North Ridge Farms, Inc. v. Trimble, 37 UCC Rep. Serv.1280 (Ky. App. 1983), aff’d sub nom, Trimble v. North Ridge Farms, 700 S.W.2d 396 (1985); following remand, North Ridge Farm v. Stathatos, 760 S.W.2d 89 (Ky. App. 1988). Syndicator of a stallion took a security interest in a share sold to a syndicate member. One year’s nomination (breeding season) was sold to another breeder. The Kentucky Court of Appeals held that the buyer of the breeding season took free of the security interest in stallion syndicate share from which the season was derived. The Court stated that the buyer of the season could not be a buyer in the ordinary course of business of goods under section 9-307 of the UCC because although the stallion share was within the definition of “goods,” the season was severed from those goods. However, because the syndicate agreement authorized the sale of seasons, the security interest was extinguished as to the season pursuant to UCC section 9-306. The Kentucky Supreme Court affirmed, its reasoning different from that of the Court of Appeals, but the earlier (unreported) decision became the basis of In re Blankenship-Cooper, Inc. which is much broader in scope. On remand, the trial court awarded damages in favor of the buyer of the season, who had not been permitted to breed. The court held that the agent who handled the transaction for a disclosed principal was not liable, but the principal was liable. The Kentucky Court of Appeals affirmed.
