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Valley Products, Inc. v. Kubelsky

Supreme Court of Arizona

May 24, 1937

VALLEY PRODUCTS, INC., a Corporation, Appellant,

APPEAL from a judgment of the Superior Court of the County of Maricopa. M. T. Phelps, Judge. Judgment reversed and cause remanded with instructions.

Mr. William C. Fields, for Appellant.

Mr. D. P. Skousen and Mr. Andrew T. Hagen, for Appellee M. B. Kubelsky.


Page 70

[49 Ariz. 502] LOCKWOOD, J.

This is an appeal from a judgment rendered in favor of M. B. Kubelsky, hereinafter called plaintiff, against Western Cotton Products Company, a corporation,

Page 71

hereinafter called garnishee, and Valley Products, Inc., a corporation, hereinafter called intervenor. The facts necessary for a determination of the appeal may be stated as follows.

On January 29, 1931, Roy Fansler executed his promissory note in favor of plaintiff, in the amount of $800, due October 31st the same year. The note not having been paid, a suit was brought thereafter against Fansler on May 9, 1934, in the superior court of Maricopa county, and judgment was rendered thereon May 3, 1935, nearly a year later. On February 4, 1936, plaintiff caused a writ of garnishment to be issued against the garnishee. It answered, showing that it held forty-three bales of cotton to the joint account of intervenor and Fansler. The answer further stated that the cotton was held by it as security for the payment of an indebtedness of some $1,252 owed it by Fansler under the terms of a crop mortgage, which provided that the cotton could be sold by the garnishee, and the proceeds applied on the payment of a note which had been given by Fansler to it. Some twelve days later a supplemental answer to the writ was filed, stating that since filing the original answer garnishee had sold the cotton under the terms of the mortgage, and, after retaining from the proceeds sufficient to pay the balance due, there remained in its hands the sum of $1,106.29, to the joint account of the intervenor and Fansler. On March 21, 1936, Valley Products, Inc., filed a motion for leave to intervene in the proceeding, alleging that the cotton in the hands of the garnishee was grown on its land, [49 Ariz. 503] which had been rented to Fansler under a cropper's contract, and that Fansler had no equity in the proceeds thereof, because he had already received more than his share from the proceeds of the crop. Issue was joined by plaintiff in his answer to the complaint in intervention, in which he claimed that Fansler grew the cotton in question under a certain recorded lease from the intervenor, which provided for a cash rental which had been paid.

A trial on these issues was had before the court sitting without a jury. Plaintiff, in order to prove his case, introduced in evidence a certain recorded lease dated April 15, 1935, between Fansler and the intervenor, which lease, in substance, provided for a cash rental to be paid in a certain manner, and showed an assignment thereof by intervenor to J.G. Boswell Farm Loan Company, a corporation. Thereupon plaintiff rested. Intervenor then called Fansler, who was asked whether he had actually farmed the land which grew the cotton involved in this action, under the recorded lease offered in evidence by plaintiff. He stated that he had not, but that it was farmed under another written lease which had been executed in 1934 and renewed in 1935. Objection was made by plaintiff to the introduction in evidence of the lease for 1934, on the ground that it had never been recorded, and the court sustained the objection. The intervenor offered then to prove that the recorded lease offered in evidence by the plaintiff had never been put into operation, having been terminated by mutual consent of the parties thereto, and that the assignment was not, in truth and fact, an assignment of the lease, but merely a waiver made for the purpose of a loan. It further offered to prove that Fansler had drawn much more than half the proceeds of the crop made on the land, so that he was not entitled to any of the proceeds of the sale of the forty-three bales of cotton left after [49 Ariz. 504] the mortgage had been satisfied. The court sustained an objection to any offer of testimony of this nature, stating:

"The court sustains the objection to the testimony, it being the view of the Court that the solemn written agreement of the parties recorded as evidence to the world as stating the true relation between the parties is binding upon them. This attachment creditor had the right to rely upon it, and certainly incurred expense in relying upon it, and that you may not now be heard to say that you didn't act upon it but acted under some former contract."

Judgment was thereafter rendered in favor of plaintiff, and against the garnishee, for the sum which it admitted that it had in its hands, and that the intervenor had no interest therein. A motion for new trial was duly made and the court denied it in the following language:

"The motion for a new trial filed by the intervenor in the above-entitled cause is hereby denied, for the reason that the contract of lease offered in evidence by the intervenor, dated the 17th day of February, 1934, creates the relation of landlord and tenant between the Valley Products, Inc., a ...

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