Second Nat. Bank of Danville v. Massey-Ferguson Credit Corp., MASSEY-FERGUSON

• Decision Date: 04 June 1985
• Docket Number: No. 4-884A218,MASSEY-FERGUSON,4-884A218
• Citation: 478 N.E.2d 916
• Parties: The SECOND NATIONAL BANK OF DANVILLE, Danville, Illinois, a national banking association, Appellant (Plaintiff below), v.CREDIT CORPORATION, Appellee (Defendant below). 1
• Court: Indiana Appellate Court

Page 916

478 N.E.2d 916

The SECOND NATIONAL BANK OF DANVILLE, Danville, Illinois, a national banking association, Appellant (Plaintiff below), v. MASSEY-FERGUSON CREDIT CORPORATION, Appellee (Defendant below).

No. 4-884A218. ¹

Court of Appeals of Indiana First District.

June 4, 1985.

R. David Bray, White, White & Bray, Covington, for appellant.

Christopher Kirages, John W. Porter, Dutton & Overman, Indianapolis, for appellee.

ROBERTSON, Judge.

Plaintiff-appellant Second National Bank of Danville (Second National) appeals from the decision of the Warren Circuit Court entering summary judgment in favor of defendant-appellee Massey-Ferguson Credit Corporation (Massey-Ferguson).

We affirm.

A synopsis of the facts shows a priority dispute between two secured creditors. Second National had a security interest in certain personal property owned by Foster's of Indiana, Inc. (Foster's), including all machinery and equipment owned or subsequently acquired by Foster's. On November 10, 1978, Second National perfected its security interest by filing a financing statement in the office of the recorder of Fountain County and in the office of the Secretary of State.

Massey-Ferguson had a security interest in a combine and grain table purchased by Foster's in 1981. On December 8, 1981, Massey-Ferguson filed a financing statement in the recorder's office in Fountain County.

Second National brought suit to foreclose its security interest in the personal property owned by Foster's. Massey-Ferguson claimed a superior interest in the combine and grain table based on a perfected purchase money security interest. Both Second National and Massey-Ferguson filed motions for summary judgment. The trial court granted Massey-Ferguson's motion for summary judgment, and Second National appealed.

One issue is dispositive of this appeal: Whether the trial court erred as a matter of law in concluding that Massey-Ferguson complied with the filing requirements of IND.CODE Sec. 26-1-9-401 (1976).

Summary judgment is appropriate where there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Ind.Rules of Procedure, Trial Rule 56. Where the parties agree there is no factual dispute, as in the instant case, the task of the appellate court is to determine whether the lower court correctly applied the law. Tilbury v. City of Fort Wayne, (1984) Ind.App., 471 N.E.2d 1183, 1185; Poole v. Corwin, (1983) Ind.App., 447 N.E.2d 1150, 1151. Second National challenges the trial court's application of IND.CODE Sec. 26-1-9-401 (1976).

IND.CODE Sec. 26-1-9-401(1)(a) (1976) provided:

The proper place to file in order to perfect a security interest is as follows: When the collateral is equipment used in farming operations, or farm products, or accounts, contract rights or general intangibles arising from or relating to the sale of farm products by a farmer, or consumer goods, then in the office of the county recorder in the county of the debtor's residence or if the debtor is not a resident of this state then in the office of the county recorder in the county where the principal place of business of the corporation is located, and in the office of the Secretary of State....

The trial court determined that Massey-Ferguson complied with the terms of this statutory provision. The collateral, a combine and grain table, constituted equipment used in farming operations. Foster's, the debtor, was located in Fountain County. Massey-Ferguson filed its financing statement in the office of the Fountain County recorder.

Second National contends that the statute required filing in a manner other than that done by Massey-Ferguson, because the statute as written was ambiguous. Second National proposes that the legislature intended for secured creditors of corporate debtors to file locally and in the office of the Secretary of State. To support that argument, Second National relies principally on the language of I.C. 26-1-9-401 as enacted prior to its amendment in 1971:

The proper place to file in order to perfect a security interest is as follows: When the collateral is equipment used in farming operations, or farm products, or accounts, contract rights or general intangibles arising from or relating to the sale of farm products by a farmer, or consumer goods, then in the office of the county recorder in the county of the debtor's residence or if the debtor is not a resident of this state...