*1 P.2d 1334 TORIX, Lаrry Torix, Joe R. Steve Terry Torix, dba Joe Torix &
Sons, Plaintiffs-Appellants,
v. Supply,
Chall ALLRED and Feeders Grain corporation, dba Feedlot, Defendants-Respon
Custom
dents.
No. 12902.
Supreme Court of Idaho.
Feb. 1980. *2 respondent Chali Allred is the
Defendant major president, general manager and Supply, Inc. stockholder of Feeders Grain operates a feed mill and corporation This operates also a custom feedlot under Butte Custom Feedlot in name which cattle owned both Allred and marketing to meat others were fattened for packing plants. spring
In the of 1975 contacted Torix arranged Allred and for Allréd to feed the until Torix cattle аt Allred’s custom feedlot ready animals were for market. Torix agreed pay a set fee for the feed and yardage. agreed to finance these feed were yardage costs until the cattle April sold. In May of 1975 Torix deliv- ered approximately to the feedlot 500 head of feeder cattle. appel- conflicting testimony by
There was concern- respondent lant Torix and even- the role Allred was to take in the However, marketing tual of the animals. Allred, without the trial court found consideration, agreed to ad- any additional mar- vise its feedlot customers of available Allred did cattle and that kets for their when the prospective buyers advise Torix of ready for market. became Torix animals Torix feed- The animals delivered in October ready lot were to market the assistance November of 1975. Without Allred, of the personally sold some Torix Nielsen, Roger Ling Ling Rupert, D. & Packing Company Magic Valley for plaintiffs-appellants. These Company. Meat Independent with checks companies paid Torix Smith, William A. & Parsons of Parsons Torix, however, most used him. directly to Burley, defendants-respondents. pay these sales to proceeds from feeding costs. Allred for BAKES, Justice. Torix informed Later in October cattle owners appellant In this action the willing pur- and Co. that Armour respon- $63,070.61from the seek to recover of the Torix 40 head approximately chase sold to an custom for cattle dent feeder by which grade yield basis animals on a Appellants packer. insolvent meat slaugh- after be determined price would respondents judgment from a in favor deter- yield grade when the ter We affirm. trial. following entered a court sell the animals agreed to mined. Torix arranged terms. Allred sons, on these Larry, Steve and Armour Joe Torix and his behalf, paid and Armour on Torix’s farming and cat- the sale in a Terry, engaged were payable to cattle with a check for the Torix and as Joe Sons. operation tle known the cattle sold receipts Feedlot. Armour indicated that Custom Un- gave “181 and 187—Torix.” check to who then for- were from lots the lot bookkeeping system it warded to Torix without an endorsement. der the feedlot’s cattle. the owner of endorsed and returned it to number indicates the check trial court foregoing facts the Allred as At this From the on feed bill. *3 by sold cattle were time Torix advised that checks in concluded that the Torix Allred by Burley shipped Minch’s and payable for cattle should be made Torix to directly to him and that he would then Butte. make the Bur- payment on his account with grade were a and Since the cattle sold on ley Torix, apparently Butte. dissatisfied yield guaranteed a minimum basis with price
with the he had received from Ar- price, payment could nоt be made at mour, also instructed Allred not to sell shipped time the cattle were but was to be more cattle to Armour. made following slaughter by their Minch’s 1, 1975, grade
On telephoned yield November Allred when the and could be deter- time, who was in Nevada at the Allred later received mined. from Minch’s drafts, advised him that he was in contact with a four bill of sale each buyer willing purchase grade “Burley cattle on a Butte Feed Lot.”1 In total yield guaranteed basis a $63,070.61 with minimum represented payment drafts 42V2(t per pound. Allred had for the re- Torix cattle. Allred each endorsed Peck, ceived the offer from Darrell cattle drafts with the “Burley endorsement buyer Idaho, Burley, from buying who was Butte Feedlot Chali Allred” on a line Bluff, Minch’s designated Wholesale Meats of Red signature