, Inc. v. United Pacific Ins. Co., 87 Idaho 185, 392 P.2d 191 (1964), it is stated at 199: The undertakings of compensated sureties are regarded as in the nature of insura......