Mitchell v. Munn Warehouse Company, 6589

• Decision Date: 31 December 1938
• Docket Number: 6589
• Parties: P. W. MITCHELL, Respondent, v. MUNN WAREHOUSE COMPANY, a Corporation, M. B. MIKKELSON, C. E. MUNN and WILEY WAGNER, Individually and as Co-partners and as Directors of Said Corporation, HARTFORD ACCIDENT AND INDEMNITY COMPANY, a Corporation, and BOYD-CONLEE COMPANY, a Corporation, Appellants
• Court: Idaho Supreme Court

86 P.2d 174

59 Idaho 661

P. W. MITCHELL, Respondent, v. MUNN WAREHOUSE COMPANY, a Corporation, M. B. MIKKELSON, C. E. MUNN and WILEY WAGNER, Individually and as Co-partners and as Directors of Said Corporation, HARTFORD ACCIDENT AND INDEMNITY COMPANY, a Corporation, and BOYD-CONLEE COMPANY, a Corporation, Appellants

No. 6589

Supreme Court of Idaho

December 31, 1938

CONVERSION-WAREHOUSEMEN-UNAUTHORIZED SALE OF PROPERTY-LIABILITY OF PURCHASER-VALUE OF PROPERTY CONVERTED-ACTION AGAINST CORPORATION AFTER FORFEITURE OF CHARTER - TRIAL-FAILURE TO MAKE FINDINGS-APPEAL AND ERROR-HARMLESS ERROR.

1. In action against warehouseman and others for conversion of wheat stored, by selling wheat without owner's consent because of fire in the warehouse, evidence held to authorize findings that much of plaintiff's wheat was distinguishable before and after the fire.

2. In action against warehouseman and others for conversion of wheat by selling wheat without owner's consent, the defense that warehouseman had right to sell to prevent destruction by fire was not available on appeal when not pleaded.

3. Where wheat stored in warehouse was sold without owner's knowledge or consent because of fire in warehouse, and owner told seller that he had no right to sell the wheat, owner was not estopped from suing warehouseman and others for conversion.

4. In action for conversion against warehouseman and others, for selling wheat without owner's consent, because of fire, a defendant whose answer did not seek recovery of expense of salvage could not urge right to recover such expense for the first time on appeal, where trial court made no finding concerning such expense.

5. An owner of wheat stored in warehouse was not estopped from suing for conversion, consisting of sale of such wheat without his consent because of fire in warehouse, by failure to assist in salvaging operations, to object, or to request any special treatment with respect to his wheat.

6. In action for conversion against warehouseman and others, for selling wheat without owner's consent because of fire in warehouse, wherein defendants did not plead that the wheat was in danger of destruction nor request finding to that effect, failure to make such finding was not error.

7. In action for conversion of wheat against corporation which operated a warehouse previously operated by copartnership but later forfeited its charter, leaving former partners as its reputed directors, officers, and agents, and also against such partners and surety on warehouseman's bond, wherein it was shown that bond furnished to the corporation was in effect at the time of the conversion, error in finding that bond furnished to the partners was then in effect was harmless. (I. C. A., sec. 67-201 et seq.)

8. In action against warehouseman and others for conversion of wheat by selling wheat during warehouse fire without owner's consent, finding that sale was made with warehouseman's knowledge and consent was authorized on showing that insurance adjuster sold the wheat during absence of warehouseman's manager, though manager had said that buyer's offer was insufficient, but manager did not protest or attempt to prevent consummation of the sale.

9. In action for conversion against corporation, which operated a warehouse but forfeited its charter after the conversion occurred, and partners who formerly operated the warehouse and were reputed directors, officers, and agents of the corporation, as statutory trustees of the corporation, judgment against the corporation was proper. (I C. A., sec. 29-611.)

10. An insurance adjuster's unauthorized sale and delivery of wheat stored in warehouse, with acquiescence of the warehouse company, because of fire in warehouse, permanently deprived owner of his property and constituted actionable conversion for which buyer of wheat, warehouse company, and surety on warehouseman's bond were liable. (I. C. A., sec. 67-201 et seq.)

11. In action for conversion of wheat stored in warehouse, by selling wheat during warehouse fire without owner's consent, where the only evidence of the market value at time of conversion was the price for which the wheat was actually sold, owner could recover only the amounts actually received. (I. C. A., sec. 69-208.)

APPEAL from the District Court of the Tenth Judicial District, for Lewis County. Hon. Miles S. Johnson, Judge.

Action for conversion. Judgment for plaintiff. Affirmed.

Judgment affirmed. Costs awarded to respondent.

Cox, Ware & Stellmon, for Appellants M. B. Mikkelson, C. E. Munn, and Wiley Wagner as Directors and Trustees of the Munn Warehouse Company, a Corporation, and Hartford Accident & Indemnity Company, a Corporation.

Where a warehouse is destroyed by fire and the grain is burned and damaged, the owners of insured and uninsured grain share proportionately the loss of the grain and must bear their share of expense of salvage and should look to the proceeds of the grain salvaged rather than to the warehouseman. (Richards on the Law of Insurance, 4th ed., 296, sec. 196, 297, sec. 198; 8 Couch Cyclopedia of Insurance Law, (1931) 6293, sec. 1891; Bedford Commercial Ins. Co. v. Parker, (Mass. 1823) 2 Pick. 1, 13 Am. Dec. 388.)