for the seller’s California. Because deposited Torix had never dealt the drafts in a bank account with Minch’s, either Peck requested he maintained in the name Burley Butte arrange Allred to the sale of the cattle to Custom Feedlot. This gener- account was a Minch’s at that price. No other terms al operating account for the feedlot busi- sale were arranged discussed. Allred then ness. All four drafts were later returned sale 125 head of Torix’s cattle to Minch’s Minch’s non-payment.2 bank for through Peck. Forty-one steers were then informed Peck that he had been un- shipped 2, to California on November an- able get payment from Minch’s. Peck forty-one other 3, forty- replied on November that he had contacted Minch’s and three 8,1975. on November The only docu- assured Allred that he paid. would be ments issued in connection with the sale Allred then deposited the four were receipts Burley Burley Butte Custom Butte’s bank account a second time.3 Feedlot However, for each of the three shipments. again the drafts were dishonored “[r]epresentative[s] records, 1. The trial court found that bank were received for collection of Minch only 21, 1975, made out the drafts in the name of Minch’s bank on November and re- bank, Butte Feed Lot. on November 24 to Allred’s which turned received them payee did not dictate nor direct the 26, name of the unpaid on November 1975. on the four drafts.” records, 3.According to bank the first draft wаs 2. The bank records indicate that Minch’s bank resubmitted the Idaho bank to the California in California received collection the first 21, 1975, bank for collection on November 14, 1975, draft on November and on November days instructions to “hold for three if nec.” non-payment 17 returned it because of again unpaid The draft was returned on No- Idaho, Allred’s bank in which received it on 23, vember 1975. The second draft was simi- 19, November 1975. It is not clear from the larly resubmitted on November 24 and later record when the bank notified Allred that the unpaid returned on December 1975. The unpaid. According draft had been returned third and fourth drafts were likewise resubmit- records, the bank Minch’s California bank re- ted for collection on November 26 and were ceived the second draft on November 17 and unpaid returned on December 1975. bank, returned it on November 18 to Allred’s unpaid which received it on November drafts, according 1975. The third and fourth 070.61, breached an alleging that Allred had a vol- shortly thereafter Minch’s filed by arranging untary petition agency contract with Torix bankruptcy in California. To- Torix cattle without credit sale of the shipment оne had sold other Allred had express approval and that rix’s August Minch’s in of 1975 and had re- arrang- use due care in negligently failed to following ceived sale. by draft answered, to Minch’s. Allred ing the sale problems No in that sale. were encountered and also filed a allegations, denying the Neither Allred Peck were aware of nor $15,073.40, he which counterclaim for problems financial at the time and services. for feed claimed Torix owed However, the sale of the Torix animals. sons, Terry, were Larry, Steve any inquiries had not made concern- Grаin plaintiffs and Feeders later added as prior Minch’s financial condition made a defendant. Supply, sale of the cattle to Minch’s. Allred’s $15,073.40, owed Allred *4 admitted that he testimony had been was that since Minch’s against sum as an offset but claimed that not years in business for several and had Following a court damages. his claim for in the exhibited financial difficulties trial, judgment in court entered the district inquire past, compelled he did not feel $17,- Torix for against of Allred and favor Likewise, solvency. about company’s interest, plus costs principal 513.40 for and about expressed any Torix had concern not $3,317.95. Torix attorney fees of for Minch’s selling exchange in the animals judgment. brings from that prior sale. to the Allred, through that The trial court found cattle to shipped After Allred had Butte, in a engaged Burley principally re- was had been Minch’s but before its drafts Burley feeding and that operation for Torix authorized cattle non-payment, turned