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Show . In The Supreme Court of The take a chemical test teat that? to of a A Not question being afraid to take a test; it was the .attitude and things that built up to the fact that they said I had to take a test. to MONDAY, OCTOBER 24, 1974 INTERMOUNTAIN COMMERCIAL RECORD PAGE EIGHT It does not show any confusion on his part at all. eviby The findings made by the trial court are not justified - to the trial dence. The case is reversed and remanded with directionwo co court to cancel plaintiff's driver's license as required by law. are awarded. . There was no evidence that McCall was confused regarding the fact that if he failed to take the breath or blood test, he might lose his driving privilege. In that regard he testified as follows: Q Do you remember reading that in the driver's State of Utah WE CONCUR: hand- book when you took the driver's test? A No. I don't. Q Do you deny that, you remember the officer telling you E. R. Callister, Chief Justice Jr. , that? A That I had? Q You could lose your license if you didn't take the chem- J. Allan Crockett, Justice ical test? A Not until after we were at jail, no. Q But you recall him telling you that? A It was after I was booked, that's when I recall that. . . . R. J. Tuckett, Justice Henriod, Justice, does not participate herein. Despite this, he still refused to take the test. The record indicates that he was obstreperous, vulgar, and not about to take any sobriety tests. Inter Mountain Association of Credit Men, a Utah corporation, Plaintiff and Appellant, wherever located, and the proceeds and products thereof, together with all other items of collateral acquired by the debtor after execution of the agreement. A financing statement was filed with the Secretary of State of Arizona on April 21, 1969, wherein it provided that it covered inventory wherever located, and the proceeds and products thereof. The debtor is listed as Village Brownstone Enterprises, Biltmore Fashion Plaza, Phoenix, Arizona. Neither the security agreement nor the financing statement indicated that the debtor was a Utah corporation, and no financing statement covering this transaction was filed in Utah.' No. 13377 FILED October 15, 1974 The Villager, Inc. , a Delaware corporation, and Villager Industries, Inc., a corporation, Defendants and Respondents. Allan E. Mechaxn, Clerk The parties to this action stipulated that The Company Enterprises transferred to plaintiff the goods, wares and merchandise situated at the premises of the Ogden store and the First South store, and The Company Enterprises had been doing business at these two stores under the assumed name of Village Brownstone. Prior to July 30, 1970, The Village Brownstone, Ltd. was a corporation engaged in the sale at retail of men's wearing apparel and furnishings, with retail stores in Salt Lake City and Ogden, Utah. The Company Enterprises, at all relevant times herein,' was also a corporation engaged in the business of the retail sales of men's wearing apparel. After the merger of the four domestic corporations, the survivor, The Company Enterprises, in addition to doing business at the two retail outlets aforementioned, maintained stores at Foothill Boulevard and at 13th East in Salt Lake City and at the Biltmore Fashion Plaza in Phoenix, Arizona. CALLISTER. Chief Justice; Plaintiff, an assignee for the benefit of creditors, initiated this action for a determination of the respective rights in proceeds of certain inventory with defendant. Plaintiff pleaded that the trial court declare null and void certain security agreements wherein defendant was the secured party and further determine that defendant did not have a security interest in the inventory or the proceeds from the sale thereof, liquidated by plaintiff. Defendant answered and counterclaimed, pleading that it had a valid security interest in all the inventory and proceeds of plaintiff's assignor, The Company Enterprises. Defendant pleaded that the court decree its security interest a valid prior lien in the funds received by plaintiff and that it be awarded the total indebtedness incurred pursuant to the security agreements, including costs and attorney's fees. the time the security agreements were entered, the Villager, Inc. was the sole supplier of merchandise to The Village Brownstone, Ltd. At the time of the assignment for the benefit of creditors The Company Enterprises did not have in its possession any inventory purchased from defendant by. the surviving corporation or any of its constituent corporations. All such inventory had been sold prior to the date of the assignment, and no 'inventory was purchased from defendant at the Utah outlets within six months to one year prior to the assignment. The funds derived by plaintiff from the liquidation of inventory of The Company Enterprises was derived from the sale of inventory acquired from suppliers other than defendant. The parties further stipulated that defendant sold merchandise for the purchase price of $38, 381. 87 to the outlets of The Village Brownstone, Ltd. in Utah and $16, 867. 