Humpfner v. D.M. Osborne & Co.

• Decision Date: 20 October 1891
• Citation: 50 N.W. 88,2 S.D. 310
• Parties: Humpfner v. D. M. Osborne & Co. et al.
• Court: South Dakota Supreme Court

50 N.W. 88

2 S.D. 310

Humpfner v. D. M. Osborne & Co. et al.

Supreme Court of South Dakota

October 20, 1891

Syllabus by the Court

1. A complaint in an action, in which it is alleged that at a certain time the plaintiff was the owner and in the possession of certain personal property; that it came into the possession of the defendants; and that, while so in their possession, they unlawfully and wrongfully converted it to their own use, to the damage of plaintiff,--is sufficient under the Code of this state. The further allegation that defendants "took possession of said personal property" should be treated as surplusage.

2. Where the complaint alleged ownership, which was denied by a general denial in the answer, an allegation in the answer that the property described in the complaint was included in a chattel mortgage given by plaintiff to the defendant, and was at the time it was so mortgaged the property of the plaintiff, is a clear and distinct admission that the property described in the complaint was the property of plaintiff, as plaintiff, being then the owner, will be presumed to have remained the owner to the time of trial, in the absence of any allegation that the title had been in the mean time transferred.

3. Facts admitted by the pleadings need not be submitted to or found by a jury in a special verdict. The facts admitted by the pleadings, together with those found by the jury, present the whole case in proper form for the consideration of the court; but a special verdict must find all the material facts not admitted, put in issue by the pleadings, when no general verdict is found.

4. A provision in a chattel mortgage that, if the "mortgagee shall at any time deem itself insecure, then thereupon and thereafter it shall be lawful for such mortgagee *** to take such property, *** and hold and sell or dispose of the same," does not confer upon the mortgagee the absolute and arbitrary power to declare itself insecure without proper cause, and authorize it to proceed to take possession and sell the mortgaged property. Until the debt matures, or some act is done or threatened by the mortgagor, specified in the mortgage, which would authorize the mortgagee to take possession of and sell, the mortgagor's possession cannot be legally disturbed. Held, further, that the questions submitted to the jury in this case were pertinent and proper and that the fact of whether or not defendant D. M. Osborne & Co. did deem itself insecure was immaterial, and was properly omitted from the questions submitted.

5. Defendants pleaded and relied upon the defense that during the pending of this action D. M. Osborne & Co. brought an action in the justice court against Humpfner, the plaintiff herein, to recover the sum due on a promissory note given by him to said D. M. Osborne & Co., in which suit two defenses were pleaded by Humpfner, one of which was that the note was paid by the foreclosure and sale under the mortgage. Evidence was offered and received tending to establish this defense but it was subsequently stricken out. Held error. If the defense, as alleged, could be proven, then Humpfner was estopped from asserting that the foreclosure sale was invalid. Held, further, that, there being two defenses pleaded in the justice court action, it was competent to show by extrinsic evidence upon which defense the justice rendered his judgment.

Appeal from circuit court, Grant county.

Action by Hubert Humpfner against D. M. Osborne & Co. and Harvey J Benedict for damages for conversion of personalty. Judgment for plaintiff. Defendants appeal. Reversed.

Taubman & Potter, for appellants. Bion A. Dodge and John W. Bell, for respondent.

CORSON J.