addition, of Butte, the remainder additional arrange Allred to sale of in “without re- consideration, Clay his cattle to John & Co. its customers advised with a draft Burley the cattle pаyment ceived markets for the cattle. available Feedlot. Burley buyers Butte Custom prospective Butte advised Torix Burley the draft and de- negotiated court found The trial of the Torix cattle.” account and posited proceeds in its bank ap- Torix’s sought and received that a credit on proceeds applied were as terms and conditions proval for the Torix’s feed bill. arranging shipment before sale to Minch’s “did and that Allred from the feedlot After Minch’s had been the drafts from lot, shipped from its any cattle to be allow time, Allred noti- returned for the second Torix, con- without the were owned that obtaining problems fied Torix of the in stated that the of Torix.” The court sent November payment. part In the latter ap- that Torix it showed evidence before Torix, who had Allred and other cattlemen sales to Minch’s proved in the unable sold cattle and had been to Minch’s or prescribe demand that “Torix did not or checks met in to collect on Minch’sdrafts except as of sale any terms and conditions of Minch’s. representatives California with guaran- grade yield and а minimum obtaining any They were in unsuccessful shipped head of cattle price on the 125 teed proof of later filed a payment. Allred to Minch.” in Califor- bankruptcy court claim with the behalf of nia own behalf and on on his pay- further found that The trial court that neither Torix. The record indicates customarily used in ment draft any payment for recover party was able to in the livestock method of as a bankruptcy at in the cattle from the trustee cattle payment for industry, particularly in the time of trial. basis, that grade yield sold on a pay- Allrеd to demand had not instructed suit Torix filed February, In authorized when he $63,- legal in tender ment recovery of seeking against Allred de- to be circumstances, of fact question Minch’s, had no the sale and that Allred and, appeal, on the trial court insolvent termined reason know that Minch’s was findings aside those November, 1975, not set sales were this Court will in when the See clearly erroneous. are they The court that unless made. also held Con- Galey Co. v. Burley Equipment Dick made drafts out Glenn P.2d Butte, struction, and not 97 Idaho payee, on its own accord instruction, Allred ne- at Allred’s and that Burley Butte’s
gotiated these drafts in
on
argument
principal
Appellant
good
collec-
name in
faith
to effect
effort
re-
in
erred
the trial court
appeal is that
to cred-
proceeds,
tion of the
with an intent
Chali
the defendant
fusing
find
received.
when
proceeds
it Torix
agent of Torix’s
conduct-
was an
law,
district
It
In its conclusions of
to Minch’s.
of Torix’s cattle
ing the sale
Allred and
accept-
court determined that
is Torix’s contention
prepared Torix
Butte fed and
lieu of cash or checks for
ing drafts in
a “bailee for hire”
market as
animals,
pay-
attempting
to collect
making avail-
assistance to Torix in
upon those drafts in the defendant’s
ment
merely in-
marketing information
able
name,
beyond
scope
own
acted
undertaking to fat-
primary
cidental
authority given
agent.
to Allred as an
To-
The court held
ten the animals.
argues
rix
that Allred
breached
fiduci-
Butte,
the animals
sold
not Allred
ary
agent
duties to
which an
owes
*5
Burley
and that Allred and
to Minch’s
that, therefore,
principal and
the trial court
to
merely shipped
animals
Butte
the
failing
erred
to
in
find Allred
liable to
The
permission
with the
of Torix.
Minch’s
for the sale
of the animals.
Burley
court concluded that Allred and
Butte served as “accommodation bailees” in
Our examination of the records indi
shipping the animals for Torix and that
cates that
the trial court
in
did not err
they
care,
all
“at
times exercised reasonable
characterizing the relationship
To
between
diligence,
judgment
caring
in
for and
rix and Allred as a
finding
bailment and in
and,
result,
the
shipping
Torix cattle
aas
Allred,
bailee,
was not liable to
liable
are not
to Torix for
that may
loss
Torix fоr the loss which
from
resulted
have been sustained on the cattle.”
insolvency.
