{ "id": 1910501, "name": "Ron WOOD, Ed Wood, and Buck Graham v. The CORNER STONE BANK", "name_abbreviation": "Wood v. Corner Stone Bank", "decision_date": "1993-12-06", "docket_number": "93-444", "first_page": "200", "last_page": "204", "citations": [ { "type": "official", "cite": "315 Ark. 200" }, { "type": "parallel", "cite": "866 S.W.2d 385" } ], "court": { "name_abbreviation": "Ark.", "id": 8808, "name": "Arkansas Supreme Court" }, "jurisdiction": { "id": 34, "name_long": "Arkansas", "name": "Ark." }, "cites_to": [ { "cite": "280 Ark. 512", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1744813 ], "weight": 2, "year": 1983, "opinion_index": 0, "case_paths": [ "/ark/280/0512-01" ] }, { "cite": "253 Ark. 966", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1627291 ], "weight": 2, "year": 1973, "opinion_index": 0, "case_paths": [ "/ark/253/0966-01" ] }, { "cite": "239 Ark. 400", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1730641 ], "weight": 2, "year": 1965, "opinion_index": 0, "case_paths": [ "/ark/239/0400-01" ] }, { "cite": "236 Ark. 954", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1681291 ], "weight": 3, "year": 1963, "opinion_index": 0, "case_paths": [ "/ark/236/0954-01" ] }, { "cite": "742 F.Supp. 544", "category": "reporters:federal", "reporter": "F. Supp.", "case_ids": [ 7389595 ], "year": 1990, "opinion_index": 0, "case_paths": [ "/f-supp/742/0544-01" ] }, { "cite": "302 Ark. 521", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1884255 ], "weight": 3, "year": 1990, "opinion_index": 0, "case_paths": [ "/ark/302/0521-01" ] } ], "analysis": { "cardinality": 474, "char_count": 6758, "ocr_confidence": 0.892, "pagerank": { "raw": 6.233605815818256e-08, "percentile": 0.3854749832905316 }, "sha256": "2db09d503e948b3d25bafe5200b7773ecedf5067fc4fe6514996d6e6322879b2", "simhash": "1:b6434429973d3e52", "word_count": 1150 }, "last_updated": "2023-07-14T19:39:34.144281+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "Ron WOOD, Ed Wood, and Buck Graham v. The CORNER STONE BANK" ], "opinions": [ { "text": "Jack Holt, Jr., Chief Justice.\nThe issue before us is whether the trial court erred in finding there was sufficient evidence to support a claim and judgment against the appellants, Ron and Ed Wood, and Buck Graham, for conversion of property in which the appellee, The Corner Stone Bank, claimed a proprietary interest. We hold that the evidence was sufficient and affirm.\nJames P. Chamberlain, a resident of Benton County, Arkansas, obtained a $12,930.73 loan from The Corner Stone Bank and gave the bank a security interest in a 1980 Great Dane trailer and a 1984 Ford one-ton truck. Apparently, the Great Dane trailer was stolen, and the bank agreed to apply the insurance funds from the loss on the purchase of another trailer. As a result, Chamberlain brought in a title to a 1977 TIMP trailer which was accepted by the bank as substituted security for the stolen trailer. The TIMP trailer\u2019s certificate of title reflected that it was owned by brothers, Ron and Ed Wood, doing business as W. W. Trucking. An endorsement on the certificate reveals that Ron Wood apparently transferred title and sold the TIMP trailer to Chamberlain. As a result, the bank and Chamberlain executed a new security agreement to reflect the substituted collateral. Thereafter Chamberlain defaulted on his payments, and the bank took possession of the trailer storing it at its lot in McDonald County, Missouri.\nLater, Ed Wood sent Buck Graham to look for the trailer. When Graham reported its location, Wood obtained a tractor, took the trailer from the lot without notice to the bank, and towed it to Buck Graham\u2019s place of business in northwest Arkansas. Graham purchased the trailer for $1,255 and immediately salvaged it.\nThe Corner Stone Bank filed suit for conversion against the appellants, Ron Wood, Ed Wood, and Buck Graham, for the value of the trailer and punitive damages. After a bench trial, the bank was awarded $4,000 in compensatory and $2,000 in punitive damages. We uphold the trial court as we do not set aside the findings of fact by a circuit judge sitting as a jury unless they are clearly erroneous. Taylor\u2019s Marine, Inc. v. Waco Mfg., 302 Ark. 521, 792 S.W.2d 286 (1990).\nAs argued by the appellants, section 2-403(1) of the Uniform Commercial Code provides that \u201ca purchaser of goods acquires all title which his transferor had.\u201d Typically, this \u201cDerivative Title Principle\u201d works to the advantage of the original owner \u25a0\u2014\u2022 i.e. since Chamberlain supposedly did not have good title to pass on to the bank, the original owners, the Woods, would succeed.