Christensen v. Farmers State Bank of Richardton

• Court: North Dakota Supreme Court
• Writing for the Court: PAULSON; TEIGEN
• Citation: Christensen v. Farmers State Bank of Richardton, 157 N.W.2d 352 (N.D. 1968)
• Decision Date: 01 March 1968
• Docket Number: No. 8452,8452
• Parties: Ole CHRISTENSEN, Plaintiff and Respondent, v. FARMERS STATE BANK OF RICHARDTON, a state banking corporation, and Thomas Dardis, Defendants, Farmers State Bank of Richardton, a state banking corporation, Defendant and Appellant. Civ.

Page 352

157 N.W.2d 352

Ole CHRISTENSEN, Plaintiff and Respondent, v. FARMERS STATE BANK OF RICHARDTON, a state banking corporation, and Thomas Dardis, Defendants Farmers State Bank of Richardton, a state banking corporation, Defendant and Appellant.

Civ. No. 8452.

Supreme Court of North Dakota.

March 1, 1968.

Rehearing Denied March 29, 1968.

Syllabus by the Court

1. Where, following a levy by the sheriff on property which did not belong to the judgment debtor, the sheriff and the judgment creditor were informed by the plaintiff (owner of the property) that the property seized and removed did not belong to the judgment debtor, but belonged to the plaintiff, and upon demand for its release and return, the sheriff at the direction of the judgment creditor held the property and refused for several days to return the property to the plaintiff, and further directed the sheriff to file a notice of levy before the property was returned, the judgment creditor is separately liable for the conversion of that property without regard to the liability of the sheriff.

2. Conversion consists of a positive tortious act; detention of personal property from the owner, or its destruction, or a wrongful exercise of dominion over the property inconsistent with, or in defiance of, the rights of the owner. The essence of conversion is not in acquiring the property, but in wrongfully depriving the owner of it, whether temporarily or permanently, and it is of little relevance that the converter received no benefit from the deprivation.

3. Where the trial court prepared written instructions, gave the opposing attorneys time to consider them, and then required them to take any exceptions they wanted before he instructed the jury, and appellant's attorney failed to take exception to the omission of a certain instruction, appellant's attorney waived bringing that exception to the instructions before the Supreme Court for consideration, and alleged error in instruction on that point could not be considered on appeal.

4. A motion for judgment notwithstanding the verdict should not be granted unless the moving party is entitled to judgment on the merits as a matter of law, and the evidence pertaining to the motion must be viewed in a light most favorable to the verdict.

5. A motion for new trial is addressed to the sound, judicial discretion of the trial court, and that court's decision on the motion will not be disturbed by the Supreme Court unless a manifest abuse of discretion is shown.

6. An affidavit dealing with alleged compromise among the jurors in reaching their verdict cannot be used to impeach their verdict and as a ground for a new trial. Rule 59(b), N.D.R.Civ.P.

Freed, Dynes & Malloy, Dickinson, for appellant.

Mackoff, Kellogg, Kirby & Kloster, Dickinson, for respondent.

PAULSON, Judge.

This is an appeal from a judgment for damages in conversion, and from an order denying a motion for judgment notwithstanding the verdict, or for a new trial.

The plaintiff, Ole Christensen, commenced an action for damages for conversion of certain farm machinery against the Farmers State Bank of Richardton, North Dakota, and Thomas Dardis, the acting sheriff of Dunn County, North Dakota. The case was tried to a jury and a verdict was rendered in favor of Ole Christensen for the sum of $900 as compensatory damages against the bank. The action against the sheriff was dismissed. The bank made a motion for judgment notwithstanding the verdict or, in the alternative, for a new trial. The motion was denied by the trial court and the bank appealed.

Ole Christensen was at all pertinent times the owner of certain tracts of farm land situated in Dunn County, North Dakota, which he had farmed for a number of years. Mr. Christensen's wife was a schoolteacher, teaching in the State of Washington. In the spring of 1965 Mr. Christensen suffered a leg injury and shortly thereafter his son, David Christensen, returned to North Dakota from the State of Washington where he had been employed as a telegrapher and assisted in the farming operations during the summer of 1965. The father, Ole Christensen, left North Dakota during the month of August 1965 to live with his wife in the State of Washington. Neither Ole nor David had made any plans for the farming of the land at the time that Ole left for Washington because David Christensen had planned to return to school in the fall of 1965.