Minch’s
been
Bailment has
defined as:
The trial court in this case made
delivery
goods
“A
of
or personal proper-
findings
detailed
following
of fact
the trial.
ty, by
person
another,
one
to
for
in trust
appellant
Upon
motion,
Torix’s
the court
special
the
of a
object upon
execution
or
subsequently entered
findings
amended
of
in
goods,
to such
relation
beneficial either
fact and conclusions
incorpo
of law which
both,
or
the bailor
bailee or
a
upon
many
rated
of the changes proposed by
contract, express or implied,
perform
Findings
Torix.
of fact entered
the
the
carry
object,
trust and
out
such
district court will
not be set aside on
thereupon either to
goods
redeliver the
they
unless
are clearly erroneous.
I.R.C.P.
the bailor or
dispose
otherwise
the
of
52(a);
Baugh,
236,
Dunn v.
95 Idaho
506
conformity
same in
purpose
the
(1973).
P.2d 463
arrangements
The
be
Motors,
Imperial
trust.” Loomis v.
tween Allred
respect
and Torix with
74,
(1964),
88 Idaho
preparation
marketing
Appellants
mak-
next maintain that
for
them and
finding
trial
liable
for
animals
court erred in not
arrangements
shipping the
sale,
proceeds of the
for conversion of the
upon Tоrix’s instructions.
arguing
wrongful do
that Allred exerted
is not an
of the
A bailee
insurer
proceeds by depositing
minion over those
express
the absence
property
bailed
of an
general
in the
agreement
parties
ef
between
to that
However,
Burley
for collection.
Butte
liability
only
fect. The bailee’s
arises
trial
court found
some
on his
Low v.
negligence
part.
act of
Butte,
deposited
endorsed the drafts
91,
Co.,
Park Price
P.2d 291
95 Idaho
503
account in an
them
495,
(1972);
Bye,
Carson v.
79
321
Idaho
To
effort to
credit to
receive
Wells,
(1958);
P.2d 604
Brown v.
66
prop
rix. To
оf bailed
establish conversion
(1965);
846
Am.
Wash.2d
403 P.2d
8
bailee,
erty by
necessary
prove
it is
a
Jur.2d,
(1963).
Bailments
The trial
§
way,
in some
words
bailee had
court
held that the
at
in this case
defendant
conduct,
decisively
repudia
indicated
care,
all times exercised reasonable
dili
right
property.
tion of the owner’s
gence,
judgment
caring
ship
for and
See, g.,
Loughridge,
e.
v.
Weisberg
253 Cal.
ping
cattle. The evidence in the
the Torix
(1967);
App.2d
Cal.Rptr. 563
Guar
amply supports
finding.
record
As a
Mihalovich,
anty
Co. v.
National Insurance
result, the trial court’s conclusion that the
(1967); Re
9U “12-120. ATTORNEY IN FEES CIVIL Butte. The trial court apparently adopted ACTIONS.—. . . the Allred characterization that he was merely trying expedite turning the “(2) In any civil action to recover on an money, drafts into apparently on the basis open account, stated, note, bill, account that he acting found Allred to be good instrument, negotiable or contract relat- faith. The court did not find or conclude purchase to the or goods, sale of from the evidence that Allred was in wares, merchandise, unless otherwise way attempting to defraud or cheаt Torix. law, provided by prevailing party readily agree, With that I but that does not shall be allowed a attorney reasonable fee preclude application of well established court, to be set to be taxed and principles of law. collected as costs.” respondent’s First it is necessary to examine the counterclaim was an ac- rela- tionship tion on between open an Torix and Allred with re- for sums Torix gard disposition feeding owed Butte for of the cattle. The caring trial court for his held that prevailing parties mеrely cattle. As Allred was an on that respondent selling counterclaim the accommodation bailee in was the Torix entitled to cattle, attorney fees as and this Court does statutory right a matter of not discuss that holding. 12-120(2) under I.C. As one text states: merely and not § in the court’s discretion. The record indicates which, business institution within “[A] attorney fees awarded included not business, the scope of its practice makes a only the fees prosecuting incurred in acting gratuitously as bailee for its counterclaim but also the fees incurred in customers and holds itself possess- out as defending appellant’s action. An award of ing peculiar is, facilities for such services attorney fees to the respondents for suc- with respect to property left with it ac- cessfully defending against appellant’s cordingly, more than a mere accommoda- action cannot 12-120(2), be based on I.C. § bailee, tion and should be held to the but nevertheless proper under I.C. responsibilities hire, of a bailee for inas- 12-121.5 much as such services attract patronage.” Am.Jur.2d Bailments 13§ Affirmed. respondents. Costs to markеting customers, service to his though specific therefor, he made no charge DONALDSON, J., SHEPARD, J., C. business; part such, was a of his it DUNLAP, Tern., J. Pro concur. gratuitous not a accommodation. More- BISTLINE, Justice, dissenting. over, testimony establishes, as the of Allred *7 he position used his as marketeer of the There question is no original but that the Torix cattle vantage point as a for the arrangement feeding for the of the Torix collection of against his bill Torix. Torix bailment, cattle Allred was a and no testified that on one earlier occasion when issue was raised as tо whether Allred was appropriated sold Torix cattle and negligent in caring for those cattle. The the proceeds, Torix admonished Allred case, issues in this of which I feel Allred’s against practice. such payments treatment of the for those cattle dispositive, necessary to be It is not evolved from the sale of to decide whether the the my view, legal Torix cattle Allred. In agent status of Allred was that of an sell, both the trial court and this Court err in authorized power to or bailee with to analysis their dispose goods. Allred’s actions in rеceiv- of the goods bailed Where ing payment in his deposit- own name and consigned by are one to another with the ing that payment in the account Burley understanding consignee that the ei- shall judgment, January 54(e) presently 5. The trial court’s entered I.R.C.P. which concerns awards 25, 1978, prior attorney was to the effective date of fees under § I.C. 12-121. 912 in goods or Allred did this effort to ensure that sell the and remit an
ther he, receiving a case is be the one goods, return the the bailee in such not would cattle, Bail- for the which he would agent an bailor. 8 Am.Jur.2d (1963). apрropriate giving credit on To- ments 34 See Globe Securities Co. then while § Co., testimony 85 shows v. Gardner Motor 337 Mo. rix’s account. Allred’s Anno., handing (1935); A.L.R. 1366 he had no intention of 561 175 that S.W.2d bailee, money whatever to Torix until agent Whether or over at 1387 as paid by sale those monies. duty making fully to in feed bill Allred’s ordinary care. and reasonable that Yes, “Q to apply did ever intend you See, Agency g., (Second) of e. Restatement of Torix’ proceeds from the sale cattle Bail- (1958) (agency); 8 Am.Jur.2d § your to own benefit? (1963) (bailments). According- ments § No, it to apply “A we to his intended in ly there is merit the Torix contention account, bill, his we to which did. feed releasing Allred acted in improperly of drafts. promise the cattle in return for a however, issue, secondary impor- That is of “Q practice your Is it a in custom and presented to the issue
tance lot, feed that methods of are over the of an dominion exercise owner’s frequently paid just with the feed you to drafts. lot’s name on them? Yes, improp- “A in instances. contends that acted some receiving payment for the Torix
erly in “Q very it Is common? Burley Butte to “A Yes. in Allred’s by depositing those drafts Burley Butte bank account. Unless own otherwise, agreed agent an parties have “Q receipt of the And fact principal has holding things on behalf of his accepted you had the money, draft they so that duty not to deal with them name, honored, was in your been own mingle them appear will to be his own or to not, was it because you, fact a benefit (Second) things. with his own Restatement you the funds paid given or would have it (1958). Ordinarily, with- Agency § pay yourself, feed bill? your contrary, out authorization pay Mr. Torix’ apply “A It would agent money that an whо receives on means bill, yes. feed properly principal may of the not extent, “Q you so when And to that or so to his own credit in a bank place it apply pro- no you had intent said money there mingle it with own benefit, your you own mean to ceeds to difficulty tracing it. Id. at could be apply pro- say you did intend to principles hold b. The same Comment except to the your own benefit ceeds (1962). It Bailments 8 C.J.S. bailees. you coming had money extent established, instance, that attor-
is well Mr. Torix? assiduously guard brokers must neys and Yes, applied— only we have “A would commingling appropriation against “Q certainly it was But that extent a client’s funds. *8 anyone your benefit rather than else’s for for agent, should be held accountable other get your it into bank account? to obligations. fiduciary’s of a a breach to well to “A It was our benefit as as to the bring myself to am unable I Torix’, yes.” Mr. receiving conclusion that Court’s out, pointed agent neither an As has been the to his own depositing and right has to take funds any a conver- nor a bailee did amount to account concedes, principal. agеnt An who belonging to opinion As the Court’s sion.