2,0 to The Village Brownstone Enterprises in Arizona, prior and subsequent to the corporate merger. The last invoice to a Utah outlet was dated September 9, 1970, and the last invoice to the Arizona outlet was dated August 4, 1971. At and-inventor- Both parties entered into a stipulation of facts and moved for summary judgment. The trial court awarded defendant priority to a portion of the. proceeds derived from inventory. Plaintiff appeals, and defendant cross -- appeals. On September 3, 1971, The Company Enterprises, a Utah corporation, doing business under the name of Village Ltd. , The Company, The Village Brownstone at Salt Lake City and Ogden, made an assignment for the benefit to creditors to plaintiff. The Company Enterprises was the survivor of the merger of four domestic corporations, The Village Ltd. , The Village Brown-ston- e, Ltd. , and Village Brownstone Enterprises. The certificate of merger was issued by the Secretary of State on July 30, 1970. There were three security agreements upon which defendant predicates its claim of priority. Plaintiff concedes that defendant's claim should be allowed, the issue is the extent to which its claim for priority over the general creditors is established. The Village Brownstone, Ltd. , with its principal place of business at 22 East First South in Salt Lake City, entered into a security agreement with The Villager, Inc. on March 29, 1968. The former was the debtor and the latter was the secured party. The agreement provided: 2. To secure the indebtedness set forth above, the Undersigned hereby grants to Villager, a security interest in and to all of the Undersigned's present and future accounts, contract rights, general intangibles, instruments, documents, chattel paper, and a purchase money security interest in the inventory wherever located, and the proceeds and products thereof (all hereinafter called the "collateral'!), together with all other items of Collateral of the same class or classes acquired by the Undersigned after the execution of this agreement and prior to its termination. The security agreement further provided that the debtor would keep the collateral located at the premises set forth in the agreement; that it would be deemed a default if the debtor made an assignment for the benefit of creditors; and that the parties named therein should include the successors or assigns of those parties. The Company Enterprises sold all the inventory, furniture, fixtures, equipment and intangibles situated in the Arizona store in May, 1971. The Arizona store continued to do business with defendant, but none of the goods was purchased by The Company Enterprises. The unpaid balance for the merchandise purchased for the Arizona store as of May 31, 1971, was in the sum of $16, 178. 70. ' , financing statement covering the property of this security agreement was filed March 19, 1968, wherein it was indicated that it covered all present and future accounts, general intangibles, instruments, documents, chattel paper and inventory. The statement further provided: "The secured party claims a purchase money security interest in the inventory." The proceeds and products of the collateral were further indicated as covered. A second security agreement was entered between The Village Brownstone, Ltd. , d. b. a. Village Brownstone, at 2354 Washington Boulevard, Ogden, and The Villager, Inc. on November 29, 1968. The relevant provisions of this security agreement were identical with those in the agreement of the debtor, concerning its store in Salt Lake City. A financing statement was filed on April 14, 1969, which provided that the property covered: "All present and future accounts, contract rights, general intangibles, instruments, documents, chattel paper and inventory wherever located." The proceeds and products of the colA Plaintiff, as an assignee for the benefit of creditors, sold furniture, fixtures, furnishings, supplies, leasehold improvements and merchandise inventory from the retail outlets in Utah. No property from the State of Arizona was included in the assignment, and plaintiff never took possession of any such property. Based on the foregoing stipulation, the trial court concluded that defendant had a valid security interest in the inventory on hand at the time of the assignment for the benefit of creditors at the Ogden and First South outlets of The Company Enterprises. The trial court ruled that defendant's security interest attached to the cash proceeds from the sale of inventory at these two stores, but that defendant did not have a security interest in the inventory located at the other outlets of The Company Enterprises in either Utah or Arizona. Plaintiff sold the leasehold, fixtures, and inventory at the First South store for $58, 688.33; plaintiff accepted $30,000 cash and a promissory note for the remainder. The value of. the inventory at the store was '$26, 305. 75, and the trial court allocated the cash and from the note to the defendant in the same proportion as the value ofproceeds the bore to the total purchase price. 1 The trial court awarded defendantinventory fee attorney's in the sum of $3, 000. The trial court decreed that any insecurity terest in the inventory or proceeds situated at other thanpurported the Ogden and First South outlets was null and void as against plaintiff, assignee, and that the unpaid balance of defendant's claim should be recognized by plaintiff as a claim with general creditor status to be. paid on a pro rata basis with other credit-tors of the same class. On lateral were also covered. appeal, plaintiff contends that under the express terms of the security agreement defendant's security interest was limited to a "purchase money security interest in inventory" and of the same class; and, therefore, defendant did not have a validproperty security interest in inventory purchased from other suppliers. The third security agreement was entered into between Village Brownstone Enterprises, d. b. a. "Village Brownstone," having its principal place of business at Biltmore Fashion Plaza, Phoenix, Arizona, and the Villager, Inc. on November 1, 1968. In addition to the debtor being a different entity, the agreement granted a security interest in the equipment and inventory The construction urged, by plaintiff would result in the anomalous situation of relegating to an inferior position the preferred status of a purchase money security interest granted by the Uniform Commercial Code, Chanter 9 2 Title 70-U.C.A. 1953. a. amended 1965. In both the .ecuriti agreemen;. and the financing statement, filed in Utah, the security interest of the defendant after-acquir- A, ed |