Sanborn v. Matthews.

• Decision Date: 27 March 1945
• Citation: 41 A.2d 704
• Parties: SANBORN et al. v. MATTHEWS.
• Court: Maine Supreme Court

41 A.2d 704

SANBORN et al.

v.MATTHEWS.

Supreme Judicial Court of Maine.

March 27, 1945.

Exceptions from Superior Court, Androscoggin County.

Trover by A. J. Sanborn and F. S. Sanborn against Walter D. Matthews for the conversion of mortgaged chattels. On plaintiffs' exception to the directing of a verdict for defendant.

Exceptions overruled.

John G. Marshall, of Auburn, for plaintiffs.

Frank W. Linnell, of Auburn, for defendant.

Before STURGIS, C. J., and THAXTER, HUDSON, MANSER, MURCHIE, and CHAPMAN, JJ.

MURCHIE, Justice.

This case is brought forward on plaintiffs' exceptions to the directing of a verdict for the defendant. It poses the single question whether the holders of a chattel mortgage, after foreclosure, may maintain trover for the conversion of a part of the mortgaged property against one who, having exercised dominion over it at a time when one of them had no interest in the title, had parted with possession prior to the time when the plaintiffs became possessed jointly of that title and right of possession on which they rely. The mortgage, which was properly recorded, ran to the plaintiffs as co-mortgagees and was given to secure notes which they owned severally but the plaintiff Frank S. Sanborn had aliened his interest in it prior to the time when the property in question came into the possession of the defendant and did not reacquire it until after that possession had been terminated.

The mortgage was executed in 1933 and provided that the mortgagor might continue in possession of the mortgaged property until breach of the conditions. The plaintiffs took a second mortgage in 1935, carrying similar recital. The plaintiff Frank S. Sanborn assigned his interest in 1937 and reacquired it in 1943, after which the plaintiffs joined in foreclosure. Between the dates of assignment and reassignment the defendant purchased one of the mortgaged chattels of the mortgagor and resold it to someone who is not identified in the record.

The purchase of mortgaged chattel property from the mortgagor (if all the property covered by a particular mortgage is acquired) does not of itself constitute a conversion on the part of the vendee, Dean v. Cushman, 95 Me. 454, 50 A. 85, 55 L.R.A. 959, 85 Am.St.Rep. 425, but it is established law that any subsequent action on his part does if it is in denial or exclusion of, or inconsistent with, the rights of the true owner, 26 R.C.L. 1098, Par. 3; 65 C.J. 29, Par. 37; Fuller v. Tabor, 39 Me. 519; Moulton v. Witherell, 52 Me. 237; McPheters et al. v. Page, 83 Me. 234, 22 A. 101, 23 Am.St.Rep. 772, and the sale itself, if not made subject to the mortgage, is a conversion by the mortgagor. The purchaser becomes a converter if he exercises dominion over the purchased chattel in a manner inimical to the rights of the mortgagee, Dean v. Cushman, supra; 14 C.J.S., Chattel Mortgages, § 264; 11 C.J. 631, Par. (342) 5 a (on which point note 64 cites Dean v. Cushman, supra). In the instant case the defendant not only purchased a part of the property originally mortgaged to the parties who are now prosecuting this action in trover but he resold it to a person unnamed without reference to the rights of the holders of the mortgage. The defendant must be held to have converted the property at the time he sold it if not at the time he purchased it, a question not requiring decision here, and the only issue presented in the present case is that of his liability for that conversion to these plaintiffs jointly.

The law is clear that the liability of a converter is measured by the value of the property at the time and place of conversion, 26 R.C.L. 1148, Par. 63; 65 C.J. 131, Par. 247; Moody v. Whitney et al., 38 Me. 174, 61 Am.Dec. 239; Wing v. Milliken, 91 Me. 387, 40 A. 138, 64 Am.St.Rep. 238; Glaspy v. Cabot, 135 Mass. 435; although interest may run from that date, R.C.L. and C.J., both supra; Hayden v. Bartlett, 35 Me. 203; Brown v. Haynes, 52 Me. 578; Wing v. Milliken, supra. This relates to the value at the time when the property came into the possession of the defendant against whom recovery is sought, Moody v. Whitney et al., supra; Powers v. Tilley, 87 Me. 34, 32 A. 714, 47 Am.St.Rep. 304; Wing v. Milliken, supra.

The issue has not arisen heretofore in this Court for formal adjudication as to whether the time element controls the question of liability as well as its measure. The owner of a chattel having the right to possession may maintain trover against a converter, whether or not such converter still retains the possession of it, or against anyone who has the property in possession and...