Ella Lee OWENS, Executrix of the Estate of George Keith Owens, aka Keith Owens, Appellant,
Jack E. HUNTER and Virginia Hunter dba Juniper Lumber Co., and Arizona Moulding Co., Inc., Appellees.
Rehearing Denied April 17, 1962.
[91 Ariz. 8] Dallas P. Richeson, E. J. Hilkert and Kenneth Biaett, Phoenix, for appellant.
Marvin Johnson, Phoenix, for appellees.
UDALL, Vice Chief Justice.
This appeal is from a judgment denying plaintiff executrix recovery for the deficiency remaining after judicial sale of collateral securing a promissory note on which the maker, Arizona Moulding Co., a corporation, was in default.
Payee on the note was the decedent, Keith Owens. While doing business as Owens Bros. Lumber in 1954 he had extended credit to the defendant Arizona Moulding Co. in connection with lumber purchases by the latter amounting to [91 Ariz. 9] $40,000. The note of May 25, 1955 was signed by the Moulding Company's president, defendant Jack E. Hunter, and called for payment of the $40,000 in monthly installments of $500 plus interest beginning January 1, 1957. An acceleration clause was included and provision was also made for payment by defendant of reasonable attorneys' fees in the event of necessary legal action. Securing the note and executed on the same date was a chattel mortgage on some thirty-six (36) items of equipment and machinery belonging to and on the premises of the Moudling Company. These items were listed in an 'inventory' appended to the chattel mortgage.
Nearly seventeen (17) months later the Moulding Company prepared and delivered to Keith Owens an 'Agreement' dated October 15, 1956 which provided in pertinent part:
'It is agreeable to me that your obligation to me, namely a note dated May 31, 1955, may be satisfactorily fulfilled by the following method, any time between the date of this agreement and January 1, 1957:
'I will accept all the equipment as listed under Chattel Mortgage dated May 31, 1955, as full payment on said note.' 
On November 15, 1956 Owens signed the above 'Agreement' but beneath his signature he also inscribed the following:
'I can't locate my list at this time, however as you stated yesterday it is to be the complete list not the deleted one.
'/s/ Keith Owens'
Defendant Hunter testified that subsequent to the execution of this 'Agreement' he and plaintiff Owens could not come to any understanding respecting which items listed in the chattel mortgage were to be surrendered to plaintiff in satisfaction of the debt. Hunter also prevented one of Owens' employees from removing one of the disputed items from the Moulding Company's premises. His reason for doing so was that any arrangement between the parties was not 'settled' at the time. An argument over this incident resulted in plaintiff striking defendant in the eye.
On December 18, 1956 defendant Hunter's attorney wrote the attorney for the plaintiff and explained that pursuant to the 'contract of October 15, 1956' the 'equipment * * * [would] be available on December 31, 1956 at Arizona Moulding's plant.' which equipment was not specified.
Early in January of 1957, after due notice to defendant Moulding Company that
the note of May 25, 1955 was in default for failure to pay the first installment thereon, plaintiff Keith Owens instituted suit to replevy the items listed in the chattel mortgage. Shortly thereafter, however, Owens was killed in an accident and his widow and executrix, Ella Lee Owens, was [91 Ariz. 10] substituted as plaintiff in the action. Pursuant to statutory procedure the items replevied were sold at public auction for $12,144. Then, in a supplemental complaint, plaintiff executrix asked for the deficiency, costs of the replevin and sale and attorneys' fees. She requested also that judgment be entered against defendant Jack E. Hunter and his wife Virginia individually and as ...