Unpublished Disposition, 907 F.2d 154 (9th Cir. 1990)

Belmont International provided shoes on consignment to American International Shoe Company. Proceeds of the sales of those shoes were placed in an account at First Interstate Bank of Oregon. Belmont explains that American delivered the shoes to its customers "on open account." American defaulted on a loan and security agreement with the Bank and the Bank applied all of American's accounts, including the consignment account, against the outstanding loan. The Bank claims to have had a perfected security interest in the funds in the consignment account.

Belmont brought suit, claiming that, under the Oregon common law doctrine of money had and received, it is entitled to the proceeds in the consignment account. In its complaint, Belmont alleges that it has "all right, title and interest in the goods delivered to American International and the resulting consignment account." The district court dismissed the claim, holding that the Oregon UCC applies and therefore preempts common law doctrines, and that Belmont had not met the requirements of those UCC sections, specifically ORS 79.3015, designed to protect consignors.

Belmont now argues that, under the relevant UCC provisions, it is entitled to the money, even though it did not file or otherwise take the necessary steps to protect itself pursuant to ORS 72.3260(3) or ORS 79.3015(1). Belmont claims that it is nonetheless protected under those sections because, at the time the Bank offset the funds in the consignment account, the Bank had actual knowledge that the account contained proceeds from the Belmont-American consignment. In the alternative, Belmont continues to press the money had and received theory.

Certification

Questions of Oregon state law will be dispositive in this case. We have, however, found no controlling precedent in the decisions of the Oregon Supreme Court. We therefore respectfully request that the Oregon Supreme Court exercise its discretion pursuant to the Uniform Certification of Questions of Law Act, ORS 28.200-28.255, and answer the following questions:

1. Does ORS 72.3260 apply to money collected "on open account" from customers of the consignee?

2. Does ORS 79.3015 apply to money collected "on open account" from customers of the consignee?

3. Assuming that either ORS 72.3260 or ORS 79.3015 applies, would a consignor, who did not file or otherwise protect itself under those sections, have priority in the proceeds of a consignment sale over a secured creditor with actual knowledge of the consignment?

4. Assuming that neither ORS 72.3260 nor ORS 79.3015 applies, would a perfected secured creditor's priority pursuant to ORS 79.2010 and/or ORS 79.3010 preempt a common law claim for money had and received?

5. Assuming that such a claim has not been preempted, has Belmont stated a claim for money had and received?

The clerk of this court shall transmit to the Oregon Supreme Court a certified copy of this order, as well as the appellate briefs and the district court record in this case.

Within 30 days after the Oregon Supreme Court has acted on our request, each side shall file a brief, no longer than 10 pages, describing the supreme court's disposition, and recommending appropriate action for us to take in light thereof.

CERTIFIED: