Title: PARKER v WEST

State: montana

Issuer: Montana Supreme Court

Document:

No. 12265 I N T H E S U P R E M E C O U R T O F THE STATE O F MONTAP4A 1972 JACK PARKER, P l a i n t i f f and Appellant, -vs - F L O Y D WEST, et a l . , Defendants and Respondents. Appeal from: D i s t r i c t Court of t h e F i r s t J u d i c i a l District, Honorable Gordon R. Bennett, Judge presiding. Counsel of Record: For Appellant : William Dee Morris, Helena, Montana. Withdrew from case and made no appearance. For Respondents: Gough, Booth, Shanahan and Johnson, Helena, Montana. Ronald F . Waterman argued, Helena, Montana. Submitted: October 26, 1972 Decided: 7.2, j $ n *I," : : " t " ; " . ? Filed: $ a . !%, Chief J u s t i c e James T, Harrison delivered the Opinion of the Court. P l a i n t i f f Jack Parker brought t h i s action i n the d i s t r i c t court of the f i r s t j u d i c i a l d i s t r i c t , county of Lewis and Clark, against F i r s t National Bank & Trust Company of Helena, F i r s t National Bank. of Great F a l l s , Bison Motor Company, and Dave Middlemas, s h e r i f f of Lewis and Clark County, t o recover f o r an alleged conversion of an automobile, Defendant F i r s t National Bank & Trust Company moved t o dismiss f o r f a i l u r e t o join indispensable p a r t i e s and f o r f a i l u r e t o s t a t e a claim f o r r e l i e f . Before t h e court could r u l e on the motion, p l a i n t i f f amended h i s complaint by adding a s defendants Floyd West, Donald Sibley and Russel S, Jones. The court treated the motion t o dismiss a s i f directed to the amended complaint. It granted the motion and dismissed the complaint f o r f a i l u r e of p l a i n t i f f t o s t a t e a claim upon which r e l i e f could be granted against any party. From the order dismissing the complaint, p l a i n t i f f appeals. The f a c t s a r e f a i r l y straightforward. Prior t o May 29, 1971, p l a i n t i f f Jack Parker was approached by Donald Sibley and a discussion was had between them i n relation t o the r e p a i r of a 1965 Chevrolet EL Camino pickup truck, Parker operates a small automotive and r a d i z t o r r e p a i r shop, The E l Camino, which was i n need nf extensive r e p a i r s , was i n the possession of Sibley, Parker repai-red the pickup, However, Sibley disappeared and never returned t o e i t h e r pay the b i l l of $1,113.20 o r t o obtain possession of the pickup. Parker then ettempted t o exercise h i s possessory l i e n and foreclose under section 45-1106, R.C.M. 1947, which provides f o r a g i s t e r ' s l i e n procedure. The s h e r i f f of Lewis and Clark County refused t o s e l l the pickup under the a g i s t e r ' s l i e n procedure. Meantime, Parker was approached by an agent of F i r s t National Bank & Trust Company of Helena, acting f o r defendant F i r s t National Bank of Great Falls. This agent declared t h a t a security i n t e r e s t existeJ i n favor of t h e Great Falis Sank i n he name of Floyd West, X search of t:he records i n the o f f i c e of the r e g i s t r a r of motor vehicles i n Deer Lodge revealed t h a t defendant F i r s t National Bank (Ji Great F a l l s had recorded i t s l i e n with the r e g i s t r a r a s of !une 2, 1971. Defendant Helena bank, again acting f o r defendant breat F a l l s bank, then caused the s h e r i f f of Lewis and Clark County ir.o forcibly talce possession and dispose of the E l Camino, under the Uniform Commercial Code, Defendant Helena bank appeared and moved t o dismiss f o r Caj-lure of p l a i n t i f f t o join indispensible p a r t i e s . The t r i a l court ruled t h a t p l a i n t i f f ' s cause be dismissed with prejudice without leave t o amend. The basis of the c o u r t ' s ruling was t h a t the record revealed p l a i n t i f f had not recorded h i s a g i s t e r ' s l i e n ; <:onsequently, h i s l i e n did not have preference a s against a recorded perfected l i e n f i l e d by defendant Great F a l l s bank. The f i r s t question i s whether or not the p l a i n t i f f had a v a l i d , p r i o r agi.sterls l i e n on the E l Camino pickup. W e find t h a t p l a i n t i f f did not have a valid l i e n , Section 45-1106, R. C . ?i. 1947, provides : 1 I Agisters' l i e n s and l i e n s f o r service -- p r