Shahood v. Cavin

• Decision Date: 28 October 1957
• Citation: 154 Cal.App.2d 745,316 P.2d 700
• Court: California Court of Appeals Court of Appeals
• Parties: Debee K. SHAHOOD, Plaintiff and Respondent, v. Gilbert CAVIN, Defendant and Appellant. Civ. 22613.

Page 700

316 P.2d 700

154 Cal.App.2d 745

Debee K. SHAHOOD, Plaintiff and Respondent, v. Gilbert CAVIN, Defendant and Appellant.

Civ. 22613.

District Court of Appeal, Second District, Division 2, California.

Oct. 28, 1957.

Paul D. Strader, Jr., Long Beach, for appellant.

Robert C. Pannell, Torrence, for respondent.

ASHBURN, Justice.

Appeal from judgment for plaintiff for $3,410.15 and costs. Appellant's first point is that the court erred in overruling a demurrer to the first amended complaint. Appellant argues that that complaint, labeled conversion, does not state a cause of action because the subject matter is money and mere money is not susceptible of conversion. We agree that the complaint does not allege a conversion but hold that the demurrer was properly overruled, disregarding in the process the faulty conclusion of the pleader.

The complaint in summary alleges the following. Plaintiff Debee K. Shahood is and was the owner of real property known as 2802 Winlock Road, in the city of Torrence, She gave a written power of attorney to her son, George N. Shahood, authorizing him to manage or sell the property for plaintiff's benefit. He coveyed it to defendant Cavin on January 9, 1955, as security for a personal loan of $1,500, defendant agreeing to reconvey upon repayment of the loan within six months. Defendant knew at all times that the loan was not to be used for the benefit of plaintiff or her property, and that the son George had no authority to convey except for the benefit of plaintiff. Thereafter, on May 1, 1955, George and Cavin made a superseding agreement to the effect that Cavin should sell the property to John Ard, deduct the amount of his loan from the proceeds and pay over the balance to George or Debee Shahood; the property was sold and conveyed to Ard for $11,200. Plaintiff had never authorized any sale or conveyance other than one for her own personal benefit and therefore the conveyances to Cavin and to Ard were unlawful; '[h]owever, Debee Shahood herewith ratifies the sale to the Ards.' Cavin withholds the proceeds of the Ard sale from plaintiff 'and has converted them to his own use and benefit, all to plaintiff's damage in the amount of $11,200.11'; defendant has acted maliciously and plaintiff is entitled to exemplary damages; '[p]laintiff is entitled to immediate possession of the sale proceeds and has demanded them but defendants have refused to surrender possession of such proceeds.'

Appellant cites Haigler v. Donnelly, 18 Cal.2d 674, 117 P.2d 331, and Olschewski v. Hudson, 87 Cal.App. 282, 262 P. 43, to the point that conversion does not lie for alleged misappropriation of money derived from the sale of an interest in land because that action applies to money 'only where there is an obligation to keep intact or deliver the specific money in question and where such money can be indentified.' The authorities support this general proposition. Haigler v. Donnelly, supra, 18 Cal.2d at page 681, 117 P.2d at page 335, says: 'While it is true that money cannot be the subject of an action for conversion unless a specific sum capable of identification is involved (Baxter v. King, 81 Cal.App. 192, 253 P. 172), it is not necessary that each coin or bill be earmarked. When an agent is required to turn over to his principal a definite sum received by him on his principal's account, the remedy of conversion is proper.' To the same effect see, 89 C.J.S. Trover and Conversion § 23, p. 541; Story v. Palmer, Tex.Civ.App., 284 S.W. 331; Calvada Inc., v. Fidelity & Deposit Co. of Maryland, Sup., 139 N.Y.S.2d 92, 96; Anderson Electric Car Co. v. Savings Trust Co., 201 Mo.App. 400, 212 S.W. 60. In the last cited case it is said at page 61 of 212 S.W.: '[T]rover lies only for specific chattels wrongfully converted, and not for money had and received for payment of debts, money being the subject of conversion only when it can be described or identified as a specific chattel.'

The complaint says the price paid was $11,200 and that defendant withholds the proceeds of sale from plaintiff and has converted same to his own use, to plaintiff's damage in the amount of $11,200. This is susceptible of the interpretation that the property was sold for cash and the entire price paid to defendant. If so, that money might be the subject of conversion within the doctrine of the Haigler and other cases above cited; we do not decide the specific point. But plaintiff destroyed her claim of conversion by alleging that she 'herewith ratifies the sale to the Ards.' This was a definite waiver of the tort and an election to stand upon the resulting implied contract. Bank of America Nat. Trust & Savings Ass'n v. Hill, 9 Cal.2d 495, 499, 71 P.2d 258; Los Angeles Drug Co. v. Superior Court, 8 Cal.2d 71, 74, 63 P.2d 1124; Graner v. Hogsett, 84 Cal.App.2d 657, 661, 191 P.2d 497. "According to the well established principles of law, where a wrongful act is both a tort and a breach of contract, the plaintiff may waive the tort and sue in contract. By virtue of this rule it is well settled that where a person takes and sells the property of another, without authority, the party aggrieved may waive the tort and sue in assumpsit for the price received at such sale or for the value of the property so taken. The basis of this 'waiver of tort' is that the plaintiff consents to the taking of his property and affirms the act of the wrongdoer. He treats it as a sale, and recovers the value due him under an implied contract of sale.' 1 Cal.Jur., p. 322.' Bank of America Nat. Trust & Savings Ass'n v. Hill, supra, 9 Cal.2d 495, 499, 71 P.2d 258, 260. The complaint therefore stated a good cause of action because it showed the receipt and retention by defendant of the proceeds of a sale of plaintiff's property to which he had no right, and through which he was unjustly enriched.

Appellant claims that the evidence is insufficient to support the finding of liability on the part of defendant. Evidence favorable to respondent's cause, presumptively believed by the trial judge, establishes the following facts. Plaintiff lived in Massachusetts and her son george in Los Angeles at the time she made her purchase; it was a purchase under an installment contract and she never acquired full title. She paid $1,200 down, which sum and other moneys paid on that contract constituted her own property, not George's. She gave George a written general power of attorney to manage and to sell or exchange the property. George was working for defendant at the time. The power, as the findings show, 'did not authorize said George Shahood to sell or encumber the property for his own benefit. That defendant, Gilbert Cavin knew of the existence of the Power of Attorney and knew that the real property had been purchased in plaintiff's name. That defendant, Gilbert Cavin knew that George Shahood was acting for his own benefit in selling or encumbering the house and would use the funds obtained for his own benefit, but that he believed that plaintiff did not have any real interest in the property and did not therefore rely on the Power of Attorney.' This was because George was a paroled convict and had told defendant that the property belonged to him but had been placed in the mother's name because a convict cannot hold title to property; that the purchase had been made with his own money. When the $1,500 loan was made by defendant in January, 1955, he knew George was acting for himself and would use the money for his own benefit; George asserted the mother's title and the power of attorney to be mere formalities, conveniences in holding and handling title by a paroled convict. Mrs. Shahood knew nothing of the loan or the transfer made to secure it, and there is no element of estoppel present to impede her asserting her rights. Having acquired record ownership of the contract with notice of plaintiff's rights and in violation of same, defendant became an involuntary trustee (Civ.Code, § 2224) for the benefit of plaintiff. The fact that he did not believe her to be the true owner could not excuse the violation of plaintiff's property rights. When he in turn sold to Ard, Mrs. Shahood had...