Smith Machinery Corp. v. Hesston, Inc., 14772
| Decision Date | 21 January 1985 |
| Docket Number | No. 14772,14772 |
| Parties | , 1985-1 Trade Cases P 66,469 SMITH MACHINERY CORPORATION, Plaintiff-Appellant, v. HESSTON, INC., and Bob Estes d/b/a Estes International Farm & Truck Supply, Defendants-Appellees. |
| Court | New Mexico Supreme Court |
Plaintiff Smith Machinery Corporation, a farm implement dealer, sought an injunction and declaratory relief against Hesston Inc. alleging violations of motor vehicle dealer franchising requirements and practices in restraint of trade. Smith appeals the summary judgment granted Hesston by the district court as to the dealer franchising claim as well as the court's dismissal of the restraint of trade claim at the conclusion of plaintiff's case-in-chief.
The first issue we address is whether a piece of farm machinery called a windrower is a motor vehicle within the meaning of the Motor Vehicle Dealers Franchising Act, NMSA 1978, Sections 57-16-1 to -16 (Franchising Act), and thus whether the Act applies to dealer purchases of these windrowers.
Smith Machinery is a dealer in irrigation and farm machinery equipment. Included in its line of products is a self-propelled windrower manufactured by Hesston. The windrower is used to mow, crimp and cut hay or other crops into rows called windrows from which the crop may be picked up and compacted into bales. The windrower consists of a power unit with a detachable header in front which is the mechanism that actually mows the crops.
In its complaint, Smith alleged that under Section 57-16-5(A) of the Franchising Act, it was improper for Hesston, as the manufacturer, to coerce Smith to order motor vehicles it did not voluntarily request. Hesston moved for and was granted summary judgment on grounds that these provisions were inapplicable since Smith was not a motor vehicle dealer and Hesston did not sell motor vehicles to Smith within the meaning of the Franchising Act.
The Act applies to "all persons, manufacturers, representatives, distributors and dealers and to all written or oral agreements between a manufacturer, distributor or representative with a motor vehicle dealer * * *." NMSA 1978, Sec. 57-16-2. The Act defines "motor vehicle" as "every self-propelled vehicle by which a person or property may be transported on a public highway and having two or more wheels." NMSA 1978, Sec. 57-16-3(A).
In construing the meaning of the statutes in question, the central concern is to determine and give effect to the intention of the Legislature. Arnold v. State, 94 N.M. 381, 610 P.2d 1210 (1980). While the inquiry into legislative intent begins with a review of the language employed in the act or statute in question, the history and background of the legislation is also instructive in determining intent. See id.; Munroe v. Wall, 66 N.M. 15, 340 P.2d 1069 (1950). Our inquiry therefore only begins with a review of the statutory language. "Our duty is to find that interpretation which can most fairly be said to be imbedded in the statute in the sense of being most harmonious with its scheme and with the general purpose of the legislature." Pittsburg and Midway Coal Mining Co. v. Revenue Division, Taxation and Revenue Dept., 99 N.M. 545, 660 P.2d 1027 (Ct.App.), cert. quashed, 99 N.M. 644, 662 P.2d 645 (1983).
The legislative history of the definition of "motor vehicle" in the Franchising Act is brief. The definition was first codified in 1973 (NMSA 1953, Section 64-37-3) and has remained unchanged except for a 1977 amendment which substituted "two" for "four" in reference to the minimum number of wheels required for a motor vehicle.
For purposes of our inquiry here, the only relevant construction concerning the scope of coverage of the Franchising Act appears in an opinion reported by the Attorney General. AG Op. No. 74-25 (1974). The issue addressed by that opinion was whether The New Mexico Motor Vehicle Act, NMSA 1953, Sections 64-37-1 to -16, the predecessor to the present Franchising Act, applied to "manufacturers * * * and dealers of self-propelled agricultural machines and equipment which may travel upon the public highways of New Mexico." Id. at 49. The opinion generally concluded that the Motor Vehicle Act did extend to this type of machinery. Smith argues the Legislature tacitly confirmed this view because after the opinion issued, the Legislature only amended the definition of motor vehicle to include units with two wheels without making any other changes regarding the scope of coverage suggested by the opinion.
