Wellbro Bldg. Co. v. McConnico
| Decision Date | 27 December 1966 |
| Docket Number | No. 40971,40971 |
| Citation | 421 P.2d 837 |
| Parties | WELLBRO BUILDING COMPANY, a corporation, Plaintiff in Error, v. Warren L. McCONNICO, Receiver, Starfire Boat Corporation, and Charles S. Kopp, d/b/a Charles S. Kopp, Insurance Agency, Defendants in Error, and Ed Neibling, Trustee of the Estate of Starfire Boat Corporation, a corporation, a bankrupt, Intervener. |
| Court | Oklahoma Supreme Court |
Syllabus by the Court
1. A lien may be created (1) by contract, or (2) by operation of law. 42 O.S.1961, § 6.
2. A lien is a charge imposed upon specific property, by which it is made security for the performance of an act. 42 O.S.1961, § 1.
3. A lien created by a rental contract will attach to personal property located in the rented premises as of the execution date of the contract where the language creating such lien is in praesenti.
4. 41 O.S.1961, § 27 merely affords a landlord an additional ground for attachment to enforce the collection of rent, but is not a procedure required in order for lien created by contract to attach to personal property.
5. A receiver appointed in aid of execution takes the assets of a debtor subject to all liens, claims and valid contractual obligations which could have been asserted against the debtor.
Appeal from the Court of Common Pleas of Tulsa County; Ed Morrison, Judge.
Action by lessor (Intervener below) under written lease to foreclose contractual lien on personal property as against claims of receiver. From an order overruling its motion to require receiver to turn over personal property and from an order overruling motion for new trial, Intervenor below appeals. Judgment reversed with directions.
Hall & Sublett, by John W. Sublett, Tulsa, for plaintiff in error.
Ungerman, Grabel, Ungerman & Leiter, Tulsa, for defendant in error, Warren L. McConnico, Receiver, and Ed Neibling, Trustee of Estate of Starfire Boat Corporation, a Corporation, a bankrupt, intervener.
The plaintiff in error, Wellbro Building Company, intervened in the trial court in the cause from which this appeal arose, after judgment had been granted the plaintiff therein, and after a receiver had in aid of execution initiated proceedings for sale of personal property, fixtures and equipment owned by the debtor, Starfire Boat Corporation. Consideration by the court of Wellbro's petition, and objection to the sale was postponed until after the receiver's sale.
The receiver's sale was held, the property being sold at public auction. His report thereof was filed, and confirmed by the court. After that sale it was stipulated by the receiver and intervener that the claimed lien of the intervener against said personal property would be continued against the sale proceeds to the same extent as if the property involved had not been sold.
Later, on January 17, 1964, Wellbro's objections to the sale and application that proceeds of the sale be required to be turned over to it were denied. Wellbro's motion for a new trial was overruled.
Wellbro contends that as lessor of its business building to Starfire Boat Corporation and pursuant to certain provisions of the lease contract between Wellbro and Starfire it possessed a special interest in and lien upon the personal property of said lessee located on the premises; that the terms of the written lease agreement between Wellbro and Starfire provided that should there be default by the lessee in payment of rents, or should the lessee become a bankrupt, or an insolvent, the lessor had the right to take and seize any personal property of the lessee located on the premises and sell the same, or any part thereof, in satisfaction of unpaid rents; that by its failure to pay the respective $900 rent payments which were due on August 1st, 1963, and September 1, 1963, Starfire had made default of its lease with Wellbro; that pursuant to terms of said lease, Wellbro had declared the lease in default as to all remaining unpaid payments thereof through the 15th of January, 1964, when the lease term ended and had made demand on the lessee for payment thereof; that such demand had been refused; that the total of the thusly matured remaining unpaid monthly payments amounted to $4,950, with interest thereon at 6% Per annum, which amount was a lien upon Starfire's personal property located on the leased premises; and that the assets of Starfire passed into the receiver's hands burdened in the same manner as the debtor itself previously had held them.
The record and pleadings before us in this case show Starfire's chattels came into the possession of the receiver. Wellbro does not contend it acquired possession of the chattels on the premises. The lease was never filed of record in the office of the county clerk. Wellbro did not attach any property belonging to Starfire.
The lease between Wellbro and Starfire in question herein in pertinent part provides:
'Provided always and these presents are upon the condition that if such rent or any part thereof shall at any time be in arrears or unpaid * * * or in the event the lessee shall become bankrupt or insolvent or shall compound with creditors, then in any such case it shall be lawful for the lessor or any person or persons duly authorized by lessor in that behalf, to enter into and upon said demised premises * * * and the lessor shall also have the right to take immediate possession of the premises * * * Lessee waives all right of exemption from sale or seizure under distress or execution that he now or hereafter has by virtue of any law exempting personal property from seizure and sale and hereby gives lessor full power, authority and right to take and seize any personal property, whether exempt by law or not, and sell the same or any part in satisfaction of said rent and damages.'
It should be noted that the lease involved herein was executed prior to midnight December 31, 1962, the effective date of the Uniform Commercial Code, and therefore the lien created thereby, if any, is to be construed in accordance with prior law.
Section 6, 42 O.S.1961, provides that a lien may be created (1), by contract, or (2), by operation of law. Section 1, 42 O.S.1961, provides:
'A lien is a charge imposed upon specific property, by which it is made security for the performance of an act.'
In 53 C.J.S. Liens § 2(b), p. 835, it is stated:
'In order that a lien may be created by a contract, express or implied, it is generally necessary that the language of the...
To continue reading
Request your trial
-
Empire Life Insurance Co. of America v. Valdak Corp.
...Kovacevich, 246 Cal.App.2d 774, 55 Cal.Rptr. 135 (1966); Leiter v. Arnold, 114 Ga.App. 323, 151 S.E.2d 175 (1966); Wellbro Building Co. v. McConnico, 421 P.2d 837 (Okl.1966); McCormack v. E. E. McCormack Co., 239 Or. 264, 397 P.2d 198 (1964); and Lack's Stores, Inc. v. Waisath, supra note 5......
-
Florida Power & Light Co. v. Westinghouse Elec. Corp.
...Kovacevich, 246 Cal.App.2d 774, 55 Cal.Rptr. 135 (1966); Leiter v. Arnold, 114 Ga.App. 323, 151 S.E.2d 175 (1966); Wellbro Building Co. v. McConnico, 421 P.2d 837 (Okl.1966); McCormack v. E. E. McCormack Co., 239 Or. 264, 397 P.2d 198 (1964); and Lack's Stores, Inc. v. Waisath (464 S.W.2d 2......
-
Citizens Bank v. Elks Bldg., N.V.
...make clear that the lien is to secure payment of the debt in question. 51 Am.Jur.2d Liens § 28 (1970). See also Wellbro Building Co. v. McConnico, Okl., 421 P.2d 837, 839 (1966) (quoting 53 C.J.S. Liens § 2(b)); 52 C.J.S. Landlord and Tenant § 606 (1968). In cases where courts have held tha......
-
Butters v. Jackson, 950361-CA
...interest' means an interest in property created by contract to secure payment or performance of an obligation."); Wellbro Bldg. Co. v. McConnico, 421 P.2d 837, 840 (Okla.1966) (holding contractual lien in lease creates security interest). Utah Code Ann. § 78-23-10(2) (1992) provides that a ......