Opinion ID: 1659935
Heading Depth: 1
Heading Rank: 2

Heading: issues raised by state securities

Text: State Securities argues as follows: Its perfected security interest was prior in time and therefore superior to any agister's lien arising after April 30, 1969. Mousel waived his agister's lien existing prior to May 1, 1969, by taking the promissory note, filing the financing statement, and making subsequent feed agreements with Daringer. Rejection of the latter argument would allow a bailor and agister to agree upon terms unfair to a secured party who had already acquired his interest. The allowance of interest at the rates of 7% and 9% agreed upon in the promissory note is a case in point. The meaning of two statutory provisions and their interaction are important. The provision for an agister's lien reads: When any person shall procure, contract with, or hire any other person to feed and take care of any kind of livestock, the person so procured, contracted with, or hired, shall have a first, paramount and prior lien upon such property for the feed and care bestowed by him upon the same for the contract price therefor, and in case no price has been agreed upon, then for the reasonable value of such feed and care, provided the holders of any prior liens shall have agreed in writing to the contract for the feed and care of the livestock involved. . .. Section 54-201, R.R.S.1943. The other statutory provision reads: When a person in the ordinary course of his business furnishes services or materials with respect to goods subject to a security interest, a lien upon the goods in the possession of such person given by statute or rule of law for such materials or services takes priority over a perfected security interest unless the lien is statutory and the statute expressly provides otherwise. Section 9-310, U.C.C. The provision for an agister's lien is first examined apart from the Uniform Commercial Code, once it is determined that a person is protected, the provision will be liberally construed so that its object will be effectuated. See, County Board of Platte County v. Breese, 171 Neb. 37, 105 N.W.2d 478 (1960); Hoerler v. Prey, 125 Neb. 822, 252 N.W. 327 (1934); Becker & Degen v. Brown, 65 Neb. 264, 91 N.W. 178 (1902). The lien is statutory, although its basis is consensual. Becker & Degen v. Brown, supra . An agister's lien under a feeding contract in Hoerler v. Prey, supra, was superior to a subsequent chattel mortgage, although the bailor and agister extended the feeding period in accordance with the contract. The lien of an agister may be waived. Hoerler v. Prey, supra. Waiver generally is the intentional, voluntary, and understanding relinquishment of a known right. Dobbs, Law of Remedies, § 2.3, p. 43 (1973). See, also, Kilpatrick v. Kansas City & B. R. R. Co., 38 Neb. 620, 57 N.W. 664 (1894). The policy behind it is stability and conclusiveness. A party who waives his rights tells others in substance that he relinquishes his rights. It is good policy in many situations to encourage such a reliance rather than to insist that affairs remain in flux. This is a very different matter from estoppel, where the concern is reparative and ethical rather than politic. In estoppel cases, it is not the policy of encouraging reliance, but the policy of protecting against harmful reliance that has already occurred. Dobbs, supra. `The mere taking of security for the amount of a debt for which (such) a lien is claimed does not ordinarily destroy the lien. To have this effect there must be something in the facts of the case, or in the nature of the security [taken], which is inconsistent with the existence of the lien and destructive of it. `The taking of a mortgage upon the same property upon which the creditor claims a statutory lien may not displace the lien. The mortgage is regarded as a cumulative security, and the creditor may enforce either the lien or the mortgage. . ..' Kilpatrick v. Kansas City & B. R. R. Co., supra . If the statute creating a lien in favor of persons who furnish services or materials with respect to goods subject to a security interest is silent on seniority, the lien takes priority over the security interest, although judicial interpretation has subordinated the lien to the security interest. See § 9-310, Comment 2, U.C.C. A person who furnishes materials or service with respect to goods that are already subject to a perfected security interest is not engaged in the ordinary course of his business under § 9-310, U.C. C., with respect to any part of his charges that are unreasonable. Cf. 4 Anderson, Uniform Commercial Code, § 9-310:10, p. 345 (2d Ed., 1971); II Gilmore, Security Interests in Personal Property, § 33.5, p. 888; Notes and Comments, 76 Yale L. J. 1649 at 1654 (1967). The argument of State Securities respecting the interest allowed by the district court is well taken. Mousel and Daringer agreed upon the rates of 7% and 9% a year after perfection of the security interest, and the rates were unreasonable. The amount of the interest on the first cause of action must be recomputed on remand in accordance with section 45-104, R.R.S.1943, which prescribes the applicable interest rates. The charge of $18,523 for the agistment period to May 1, 1969, being reasonable, Mousel in that respect unquestionably acted in good faith. Inasmuch as he did not waive the lien, enforceability of the note against Daringer in this controversy is a moot question. Equity delights to do justice, and that not by halves. The argument that Mousel possessed more than one agistment lien and that the first one alone took priority over the security interest is not sound. Mousel's statutory lien attached no later than June 2, 1968, and was prior in right.