Opinion ID: 1834309
Heading Depth: 1
Heading Rank: 4

Heading: Entitlement to Proceeds of Joint Payee Checks.

Text: The final issue that we must consider is whether the district court correctly disposed of the proceeds of the two checks payable jointly to the Beuthiens, the bank, and the feed store. The district court ordered that the proceeds should go to the bank. The court of appeals disagreed and held that this determination should abide the result of further proceedings after denial of summary judgment. Both of these checks were issued by third persons who purchased hogs from the Beuthiens. The feed store again relies on the argument that the bank's lien rights had been compromised by a course of dealing allowing hog sales to take place. Again, we conclude that the Hedrick Savings Bank and Ottumwa Production Credit Association cases relied on by the feed store have no application. We are not concerned, as was the court in those cases, with whether the lien continued on the hogs in the hands of the buyer. We are concerned with the bank's lien on the proceeds of the hog sales. That lien was in no way compromised by a course of dealing, and by virtue of its existence, the bank holds a superior claim to the proceeds over the feed store, which had no lien on any of the Beuthiens' assets. The fact that the two hog buyers elected to put the feed store's name on these checks does not alter the rights of the parties to the litigation. Only if the hog buyers had some personal basis for asserting that a portion of the proceeds should go to the feed store, and asserted that claim, would the feed store's claim rise to the level of the bank's claim. No such reason has been asserted in this litigation. We conclude that the bank has the superior claim to the proceeds of the two checks. This claim was expressly preserved in the October 25, 1991 settlement agreement with the Beuthiens. We have considered all issues presented and conclude that the decision of the court of appeals should be vacated. The judgment of the district court is affirmed in all respects. DECISION OF COURT OF APPEALS VACATED; DISTRICT COURT JUDGMENT AFFIRMED.