913 essence, a unilateral nova- money his Allred effected principal has received for has Torix. At tion, totally unauthorized duty money principal. to deliver to be held have he must point time (Second) Agency of See Restatement might loss that any assumed risk (1958). Allred commandeered the drafts Minch’s drafts. nonpayment result from for his own benefit. Had the consequences That Allred so understood dishonored, admit- drafts not been Allred conclusively demon- is of his own conduct tedly turn Minch was not about unsuccessfully explained fil- strated payment until point over to Torix such in Minch’s bank- claim creditor’s there was an excess over above the wisely been said It ruptcy. has often effect, channeling feed Allred was bill. In forcefully more speaks that a man’s conduct thereby those drafts to his own than his words. unauthorizedly taking payment feed Only bill. when the drafts were dis- unilaterally chose voluntarily he characterize his honored did conduct accept and Minch drafts as look to those accepting expedient the drafts as a mere It was feed bill. payment of thе Torix legal for Torix. The effect the benefit of custody of posture that he surrendered cannot be easily Allred’s conduct so choosing to also surren- thereby the cattle — agent may not payment avoided. An take agister’s lien there- der his own claim of an drafts, principal appli- due his in his own name for on. At worst the dishonored bill, principal cation on a owed him should be an debt extent of Torix feed should recover subsequently, after it has dishon- Allred loss. At best Torix been ored, across the the amount of dishon- successfully pay- maintain bоard drafts, owed Allred ored less amount ment at all times really belonged to the caring supplying feed. the cattle principal.1 I respectfully dissent. Although may be correct in his assertion that loss here suffered was insolvency,
occasioned Minch’s and not
by the manner in which the drafts were
handled, necessarily it does not follow that
he wholly escapes responsibility if his ac-
tions give were such as to rise to a conver-
sion.2
Clearly appropriated the drafts to
himself as on Torix’s feed bill. appropriation
Such an was an unauthorized belonging
dominion over drafts
and as act of such was an conversion. In transaction, escape Following wrongdoer 1. the Minch Allred sold refused to liabil- allow Clay ity possibility might another load of cattle for to John & on the that the same loss $20,631.83. anyway: Co. for for this was have occurred also made out to Butte and was also contingencies “In viеw of the manifold Butte, by Burley appropriated being ap- credit transactions, range wide business and the plied Again the feed bill. Torix never saw possibilities act of a commer- that attend any money from this sale. nature, things be more unfor- cial few could incorporate into established tunate than to Cooper, 2. North In Bank of British America v. disobey right specific agent law the instructions, of an (1890), 11 S.Ct. U.S. defendant-agent alleged L.Ed. 759 guess as to and to make a re- that even had he accruing sults an for relief from loss.” excuse instructions, principal’s followed his the same Id. at at 162. S.Ct. principal losses to the would have It occurred. so, being whether this was uncertain the Court