Porter v. Roseman

• Decision Date: 30 June 1905
• Docket Number: No. 20,609.,20,609.
• Citation: 74 N.E. 1105,165 Ind. 255
• Parties: PORTER v. ROSEMAN.
• Court: Indiana Supreme Court

165 Ind. 255

74 N.E. 1105

PORTER

v.ROSEMAN.

No. 20,609.

Supreme Court of Indiana.

June 30, 1905.

Appeal from Circuit Court, Tipton County; J. F. Elliott, Judge.

Action by Abraham Roseman against Robert L. Porter. From a judgment for plaintiff, defendant appeals. Transferred from the Appellate Court under Burns' Ann. St. 1901, § 1337u. Reversed.

Gifford & Gifford, for appellant. Jno. P. Kemp, for appellee.

HADLEY, J.

This is an ordinary action by appellee against appellant, on an open account, for goods sold and delivered. Answer in set-off. Reply said to be by general denial, but it is not in the record. Special finding, conclusions of law, and judgment in favor of appellee. The evidence is not in the record. The question for decision arises upon the conclusions of law and motion to modify the judgment.

The special finding discloses the following facts: Prior to the commencement of this action there was owing the plaintiff (appellee), a resident of New York, from the appellant, $249, for goods sold and delivered. There was also owing the plaintiff from one William Mount, a former merchant of Elwood, for goods sold and delivered prior and subsequent to June 10, 1897, $432. On said June 10, 1897, Mount was in the employ of the defendant, and had charge of the defendant's jewelry store in Elwood on a fixed salary. On the latter date the plaintiff's agent, knowing that Mount had no interest in the defendant's said store except as salesman, called upon Mount therein for a settlement of his indebtedness to the plaintiff, and during the call assisted Mount in making sale of a diamond belonging to the defendant, and received $35 of the proceeds which he credited to the account of Mount, and turned it over to the plaintiff. The balance of the account was arranged by Mount executing to the plaintiff and delivering to said agent his notes for the amount, payable in monthly installments of $20 each, beginning October 31, 1899. The notes were delivered to the plaintiff in New York, and, as they severally became due were placed by the plaintiff in a bank in New York for collection, and by that bank forwarded to a bank in Elwood, at which latter bank eight of said notes first maturing were paid by Mount from money belonging to the defendant, which he had received from sales made from said store. The plaintiff had no knowledge of the ownership of the money used in the payment of his notes. As they were paid the Elwood bank remitted a like sum of money to the New York bank, where it was credited to plaintiff's account, but there was no evidence that any part of the identical money paid by Mount was remitted to New York or received by the plaintiff.

The conclusion of law is that the defendant is entitled to a set-off for the $35 knowingly received by the plaintiff's agent from the sale of the defendant's diamond, and that the plaintiff is entitled to recover the balance of his claim. The facts pleaded as an answer and equitable set-off are substantially the same as those found to be true in the special finding, and the exception reserved to the conclusion of law raises the question, do these facts show appellant to be entitled to set off against the claim of appellee an amount equal to the sum of appellant's money found to have been converted and used by Mount in payment of the latter's debt to the appellee? The $35 received directly by appellee's agent from the purchase money for the diamond, with knowledge that it was appellant's money, was allowed by the court as a proper set-off, but the sum converted by Mount in the payment of his notes to the bank, to wit, $160, was disallowed, presumably, because (1) the identical money converted was not traced to appellee; and (2) when received appellee had no knowledge of the conversion. Was the conclusion of law right?

One of the facts found is that Mount wrongfully converted $160 of appellant's money and delivered it to appellee in discharge of a debt. It is true, the immediate delivery of the money was to the bank at Elwood, which bank transmitted it to the bank in New York, where it was credited to appellee. These banks constituted the agency selected by appellee for the collection of his notes, and in every proper sense a payment to the bank was payment to appellee. Jones v. Kilbreth, 49 Ohio St. 401, 413, 31 N. E. 346;Bank v. Union Trust Co., 149 Ill. 343, 351, 36 N. E. 1029, 23 L. R. A. 611. It is plain that Mount acquired no title by the conversion, and that he transferred to appellee no better title to the money than he himself possessed. Alexander v. Swackhamer, 105 Ind. 81, 4 N. E. 433, 5 N. E. 908, 55 Am. Rep. 180;Shearer v. Evans, 89 Ind. 400;Breckenridge v. McAfee, 54 Ind. 141. Appellant's money, having reached the possession of appellee without authority or right, remained as much his property in the hands of appellee as it was in the hands of Mount (Shearer v. Evans, 89 Ind. 403); and this, too, without reference to whether appellee at the time of its receipt did, or not, know whose money it was. He received it from one who had no authority to dispose of it, and its appropriation to his own use was conversion. Alexander v. Swackhamer, supra; Harlan v. Brown, 4 Ind. App. 319, 323, 30 N. E. 928. Appellee's innocence and good faith afford no protection against the rightful owner who has been tortiously dispossessed. Breckenridge v. McAfee, 54 Ind. 149. To charge appellee, it is not essential that appellant shall trace his identical money into the possession of appellee. It is sufficient to show that it went into his bank account. Pearce v. Dill, 149 Ind. 136, 143, 48 N. E. 788, and cases cited.

Appellee thus having in his possession money which ex æquo et bono belonged and ought to have been returned to appellant, an action for money had and received might have been well brought for its recovery; and it was not material how the money came into his hands, if the plaintiff is justly entitled to receive it. In such a case the law implies a promise to pay. Daily v. Board Com'rs (this term, June 6, 1905) 74 N. E. 977, and authorities cited; Glascock v. Lyons, 20 Ind. 1, 83 Am. Dec. 299; 15 Am. & Eng. Ency. 1096, 1098, and cases collated.

The case then comes to this: The defendant, a resident of this state, at the commencement of this suit owed the plaintiff, a resident of New York, the sum of $249; and at the same time the plaintiff, in equity and good conscience, owed the defendant $195. In this state of cross-demands, the plaintiff having come into this jurisdiction and entered suit for the recovery of his claim against the defendant, may the latter carry the case into equity, and have set off...