Huether v. McCaull-Dinsmore Company, a Corp.

• Decision Date: 29 May 1925
• Citation: 204 N.W. 614,52 N.D. 721
• Court: North Dakota Supreme Court

204 N.W. 614

52 N.D. 721

EMANUEL HUETHER, Respondent, v. McCAULL-DINSMORE COMPANY, a Corporation, and Havelock Equity Exchange, a Corporation. McCAULL-DINSMORE COMPANY, a Corporation, Appellant

Supreme Court of North Dakota

May 29, 1925

Appeal from the District Court of Hettinger County, Berry, J.

Modified and affirmed.

Affirmed.

Sullivan Hanley & Sullivan, for appellant.

The rule is that the agent who assists his principal in disposing of the property of another entrusted to the principal is not liable for the wrongful conversion of the property or his participation therein unless he had knowledge that such act was wrongful or would have had such knowledge but for gross negligence. Leuthold v. Fairchild, 35 Minn. 99, 27 N.W. 503; Ashcroft v. Tucker (Colo.) 215 P. 877; Roach v. Turk, 9 Heisk. 708, 24 Am. Rep. 360; Farguson v. Ball, 128 Tenn. 137, 159 S.W. 221; 159 Minn. 395 199 N.W. 85.

Where the depositor knows that the property is to be commingled with that of the warehousemen, and that the latter is selling and publicly shipping from the common mass, he may be estopped from asserting title as against an innocent purchaser in the usual course of business. 27 R. C. L. p 981.

A person who stands by with a thresher's lien and permits a sale is estopped from suing in conversion the party who purchased grain subject to his lien. Branthover v. Monarch Elevator Co., 33 N.D. 454, 156 N.W. 927.

One who owns or has an interest in personal property, with full knowledge of his rights, suffers another to deal with it as his own by selling or pledging it, or otherwise disposing of it, in such case there can be no doubt that an estoppel exists. 16 Cyc. 762-764.

An estoppel is fundamentally based upon the idea that "he who is silent when conscience requires him to speak, shall be debarred from speaking when conscience requires him to keep silent." 16 Cyc. 681; Branthover v. Monarch Elev. Co., 33 N.D. 454, 156 N.W. 927.

The term market implies competition. Watts v. Western, 62 F. 136.

Where the subject of the price is an article commonly dealt in, this price will be fixed in a more or less definite sum by the concensus of all the buyers and sellers dealing in the article. Carey Lithographic Co. v. Magazine & Book Co., 70 Misc. 541, 127 N.Y.S. 300.

To constitute a market value, it must appear that similar articles have been bought and sold in the way or trade in sufficient quantity or frequency. Harris v. Panama R. Co., 58 N.W. 660.

If the contract or conduct of the parties fixed a day so that the right of recovery, strictly considered, turns on the then market value, the evidence should be directed to the market value on that precise day, and not extend to the ordinary market value at other times. Cahen v. Platt, 69 N.Y. 353; Belden v. Nicolay, 4 E. D. Smith, 14; Houghton Implement Co. v. Doughty, 14 N.D. 33, 104 N.W. 516.

But if there were no sales then, or if the sales had are shown to have been at fictitious prices, or at prices unnaturally inflated or depressed by artificial combination for the purpose of fixing a false price, evidences of prices before and after the day within a reasonable limit resting in judicial discretion, is competent for the purpose of inferring the value on the precise day. Dana v. Fiedler, 12 N.Y. 40; Cahen v. Platt, 69 N.Y. 352; Kountz v. Kirkpatrick, 72 Pa. 376, 13 Am. Rep. 687.

Jacobsen & Murray, for respondent.

A note given conditionally does not operate as payment for redemption of storage tickets. State ex rel. Olson v. Royal Indemnity Co. (N.D.) 175 N.W. 625.

The court may take judicial notice of the fact, one of common knowledge throughout the state, that the market prices of grain, particularly of wheat, in North Dakota, are determined by, and are but the reflex of, prices paid for the same grades of grain at certain centers in the country, like Minneapolis, Minn., Chicago, Ill., and other points, after taking into consideration the cost of transportation, insurance, handling charges, and the like. Grain buyers at points in North Dakota receive daily market reports, cards, or bulletins, showing the prices, the different kinds and grades of grain, which become the basis for prices at local points in this state. Upon the reports thus received, local market prices are fixed from day to day. There is a market in the technical and legal sense, for wheat at Killdeer, N.D., as there is in nearly every city and village in the state situated upon a railroad. Weigel v. Powers Elevator Co., 194 N.W. 113.

