Court Opinion

ID: 9546215
Source: CourtListenerOpinion
Date Created: 2023-08-07 17:26:15.898996+00
Date Added: 2024-06-11T15:16:09.553463
License: Public Domain

Herd, J.,
dissenting: I respectfully disagree with the majority opinion. Excel had constructive notice of the bank’s security interest. There was no waiver of that lien. The conditional consent given Burkdoll to find a purchaser for the cattle made no change in the recorded security agreement. Thus, Excel was not misled. In fact the bank’s recorded security interest was the reason it was free to permit the debtor to make the conditional sale. It was justified in relying on the recorded lien in case Burkdoll failed to deliver the sale proceeds.
This case is clearly distinguishable from North Cent. Kan. Prod. Cred. Ass’n v. Washington Sales Co., 223 Kan. 689, 577 P.2d 35 (1978). In Washington Sales the sale company was the agent of the debtor and thus entitled to the benefit of the consent given by PCA. Excel is not the agent of Burkdoll. It is a third party to whom constructive notice is applicable.
This decision compounds agriculture’s credit problems by forcing farm creditors to closely supervise each sale of farm products, thus rendering agricultural loans more expensive and less desirable. I would reverse the trial court’s decision and hold Excel liable for the amount of the bank’s unreleased recorded security interest.