Shortly after arriving in the State of Washington Ole received from his son a form of feeder agreement which his son requested that Ole Christensen sign. Ole refused to sign this agreement and, on September 15, 1965, returned to North Dakota. Ole and david thereafter executed a farm contract whereby David leased a quarter of land from his father, which land would be used primarily to conduct a feeder operation during the winter of 1965--66. The contract was to expire May 15, 1966. Ole then returned to the State of Washington. The farm machinery which was the subject of this action was left on the farm in the care of David.

In October 1965 David and his wife, Marlene, without Ole's knowledge, executed a chattel mortgage to the appellant bank on the farm machinery owned by Ole Christensen. Mr. D. W. Knudson, executive officer of the bank, compiled the financial information prior to making the loan and he, at the time, was fully aware that the land which David was occupying was owned by Ole. The banker also knew that the feeder contract had not been signed by Ole Christensen. The bank loaned David more than $12,000 on the basis of the feeder contractr and the chattel mortgage.

Ole Christensen returned to North Dakota during the month of February 1966 and discovered that his son, David, was drinking heavily and neglecting the livestock. Ole, early in April of 1966, contacted Mr. Knudson and informed him of David's drinking problem and that, as a consequence, the cattle were being neglected. Knudson investigated and later made arrangements to dispose of the cattle. David left the farm about May 1, 1966, after a dispute with his father, and thereafter resided elsewhere. Ole continued to reside on the farm after that date.

David failed to make the payments due on the promissory note which was secured by the chattel mortgage, and the appellant commenced foreclosure of the mortgage during the month of July 1966. Neither David nor his wife contested the foreclosure action and judgment was entered by default. The appellant, under date of August 29, 1966, secured a special execution from the Clerk of Court of Stark County, North Dakota, and on September 7, 1966, Thomas Dardis made a trip to Ole's farm to make the levy in accordance with the execution. The appellant had instructed the sheriff that it desired that the property be removed from the Christensen farm and transported to Richardton, North Dakota, some 40 miles distant. Knudson, at the time the levy was made, accompanied the sheriff, as well as an implement dealer from Richardton whose equipment was used to haul some of the machinery from the farm. None of the Christensens were present at the farm when the levy was made and the machinery removed. Some of the machinery was parked on a lot owned by the implement dealer and the remainder was parked on a street adjacent to the lot in Richardton, and it was not moved again until it was returned to Ole's farm.

Ole Christensen returned to his farm in the morning of September 8 and discovered that his property was missing. On the same day, Sheriff Dardis informed Ole that the property had been levied upon and transported to Richardton and, at the same time, he served upon Ole a copy of the notice of levy. Thereafter, on the 9th day of September 1966, Ole personally and through his attorneys demanded that the appellant immediately return the property. The appellant did not return the property at once, but apparently consulted with its attorneys and subsequently returned the property to Ole's farm on September 15, 1966. However, appellant, through the sheriff, on September 14, 1966, filed the notice of levy on the farm machinery with the Register of Deeds of Dunn County.

The appellant enumerates certain specifications of error, as well as specifications of insufficiency of the evidence. Summarized these specifications present the following pertinent issues:

1. The appellant bank did not as a matter of law commit a conversion because it was acting only as the aider and abettor of the sheriff in levying under the special execution.

2. The trial court failed to instruct the jury that the appellant had a reasonable period after demand was made for the property during which it could hold the property in order to ascertain its ownership.

3. The trial court erred in not granting appellant's motion for a judgment notwithstanding the verdict.

4. The trial court erred in not granting the appellant's motion in the alternative for a new trial, especially with reference to damages.

The first question to be determined is whether a judgment creditor may be held liable following a levy under process on property not owned by the judgment debtor. The appellant urges that, as a matter of law, it cannot be held liable for conversion, basing this contention on two theories. The first theory is that the appellant appellant was only acting as the agent of the sheriff in carrying out the levy and since the sheriff was not found to be liable, the appellant could not be liable. The second theory is that, under the principles set forth in Renner v. J. Gruman Steel Company (N.D.), 147 N.W.2d 663, the sheriff cannot be held liable for acting under process valid on its face and, therefore, the appellant could not be liable for directing the sheriff, participating in the levy, or later ratification of what was, in the first instance, a legal act.

In regard to the first theory, it seems clear to this court that at the time the demand for the return of the property was made upon the judgment...