Hovland v. Farmers Union Elevator Co.

• Decision Date: 13 November 1936
• Docket Number: No. 6434.,6434.
• Citation: 67 N.D. 71,269 N.W. 842
• Parties: HOVLAND v. FARMERS UNION ELEVATOR CO.
• Court: North Dakota Supreme Court

67 N.D. 71

269 N.W. 842

HOVLAND

v.FARMERS UNION ELEVATOR CO.

No. 6434.

Supreme Court of North Dakota.

Nov. 13, 1936.

Syllabus by the Court.

1. The measure of damages for the conversion of personal property is its value at the time of conversion, with interest thereon from that time, or, if the action has been prosecuted with reasonable diligence, the highest market value between the time of conversion and the verdict without interest at the option of the injured party, and a fair compensation for the time and money properly expended in the pursuit of the property. Section 7168, Compiled Laws of 1913.

2. One who innocently purchases and takes possession of stolen personal property thereby exercises dominion and control over it inconsistent with and in denial of the rights of the true owner, and may be sued in conversion by such owner without previous demand; the time of conversion being the time of purchase.

Appeal from District Court, Traill County; Daniel B. Holt, Judge.

Action by John Hovland against the Farmers Union Elevator Company. From an adverse judgment, plaintiff appeals.

Affirmed.

Acker & Schafer, of Hillsboro, for appellant.

Libby & Harris, of Grand Forks, and Henry Leum, of Mayville, for respondent.

MORRIS, Judge.

This is an action for the conversion of 684.9 bushels of wheat which were stolen from the plaintiff and sold and delivered by the thieves to the defendant, whose manager purchased the grain without knowing that it was stolen. The theft and sale took place during the last part of December, 1932, and the first part of January, 1933; the delivery being made by one Moe. On May 14, 1934, the defendant delivered to plaintiff's attorney a statement of grain that had been hauled by Moe, being the grain which is involved in this action. On September 5, 1934, the plaintiff served upon the defendant a demand to settle for the grain “by making restitution of the grain above described, or grain of like kind and quantity or of paying therefor at the current market price,” with which demand the defendant refused to comply. The plaintiff promptly thereafter instituted this action and demanded judgment of the defendant for the value of the wheat as of the date of the demand. The wheat was worth about 30 cents a bushel when it was delivered to the elevator, and $1.03 a bushel when the demand was made. The trial court instructed the jury in effect that if it found that the defendant had converted the plaintiff's wheat, it should determine the value thereof on the date or dates of the purchase by the defendant, and that such value would represent the damages to which the plaintiff is entitled. The plaintiff contends that this is error and that the damage to which he is entitled should be measured by the value of the wheat as of the date of demand.

The measure of damages for the conversion of personal property is its value at the time of conversion, with interest thereon from that time, or if the action has been prosecuted with reasonable diligence, the highest market value between the time of conversion and the verdict without interest at the option of the injured party, and a fair compensation for the time and money properly expended in the pursuit of the property. Section 7168, Compiled Laws of 1913; First State Bank v. Osborne-McMillan Elevator Co., 53 N.D. 551, 207 N.W. 37;Lamoreaux v. Randall, 53 N.D. 697, 208 N.W. 104, 44 A.L.R. 1315.

[1] The determination of this lawsuit depends upon when the conversion took place. The fact that a demand was made does not necessarily establish that conversion took place when the demand was refused. Demand and refusal do not constitute conversion, but proof thereof is merely evidence of conversion. More v. Western Grain Co., 31 N.D. 369, 153 N.W. 976;Rolette State Bank v. Minnekota Elevator Co., 50 N.D. 141, 195 N.W. 6;State ex rel. Hermann v. Farmers' Elevator Co., 59 N.D. 679, 231 N.W. 725.

[2] It is well settled that an innocent purchaser can obtain no title to personal property from a thief, for the thief has no title and has nothing to convey. A person who purchases property from the possessor thereof without ascertaining whether he has title thereto, makes the purchase at his peril and may be sued in conversion by the true owner. By taking possession of the property as the owner, the purchaser thereby exercises dominion and control over it inconsistent with and in denial of the rights of the owner, even though he acts in good faith. Good faith cannot be shown as a matter of defense in an action for conversion. Clapp v. Johnson (Wash.) 57 P.(2d) 1235. It is the effect of the act of assuming dominion and control over the property under claim of ownership, rather than the intent with which it is done, that constitutes the conversion. Bowers Law of Conversion, § 345. An early New...