Whitaker v. Bank of El Paso

• Decision Date: 17 March 1993
• Docket Number: No. 08-92-00286-CV,08-92-00286-CV
• Citation: 850 S.W.2d 757
• Parties: J.H. WHITAKER, Appellant, v. The BANK OF EL PASO, a/k/a Cielo Vista Bank, et al., Appellees.
• Court: Texas Court of Appeals

Page 757

850 S.W.2d 757

J.H. WHITAKER, Appellant, v. The BANK OF EL PASO, a/k/a Cielo Vista Bank, et al., Appellees.

No. 08-92-00286-CV.

Court of Appeals of Texas El Paso.

March 17, 1993.

Dick Stengel, El Paso, for appellant.

Ken Slavin, Brower & Slavin, El Paso, for appellees.

Before KOEHLER, BARAJAS and LARSEN, JJ.

OPINION

LARSEN, Justice.

This is an appeal from a summary judgment in a conversion case. We find that defendants have established as a matter of law that plaintiff cannot prevail on an essential element of his claim of conversion. We also find that the trial court did not abuse its discretion in refusing to award defendants sanctions under Tex.R.Civ.P. 13, and overrule plaintiff's cross-point on appeal. We affirm the judgment of the trial court.

STANDARD OF REVIEW

The standard of review of a summary judgment on appeal is

1. The movants for summary judgment have the burden of showing that there is no genuine issue of material fact and that they were entitled to judgment as a matter of law;

2. In deciding whether there is a disputed material fact issue precluding summary judgment, evidence favorable to the nonmovant will be taken as true; and

3. Every reasonable inference must be indulged in favor of the nonmovant and any doubts resolved in his favor.

Nixon v. Mr. Property Management Company, Inc., 690 S.W.2d 546, 548-49 (Tex.1985). The question before us is whether the summary judgment proof establishes as a matter of law that there is no genuine issue of fact as to one or more of the essential elements of the plaintiff's cause of action. Gibbs v. General Motors Corporation, 450 S.W.2d 827, 828 (Tex.1970); Zep Manufacturing Company v. Harthcock, 824 S.W.2d 654, 658 (Tex.App.--Dallas 1992, n.w.h.). Because it is plaintiff's burden to establish each element of the cause of action, if a defendant submits summary judgment evidence disproving at least one element of the plaintiff's case, then the defendant's summary judgment should be granted. Bradley v. Quality Service Tank Lines, 659 S.W.2d 33, 34 (Tex.1983); Rayos v. Chrysler Credit Corporation, 683 S.W.2d 546, 547 (Tex.App.--El Paso 1985, no writ).

FACTS

On November 12, 1991, John H. Whitaker filed a conversion suit against Bank of El Paso, H. Clark Harvey and E. Burt Blacksher (two of the bank's officers), Morgan Drive Away Inc. and Gene and Lily Hoagland. The suit alleged that Mr. Whitaker had purchased eight used mobile homes through his agent O.W. "John" Bowen, which were stored at the Desert Outpost Truck Stop in Hudspeth County, Texas. It also alleged that the bank, through its agents the Hoaglands and Morgan Drive Away, wrongfully took the mobile homes, that Whitaker had demanded their return and defendants had failed to respond. The suit requested actual and punitive damages for conversion.

The record in this case is far from a model of clarity. Indeed, deliberate obfuscation of ownership interests seem to prevail. The eight mobile homes in question may, or may not, have been owned by: (1) Industrial Mobile Space Leasing and Sales Inc.; (2) O.W. "John" Bowen; (3) Bowen's daughter, Darla Elder; (4) John Whitaker; or (5) Bowen Mfg. Housing. The certificates of title are no help in this regard, as they have never been transferred to reflect any sale. For summary judgment purposes, we assume that John Whitaker purchased and owned the eight mobile homes. ¹

The Bank of El Paso took possession of the mobile homes after obtaining a judgment and writ of sequestration following default on a promissory note by Industrial Mobile Space Leasing and Sales, Inc. The judgment and writ of sequestration identify the trailers claimed by Whitaker. ² The bank had loaned Industrial $40,000 for the purchase of 41 used mobile homes, retaining a security interest in Industrial's business inventory. The mobile homes which Whitaker claims are included in the inventory list which accompanied the loan documents, in the UCC-1 form signed by Industrial and the Bank's representatives, and in the affidavit of Jan Orr, identifying the trailers she sold to John Bowen. Bowen purchased the trailers with a $5,000 wire transfer and a $35,000 cashier's check drawn on the Bank of El Paso. John Bowen's summary judgment affidavit, however, states that Whitaker's mobile homes were never mortgaged to the Bank of El Paso nor did Industrial Mobile Leasing and Sales, Inc. ever have any interest in the mobile homes that belonged to Mr. Whitaker. For summary judgment purposes, we presume Bowen's evidence is true, and we reject all evidence to the contrary. It is undisputed, however, that all the trailers were parked together at the Desert Outpost Truck Stop, and Whitaker's were not physically segregated in any way.

