{ "id": 3520004, "name": "MIDKIFF IMPLEMENT COMPANY, Plaintiff-Appellant, v. GRACE E. WORRALL, Indiv. and as Adm'r of the Estate of Donald L. Worrall, Deceased, et al., Defendants-Appellees", "name_abbreviation": "Midkiff Implement Co. v. Worrall", "decision_date": "1983-07-06", "docket_number": "No. 4\u201482\u20140838", "first_page": "546", "last_page": "551", "citations": [ { "type": "official", "cite": "116 Ill. App. 3d 546" } ], "court": { "name_abbreviation": "Ill. App. Ct.", "id": 8837, "name": "Illinois Appellate Court" }, "jurisdiction": { "id": 29, "name_long": "Illinois", "name": "Ill." }, "cites_to": [ { "cite": "12 Ariz. L. Rev. 391", "category": "journals:journal", "reporter": "Ariz. L. Rev.", "year": 1970, "pin_cites": [ { "page": "394" } ], "opinion_index": 0 }, { "cite": "27 Okla L. Rev. 469", "category": "journals:journal", "reporter": "Okla. L. Rev.", "year": 1974, "pin_cites": [ { "page": "474" } ], "opinion_index": 0 }, { "cite": "28 Mercer L. Rev. 611", "category": "journals:journal", "reporter": "Mercer L. Rev.", "year": 1977, "pin_cites": [ { "page": "620" } ], "opinion_index": 0 }, { "cite": "119 Ariz. 145", "category": "reporters:state", "reporter": "Ariz.", "case_ids": [ 707629 ], "weight": 2, "pin_cites": [ { "page": "147" }, { "page": "1117" } ], "opinion_index": 0, "case_paths": [ "/ariz/119/0145-01" ] }, { "cite": "191 N.E.2d 471", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1978, "pin_cites": [ { "page": "473" } ], "opinion_index": 0 }, { "cite": "346 Mass. 255", "category": "reporters:state", "reporter": "Mass.", "case_ids": [ 518336 ], "year": 1978, "pin_cites": [ { "page": "257" } ], "opinion_index": 0, "case_paths": [ "/mass/346/0255-01" ] }, { "cite": "292 Minn. 277", "category": "reporters:state", "reporter": "Minn.", "case_ids": [ 315102 ], "weight": 4, "pin_cites": [ { "page": "286-88" }, { "page": "782" }, { "page": "287" }, { "page": "782" } ], "opinion_index": 0, "case_paths": [ "/minn/292/0277-01" ] }, { "cite": "438 N.E.2d 1381", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "108 Ill. App. 3d 404", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 3011642 ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/108/0404-01" ] } ], "analysis": { "cardinality": 597, "char_count": 11074, "ocr_confidence": 0.751, "pagerank": { "raw": 1.9215264481742684e-07, "percentile": 0.7330400343803828 }, "sha256": "9d0859ce71a0a4f03d466b4e0e55a137848cfbef3ca61631f34156b428352e20", "simhash": "1:7b2494eeb8a63786", "word_count": 1777 }, "last_updated": "2023-07-14T17:34:21.721217+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "MIDKIFF IMPLEMENT COMPANY, Plaintiff-Appellant, v. GRACE E. WORRALL, Indiv. and as Adm\u2019r of the Estate of Donald L. Worrall, Deceased, et al., Defendants-Appellees." ], "opinions": [ { "text": "JUSTICE MILLS\ndelivered the opinion of the court:\nUniform Commercial Code.\nDoes \u201call *** farm machinery *** now owned\u201d mean just that in a security agreement?\nIt does.\nWe affirm.\nDonald Worrall, a Morgan County farmer, found himself beset by the same plight that has befallen many farmers today \u2014 he bought farm machinery which he was unable to pay for. In April of 1977, he purchased a New Holland Model 850 round hay baler from the Midkiff Implement Company. In June of the same year, he purchased a 770 W forage pickup, a New Holland Model 80 bale carrier, and a New Idea Model 404 hay rake from Midkiff. Worrall executed a retail installment contract with each purchase and security agreements covering the items were recorded in Greene County, where Midkiff\u2019s business is located. Midkiff, however, failed to record its security interest in the items in Morgan County, where Worrall lived.\nFrom time to time, Worrall and his wife, Grace, borrowed money from the First National Bank of Jacksonville, which subsequently merged with the Elliott State Bank of Jacksonville (the Bank). In April of 1979, Worrall and his wife executed a chattel mortgage (the security agreement) giving the Bank a security interest in certain collateral in order to secure their loans at the Bank. That security agreement contained the following description of collateral:\n\u201cFirst lien under the Uniform Commercial Code of Illinois on all machinery, equipment, including farm machinery and equipment, fixtures, inventory, crops growing or to be grown, livestock, accounts receivable and general intangibles now owned and hereafter acquired and all proceeds thereafter including but not limited to the attached Exhibit A.\u201d (Emphasis added.)\nThe attached Exhibit A did not list the four items Worrall purchased from Midkiff. Within 10 days, the Bank filed a financing statement-containing the same description of collateral \u2014 in the Morgan County clerk\u2019s office.