Court Opinion

ID: 7022591
Source: CourtListenerOpinion
Date Created: 2022-07-24 04:51:19.061427+00
Date Added: 2024-06-11T16:10:37.571525
License: Public Domain

PRESIDING JUSTICE GREEN, dissenting: I dissent. I would reverse the judgment of the circuit court affirming the decision of the Director of Agriculture (Director) and remand to the Director with directions to allow the claims of both plaintiffs. I agree with most of the analysis by the majority, including their determination that the Director’s finding plaintiffs were lenders was not contrary to the manifest weight of the evidence. The reason for my dissent is that I do not interpret section 7 — 202(1) of the UCC (Ill. Rev. Stat. 1983, ch. 26, par. 7 — 202(1)) to provide such receipts are invalid if the name of the owner of the grain does not appear thereon. Section 7 — 202 states: “Form of Warehouse Receipt; Essential Terms; Optional Terms. (1) A warehouse receipt need not be in any particular form. (2) Unless a warehouse receipt embodies within its written or printed terms each of the following, the warehouseman is liable for damages caused by the omission to a person injured thereby: * * * (h) if the receipt is issued for goods of which the warehouseman is owner, either solely or jointly or in common with others, the fact of such ownership ***.” (Emphasis added.) Ill. Rev. Stat. 1983, ch. 26, par. 7 — 202. As the majority points out, section 7 — 202 does not provide that receipts failing to conform to its requirement are invalid. Rather, section 7 — 202 places responsibility for those imperfections on the issuer. Section 7 — 401(a) of the UCC states that the “obligations imposed by [Article 7] on an issuer apply to a document of title regardless of the fact that” the document does not “comply with the requirements of [Article 7]” (Ill. Rev. Stat. 1983, ch. 26, par. 7 — 401(a)). When sections 7 — 202 and 7 — 401(a) are considered together, a clear indication is given that under the UCC, a warehouse receipt given by a warehouseman for grain he purportedly owns and has in storage is not made invalid by the failure of the warehouseman to record his ownership of the grain on the receipt. The majority does not contend any part of the Public Grain Act (Ill. Rev. Stat. 1983, ch. 114, pars. 214.1 through 214.29) invalidates warehouse receipts for grain issued by a warehouseman for grain purportedly owned by him merely because the receipts do not designate the ownership of the grain on their face. I find no such provision in the Public Grain Act. Accordingly, I conclude that here, where the State failed to prove either plaintiffs knew of the lack of grain on hand to cover their receipts or that either plaintiff was guilty of any fraud or collusion with any agent of Atwater Grain Company, plaintiffs had valid receipts against the grain held by Atwater Grain Company. Plaintiffs were “claimants” within the meaning of section 2 of the Grain Insurance Act because they were “lenders” possessing “warehouse receipts covering grain owned *** by the *** warehouseman,” and had not been repaid their loans in full prior to the failure of Atwater Grain Company. Ill. Rev. Stat. 1983, ch. 114, par. 702. I share the majority’s concern that the Grain Insurance Act may be abused. While clearly the Grain Insurance Act was not intended to cover creditors who receive interest in warehouse receipts knowing the receipts were issued for nonexistent grain, no such finding was made by the Director and the record does not indicate that issue to have been raised. Any evidence of the existence of such knowledge by plaintiffs was very circumstantial. Under the evidence presented and issues raised, plaintiffs’ claims should have been allowed.