i o r i t y . Every person who, while lawfully i n possession of an a r t i c l e of personal property, renders any service t o che owner or Lawful claimant thereof by labor or s k i l l employed f o r the making, repairi-ng, protection, i m - ixovement, safekeeping, or carriage thereof, has a special l i e n thereon, dependent on possession, f o r the compensation, i f any, which i s due t o him from the owner o r lawful claimant f o r such service and f o r material, i f any, furnished i n connection therewith. A ranchman, farmer, a g i s t e r , herder, hotel-keeper, livery, boarding, o r feed stable-keeper, t o whom any horses, mules, c a t t l e , sheep, hogs, o r other stock a r e dntrusted, and there i s a contract, express or implied, Eor t h e i r keeping, feeding, herding, pasturing, o r ranching, has a l i e n upon such stock f o r the amount due ?or keeping, feeding, herding, pasturing, o r ranching che same. and i s authorized t o r e t a i n possession thereof tlntil t h ; sum due i s paid. The l i e n &reby created s h a l l ]lot talce precedence over perfected security i n t e r e s t s under the Uniform Commercial Code-Secured Transactions, 3r other recorded l i e n s on the property involved, unless within ten days from the time of receiving the property, the person desiring t o a s s e r t a l i e n thereon s h a l l give notice i n writing t o said secured party or other l i e n holder, s t a t i n g h i s intention t o a s s e r t a l i e n 3n said property, under the terms of t h i s a c t , and s t a t i n g the nature and approximate amount of the work, o r feed, per- formed or furnished o r intended t o be performed or furnished theref or. "Such service may be made e i t h e r by personal service or by mailing by registered mail a copy of said notice t o the secured party or other l i e n holder a t h i s l a s t known post-office address. Said service s h a l l be deemed complete upon the deposit of the notice i n the post office. I I (Emphasis added) . W e have emphesized the section's two important aspects. One porti.on of the s t a t u t e provides t h a t the lien i s properly asserted only against the owner o r lawful claimant of the property. Thus, from the face of the s t a t u t e alone, it i s apparent only the owner or la.wful claimant can auth.orize work on personal property, which then, can be charged. with a l i e n . The second portion of the section, which controls i n t h i s case, provides t h a t t o take p r i o r i t y over the holder of a recorded l i e n , the individual asserting an a g i s t e r ' s l i e n must, within ten days of receipt of the property, a s s e r t h i s l i e n by mailing t o the recorded l i e n holder a statement of h i s intention t o a s s e r t such a l i e n . P l a i n t i f f ' s complaint f a i l s t o come within the provisions of the a g i s t e r ' s l i e n s t a t u t e upon which he r e l i e s . P l a i n t i f f a t - tached t o h i s complaint a s exhibits a copy of the r e t a i l i n s t a l l - ment contract and t i t l e t o the automobile, Neither document sho~\~s Donald Sibley a s the registered owner of the car. Both documents demonstrate t h a t Floyd West held undisputed t i t l e ownership of the car. P l a i n t i f f does not contend Sibley acted a s West's agent i n authorizing r e p a i r s on the c a r ; r a t h e r , he r e l i e s exclusively upon Sibley's alleged ownership. P l a i n t i f f , however, cannot refuse t o aclcnowledge f a c t s wllich he had knowledge o f , s p e c i f i c a l l y , the t i t l e ownership i n West's name and the security i n t e r e s t of the F i r s t National Bank of Great F a l l s , It i s apparent t h a t p l a i n t i f f was aware of those i n t e r e s t s , a s i t was these p a r t i e s with whom he d e a l t and it was these p a r t i e s who were named i n the a g i s t e r ' s l i e n notice. The complaint and exhibits demonstrate p l a i n t i f f ' s awareness t h a t p a r t i e s other than Sibley owned the vehi-cl-e. . k second element required by section 45-1106, R.C.M, 1-947, i s : h a t t x o achieve p r i o r i t y over a record l i e n holder notice of ,he l i e n must be given within ten days of when the property was received by the mechanic. P l a i n t i f f did not follow t h i s