Wilkinson v. Misner

• Decision Date: 30 June 1911
• Parties: WILKINSON v. MISNER.
• Court: Missouri Court of Appeals

138 S.W. 931

158 Mo. A. 551

WILKINSON v. MISNER.

St. Louis Court of Appeals. Missouri.

June 30, 1911.

1. PLEADING (§ 428) — OBJECTION TO EVIDENCE — INSUFFICIENCY OF PETITION.

A demurrer to a petition made by an objection to the introduction of evidence thereunder is tantamount only to a challenge of its sufficiency after verdict, and will be overruled if it alleges facts sufficient to constitute a cause of action, when considered with all the implications which may be legitimately deduced therefrom.

2. TROVER AND CONVERSION (§ 4) — WHAT CONSTITUTES.

Any wrongful exercise of dominion by one person over the goods and chattels of another which is inconsistent with and exclusive of the owner's rights therein, amounts to a conversion.

3. PLEADING (§ 433) — PETITION.

Plaintiff alleged that, while he was holding certain stock certificates as collateral security to an indebtedness, defendant, who was the owner of the stock, subject to the pledge, represented to plaintiff that if he would surrender the shares to him defendant would sell them for cash and pay plaintiff $5,000 of the proceeds on the indebtedness, and if he did not succeed in so doing within 30 days he would return the certificates, to be held as before; that plaintiff delivered the certificates to defendant for that purpose, and defendant having obtained possession unlawfully converted them, in that he sold them to another and converted the proceeds to his own use, to plaintiff's damage in the sum of $15,000. Held, that it would necessarily be implied from such allegations that, instead of either paying plaintiff $5,000 as agreed, or returning the stock, defendant appropriated the proceeds to his own use after the sale, and that the petition was therefore not bad after verdict for failure to allege that plaintiff either had possession or right of possession of the shares at the time of the conversion.

4. TROVER AND CONVERSION (§ 34) — ISSUES AND PROOF — IMMATERIAL VARIANCE.

Where, in an action for the conversion of stock certificates held by plaintiff as collateral security, plaintiff alleged that he delivered the certificates to defendant on the latter's promise to sell the same within 30 days and pay plaintiff $5,000 of the proceeds, or return the certificates, and it appeared that defendant obtained possession of the certificates and sold the same and converted all of the proceeds to his own use, the fact that the evidence failed to show an agreement to return the certificates within 30 days, instead of within a reasonable time, was an immaterial variance, which the court was

required to disregard, by the express provisions of Rev. St. 1909, § 1847.

5. PLEDGES (§ 1) — WHAT CONSTITUTES.

To constitute a pledge of personal property, there must be a contract whereby the property is held as security, but it is not essential that such a contract shall be express, as it may be implied from the circumstances of the case, if it appears that the minds of the parties met with respect to the same subject-matter, and consented to the same thing for a sufficient consideration.

6. PLEDGES (§ 19) — COLLATERAL AGREEMENT — FURTHER INDEBTEDNESS.

Independent of a new agreement to that effect, a pledgee may not withhold the pledge as collateral for a debt, other than that to which the pledge was originally made, and the mere withholding of the property by the pledgee, with a declaration that it will be withheld until a debt of the property owner is paid, does not of itself constitute a contract of pledge, when nothing more appears than that the owner of the property did not object at the time.

7. CONTRACTS (§ 16) — "CONSENT" — DEFINITION.

The word "consent" in the law of contracts means concurrence of wills.

8. CORPORATIONS (§ 123) — PLEDGED STOCK — CONVERSION BY PLEDGOR — INSTRUCTIONS.

Where defendant pledged stock to secure a loan to himself and another, and thereafter substituted notes of a corporation for the debt, and afterwards obtained possession of certificates, under an agreement to return the same within a reasonable time in case the stock was not sold, and if sold to pay plaintiff $5,000 of the proceeds, but instead defendant sold the stock and converted the proceeds to his own use, and both the substitution note and receipt which defendant gave for the stock when it was surrendered to him for sale recited that the stock was deposited as collateral to the notes, while defendant, in an action for conversion of the stock, testified that it was pledged for the individual note only, the court properly charged that, if the jury found the shares were pledged for the individual note, they should find for defendant, "unless" defendant consented that plaintiff should hold the shares as security for the notes of the corporation.

