Squire v. Ordemann

• Decision Date: 23 February 1909
• Citation: 194 N.Y. 394,87 N.E. 435
• Parties: SQUIRE v. ORDEMANN et al.
• Court: New York Court of Appeals Court of Appeals

194 N.Y. 394

87 N.E. 435

SQUIRE

v.ORDEMANN et al.

Court of Appeals of New York.

Feb. 23, 1909.

Appeal from Supreme Court, Appellate Division, First Department.

Action by Benjamin Squire against Ernst Ordemann and others for conversion. The issues were tried before the court and a jury, and at the close of the trial counsel for the plaintiff, and also for the defendant Ordemann, asked that a verdict be directed in favor of his client. The court directed a verdict in favor of the plaintiff. Subsequently, upon motion, the court set aside the verdict, and dismissed the plaintiff's complaint. The plaintiff appealed to the Appellate Division from the order setting aside the verdict and directing the dismissal of the complaint, and from the judgment entered thereupon. From the judgment of affirmance entered at the Appellate Division (122 App. Div. 890,106 N. Y. Supp. 1146), this appeal is taken. Reversed.

L. A. Gould, for appellant.

H. H. Glass, for respondent Ordemann.

CHASE, J.

One Christie died February 25, 1902, leaving a will by which the defendants Andariese and Strachan were named as executors, and they duly qualified and proceeded with the discharge of their duties as such.

On December 19, 1902, said Andariese individually entered into a contract with the defendant Ordemann to purchase his liquor saloon, and as part payment on the purchase price thereof gave a check, of which the following is a copy: ‘No. 33. New York, December 19, 1902. West Side Bank. Pay to the order of Ernest Ordeman five hundred dollars on account of purchase price of store and business, No. 392 Sixth avenue, N. Y. city. $500.00/100. Safe Deposit Vault. Estate of James A. Christie. Edwin M. Andariese, Ex. R. W. Strachan, Ex.’ The check was paid by said West Side Bank, and Ordemann received the proceeds thereof. The delivery of the check, followed by the collection and receipt thereof by Ordemann, constituted an appropriation of the amount of the check to the individual use of Andariese. The form of the check was notice to Ordemann that it was payable from trust funds, and as the check was payable to Ordemann, and actually applied in part payment of the individual contract of Andariese, the transaction is prima facie evidence to charge Ordemann as a joint tort-feasor with Andariese and Strachan in the conversion of the amount of the check from the Christie estate. Ward v. City Trust Co., 192 N. Y. 61, 66,84 N. E. 585;Hathaway v. County of Delaware, 185 N. Y. 368, 78 N. E. 153, 13 L. R. A. (N. S.) 273, 113 Am. St. Rep. 909; Seger v. Farmers' Loan & Trust Co., 187 N. Y. 314, 79 N. E. 977;Wetmore v. Porter, 92 N. Y. 76;Boyce v. Brockway, 31 N. Y. 490;Rochester & C. T. R. Co. v. Paviour, 164 N. Y. 281, 58 N. E. 114,52 L. R. A. 790;Gerard v. McCormick, 130 N. Y. 261, 29 N. E. 115,14 L. R. A. 234;First Nat. Bank of Paterson v. Nat. B'way Bank, 156 N. Y. 459, 51 N. E. 398,42 L. R. A. 139;Kirsch v. Tozier, 143 N. Y. 390, 38 N. E. 375,42 Am. St. Rep. 729;Wilson v. Metr. E. R. Co., 120 N. Y. 145, 24 N. E. 384,17 Am. St. Rep. 625.

To entitle Ordemann to a dismissal of the plaintiff's complaint it was necessary for him to establish that the transaction did not amount to a conversion of trust funds, or to show that the amount of the check has been returned to the Christie estate. He claims that the amount of the check was returned to the estate, and to establish such return he has shown that the contract with Andariese was subsequently canceled, and that at the time of such cancellation he gave to the attorneys representing Andariese a check for $500, payable to Andariese individually. It further appears that thereafter said check was indorsed by Andariese at the request of his attorneys, and that said attorneys then retained $150 thereof, and paid the remainder of $350 to Andariese. Under the agreement canceling the contract it was necessary for Ordemann to pay Andariese $500. That was an individual contract obligation, wholly independent of the fact that Andariese and Strachan, the two executors, and Ordemann had in law combined to despoil the estate of Christie to the extent of $500. Alleged good faith on the part of Ordemann does not relieve him from the legal consequences of receiving money in a transaction wholly personal, with notice at least sufficient to put an ordinarily prudent person upon inquiry that the money had been taken from a trust fund that could not be used for investment in the saloon business. There is no pretense of an attempt on the part of Ordemann to return to the estate of Christie the money that had been improperly taken from such estate. He did not even take the precaution of making the check, which he gave upon the cancellation of the contract for the purchase of the saloon, payable to both Andariese and Strachan or to Andariese and Strachan as executors, etc., of Christie, nor did he take any other precaution to relieve himself from the obligation resting upon him by reason of having been a party to the conversion of such $500. The facts do not warrant the apparent conclusion of the trial court that Ordemann had returned the money to the Christie estate from which it had been converted.

The will of Christie gave and bequeathed to each of his executors $500 exclusive of their fees and commissions...