Plaintiff Whitaker cannot establish a fact question as to each of the essential elements of his conversion claim, because defendants have shown, as a matter of law, that plaintiff failed to make demand for the return of the mobile homes at issue. Moreover, defendants never refused to return the homes, and indeed on at least two occasions stated that upon plaintiff's identification of his trailers, and submission of some proof of his ownership claim, they would happily release the property to him.

ELEMENTS OF CONVERSION

Conversion is the unauthorized and unlawful assumption and exercise of dominion and control over the personal property of another which is to the exclusion of, or inconsistent with, the owner's rights. Waisath v. Lack's Stores, Inc., 474 S.W.2d 444, 446 (Tex.1971); Beam v. Voss, 568 S.W.2d 413, 420-21 (Tex.Civ.App.--San Antonio 1978, no writ). Plaintiff must prove that at the time of the conversion, he was the owner of the property, had legal possession of it or was entitled to possession. Lone Star Beer, Inc. v. Republic National Bank of Dallas, 508 S.W.2d 686, 687 (Tex.Civ.App.--Dallas 1974, no writ); Lone Star Beer, Inc. v. First National Bank of Odessa, 468 S.W.2d 930, 933-34 (Tex.Civ.App.--El Paso 1971, writ ref'd n.r.e.). Ordinarily, plaintiff must establish that he demanded return of the property, and that the defendant refused to return it. Hull v. Freedman, 383 S.W.2d 236, 238 (Tex.Civ.App.--Fort Worth 1964, writ ref'd n.r.e.). Demand and refusal are not necessary, however, when the possessor's acts manifest a clear repudiation of the plaintiff's rights. Loomis v. Sharp, 519 S.W.2d 955, 958 (Tex.Civ.App.--Texarkana 1975, writ dism'd). While an absolute refusal to transfer possession to one entitled to it generally constitutes conversion, a qualified good faith refusal based on a reasonable requirement does not constitute conversion. A refusal to deliver property on request may be justified in order to investigate the rights of the parties, and no conversion results if such refusal is made in good faith to resolve a doubtful matter. Earthman's, Inc. v. Earthman, 526 S.W.2d 192, 204-06 (Tex.Civ.App.--Houston [1st Dist.] 1975, no writ). The reason for the qualified refusal must be distinctly stated to the party demanding possession, however, or the right to withhold the property is lost. Any reasons for refusing to turn over the property which are not mentioned at the time of the refusal are lost and may not be raised later. Stein v. Mauricio, 580 S.W.2d 82, 83 (Tex.Civ.App.--San Antonio 1979, no writ).

NO DEMAND OR REFUSAL TO RETURN

Here, plaintiff's original petition states that "[p]laintiff has made demand for the return of said Mobile homes both of the Bank and Morgan Drive Away but has had no response from either one." In his reply to defendants' motion for summary judgment, however, Whitaker states John H. Whitaker, Plaintiff, had no duty to demand return of any mobile homes or anything else that has been converted by anyone, in this instance, by THE BANK OF EL PASO, H. CLARKE HARVEY, E. BURT BLACKSHER, MORGAN DRIVE AWAY, INC., GENE HOAGLAND and LILLY HOAGLAND, Defendants.

John H. Whitaker had no duty to do what THE BANK OF EL PASO had ordered him to do.

Unfortunately for Whitaker, these latter statements are contrary to both his own pleading and the relevant law of conversion. Whitaker was required to raise a fact question on one of two theories: that he either demanded return of the property and defendants refused, or that defendants acted in some way that displayed a clear repudiation of plaintiff's ownership rights. In his petition, he relies only upon the first theory, of demand and refusal. In the interest of justice, however, we will examine the record to determine whether a fact question exists as to either theory. All summary judgment evidence on this issue follows.

Plaintiff testified by deposition that he sent a letter to the bank about the mobile homes, "they chose to ignore it and I figured to hell with them, and I filed the suit." This letter signed by John Whitaker, dated October 22, 1991, and addressed to Bank of El Paso and Morgan Drive Away read in its entirety:

RE: 8 Mobile Homes Parked at Desert Outpost Truck Stop

Gentelmen [sic]:

I had 8 mobile homes stored for repair at the above address. Since, John Bowen, as my agent found and helped bring them here for me.

If you know anything about these homes, please advise me.

Mr. Hoagland of Morgan Drive Away testified at deposition that he never received the letter. Likewise, E. Burt Blacksher, Vice President of Commercial Lending at Bank of El Paso, testified by affidavit that:

THE BANK OF EL PASO never received any written or oral communication directly or through any agent regarding any claim by Plaintiff to ownership of any mobile homes prior to his filing of this lawsuit....

Ken Slavin, attorney for defendants, testified that on November 21, 1991, he sent correspondence to plaintiff which included these inquiries:

Mr. Bob Beck at your [Whitaker's] offices informed me that several 'innocent persons' were claiming that they owned some of the mobile homes which were about to be sold by...