\nHowever, four exceptions to this derivative title principle have been recognized in the Uniform Commercial Code and in common law. Relevant to the issue at hand is the fourth exception, the \u201cPreclusion Exception,\u201d which is found in common law and equity rather than in the U.C.C. This exception is well enunciated in an article by Professor Robert Laurence, entitled Bona Fide Purchaser Analysis, Beverage Products Corporation v. Robinson and the Case against Very Short Opinions, Ark. L. Notes 85 (1990). According to Professor Laurence, this doctrine holds that irrespective of the property holder\u2019s (such as Chamberlain) actual title \u2014 void, voidable or good \u2014 there will be times when the original owner\u2019s behavior does not justify allowing him to dispute the property holder\u2019s title. Therefore, the purchaser of the property will win, not so much on his own behalf but rather due to the original owner\u2019s procedural inability to force the contrary results. Id.\nApplying the preclusion exception to the facts before us, it is clear that Woods\u2019s and Graham\u2019s conduct does not justify allowing them to dispute the bank\u2019s security interest in the trailer. When the bank could not get Chamberlain to cooperate in perfecting a new title reflecting a lien in its favor, it contacted Ron Wood, as the listed seller on the certificate of title, to see if he would help. According to a loan officer, neither of the Woods told him that the signature on the certificate was allegedly forged. At trial, Ron Wood, to the contrary, stated that he had loaned the trailer to Chamberlain in order for him to fix it up and had given him possession of the trailer\u2019s title to \u201cobtain what permits he might need.\u201d Wood claimed that when he presented Chamberlain with the title, the back of the certificate was signed, but he had not signed its front nor was he present when his signature on the back was notarized. The notary public, Mr. Hueston Brown, maintained that he did not remember whether Ron Wood signed the document in front of him or not. The Woods were aware the bank had possession of and a possible security interest in the trailer, yet they failed to inform or make mention to the bank that they disputed that Chamberlain had valid title.\nPersuasive is the fact that the bank had no cause to be aware that anything was amiss and that Chamberlain presented the bank officer with a certificate of title seemingly signed by the owner and notarized.\nThe appellants ask us to rely upon Pachter, Gold & Shaffer v. Yantis, 742 F.Supp. 544 (W.D. Ark. 1990) for reversal, but this case is of no moment. There, the federal district court held that an owner of a lamp retained title to it after it was wrongfully pledged by his agent, and the sums received from the lamp\u2019s sale could be garnished by the owner\u2019s creditor. Yet, this case is distinguishable from the facts before us. In Pachter, there was no evidence that the original owner of the lamp had done anything to induce the loss, whereas here, the Woods furnished Chamberlain with the title as well as possession of the trailer.\nIn Snuffy Smith Motors v. Universal C.I.T., 236 Ark. 954, 370 S.W.2d 808 (1963), a case involving the question of title in two automobiles, we held that, \u201cWhere one of two innocent parties must suffer... the burden should be borne by the one whose conduct can be said to have induced the loss. We think the appellee is least at fault as between it and appellant.\u201d Id. This principle embodies the preclusion exception and has been upheld in other situations. Lane v. Rachel, 239 Ark. 400, 389 S.W.2d 621 (1965); Pine Bluff Nat\u2019l Bank v. Parker, 253 Ark. 966, 490 S.W.2d 457 (1973); Arkansas Dept. of Fin. & Adm. v. City of No. Little Rock, 280 Ark. 512, 659 S.W.2d 937 (1983).\nIn sum, the Woods\u2019s as well as Graham\u2019s conduct precludes them from disputing the bank\u2019s proprietary interest in the trailer taken from its possession \u2014 thus, the trial court\u2019s finding of a conversion of property was correct.\nAffirmed.", "type": "majority", "author": "Jack Holt, Jr., Chief Justice." } ], "attorneys": [ "William R. Mayo, for appellants.", "Ralph C. Williams, for appellee." ], "corrections": "", "head_matter": "Ron WOOD, Ed Wood, and Buck Graham v. The CORNER STONE BANK\n93-444\n866 S.W.2d 385\nSupreme Court of Arkansas\nOpinion delivered December 6, 1993\nWilliam R. Mayo, for appellants.\nRalph C. Williams, for appellee." }, "file_name": "0200-01", "first_page_order": 228, "last_page_order": 232 }