Henderson v. Security Nat. Bank

Citation140 Cal.Rptr. 388,72 Cal.App.3d 764
CourtCalifornia Court of Appeals Court of Appeals
Decision Date22 August 1977
Parties, 22 UCC Rep.Serv. 846 Willie Chester HENDERSON, Plaintiff and Appellant, v. SECURITY NATIONAL BANK, Defendant and Appellant. Civ. 38597.

Donald S. Britt, San Francisco, Stevens & Wood, Dale E. Wood, Truckee, for plaintiff and appellant.

Kornfield & Koller, Irving J. Kornfield, Oakland, for defendant and appellant.

ELKINGTON, Associate Justice.

Defendant Security National Bank (the 'Bank') wished to repossess a Cadillac automobile which it had financed for plaintiff Willie C. Henderson under a contract on which he had defaulted. The Bank employed an independent contractor, a licensed 'repossessor' (see Bus. & Prof.Code, §§ 7520, 7521, subd. (c), 7526.4), for that purpose. Following the car's repossession and subsequent sale, Henderson commenced an action against the repossessor and the Bank, seeking compensatory and exemplary damages. Two causes of action were alleged; the first was for 'conversion' and the second for 'trespass.' Each was based upon Henderson's contention (and later testimony) that in the repossession of his automobile the lock on his garage door had been broken. Such an entry by force, if made, was of course unlawful. (See Cal.U.Com.Code, § 9503; Pen.Code, § 418.)

Prior to the trial Henderson compromised and settled his case against the professional repossessor and the action as to that defendant was discontinued.

Following testimony at the trial, which was by jury, the Bank moved for a judgment of nonsuit as to each of Henderson's two causes of action. As pointed out, each of those causes of action was based upon the manner in which the repossessor obtained possession of the automobile.

As to Henderson's cause of action for Trespass the trial court granted the motion, and judgment of nonsuit as to that count was later entered in favor of the Bank. But on the Bank's motion for nonsuit on Henderson's cause of action for Conversion, the trial court denied the motion. Accordingly the case went to the jury on the issue of conversion alone. The jury returned a verdict against the Bank for compensatory damages of $1,357.43 and exemplary damages of $125,000, and judgment was entered upon that verdict.

The trial court thereafter, on the Bank's motions, entered judgment notwithstanding the verdict and, to become effective if that judgment should be reversed on appeal, a new trial 'on ground of insufficiency of evidence & errors in law; . . .' (See Code Civ.Proc., § 629.) The 'specification of reasons' for granting the new trial was not filed by the court until 12 days after the filing of the order granting a new trial and was accordingly not timely. (See Code Civ.Proc., § 657.)

Henderson took a timely appeal from the 'judgment of non-suit and judgment notwithstanding the verdict.' He also filed a notice of appeal from the order granting a new trial. The Bank has filed a 'protective cross-appeal' from the judgment which had been entered on the jury's verdict. These several appeals are presently before us for determination.

We observe initially that although Henderson has appealed from the 'judgment of non-suit and judgment notwithstanding the verdict' (emphasis added), he makes no contention whatever, in this court, that the judgment of nonsuit on the Trespass cause of action was erroneously entered. According to well-established authority, the point will be deemed unmeritorious, or at least to have been abandoned or waived. (Johnston v. Board of Supervisors,31 Cal.2d 66, 70, 187 P.2d 86; Title G. & T. Co. v. Fraternal Finance Co., 220 Cal. 362, 363, 30 P.2d 515; Moore v. Morhar, 65 Cal.App.3d 896, 903, 135 Cal.Rptr. 626; McDonald's Systems of California, Inc. v. Board of Permit Appeals, 44 Cal.App.3d 525, 529, 119 Cal.Rptr. 26; Aronowicz v. Nalley's, Inc., 30 Cal.App.3d 27, 33, fn. 2, 106 Cal.Rptr. 424; Hanberry v. Hearst Corp., 276 Cal.App.2d 680, 688, 81 Cal.Rptr. 519; County of Los Angeles v. Law Bldg. Corp., 254 Cal.App.2d 848, 853, 62 Cal.Rptr. 542; Wheeling v. Financial Indem. Co., 201 Cal.App.2d 36, 44, 19 Cal.Rptr. 879; 6 Witkin, Cal. Procedure (2d ed. 1971) Appeal, § 425, pp. 4391--4393.)

As will be seen, Henderson's cause of action for Trespass was based on a theory that the Bank had either expressly or impliedly authorized or ratified the breaking of a lock on his garage, and thus a trespass. By virtue of the unchallenged judgment of nonsuit, It is now established, as a matter of law, that the Bank neither expressly, nor impliedly, authorized or ratified the trespass which consisted of the breaking of the lock of Henderson's garage.

We first consider Henderson's appeal from the judgment notwithstanding the verdict.

