
    BUCKLEY’S, INC v TELL-MALL, INC
    Docket No. 78-4966.
    Submitted August 28, 1979, at Detroit.
    Decided November 7, 1979.
    Tell-Mall, Inc., which operated a restaurant, sold the assets of the business to Madi’s Red Barn West, Inc. The bulk transfer provisions of the Michigan Uniform Commercial Code were not complied with in that sale. Approximately seven months later, Buckley’s, Inc., obtained a judgment against Tell-Mall on a previous debt. Buckley’s served a writ of garnishment on Mad-i’s Red Barn West and at a subsequent hearing the 50th District Court found Madi’s Red Bam West to be liable to Buckley’s in the amount of the judgment because the bulk transfer provisions of the Uniform Commercial Code were not complied with. Madi’s Red Barn West appealed to the Oakland Circuit Court, which affirmed, James S. Thorburn, J. Madi’s appeals by leave granted. Held:
    
    The bulk sales provisions of the Uniform Commercial Code do not apply to the sale of a restaurant; therefore, the assets in the hands of Madi’s Red Barn West are not subject to garnishment for failure to comply with the bulk sales provisions.
    Reversed.
    Sales — Uniform Commercial Code — Sale of Restaurants.
    The sale of p restaurant is not subject to the bulk sales provisions of the Uniform Commercial Code (MCL 440.6102; MSA 19.6102).
    References for Points in Headnotes
    [1] 37 Am Jur 2d, Fraudulent Conveyances § 256.
    Bulk transfers: construction and effect of UCC Article 6, dealing with transfers in bulk. 47 ALR3d 1114.
    
      Kahn, Kollin & Mandel, for plaintiff.
    
      Bassey, Selesko, Couzens & Murphy, P.C. (by Joseph Falcone), for Madi’s Red Barn West, Inc.
    
      Before: J. H. Gillis, P.J., and R. B. Burns and N. J. Kaufman, J j.
   Per Curiam.

By an order of May 31, 1978, Judge Christopher C. Brown of the 50th Judicial District held that assets purchased by garnishee defendant from the principal defendant Were subject to levy and execution to satisfy plaintiffs judgment against the principal defendant. The reason assigned was failure to comply with the bulk transfer provisions of the UCC. The amount of liability Was set at $1,816.86.

On August 28, 1978, the district court Order Was affirmed by Judge James S. Thorburn of the Oakland County Circuit. Garhisheé defendaiit was granted leave to appeal on February 23, 1979.

The parties are in agreement as to the facts here. The only question before us is whether the sale Of a restaurant is subject to the bulk transfer provisions of the Michigan Uniform Commercial Code.

This issue was addressed by the drafter of the code in Official Comment 2 to 6-102 as follows:

"2. The businesses covered are defined in subsection (3). Notice that they do not include farming nor contracting nor professional services, nor such things as cleaning shops, barber shops, pool halls, hotels, restaurants, and the like whose principal business is the sale not of merchandise but of services. While some bulk sales risk exists in the excluded businesses, they have in common the fact that unsecured credit is not commonly extended on the faith of a stock of merchandise.”

In accord with this is the great majority of decisions from other jurisdictions. Levy v Paul, 207 Va 100; 147 SE2d 722; 3 UCC Rep 412 (1966), Nichols v Acers Co, 415 SW2d 683; 4 UCC Rep 591 (Tex Civ App, 1967), Silco Automatic Vending Co, Inc v Howells, 102 NJ Super 243; 245 A2d 765; 5 UCC Rep 625 (Ch Div 1968), affirmed 105 NJ Super 511; 253 A2d 480; 6 UCC Rep 531 (1969), Kane-Miller Corp v Tip Tree Corp, 303 NYS2d 273; 6 UCC Rep 721 (1969), De La Rosa v Tropical Sandwiches, Inc, 298 So 2d 471; 15 UCC Rep 595 (Fla App, 1974), Uarco, Inc v Peoples Bank & Trust Co of St Bernard, 414 F Supp 1219 (ED La, 1976).

Finally, Michigan Packing Co v Messaris, 257 Mich 422; 241 NW 236 (1932), the case relied upon by the plaintiff-appellee and, presumably, by the lower courts, is inapposite. That case construed 1929 bulk sales and bulk mortgage laws which covered "stock of merchandise or merchandise and fixtures”. The sale of the restaurant fixtures in Michigan Packing Co was found to fit the laws which at that time included "fixtures”. However, the UCC, adopted after the Michigan Packing Co case, does not include fixtures, but only "materials, supplies, merchandise, or other inventory * * *”. MCL 440.6102(1); MSA 19.6102(1).

Reversed.  