\nWorrall defaulted in his payments to Midkiff and then died in the summer of 1979. His widow was appointed administratrix of his estate. She hired attorney Ronald Kesinger and the Moss Auction Company to assist her in liquidating her husband\u2019s estate. After the sale of the decedent\u2019s farm machinery at public auction, both Midkiff and the Bank demanded the proceeds from the sale of the four disputed items: the hay baler, the forage pickup, the bale carrier, and the hay rake. Caught between the devil and the deep blue sea, the widow turned to her attorney for guidance. Kesinger advised Mrs. Worrall to pay the proceeds to the Bank, which she did.\nMidkiff then filed a complaint in the circuit court of Morgan County against Mrs. Worrall (individually and as adminstratrix of her husband\u2019s estate), Kesinger, the Moss Auction Company, and the Bank (collectively the defendants). The complaint alleged that the defendants had illegally appropriated the proceeds from the sale of the four disputed items. All of the parties \u2014 Midkiff and each of the defendants \u2014 filed motions for summary judgment. Judge Seator granted the defendants\u2019 motions for summary judgment and Midkiff appeals.\nWe affirm.\nOn appeal, Midkiff admits that it failed to perfect its security interest in the four items by not filing a financing statement covering the items in Morgan County, the situs of debtor\u2019s residence. Midkiff maintains, however, that although it failed to perfect its security interest, it did at least attach a security interest to the four items by entering into a security agreement with Worrall. We agree. Midkiff did attach a valid security interest to the four items.\nMidkiff then argues that it should have priority over the Bank to the proceeds because it attached a security interest to the items and the Bank did not. Midkiff bases its argument on the position that although the Bank entered into a security agreement with Worrall and did perfect first by filing in Morgan County, the description of the collateral in the Bank\u2019s security agreement \u2014 \u201call *** farm machinery and equipment *** now owned\u201d \u2014 was too vague and therefore did not cover the four items. Here, we disagree. Although the collateral description in the Bank\u2019s security agreement was very broad, it was sufficient to cover the four items. Consequently, the Bank did have priority over Midkiff to the proceeds of the sale because the Bank attached a valid security interest to the four items and then perfected that interest by filing a financing statement covering the items in Morgan County.\nAlthough we note that the description \u201call *** farm machinery and equipment *** now owned\u201d is a very broad one and that more careful practice may have dictated the use of a more exact description, we believe that such a description is sufficient. Section 9\u2014203(1) of the Uniform Commercial Code (Ill. Rev. Stat. 1981, ch. 26, par. 9\u2014203(1)) requires that the security agreement between a creditor and a debtor contain a description of the collateral. The standard for judging the adequacy of that description is set out in section 9-110 of the Code (Ill. Rev. Stat. 1981, ch. 26, par. 9\u2014 110), which states in full:\n\u201cFor the purposes of this Article [9] any description of personal property *** is sufficient whether or not it is specific if it reasonably identifies what is described.\u201d\nThe Illinois Code Comment to section 9 \u2014 110 states in part:\n\u201cThe test is whether the description \u2018reasonably identifies what is described,\u2019 which it will do if it describes the property so as to distinguish it from any other property with which it might be confused.\u201d (Ill. Ann. Stat., ch. 26, par. 9\u2014110, Illinois Code Comment, at 85 (Smith-Hurd 1974).)\nThe Uniform Commercial Code Comment to section 9 \u2014 110 states in part:\n\u201cThe requirement of description of collateral *** is evidentiary. The test of sufficiency of a description laid down by this section is that the description do the job assigned to it \u2014 that it make possible the identification of the thing described.\u201d (Ill. Ann. Stat., ch. 26, par. 9\u2014110, Uniform Commercial Code Comment, at 88 (Smith-Hurd 1974).)\nThe Code\u2019s \u201creasonable identification\u201d test appears to us to allow very broad descriptions of collateral in security agreements.\nLast year, this court in Interstate Steel Co. v. Ramm Manufacturing Corp. (1982), 108 Ill. App. 3d 404, 438 N.E.2d 1381, held that the security description \u201call accessories, parts and equipment\u201d was sufficient to include all equipment used in the production of merchandise by the debtor. We also held that the description \u201cmerchandise\u201d in the same security agreement was sufficient to cover the debtor\u2019s inventory. In both instances we applied the \u201creasonable identification\u201d test of section 9\u2014110.\nOur position, that section 9\u2014110 allows very broad descriptions of collateral to be used in security agreements, is supported by the courts in the vast majority of jurisdictions. The Supreme Court of Minnesota in James Talcott, Inc. v. Franklin National Bank (1972), 292 Minn. 277, 286-88, 194 N.W.2d 775, 782, stated:\n\u201cThe principal function of a description of the collateral in a security agreement is to enable the parties themselves or their successors in interest to identify it, particularly if the secured party has to repossess the collateral or reclaim it in a legal proceeding. ***\n* * *\nA security agreement should not be held unenforceable unless it is so ambiguous that its meaning cannot reasonably be construed from the language of the agreement itself.\u201d\nThe court in James Talcott also stated:\n\u201cIf the debtor himself is willing to give a creditor a security interest in everything he owns, the code does not prevent it, whether his action is prudent or not. Upon default, the creditor takes everything to which the debtor previously agreed; hence, identification is no problem.\u201d 292 Minn. 277, 287, 194 N.W.2d 775, 782.\nIn National Cash Register Co. v. Firestone & Co. (1963), 346 Mass. 255, 257, 191 N.E.2d 471, 473, the court held that a security agreement covering \u201call contents of a luncheonette including equipment\u201d was sufficient to include a cash register. In Empire Machinery Co. v. Union Rock & Materials Corp. (1978), 119 Ariz. 145, 147, 579 P.2d 1115, 1117, it was held that the description \u201call earth movers, blades, rollers, lay down machines\u201d was sufficient to include irrigation equipment.\nNot only does our broad reading of section 9 \u2014 110 have the support of our brethren across the nation, but it is also supported by many of the commentators on the UCC. For example, White and Summers in their treatise Handbook of the Law Under the Uniform Commercial Code, at page 910-11 (2d ed. 1980) support allowing the use of broad descriptions in security agreements:\n\u201cThe overwhelming majority of courts uphold very broad descriptions. Probably what is at work when courts condemn such descriptions is an unstated (and even unconscious) desire to protect debtors against dragnet clauses subjecting all or virtually all of their property to the claim of a single secured creditor. Such sweeping clauses reduce debtor opportunities to obtain credit from other sources. And they may bespeak creditor greed. Yet, courts that condemn such clauses are not on sound ground. The ability to monopolize collateral \u2014 and to have collateral monopolized \u2014 comports with freedom of contract.\u201d\nSee also Beard, The Description of Collateral in Security Agreements and Financing Statements, 28 Mercer L. Rev. 611, 620 (1977); Sea-mans, Commercial Transactions: The Adequacy of the Description of Collateral in Uniform Commercial Code Financing Statements and Security Agreements, 27 Okla L. Rev. 469, 474 (1974); Phillips, Agricultural Financing Under the U.C.C., 12 Ariz. L. Rev. 391, 394 (1970).\nIn conclusion, it appears that the commentators along with the courts in the majority of jurisdictions agree with our position that a broad collateral description is sufficient for security agreement purposes.\nAdmittedly, the description in the case sub judice \u201call *** farm machinery and equipment *** now owned\u201d is broad. But it covers exactly what it says it covers \u2014 all of Worrall\u2019s farm machinery and equipment. There can be no argument that the hay baler, the forage pickup, the bale carrier, and the hay rake are pieces of farm mach\u00ednery or equipment. Consequently, they are covered by the description of collateral in the security agreement; the Bank\u2019s security agreement attached a security interest to those items; and the Bank achieved priority over Midkiff to the proceeds from the items\u2019 sale by perfecting that interest.\nAffirmed.\nWEBBER, P.J., and MILLER, J., concur.", "type": "majority", "author": "JUSTICE MILLS" } ], "attorneys": [ "Robert H. Mehrhoff, of Carrollton, for appellant.", "G. Ronald Kesinger, of Jacksonville, pro se, for appellees Grace E. Worrall and Moss Auction Co.", "Richard T. Mitchell, of Mitchell & Woodruff, of Jacksonville, for appellee Elliott State Bank of Jacksonville." ], "corrections": "", "head_matter": "MIDKIFF IMPLEMENT COMPANY, Plaintiff-Appellant, v. GRACE E. WORRALL, Indiv. and as Adm\u2019r of the Estate of Donald L. Worrall, Deceased, et al., Defendants-Appellees.\nFourth District\nNo. 4\u201482\u20140838\nOpinion filed July 6, 1983.\nRobert H. Mehrhoff, of Carrollton, for appellant.\nG. Ronald Kesinger, of Jacksonville, pro se, for appellees Grace E. Worrall and Moss Auction Co.\nRichard T. Mitchell, of Mitchell & Woodruff, of Jacksonville, for appellee Elliott State Bank of Jacksonville." }, "file_name": "0546-01", "first_page_order": 568, "last_page_order": 573 }