C. Itoh Industrial Machinery, Inc. v. Forklift Service Co.

Benham, Judge. Appellant, a distributor of forklift trucks, entered into a retail dealer agreement with appellee Forklift Service Company, Inc. (“Forklift”). By means of a “Deferred Payment Purchase Agreement” (“DPPA”), appellant agreed to finance Forklift’s purchases of forklifts, and individual appellees Moore, Wilson, and Petite executed unconditional guaranties of payment of any and all debts of Forklift to appellant. Appellant was also given a security interest in Forklift’s present and future inventory of forklifts acquired from appellant, as well as in the proceeds of the sale or lease of those forklifts. In September 1980, asserting that Forklift had not complied with the retail dealer agreement, appellant informed Forklift and the individual guarantors it was accelerating all amounts due “per Section 3 of the D,P.P.A.” The debt remaining unsatisfied, appellant filed suit against all the appellees to recover the balance due, interest, and attorney fees. After a bench trial, appellees moved for and were granted an involuntary dismissal on the ground that appellant had not complied with OCGA § 11-9-504. Appellant seeks review of the trial court’s action. After appellant accelerated the debt, it discovered that several forklifts shipped to Forklift were not part of Forklift’s inventory, and that the full and final payment due on those forklifts within seven days of sale, rental, lease or use (as required under the terms of the DPPA) had not been received by appellant. Appellant found two of the missing forklifts in the possession of one of Forklift’s guarantors, another leased to and in the possession of Universal Form Clamp, and [126] one in the possession of Southern Pan. The lease payments from Universal Form Clamp were diverted by appellant from Forklift to appellant, and after making several monthly payments, Universal made one lump sum payment to appellant, which then announced its security interest was satisfied in full through payment of all sums owing and outstanding. Appellant’s controller testified at trial that the forklift was sold to Universal at a private foreclosure sale, and that no other potential buyers were contacted or bids solicited. Appellees maintain appellant’s lawsuit sought payment of a debt secured by all of Forklift’s inventory and that appellant sold one piece of that inventory to Universal in a commercially unreasonable manner, thereby adversely affecting appellant’s endeavors to collect the amounts due on the remaining pieces of equipment. Farmers Bank, Union Point v. Hubbard, 247 Ga. 431, 436 (276 SE2d 622) (1981). Appellant, on the other hand, contends it sought recovery of separate debts incurred on each of the missing pieces of machinery and that the disposition of the forklift to Universal does not affect its ability to collect the unpaid balances of the remaining equipment. The trial court found appellant to have conducted a commercially unreasonable sale of the Universal forklift, and since the testimony of appellant’s witness supports this finding, we cannot hold that the trial court erred in dismissing the suit. OCGA § 9-11-41 (b); Farmers Bank, supra. Appellant cites Jerkins v. Savannah &c. Credit Assn., 157 Ga. App. 652 (278 SE2d 431) (1981), as authority for the proposition that the invoices should be treated as separate entities. In Jerkins, eight separate security agreements were executed by the parties. That is in marked contrast with the case before us wherein appellant and Forklift executed one document by which appellant took a security interest in every forklift it shipped to Forklift. Judgment affirmed. McMurray, P. J., and Pope, J., concur. Banke, C. J., and Birdsong, P. J., concur specially. Deen, P. J., Carley, Sognier and Beasley, JJ., dissent.