This is an action for damages for the unlawful conversion of personal property. Judgment was rendered for plaintiff upon a special verdict. Defendants appeal. The plaintiff, in his complaint alleges, in substance, that the defendant D. M. Osborne & Co. is a corporation; that on or about October 8, 1887, he was the owner and in possession of certain described personal property; that on or about said last-mentioned date defendants took possession of the same, and that on or about October 20, 1887, defendants, being then in possession of the same, unlawfully disposed of the same, and converted it to their own use, to his damage, etc. Defendants, in their answer, deny each and every allegation of the complaint not specifically admitted. They then set out in detail the facts claimed by them to constitute a justification for said alleged taking and sale, which, briefly stated, are as follows: That on the 8th day of November, 1886, the plaintiff executed and delivered to the defendant D. M. Osborne & Co. his certain promissory note bearing date of that day, and payable on November 1, 1887, with 7 per cent. interest; that at the same time he executed and delivered to said defendant D. M. Osborne & Co. a chattel mortgage of the property described in the complaint, to secure the payment of said note; that the plaintiff did not take proper care of said personal property so mortgaged, etc.; and that said D. M. Osborne & Co., deeming itself insecure, took possession of said property, and thereafter sold the same, on October 20, 1887, through the defendant Benedict, who acted as the agent of D. M. Osborne & Co., and that said Benedict was at the time sheriff of Grant county, territory of Dakota. Another defense was also set up that will be referred to hereafter. The chattel mortgage contained, among others, the following provisions authorizing the mortgagee to take possession of and sell the mortgaged property: "But if default shall be made in the payment of said sum of money or interest thereon at the time the said note shall become due, or if any attempt shall be made to dispose of or injure said property, or to remove said property from said Grant county, Dakota, or any part thereof, by the said mortgagor or any other person, or if said mortgagor does not take proper care of said property, or if said mortgagee shall at any time deem himself insecure, then, thereupon and thereafter, it shall be lawful, and the said mortgagee hereby authorizes its successors or assigns, or its or their authorized agent, to take said property wherever the same may be found, and hold or sell and dispose of the same and all equity of redemption at public auction, with notice, as provided by law, and on such terms as said mortgagee may see fit." At the close of the trial the jury, under the direction of the court, found and returned a special verdict as follows: "(1) Was the property which the defendants took possession of and sold under the foreclosure proceedings the same property which is described and mentioned in the mortgage given by plaintiff to D. M. Osborne & Co., being the mortgage in question? Yes. (2) Have any facts been shown to exist by which the defendant, the mortgagee herein, had reasonable grounds to deem himself insecure? No. (3) Had the plaintiff, before said property was taken by the mortgagees, disposed of or injured, or attempted to dispose of, remove, or injure, the property included in said mortgage? No. (4) Was plaintiff, before the mortgagee took said property, failing or neglecting to take proper care of said property included in said mortgage? No. (5) Was the plaintiff, at the time the property was taken by the mortgagee, guilty of any default of the conditions mentioned in said mortgage? No. (6) Did the default mentioned in the notices of sale of the property in question exist at the time of the foreclosure proceedings? No. (7) What was the value of the property in question at the time it was taken possession of by the defendants and sold under foreclosure proceedings? Answer. $213.76." The jury returned no general verdict, and the judgment was rendered upon the special verdict alone.

The following errors are assigned: "(1) The court erred in not sustaining defendant's objection to the introduction of any evidence, on the alleged ground that the complaint did not state a cause of action. (2) The court erred in sustaining the motion of plaintiff to strike out the testimony of the witness Jones, and the judgment and pleadings in the case of D. M. Osborne & Co. vs. Hubert Humpfner. (3) The court erred in denying defendants' motion to direct a verdict in favor of defendants. (4) The court erred in submitting each and all said special findings to the jury. (5) The court erred in requiring from the jury and receiving a special verdict, which did not include a finding that plaintiff was the owner of the property at the time of the alleged conversion; nor whether in fact the defendant D. M. Osborne & Co. deemed itself insecure at the time of the taking of the mortgaged property. (6) The court erred in entering judgment against defendants without having submitted to the jury the question of whether plaintiff was the owner of the property at the time of the alleged taking by defendant. (7) The court erred, as a matter of law, in giving judgment against defendants, on the facts established by the evidence and found by the jury."

Appellants contend that the complaint fails to state a cause of action it alleging that on a certain day the defendants took possession of the property, but stating no facts showing that such taking was against the will or consent of plaintiff. The complaint was evidently drawn upon the theory that the property came rightfully into the possession of the defendants, but that subsequently it was wrongfully converted by them to their own use, by a wrongful sale, making the action one that under the old common-law system of pleadings would have been an action of trover, which seems to be in accord with the intention of the pleader. The action being in the nature of trover, the...