A judgment cannot be entered against a corporation which does not exist. (Rowe v. Stevens, (1913) 25 Idaho 237 at 254, 137 P. 159; secs. 29-607, 29-610, 29-611, I. C. A.; Holter v. Hauser, (1921) 33 Idaho 406, 195 P. 628; California Nat. Supply Co. v. Flack, (1920) 183 Cal. 124, 190 P. 634; Slayden v. O'Dea, (Cal. App. 1919) 189 P. 1062.)

A. S. Hardy, for Appellant Boyd-Conlee Company, a Corporation.

Plaintiff Mitchell is estopped to assert title as against or to claim a conversion on the part of the defendant Boyd-Conlee Company. (10 R. C. L., p. 692, sec. 21; also, p. 777, sec. 91; vol. 2, Pomeroy's Equity Jurisprudence, 2d ed., sec. 818; 21 C. J. 1202; 50 A. L. R. 668.)

There was no evidence of the grade or quality of plaintiff's grain following the fire or as to its value at the time it was purchased by defendant Boyd-Conlee Company other than the evidence of the price paid therefor by Boyd-Conlee Company. In such a situation damages must be assessed with reference to the value of the grain as shown by the price paid therefor by Boyd-Conlee Company. (Advance-Rumely Thresher Co. v. Brady, 47 Idaho 726, 278 P. 224.)

In asserting damages for conversion of salvaged wheat deduction should be allowed for the cost of salvaging. (Idaho Code Ann., sec. 67-127; 67 C. J., p. 542, par. 182; Vollmer Clearwater Co. v. Union Warehouse & Supply Co., 43 Idaho 37, 248 P. 865.)

Wilbur L. Campbell, for Respondent.

So whenever a person entrusted with the goods of another, puts them into the hands of a third person, without orders, such a delivery to an unauthorized person is as much conversion as would be the sale of the property or an appropriation of it to the bailee's own use. And in such case neither a sincere nor well founded belief that the tortious act was right nor the exercise of any degree of care constitutes a defense. (Sec. 67-110, I. C. A.; 27 R. C. L., p. 40; 27 R. C. L., sec. 41, p. 984.

A corporation does not by becoming delinquent for failure to pay annual license tax required by sec. 29-603, I. C. A., die as does a natural person or a corporation whose term of existence has terminated, but is rather in a state of suspended animation, from which it may be relieved by paying penalties as provided in sec. 29-608, I. C. A. (Ferguson Fruit & Land Co. v. Gooding, 44 Idaho 76, 86, 258 P. 557.)

A seller of personal property can convey no greater title than he had, and it makes no difference that the purchaser has no notice and is ignorant of other parties and interest. And conversely one who buys property must, at his peril, ascertain the ownership; and if he buys from one having no authority to sell, his taking possession in denial of the owner's right is a conversion. (Federal Land Bank v. McCloud, 52 Idaho 694, 703, 20 P.2d 201; I. C. A., sec. 62-207; 7 R. C. L. 879, 886; 2 Cooley on Torts, p. 506; 65 C. J., p. 35, sec. 46; Velzian v. Lewis, 15 Ore. 539, 16 P. 631, 3 Am. St. 184; Carver v. Ketchum, 53 Idaho 595, 601, 602, 26 P.2d 139.)

Irrespective of the provisions of the Uniform Warehouse Law, a delivery of goods to the wrong person, whether by mistake or negligence, constitutes a conversion, though such person be the original bailor. (27 R. C. L., p. 40, sec. 41, p. 984; 6 Am. Jur. (Bailments), sec. 153; p. 256, sec. 150; Jeffersonville Ry. Co. v. White, 6 Bush (Ky.), 251; Devereux v. Barclay, 2 Barn. & Ald. (Eng.) 702.)

The general rule is that the ordinary measure of damages in an action for trover is the value of the property converted at the time and place of the conversion. (Unfried v. Libert, 23 Idaho 603, 131 P. 660; Unfried v. Libert, 20 Idaho 708, 119 P. 885; Averill Machinery Co. v. Vollmer-Clearwater Co., 30 Idaho 587, 166 P. 253; 65 C. J. (Trover and Conversion), sec. 252, p. 136; 26 R. C. L., p. 1147, pp. 61, 63; Edwards v. Cleveland Mill & Power Co., 193 N.C. 780, 138 S.E. 131, 53 A. L. R. 1404.)

And a sum equal to the legal rate of interest on the value of the property from the time of conversion to the entry of judgment is recoverable as an element of damage. (Averill Machinery Co. v. Vollmer-Clearwater Co., supra; Gunnell v. Largilliere Co., 46 Idaho 551, 269 P. 412; Singer v. Pearson Page Co., 58 Ore. 526, 115 P. 158; Sigel-Campion Live Stock Co. v. Holly, 44 Colo. 580, 101 P. 68; Dixon v. Southern P. Co., 42 Nev. 73, 172 P. 368, L. R. A. 1918D, 960.)

HOLDEN, C. J. Morgan, J., concurs, GIVENS, J., Ailshie and Budge, JJ., concurring in part.

OPINION

HOLDEN, C. J.

Prior to October 25, 1931, M. B. Mikkelson, C. E. Munn, and Wiley Wagner were engaged as...