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Ford Motor Credit Co. v. Barnhart

decided: November 16, 1981.

FORD MOTOR CREDIT COMPANY, APPELLANT
v.
S. E. BARNHART & SONS INC. AND MERLE HARR AND BETTY HARR, APPELLEES



APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA (D.C. Civ. No. 79-1756)

Before Hunter, Van Dusen and Weis, Circuit Judges.

Author: Weis

Opinion OF THE COURT

Devastation of the Pennsylvania landscape caused by irresponsible strip mining prompted the legislature to enact a comprehensive statute governing the conduct of mine operators and providing for administrative enforcement. In response to a legislative delegation of authority, the state Department of Environmental Resources adopted a regulation prohibiting removal of backfilling equipment from a mining site until reclamation is completed. The district court held that the regulation barred plaintiff finance company from repossessing a loading machine from a stripping site. Because we conclude that the regulation was not intended to apply to financing agencies and that, if otherwise interpreted, it would exceed the agency's authority, we vacate and remand.

Plaintiff Ford Motor Credit Company brought suit against the defendants Harrs to replevy a wheel loader that had been used in stripping coal from their farm. Plaintiff later amended its complaint to include a claim against defendant S. E. Barnhart & Sons, Inc., the owner of the loader. The district court initially allowed plaintiff to take possession of the equipment but later reversed its order, directed plaintiff to return the loader to the farm, and dismissed the action against the Harrs. Finding that Ford's only remaining claim was for money damages against Barnhart, the district court certified the case under 28 U.S.C. ยง 1292(b) (1976). A panel of this court allowed the appeal.

Barnhart had purchased the wheel loader from Highway Equipment Company on an installment sale contract in April 1978. The agreement was assigned to the Ford Motor Credit Company in November 1978, and a notation to that effect was entered in the filing offices where financing statements had previously been lodged by Highway Equipment Company.*fn1

Barnhart ultimately leased the loader to Summit Fuel Company, who used it to strip coal from the Harr farm pursuant to a written agreement. In return, Summit was to pay the Harrs a stipulated royalty, to abide by state and federal regulations on backfilling, and, in addition, to have "at least one piece of mining equipment performing backfilling operations simultaneously with any mining and stripping operations ...."

After failing to pay royalties or backfill as agreed, Summit vacated the premises, leaving the loader behind. In the meantime, Barnhart defaulted on its payments to Ford Motor Credit Company. When Ford sought to repossess the loader, the Harrs refused permission and this replevin action followed.

In their answer to Ford's complaint, the Harrs asserted a possessory lien on the equipment. The district court rejected that contention in an order dated October 30, 1980, but scheduled a hearing on the applicability of regulations issued by the Pennsylvania Department of Environmental Resources, particularly the one providing that backfilling equipment must remain on site until restoration is completed.

After the hearing, the court found that the required reclamation had not been accomplished and that the loader was a piece of backfilling equipment within the meaning of the regulation. It then concluded that Ford must return the loader to the farm, where it was to remain until the backfilling was completed. The Harrs, however, were not permitted to operate or sell the equipment. After argument, the court denied plaintiff's motion for reconsideration.

On appeal, plaintiff contends primarily that the regulation is applicable only to mining operators, not finance companies. The Harrs assert that they have a possessory lien on the loader by virtue of both the regulation and their status as landlords.

I.

We first discuss the question of jurisdiction. When the district court directed plaintiff to return the loader to the farm, the order recited that the "only outstanding litigation remaining in the case is the claim of the plaintiff against Barnhart for money damages ...." This put the case clearly within the ambit of Fed.R.Civ.P. 54(b):

"When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there ...


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