The description of a crop is sufficient if it be such that a prudent, disinterested person, aided and directed by such inquiries as the instrument itself suggests, is able to identify the property. 11 C. J. 468, § 96.

The person who, as its agent, does that business, should be considered its managing agent; and more especially should that be so where the foreign corporation has an office or place of business in the state; and when that office is in charge of that person, and he there acts for the corporation, he is there doing business for it, and so manages its business. Brown v. Chicago, M. R. Co., 95 N.W. 153.

Preliminary proof of the loss or destruction of primary evidence does not involve the question in issue and is not regarded as evidence in the cause; it is addressed solely to the trial court and its sufficiency is a question for that court and not for the jury. Moreover the sufficiency of the evidence on the preliminary proof rests in the sound discretion of the trial court, whose determination will generally not be disturbed by an appellate court. 22 C. J. 1052, § 1352.

Ordinarily the value of property which may be so recovered is that which it had at the time and place of conversion. Dearborn Truck Co. v. Nedroloe (N.D.) 193 N.W. 311.

NUESSLE, J. CHRISTIANSON, Ch. J., and BIRDZELL, JOHNSON, and BURKE, JJ., concur.

OPINION

NUESSLE, J.

This action was brought to recover damages on account of the conversion of certain grain.

Plaintiff is a farmer residing near Havelock, North Dakota. The defendant McCaull-Dinsmore Company is a corporation engaged in the grain commission business at Minneapolis, and a member of the Chamber of Commerce of that city. The defendant Havelock Equity Exchange was a corporation, nearly all of whose stockholders were farmers in the vicinity of Havelock. The Exchange was incorporated in 1910. It owned and operated a grain elevator at Havelock and was engaged in buying grain and reselling the same at terminal markets. In July, 1920, the Exchange entered into a contract in writing with the defendant company, whereby in consideration of the company making certain advances in money from time to time, the Exchange was to ship at least eighty per cent of the grain received by it to the Company, which agreed to sell the same, and after deducting its commissions and other charges for freight, handling, etc. to credit the proceeds upon the account, if any, owing to it by the Exchange for advances thus made. During the fall of 1920 and thereafter the Exchange shipped all of its grain to the company and the company handled and sold the same under the terms of the sales contract. The method followed was that if the Exchange needed money it drew sight drafts upon the company the amounts of which when paid were charged to the account of the Exchange. The grain was shipped in car lots to the company at Minneapolis, and the bills of lading were sent forward to it. Upon receipt of the bills of lading the company sold the grain thus consigned and endorsed the bills of lading to the buyer. After deducting the freight and handling charges and its commissions, it credited the proceeds on the account of the Exchange. At the time that this contract was entered into in July 1920, the Exchange was owing several thousand dollars to the company on account of its previous business transactions. During the succeeding months further advances were made by the company so that when on October 11th, the first shipment of grain was made to and received by the company, the Exchange owed nearly $ 16,000 on account.

In the fall of 1920 the plaintiff deposited in the elevator of the Exchange for storage 1734 bushels 20 pounds of wheat. The usual storage receipts or tickets for this wheat were issued to him. In the spring of 1920 the plaintiff had furnished one Stenwick, 160 bushels of seed wheat at the agreed price of $ 3.16 per bushel. He filed a lien for this seed. Stenwick raised a crop from it and sold it to the Exchange. From August to December 1920, one Bean was the manager of the Exchange. Bean was discharged in December 1920. After Bean was discharged, Rafferty, president of the Exchange, acted as manager from that time and until it ceased to do business. During the fall of 1920 the Exchange received either by purchase or for storage about 40,000 bushels of wheat. A large amount of this was received for storage, and the usual storage tickets were issued. Some of these were later redeemed. During the latter part of 1920 the Exchange met with financial difficulties and was unable to meet the demands of the holders of the storage tickets. Checks that it issued were dishonored. After Rafferty became manager and during the winter and spring of 1921, the Exchange made an effort to reduce its storage liability by giving its promissory notes to ticket holders. By this means the liability was reduced several thousand bushels. The holders of these notes, however, received them conditionally, and the condition was never performed. This was denied by Rafferty and others in authority, but the jury found to the contrary. In May 1921, a meeting of the stockholders and some of the ticket holders was held for the purpose of considering the condition of the Exchange and devising...