In reaching its conclusion, however, this brief opinion relies solely upon cases from other jurisdictions dealing with farm tractors and their inclusion as vehicles under statutory schemes far removed from the one before us. See e.g., American Mutual Liability Insurance Co. v. Chaput, 95 N.H. 200, 60 A.2d 118 (1948) (); Keller v. Wellensiek, 186 Neb. 201, 181 N.W.2d 854 (1970) (); Hessler v. Ford, 225 Iowa 1055, 125 N.W.2d 132 (1963) (). Moreover, the remaining cases cited by the opinion involved statutory schemes which exclusively regulated highway use and not, as with the Franchising Act, the business relationships between manufacturers, dealers and consumers of motor vehicles. In addition, the definitions within those statutory schemes did not include the elements that persons or property be transported or that the machinery be used on public highways as required by Section 57-16-3(A) of the Franchising Act.
That the Attorney General's opinion relied solely upon cases involving agricultural farm tractors, is an additional firm basis for distinction. The windrower unit is hardly comparable to the general purpose agricultural tractors found to be motor vehicles by the opinion. The record here indicates that agricultural tractors are general purpose machines used to power or tow various types of other agricultural implements. By contrast, the unit which powers the windrower in question, while detachable, is incompatible with other agricultural machinery. The record in fact indicates that when the windrower header unit is detached from the power unit the windrower becomes unstable and is not suitable for operation. As the opinion itself concludes, there may be certain exceptions which apply and which must be evaluated on a case-by-case basis. We approve of this ad hoc approach and adopt it for this and subsequent cases seeking to determine coverage of the Franchising Act. The motor vehicle definition found in Section 57-16-3(A) of the Franchising Act incorporates portions of definitions found in related statutes which have been previously construed by New Mexico courts. For purposes of fettering out the Legislature's intent in formulating this definition, it is instructive to refer to these definitions and cases interpreting them.
In the Motor Vehicle Code, "motor vehicle" is defined in part as "every vehicle which is self-propelled". NMSA 1978, Sec. 66-1-4(B)(39)(Repl.Pamp.1984). "Vehicle" is defined in part as "every device in, upon which or by which, any person or property is or may be transported or drawn upon a highway, including any frame, chassis or body of any vehicle or motor vehicle * * *." NMSA 1978, Sec. 66-1-4(B)(74)(Repl.Pamp.1984).
The question whether any particular piece of machinery is a "vehicle" under the Motor Vehicle Code has been addressed in few New Mexico cases. In Kaiser Steel Corp. v. Revenue Division, Taxation and Revenue Dept., 96 N.M. 117, 628 P.2d 687 (Ct.App.), cert. denied, 96 N.M. 116, 628 P.2d 686 (1981), a question presented was whether certain pieces of equipment were vehicles exempt from registration under the Motor Vehicle Code. Exemption would have provided the basis for a substantial tax deduction. The machinery included a dragline and a continuous miner. The dragline structure was used for excavating large quantities of dirt and rock as part of the process of exposing coal for mining. It was powered by electricity provided by large trailing cables. The continuous miner was a coal mining machine mounted on caterpillar-type treads. It was used for underground mining and was also electrically powered by a trailing cable.
The Court of Appeals concluded that the machinery was not a vehicle within the meaning of that statutory scheme. Initially, the Kaiser record did not establish that the machines in question were capable of moving persons or property upon a highway as required by the statutory definition. Neither was there any indication that the pieces were self-propelled since their electrical power was provided by trailing cables. The court therefore concluded that the equipment could not be considered vehicles of any type under the controlling definitions.
Similarly, this Court in Gibbons & Reed Co. v. Bureau of Revenue, 80 N.M. 462, 457 P.2d 710 (1969), had before it the question whether a piece of mining equipment qualified for lower use tax rates. The tax reduction, as in Kaiser, was available to owners of vehicles exempt from registration under the Motor Vehicle Code. The mining equipment there, called a mole, moved on rail tracks and was used to transport personnel, supplies and excavated material in and out of tunnels. The Court held that the equipment did not fall within the definition of vehicle and could not therefore qualify for taxation under reduced rates available to its owners.
Gibbons and Kaiser respectively make it clear that the pieces of equipment...
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