The applicable rule was stated in Quintal v. Laurel Grove Hospital, 62 Cal.2d 154, 159, 41 Cal.Rptr. 577, 580, 397 P.2d 161, 164, as follows: 'The rules applicable to judgments notwithstanding the verdict for defendant are well settled and are agreed to by all the parties. Such a motion may be granted, properly, only when, disregarding the conflicting evidence, and indulging in every legitimate inference in favor of the plaintiff, the result is a determination that there is no evidence of substantial nature to support the verdict. The trial court, on such motion is not permitted to weigh the evidence, and on an appeal from the judgment entered on the granting of such a motion, the appellate court must read the record in the light most advantageous to the plaintiff, resolve all conflicts in his favor, and give him the benefit of all reasonable inferences in support of the judgment.'

Viewed in the light most favorable to Henderson, the evidence discloses that his car was obtained by the repossessor by means of an unlawful entry, i.e., the breaking of the lock on his garage door. (The employee who actually did the repossessing could not be found and was unavailable as a witness.)

Although there appears to be a paucity of authority on the subject in this state, we are of the opinion that where one is otherwise entitled to take possession of property, its repossession by such means constitutes a conversion. The leading case in support of our conclusion is Manhattan Credit Co., Inc., v. Brewer, 232 Ark. 976, 978, 341 S.W.2d 765, 766, 99 A.L.R.2d 354, 356, where, as here, the party charged with such a conversion had a right to repossess a hypothecated vehicle. Upholding a finding of conversion the court said: 'The applicable rule (briefly stated) as set forth in many of our decisions, appears to be that there is a conversion if force or threats of force are used to obtain possession of the automobile.' To the same effect see A. B. Lewis Company v. Robinson, Tex.Civ.App., 339 S.W.2d 731, 735; Thrasher v. First National Bank of Miami, Fla.App., 288 So.2d 288, 289; Victor v. Fairchild Motor Corporation, La.App., 8 So.2d 566, 567--568; Douglas Motor Co. v. Watson, 68 Ga.App. 335, 22 S.E.2d 766, 767; and Thompson v. Ford Motor Credit Company, D.C., 324 F.Supp. 108, 115, where the court said, 'if the mortgagee finds that he cannot get possession without committing a breach of the peace, he must stay his hand, and resort to the law, for the preservation of the public peace is of more importance to society than the right of the owner of a chattel to get possession of it.'

Unlike Henderson's cause of action for Trespass, his cause of action for Conversion did not depend upon authorization, or ratification, or upon the knowledge, or intent, or bad faith of the Bank. "The foundation for the action of conversation rests neither in the knowledge nor the intent of the defendant. It rests upon the unwarranted interference by defendant with the dominion over the property of the plaintiff from which injury to the later results. Therefore, neither good nor bad faith, neither care nor negligence, neither knowledge nor ignorance, are of the gist of the action. 'The plaintiff's right of redress no longer depends upon his showing, in any way, that the defendant did the act in question from wrongful motives, or generally speaking, even intentionally; and hence the want of such motives, or of intention is no defense. Nor, indeed, is negligence any necessary part of the case. Here, then, is a class of cases in which the tort consists in the breach of what may be called an absolute duty; the act itself (in some cases it must have caused damage) is unlawful and redressible as a tort."' (Byer v. Canadian Bank of Commerce, 8 Cal.2d 297, 300, 65 P.2d 67, 68; and see McAllister v. Metzger, 220 Cal.App.2d 692, 707, 33 Cal.Rptr. 879; Culp v. Signal Van & Storage, 142 Cal.App.2d Supp. 859, 862, 298 P.2d 162; Kee v. Becker, 54 Cal.App.2d 466, 471, 129 P.2d 159.)

Since the theory of the trial court in awarding judgment notwithstanding the verdict was that there had been no conversion we now hold under the above authority that insofar as it denied Henderson the award of Compensatory damages, the judgment was erroneous.

We turn our consideration now to whether there was 'evidence of a substantial nature' supportive of the jury's award of Exemplary damages. Such a question is one of law. (Fidelity etc. Co. v. Federal etc. Co., 217 Cal. 307, 319, 18 P.2d 950.)

It is appropriate at this point to first consider the law relating to exemplary damages.

Such damages are never awarded as a matter of right (Schumate v. Johnson Publishing Co., 139 Cal.App.2d 121, 135, 293 P.2d 531; Browand v. Scott Lumber Co., 125 Cal.App.2d 68, 73, 269 P.2d 891); they are not favored by the law and they should be granted with the greatest of caution (Beck v. State Farm Mut. Auto. Ins. Co., 54 Cal.App.3d 347, 355, 126 Cal.Rptr. 602; Gombos v. Ashe, 158 Cal.App.2d 517, 526, 322 P.2d 933); they will be allowed only in the clearest of cases (Gombos v. Ashe, supra, p. 526, 322 P.2d 933). To justify their award there must be proof of malice in fact; such malice will not be...

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