Dayton Const., Inc. v. Meinhardt
| Decision Date | 21 June 1994 |
| Docket Number | No. WD,WD |
| Citation | 882 S.W.2d 206 |
| Parties | DAYTON CONSTRUCTION, INC., Respondent, v. Troy MEINHARDT, Appellant. 47757. |
| Court | Missouri Court of Appeals |
George E. Kapke, Independence, for appellant.
Alan B. Gallas, Paul R. Lamoree, Gallas & Schultz, Kansas City, for respondent.
Before ULRICH, P.J., and BRECKENRIDGE and SPINDEN, JJ.
Troy Meinhardt appeals the judgment on two counts to the benefit of Dayton Construction, Inc., (Dayton) entered pursuant to jury verdict on count I for conversion of certain checks payable to Dayton, and on count II for injunction and constructive trust, tried to the trial court. Judgment on count I was in the sum of $46,000, plus interest calculated by the court in the sum of $11,285.75, plus punitive damages in the sum of $10,000 and on count II in the sum of $29,111.57 as a constructive trust in said amount with a specific bank account. Mr. Meinhardt claims as point one that the trial court erred in failing to grant his motion for directed verdict and his motion for judgment notwithstanding the verdict, or alternatively a new trial, as to count I for conversion, asserting that Dayton failed to state a cause of action because Dayton's money was held by Mr. Meinhardt for general corporate purposes and was not subject to conversion. Additionally, Mr. Meinhardt claims as point two that the court erred in awarding judgment on count I because the award of damages to Dayton was not supported by competent evidence. As point three, Mr. Meinhardt claims that the trial court erred in awarding judgment to Dayton on count II because the court failed to give him credit for sums he expended for certain of Dayton's bills and accounts owed.
The judgment of the trial court is affirmed.
In May of 1988, Dayton and Mr. Meinhardt entered into a business relationship in which Mr. Meinhardt was to be paid $8 per hour for his effort pertaining to a remodeling business. 1 Appellant's duties included securing remodeling work; scheduling work; arranging for subcontractors to perform work; scheduling suppliers and acquiring materials; collecting accounts; and paying employees, subcontractors, and suppliers for work done in behalf of the company.
The business established a bank account in a bank in Olathe, Kansas, and Mr. Meinhardt was authorized to sign checks on that account to conduct business. Mr. Meinhardt's payroll check was to be written from that account.
In the summer of 1989, Mr. Meinhardt opened a separate bank account in Boatmen's First National Bank of Kansas City, Raytown branch (Boatmen's), in the name of Dayton Construction. The existence of this account was unknown to anyone else affiliated with Dayton. Mr. Meinhardt provided purported Dayton resolutions to Boatmen's authorizing the account, signed as signatory on the bank's form for sole proprietorships, and identified as the depositor "Troy Meinhardt d/b/a Dayton Construction." Mr. Meinhardt later changed the account to reflect as depositor "Troy Meinhardt d/b/a Dayton Re-Construction." Unknown to Dayton, certain checks received by Mr. Meinhardt from customers who transacted business with Dayton were deposited by Mr. Meinhardt into this account.
Bill Brewer, President of Dayton, discovered that checks payable to Dayton had been deposited in the Boatmen's bank account. On April 27, 1990, a temporary restraining order was obtained in this action precluding any account activity which became a preliminary injunction on May 4, 1990, and ultimately final judgment imposed a constructive trust on the account by judgment of the trial court.
During the trial, Mr. Meinhardt acknowledged depositing a total of $70,576.26 in the Boatmen's account. Some of Mr. Meinhardt's deposits included revenues from remodeling jobs that he claimed he did independently of the business relationship he had with Dayton. Additionally, the total sum deposited to the Boatmen's account included nineteen specific checks paid by customers in payment for thirteen jobs completed by Dayton, nineteen of such checks totaling $54,300. One check totaling $5,654 for the "Brinkman job," dated June 6, 1990, was kept by Mr. Meinhardt and not deposited into the Boatmen's account because of the then-existing preliminary injunction applicable to the account.
During trial, Mr. Meinhardt identified $14,386 in checks paid out of the Boatmen's account into the Dayton account in Olathe, Kansas. The first deposit was dated January, 1990, and the last dated in March, 1990.
Mr. Meinhardt paid a relatively small sum from the Boatmen's account to suppliers and subcontractors of the Dayton business. During trial, Mr. Meinhardt identified $3,128.43 in checks drawn on the Boatmen's account by him and paid to Dayton suppliers or subcontractors in five of thirteen jobs. Additionally, Mr. Meinhardt testified that he paid $7,674 to suppliers of certain of the thirteen jobs, said sum resulting from four cashier's checks purchased by Mr. Meinhardt in June, 1990, using proceeds of the Boatmen's account. Mr. Meinhardt testified that $16,117 from the Boatmen's account was used for his personal use in addition to $3,733 he spent for "truck expenses."
As point one on appeal, Mr. Meinhardt claims that the trial court erred in failing to grant his motion for directed verdict and in failing to grant his motion for judgment notwithstanding the verdict, or alternatively, for a new trial, asserting that Dayton's petition for conversion in count I failed to state a cause of action because money held by Mr. Meinhardt for Dayton's purposes is not subject to conversion.
Conversion is the unauthorized assumption of the right of ownership over the personal property of another to the exclusion of the owner's rights. Lappe and Assoc., Inc. v. Palmen, 811 S.W.2d 468, 471 (Mo.App.1991). Conversion is not the proper remedy to recover on an ordinary debt. Breece v. Jett, 556 S.W.2d 696, 710 (Mo.App.1977). "[A]s a general rule a claim for money may not be in conversion because conversion lies only for a specific chattel which has been wrongfully converted." Gaffney v. Com. Fed.Sav. & Loan Ass'n, 706 S.W.2d 530, 533 (Mo.App.1986). Money is the appropriate subject of conversion only when it can be described or identified as a specific chattel. Jett, 556 S.W.2d at 710. Neither is conversion a proper cause of action for withdrawal of money from a joint bank account. Id. Specific checks, drafts or notes will support a cause of action for conversion where they can be described or identified as a specific chattel. K-Smith Truck Lines, Inc. v. Coffman, 770 S.W.2d 393, 399 (Mo.App.1989). The measure of damages for conversion of identifiable checks or drafts is "prima facie the value of the paper converted." Id.
The checks and drafts in this case were each specifically identified at trial. Mr. Meinhardt deposited the checks directly into Mr. Meinhardt's separate Boatmen's account. Mr. Meinhardt was the only person with access to the proceeds of the checks. Dayton Construction, Inc. was excluded from exercising its ownership rights in the checks and their proceeds. The agreement of the parties required that Mr. Meinhardt deposit all checks or drafts received as payment for remodeling work into the Dayton joint account. Mr. Meinhardt could then draw funds from that joint account to pay suppliers and pay the other expenses of the remodeling business. Mr. Meinhardt's actions in depositing specific and identifiable checks directly into his secret separate account properly gave rise to an action for conversion. The trial court did not err in overruling Mr. Meinhardt's motions for directed verdict, for j.n.o.v., or for a new trial. Point one is denied.
As point two on appeal, Mr. Meinhardt argues that giving the jury the verdict directing instructions for conversion and for punitive damages was error because, as he argued in point one, conversion was not a cause of action, and if the cause of action were for money had and received punitive damages would not be appropriate. This portion of point two is repetitive of the contentions denied...
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