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International Harvester Co. v. Glendenning

Supreme Court of Texas
505 S.W.2d 320 (1974)


Facts

In the 1950s, Don Glendenning (defendant) owned an International Harvester dealership. Later, Glendenning worked as an International Harvester salesman before becoming a farmer and frequent trader of farm equipment. In 1971, Glendenning bought three tractors from Jack L. Barnes, another International Harvester dealer. Glendenning paid $16,000 in cash for all three, which were worth about $22,500. Barnes indicated in the order form and the bill of sale, which Glendenning signed, that in addition to the cash, Glendenning had traded in four other tractors valued at $8,700. Glendenning admitted that he traded in no tractors, that he knew a great deal about International Harvester’s floor-plan pricing method of supplying tractors to dealers and retaining a security interest, and that falsifying the transaction documents was likely to mislead International Harvester and other creditors. Nevertheless, when an International Harvester representative called Glendenning about the deal, he lied and affirmed that he had traded in the tractors. International Harvester Company and International Harvester Credit (International) (plaintiffs) sued Glendenning for wrongful conversion of the three tractors. Glendenning argued that damages were improper, because he was a buyer in the ordinary course of business. The jury agreed, and International appealed to the Texas Supreme Court.

Rule of Law

Issue

Holding and Reasoning (Williams, J.)

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