Harrington v. Stromberg-Mullins Co.

MR. JUSTICE HO'LLOWAY

delivered tbe opinion of tbe court.

This is au actiou in conversion. Tbe complaiut alleges tbat tbe defeudaut is a corporation; tbat or August 1,1901, Timothy P. Harrington executed aud delivered to tbe plaintiff aud re-spoudeut, Cor. O. HarriugtoR, bis promissory Rote for $500, due oue year after date,- witb interest at 6 per cent, per annum, aud to secure tbe payment thereof executed a chattel mortgage upou certain personal property; tbat or August 16, 1901, tbe said Timothy P. HarriugtoR executed aud delivered to plaiutiff bis certain other promissory note for tbe. sum of $500, due oue year after date, witb interest at 1 per ceut. per mouth, aud, to secure tbe paymeut thereof, executed a secoud chattel mortgage upou tbe same persoual property; tbat these mortgages were properly verified, aekuowledged aud filed for record in tbe office of tbe county clerk and recorder of Silver Bow county; tbat tbe defendant has entered into possession of tbe property described in tbe chattel mortgages, and has converted tbe same to its own use, and has thereby deprived tbe plaintiff of bis security, to bis damage in tbe sum of $1,000, for which amount judgment is demanded. Tbe defendant made answer, denying tbe material allegations of the complaint, and pleading fraud in tbe execution of tbe mortgages. To this answer plaintiff filed a reply. Tbe cause was tried to- a jury, which returned a verdict in favor of tbe plaintiff for $1,000, and from tbe judgment entered thereon this appeal is taken.

Tbe only question for determination is, does the complaint state facts sufficient to constitute a cause of action ? -

1. Tbe action is by a mortgagee, whose only interest in tbe property, so far as tbe complaint discloses, is tbe lien secured to a mortgagee out of possession. Tbe date of tbe alleged conversion is nowliere stated. It may have been at any time prior to the filing of the complaint, November 15, 1901, and was presumably subsequent to tbe execution of tbe second mortgage. Put tbe mere allegation that tbe first note was executed on August 1st-and tbe second on October 15, 1901, does not imply continued ownership or nonpayment of tbe notes, or either of them. If tbe plaintiff was not tbe owner of tbe notes at tbe date of tbe alleged conversion, or if tbe notes bad been paid, be could have suffered no injury; for a transfer of tbe notes would operate to transfer tbe mortgages, or payment of tbe notes would operate to discharge tbe mortgages, and tbe necessity for an allegation that tbe plaintiff was tbe owner and holder of tbe notes in question, and that they bad not been paid, or, if paid in part, tbe amount then due upon them at tbe date of tbe alleged conversion is apparent.

2. Assuming that tbe allegations of tbe complaint are sufficient to show a special property interest in the plaintiff in tbe property described in tbe mortgages, tbe complaint is defective, in that it does not allege that tbe plaintiff was either in possession or entitled to the possession at tbe date of tbe conversion. Tbe party complaining “must have bad, when tbe goods were taken, a general or special property in them, and a right to tbe immediate possession.” (Wetzel v. Power, 5 Mont. 214, 2 Pac. 388; Reardon v. Patterson, 19 Mont. 231, 41 Pac. 956; 21 Ency. Pleading & Practice, 1062; Binnian v. Baker, 6 Wash. 50, 32 Pac. 1008.)

3. In order for tbe court properly to determine tbe measure of damages, two things must be made to appear-: (1) The amount due tbe plaintiff, and (2) tbe value of tbe property converted ; for, in tbe absence of any allegation of time spent or money expended in pursuit of tbe property, tbe plaintiff could not have been injured beyond tbe amount due him.

Section 4333 of tbe Civil Code fixes tbe measure of damages. Tbat section reads as follows: “Tbe detriment caused by tbe wrongful conversion of personal property is presumed to be: (1) Tbe value of tbe property at tbe time of its conversion, witb tbe interest from tbat tim'e; or, where tbe action bas been prosecuted witb reasonable diligence, tbe highest market value of tbe property at any time between tbe conversion and the verdict, without interest, at tbe option of tbe injured party; and (2) a fair compensation for tbe time and money properly expended in pursuit of tbe property.”

Under tbe pleadings in this case the second subdivision of this section can be entirely eliminated from consideration. Tbe value of tbe property at tbe date of conversion, witb interest; thereon, or tbe highest market value of tbe property at any time between tbe date of its conversion and the determination of tbe trial, provided tbat does not exceed! tbe amount due tbe plaintiff, is tbe utmost tbat be could recover; and, as it was necessary for him to prove tbe value of tbe property, an allegation of tbat value must have been contained in tbe complaint in order to admit the proof. This question bas been before this court, bas been fully considered, and ought now to be deemed finally determined. (Rochelean v. Boyle, 12 Mont. 590, 31 Pac. 533.)

In passing, we may say that the complaint alleges tbat tbe defendant was, at tbe date of tbe filing of tbe complaint, a corporation. There is no allegation tbat it was such at tbe time of tbe alleged conversion.

To summarize, then, tbe plaintiff must allege (1) tbat at tbe date of tbe conversion be w>as tbe owner and bolder of tbe notes in question; (2) tbat tbe notes bad) not been paid, dr, if paid in part, the amount then duej (3) tbat be bad some property interest in tbe chattels converted, either general or special, and was either in actual possession or entitled to tbe possession thereof; and (4) tbe value of tbe property converted. These are all necessary averments, without any one of which the complaint would be fatally defective. In the absence of these allegations, the complaint does not state a cause of action, and will not support the judgment rendered. The judgment is reversed, and the cause remanded.

Reversed and remanded.

Rehearing denied December 24, 1903.