Greenawalt v. Wilson

• Decision Date: 07 October 1893
• Parties: JOSEPH C. GREENAWALT v. A. S. WILSON, as Receiver of the First National Bank of Greenleaf
• Court: Kansas Supreme Court

34 P. 403

52 Kan. 109

JOSEPH C. GREENAWALT v. A. S. WILSON, as Receiver of the First National Bank of Greenleaf

Supreme Court of Kansas

October 7, 1893

Error from Atchison District Court.

ON June 10, 1889, A. S. Wilson, as receiver of the First National Bank of Greenleaf, filed his petition in the district court of Atchison county against Joseph C. Greenawalt, alleging his (Wilson's) appointment as such receiver, on October 18 1888, his giving bond, and taking the oath required by law that on March 5, 1889, he was directed by a proper order of the district court of Washington county, Kansas, to institute and prosecute this action, and that by reason of his appointment as such receiver he became the owner of the horse "Wartrace," of the value of $ 2,000, and that defendant, on the 8th day of June, 1889, unlawfully converted the horse to his own use. The defendant below filed a general denial, duly verified. After a trial by jury and verdict for plaintiff below, judgment was rendered for plaintiff in the sum of $ 1,000 and costs, which defendant below, plaintiff in error, now seeks to reverse.

Judgment affirmed.Judgment affirmed.

Geo. H Roberts, for plaintiff in error:

The plaintiff in error contends that the receiver never had any title or claim of ownership or right of possession whatever in said horse, or could have; that there was no conversion no cause of action existed. These allegations were not proved. 1 Add. Torts (4th Eng. ed.), 452, and cases cited.

E. D. Nims, from whom Greenawalt derived and obtained his title, had an agister's lien upon the horse at the time of the appointment of the receiver. The receiver was not entitled to the possession of the horse at any time until that lien was satisfied; and before any receiver was appointed, Smith, as specially-authorized agent of the bank, had the right to dispose of the assets of the bank, settle up its affairs, and pay the debts of the bank. Nims's claim was a special lien; neither Smith, the bank nor the receiver could cut down his claim below a reasonable compensation, and could not take possession of the property without his consent.

The court's instruction No. 5 was erroneous, assuming the province of the jury. Under the evidence, determining whether a sale had or had not been made, should have been left to them to find. This, we insist, was error on the part of the trial court, as also the refusal of defendant's seventh and eighth instructions.

The receiver's possession, without Nims's knowledge or consent, was wrongful, and gave him no right, and Nims was rightfully in the possession of said horse. Beach, Rec., §§ 203, 641, and cases cited.

To have constituted any conversion, as against defendant, Greenawalt, there must have been evidence of a demand and refusal. 1 Add. Torts (4 Eng. ed.), 398, 399, and cases cited; Gillet v. Roberts, 57 N.Y. 28. It was conceded that Greenawalt was an innocent purchaser of this horse; the jury so found, at least from E. D. Nims, and that Nims had made an arrangement with the bank to keep the horse, and no cause of action could exist or arise against Greenawalt only after demand and refusal. Beach, Rec., § 643.

The court erred in the admission and rejection of testimony upon the trial.

The petition shows upon its face that the cause of action in this case did not arise until long after the court authorized this suit. Beach, Rec., §§ 650, 651; 18 Kan. 150, 361; 22 id. 414; 30 id. 680.

The moment A. S. Wilson became a citizen of Iowa, or the moment he moved there with the intention of remaining, he became at that moment a nonresident of Kansas, and his powers as receiver in this state ceased--his office was vacant. Bawden v. Stewart, 14 Kan. 355; Const., art. 3, § 11. The receiver is an officer of the court--the arm of the court--the agent of the court--and by becoming a nonresident his office as receiver ceased.

Solomon & Bland, for defendant in error:

The pretended sale of the horse, on December 8, conveyed no title, and if Greenawalt had become purchaser at that sale he would not have obtained title. The board of directors of the bank never authorized Smith, as president, and Nims, as cashier, or either of them, to make such sale of the bank's property. Nims and Smith, virtute officii, without such authority from the directors, could make no valid sale. Asher v. Sutton, 31 Kan. 286; National Bank v. Drake, 29 id. 325; Morse, Banks, 107.

The court very properly instructed the jury that no sale was made by Nims under the lien he may have claimed for keeping said horses, for the reason that the requirements of the statutes of this state were not complied with by him. If he had a lien at the time of the sale, on December 8, 1888, it was purely statutory. No such lien existed at common law, and to enforce it he must comply with the statute, and he says he did not sell them in satisfaction of his lien. As the lien of a livery stable keeper is purely statutory, it is for him to comply with all the conditions which the statute requires. 1 Jones, Liens, §§ 685, 1034; Longstreet v. Phile, 39 N.J.L. 63. See, also, Elwood v. National Bank, 41 Kan. 475, 480.

The right of possession in the receiver, after qualifying and giving bond, vested, eo instanti, as of the time of his appointment; and when he first took possession of the horse, on October 19, his possession was rightful, and Nims, being a debtor instead of a creditor of the bank, or of the receiver, could not have replevied the horse from the receiver. Gardner v. Risher, 35 Kan. 93, 97, 98; St. L. Ft. S. & W. Rld. Co. v. Chenault, 36 id. 51, 55.

Nims and Smith were guilty of conversion when they sold the horse, on December 8, 1888, whether sale was made to Nims or a third party; and Nims was again guilty of conversion when he sold the horse to Greenawalt; and Greenawalt was guilty of conversion when he refused to deliver the horse upon demand to the receiver before suit was commenced.

That a demand before suit was made, see Frame's evidence, and Barry's, and Greenawalt's. The unusual precaution was taken not only to have Frame make demand, but also to have the sheriff do so, and Greenawalt himself substantially admits Frame's demand before commencement of suit, although he states he does not recollect exactly what was said. But if a demand had not been made, under the circumstances of this case, the defendant's claim of title and ownership, and the circumstances showing that the demand would have been unavailing, obviated the necessity thereof and completed the conversion. Cobbey, Repl., § 474; Gottlieb v. Hartman, 3 Colo. 53; Wood v. McDonald, 66 Cal. 546; Raper v. Harrison, 37 Kan. 243. Woods v. Hamilton, 39 id. 69; Schmidt v. Bender, 39 id. 437.

There is no material error in the ruling of the court upon the admission and rejection of testimony.

It is urged by plaintiff in error that the fact that the receiver was a nonresident of Kansas, and had moved to Iowa, would deprive him of the right to prosecute this suit and obtain judgment. We find no case supporting this contention. The fact that a receiver is a nonresident at the time would not of itself render him ineligible, and the judgment appointing him void. At most, the judgment of the court appointing a nonresident as receiver would only be erroneous, and might even be reversed as an abuse of discretion in some jurisdictions, where it is held to be a final order; but such order could...