Sand Seed Service, Inc. v. Poeckes

• Decision Date: 19 January 1977
• Docket Number: No. 2--57609,2--57609
• Citation: 249 N.W.2d 663
• Parties: 21 UCC Rep.Serv. 12 SAND SEED SERVICE, INC., Appellant, v. David POECKES, Appellee.
• Court: Iowa Supreme Court

Page 663

249 N.W.2d 663

21 UCC Rep.Serv. 12

SAND SEED SERVICE, INC., Appellant, v. David POECKES, Appellee.

No. 2--57609.

Supreme Court of Iowa.

Jan. 19, 1977.

Charles F. Knudson, Marcus, for appellant.

Philip J. Parriott, Remsen, and Gerald M. Kraai, of Shull, Marshall & Marks, Sioux City, for appellee.

Considered En Banc.

LeGRAND, Justice.

This appeal asks us to reverse a summary judgment entered in favor of defendant David Poeckes in an action brought by plaintiff Sand Seed Service, Inc. for breach of contract. We affirm the trial court.

The petition alleges an oral contract by which Poeckes agreed to sell Sand Seed approximately 2,700 bushels of soybeans at $4.42 per bushel. Promptly following this transaction, Sand Seed sent Poeckes a confirmation of purchase which included this statement:

'PLEASE NOTE: The above covers our understanding of the transaction. Failure to advise us immediately will be understood by us as your acceptance of these terms.'

This confirmation was signed by Sand Seed but not by Poeckes. Neither did Poeckes notify Sand Seed that the contract was unacceptable.

When the time for delivery came, Poeckes refused to perform. This suit is for $4,671, the additional amount Sand Seed was required to pay for the purchase of 2,700 bushels of soybeans on the market to cover commitments it had made on the basis of the alleged oral contract with Poeckes.

Poeckes raised the defense of statute of frauds under the Uniform Commercial Code, § 554.2201, the pertinent part of that statute is here set out:

'1. Except as otherwise provided in this section, a contract for the sale of goods for the price of five hundred dollars 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 authorized agent or broker. A writing is not insufficient because it omits or incorrectly states a term agreed upon but the contract is not enforceable under this paragraph beyond a quantity of goods shown in such writing.

'2. Between merchants if within a reasonable time a writing in confirmation of the contract and sufficient against the sender is received and the aprty receiving it has reason to know its contents, it satisfies the requirements of subsection 1 against such party unless written notice or objection to its contents is given within ten days after it is received.'

The case turns on whether Poeckes is a 'merchant,' in which event the transaction between him and Sand Seed would be controlled by subsection 2 of the foregoing statute.

The statute defining merchant (§ 554.2104) now becomes pertinent. We set it out in part:

'1. 'Merchant' means a person who deals in goods of the kind or otherwise by his occupation holds himself out as having knowledge or skill peculiar to the practices or goods involved in the transaction or to whom such knowledge or skill may be attributed by his employment of an agent or broker or other intermediary who by his occupation holds himself out as having such knowledge or skill.

'3. 'Between merchants' means in any transaction with respect to which both parties are chargeable with the knowledge or skill of merchants.'

Since it was Poeckes who moved for summary judgment, he has the burden of proving no genuine issue of fact exists. In determining if this burden has been met, we view the circumstances in the light most favorable to Sand Seed. Daboll v. Hoden, 222 N.W.2d 727, 731 (Iowa 1974); Rich v. Dyna Technology, Inc., 204 N.W.2d 867, 871 (Iowa 1973).

In considering a motion for summary judgment, we must examine the entire record, including pleadings, admissions, depositions, answers to interrogatories, affidavits, and oral testimony, to determine if there is a genuine issue of fact. Daboll v. Hoden, supra, 222 N.W.2d at 731, 732.

In the present case, we have only the pleadings, an affidavit by Poeckes, and oral testimony produced by Sand Seed at the hearing on the motion.

The affidavit filed by Poeckes set forth the fact that he sold no crops or livestock except those which he raised; that he did not otherwise buy or sell any crops or livestock on the open market; that he is engaged in no business or occupation except farming; that he has no ownership interest in any other business; that he is not a member of the board of directors of any corporation or association; that he has no other business experience; that he is a high school graduate with no additional formal education; that he has had limited experience in selling crops; that before selling his crops he occasionally makes inquiry as to the current prices being paid by various buyers; that prior to the transaction in question, he had sold soybeans and other crops on approximately three other occasions each; and that he had never bought any crops except for seed or feed.

Sand Seed did not file a counter affidavit, and the testimony of its officer at the hearing on the motion did no more than describe the transaction with Poeckes and admit Sand Seed had not previously done business with him. There was no effort on the part of Sand Seed to dispute any of the facts set out in Poeckes' affidavit.

Nevertheless there may be an issue of fact if reasonable minds may draw different inferences from undisputed facts. See Daboll v. Hoden, supra, 222 N.W.2d at 733.

This leads us to the statute of frauds as set out in the Uniform Commercial Code. We have not heretofore been called upon to interpret this statute, and we therefore look with interest to what other courts have said about it.

Before doing so, however, we point out the editorial comment to $ 554.2104 which states 'merchant' as used there 'roots in the 'law merchant' concept of a professional in business.' It apparently excludes the casual buyer or seller.

The several courts which have ruled on the problem we now face have split on the status of a farmer vis-a-vis merchant.

At least two states, Illinois and Ohio, have held a farmer to be a merchant under circumstances very close to ours. Sierens v. Clausen, 60 Ill.2d 585, 328 N.E.2d 559, 561 (1975); Ohio Grain Co. v. Swisshelm, 40 Ohio App.2d 203, 318 N.E.2d 428, 430 (1973).

Again on facts almost identical to those now before us, other courts have refused to say a farmer is a merchant. We refer to them in some detail because we have concluded they state the right rule.

In Lish v. Compton, 547 P.2d 223, 226 (Utah 1976) this appears:

'We think the meaning of the term 'merchant' as used in the statute under consideration (relating to the definition of merchant under the Uniform Commercial Code) refers primarily to one whose occupation is that of buying and selling. However, we would not exclude therefrom one who sells products he makes or raises, or otherwise acquires, if that is done with such regularity that it forms at least a substantial part of his occupation. But we think it is neither consistent with the intent and purpose of the statute, nor with the ordinarily understood meaning of its language, to apply it to anyone such as this defendant who simply sells his crops annually. Consequent to what we have said, it is our opinion that the trial court should have ruled as a matter of law that under the circumstances shown here, the defendant was not a 'merchant' within the meaning of the statute.'

The Alabama Supreme Court reached a similar result in Loeb and Company, Inc. v. Schreiner, 321 So.2d 199, 201, 202 (Ala.1975) where the court held that the framers of the Uniform Commercial Code dit not contemplate that farmers should be included among those considered to be 'merchants.' The Alabama court relied heavily on the fact that the defendant sold only products which he had raised. The court said:

'Although there was evidence which indicated that the appellee here had a good deal of knowledge, this is not the test.

There is not one shred of evidence that appell...