Appeal from St. Louis Circuit Court; Hugo Muench, Judge.

Action by George E. Wilkinson against Edgar D. Misner. Judgment for plaintiff, and defendant appeals. Affirmed.

Johnson, Houts, Marlatt & Hawes, for appellant. Abbot, Edwards & Wilson, for respondent.

NORTONI, J.

This is an action in the nature of trover as for conversion. Plaintiff recovered a verdict of $5,000, and defendant prosecutes the appeal.

In so far as important to state it, the petition avers plaintiff was, on January 28, 1908, in possession of two certificates of stock of the Renfrow Briquette Machine Company of the par value of $15,000, which he held as collateral security to a certain indebtedness evidenced by notes given to him in consideration of a loan of money. That on the 29th of January, 1908, defendant, who was the owner of the stock, subject to the pledge, represented to plaintiff if plaintiff would surrender the shares to him defendant would sell the same for cash and pay plaintiff $5,000 of the proceeds thereof on the indebtedness, and that if he did not succeed in so doing within 30 days he would return the certificates of stock to plaintiff, to be held as theretofore. Plaintiff says that, induced solely by such representations of defendant and relying thereon, he delivered to defendant the shares of stock for the purpose mentioned, and that defendant so having obtained possession thereof from plaintiff unlawfully converted the same, in that he disposed thereof to another for his own use, to the damage of plaintiff in the sum of $15,000, for which amount judgment is prayed.

It is argued the petition is insufficient, for the reason it does not expressly aver that plaintiff either had possession of or the right of possession to the shares of stock mentioned at the time of the conversion. There was no demurrer interposed to the petition, and the objection was made ore tenus to the introduction of evidence thereunder, which is tantamount only to a challenge of its sufficiency after verdict. Though it be true that plaintiff must have the right of possession, as well as a right of property, in the goods converted at the time of the conversion, and that the petition should so show on its face, no one can doubt the sufficiency of the pleading after verdict, in respect of the right of possession at that time, if such is necessarily implied or may be reasonably inferred from other pertinent allegations therein. Munchow v. Munchow, 96 Mo. App. 553, 70 S. W. 386.

Any wrongful exercise of dominion by one person over the goods and chattels of another, which is inconsistent with and exclusive of the owner's rights therein, amounts to a conversion thereof. If one wrongfully deals with the property of another by disposing of it to a third person, without right, as if it were his own, he is guilty of conversion. 2 Cooley on Torts (3d Ed.) 859 et seq.; Withers v. La Fayette County Bank, 67 Mo. App. 115, 119; Miller v. Lange, 84 Mo. App. 219.

It appears from the averment of the petition that defendant was intrusted by plaintiff with the certificates of stock for a particular purpose, and that he transferred them to another and converted the proceeds thereof to his own use. When all of the allegations are considered together, it is necessarily implied therefrom that, instead of either paying plaintiff the $5,000 as agreed, or returning the stock to him, defendant appropriated the proceeds thereof to his own use, after the sale was made. If such be true, and the evidence tends to prove that it was, then defendant converted the stock to his own use, for he not only violated the primary duty of the agency, but actually converted the property as well. Boldewahn v. Schmidt, 89 Wis. 444, 62 N. W. 177; Weaver v. So. R. Co., 135 Mo. App. 210, 115 S. W. 500, and authorities, supra; 22 Am. & Eng. Ency. Law (2d Ed.) 872, 873. The petition avers plaintiff was in possession of the stock and held it as collateral security for an indebtedness, and delivered it to defendant for the particular purpose mentioned, and this implies that plaintiff was entitled to the possession at the time of conversion, except for the right of defendant, to deal with it in accordance with his agency. It appearing from the petition, too, that defendant did not adhere to the agency involved, but instead sold the stock and converted the proceeds to his own use, it is necessarily implied therefrom that plaintiff was entitled to the possession of the certificates at the time of the conversion, as defendant had no right in the premises whatever, except to perform the agency delegated....