requirement. His complaint f a i l e d t o a s s e r t t h a t notice, as required, was ever directed t o the record l i e n holder, F i r s t National Bank of Great Falls. P l a i n t i f f surely had notice of the Great Falls bank's iiiterest i n the automobile, a s i n the notice of the a g i s t e r ' s l i e n he named t h a t party a s one of the owners of the automobile. Yiaintiff cannot deny he had notice o r lcnowledge of the bank's i n t e r e s t when i n the notice f i l e d i n July 1971, he recognized the existence of t h a t i n t e r e s t , Since p l a i n t i f f was charged with knowledge, t o gain p r i o r i t y over the bank he had t o f i l e h i s notice of a g i s t e r ' s l i e n and send a copy of the notice t o the bank within ten days of when he obtained possession of the automobile, By the allegation i n p l a i n t i f f ' s complaint, the date of h i s possession i s s e t a t May 28, 1971. Yet the complaint shows t h a t more than ten days elapsed between the day possessi.on was obtained and when notice of the l i e n was given, which was sometime a f t e r July 13, 1971. Section 45-1106, R.C.M. 1947, s p e c i f i c a l l y provides t h a t "notice s h a l l be given" and unless given within ten days the "lien created" does not take precedence over other recorded l i e n s on the propercy involved. Failure t o comply with t h i s statutory provision r e s u l t s i n p l a i n t i f f ' s l i e n being i n f e r i o r t o the l i e n o? F i r s t National Bank of Great Falls. Thus, the bank could and J i d properly repossess t h e automobile; i t s agents were not l i a b l e t o r the repossession, and neither i t s action nor the action of -ne sheri-ff w a s conversion a s t o the p l a i n t i f f . Through exhibits i n h i s complaint, p l a i n t i f f demonstrates I h a i 9n February 2, 1972, the r e g i s t r a r of motor vehicles had only the r e c a i l installment concract on f i l e . It i s alleged and admitted therefore t h a t p l a i n t i f f had not a t any time p r i o r t o the re- possessi-on of the aet~omoL)i.le, placed h i s ag-kster's l i e n on file Controlling i s section 53-F10 ( a ) , & . ~ . h . ~ Y L F ~ ~ , W ~ - L J _ ~ : ~ I ;-xi i i l l e ~ ~ t art provides : "No c h a t t e l mortnage, conditiorial sales conCraeL, - - . lease o r other l i e n on a motor vehicle s h a l l be . ~ a l i d as against c r e d i t o r s , subseq~ient purchasers ~r encumbrances unless and u n t i l such mortgage, t:onditional sales contract, lease or other l i e n , ~r a true copy thereof c e r t i f i e d by a notary public 'las been filEb with the r e g i s t r a r of motor vehicles 2s hereinafter provided +( ; k 5 : . " (Emphasis added). i'tlis 5 t a t u t e spec5.fically deals w i t h the cituation here. It provides t h a t u n t i l the l i e n or a copy thereof has been f i l e d with the r e g i s t r a r of motor vehicles, i t i s not v a l i d a s against creditors of the motor vehicle owner having a security i n t e r e s t i l l the automobile. As against a l l p a r t i e s , lai in tiff's l i e n w a s not v a l i d ; it was never f i l e d with the r e g i s t r a r . P l a i n t i f f ' s complaint r e s t s e n t i r e l y upon the v a l i d i t y and p~i.~ritl)r of h i s li-en. This Court i s s a t i s f i e d h i s l i e n was iie-ither p r i o r j.n time, nor fulfil-led the statlutory requirements JL? sections 45-IlOG and 53-110(a), R.C.M. 1947. For t h i s reason p l a i n t i f f ' s complaint must f a i l , and the d i s t r i c t c o u r t ' s judgment L s affirmed. W e a l s o find the d i s t r i c t court properly granted the motion t o dismiss, both a s t o the F i r s t National Bank & Trust Cuoipany of Helena and as t o a l l other p a r t i e s . The c o u r t ' s action was appropriate a s p l a i n t i f f ' s cl.aim a s t o each individual party rusted exclusively upon the p r i o r i t y and v a l i d i t y of h i s agi-stert s l i e n . Once establish.ed t h a t the l i e n was neither v a l i d nor prior as t o the F i r s t National Bank and Trust Company of Helena, it b g i c a l l y follows t h a t the l i e n was likewise invalid and subsequent Co the claim of any ocher og- , + . - defendants, The order of the d i Chief J u s t i c e ,ji // As ociate ~udtices. f i '