Goldschmidt v. Maier

73 P. 984, 7 Cal. Unrep. 162, 1903 Cal. LEXIS 952
CourtCalifornia Supreme Court
DecidedSeptember 14, 1903
DocketL. A. No. 1050
StatusPublished
Cited by3 cases

This text of 73 P. 984 (Goldschmidt v. Maier) is published on Counsel Stack Legal Research, covering California Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Goldschmidt v. Maier, 73 P. 984, 7 Cal. Unrep. 162, 1903 Cal. LEXIS 952 (Cal. 1903).

Opinion

PER CURIAM.

The plaintiff appeals from the judgment and from an order denying a new trial. In May, 1897, Mclnnis Bros, were the owners of a liquor saloon conducted in a leased' building in Los Angeles, and, as found by the court, were then indebted to the copartners of Goldschmidt Bros, in the sum of $1,115.36, and to said corporation in the sum of $1,500; that said Mclnnis Bros., for the purpose of paying said indebtedness, proposed to said Goldschmidt Bros, and the defendants that they would transfer to them [164]*164all their interest in said property and business; said creditors, Goldschmidt Bros, and the defendants, should take possession, and either sell the same or do the best they could therewith, in order to pay said debt; that, if any balance remained after, paying said debts and the expense of carrying on the business to the time of sale, it should be paid to Mclnnis Bros., but, if less was realized, the proceeds should be divided pro rata between Goldschmidt Bros, and said corporation in proportion to the amount of said indebtedness ; that both of said parties consented thereto, but said proposal was not then carried out, but Mclnnis Bros, remained in possession about ten days, carrying on said business on their own account, and then delivered possession to said corporation defendant, which accepted the same as trustee for Goldschmidt Bros, and itself to sell said property, and apply the proceeds to the payment of the said respective claims, and neither the plaintiff nor Goldschmidt Bros., whose claims were assigned to plaintiff, obtained or had possession of said property at any time. Defendant Maier'was the lessee of the building in which said saloon business was conducted, Mclnnis Bros, paying the lessor the rent. No sale of the property and business was made until April 1, 1899, when it was sold for $1,775-, which was insufficient to reimburse said corporation for the expenses -of carrying on the business and to pay any part of plaintiff’s claim. On May 11, 1897, plaintiff’s assignors gave notice to the corporation that it held said property as trustee for the purposes hereinbefore stated, and demanded that they be consulted as to the management of the property; that the corporation refused to do so, and that neither plaintiff nor his assignors produced any purchaser or claimed an accounting, or made any application to have said corporation declared a trustee, or to be recognized as cotrustees; that the value of said property and business, exclusive of the lease, did not, with the goodwill, exceed $500; and as to plaintiff’s allegation that defendants took exclusive possession, and converted said property to their own use,, the court found that neither of the defendants converted any part of the property; and as a conclusion of law the court found that plaintiff could not maintain this action for the alleged conversion, and is not entitled to judgment against the defendants, or either of them, but that said conclusion is [165]*165without prejudice to the right of plaintiff to maintain an action for an accounting, and that this action be dismissed, and entered judgment accordingly. Plaintiff moved for a new trial upon a statement of the case, and his motion was denied, and on appeal specifies several errors of law in ruling upon evidence, a failure to find upon certain issues, and also that the evidence is insufficient to justify certain findings.

We do not think it necessary to consider in detail the sufficiency of the evidence to justify the findings specified by appellant. As to each of them there was a material conflict in the evidence. Nor is it contended that the findings are not sufficient to support the judgment, though it is argued that a different judgment might and should have been rendered upon the same facts. It is said that the plaintiff had two remedies for the wrongful acts of the defendants—that they could have brought an action for an accounting, or an action for damages for the wrongful acts of the defendants; that, as defendants refused to manage the property according to the terms of the trust, plaintiff had the right to treat the acts of the defendant as a tort, and recover damages therefor. But appellant further says: “The Goldschmidts occupied a double relation to defendants ; that both they and defendants were trustees and beneficiaries for themselves and each other.” The possession of one trustee, however, is - the possession of all, and each is entitled to the possession to the same extent, and the character of the possession of each is like that of copartners, joint tenants, or tenants in common: See Balch v. Jones, 61 Cal. 234. Prior to the sale made by defendants, neither the plaintiff nor his assignors could have maintained an action in claim and delivery to recover possession of the trust property, or any part of it, from their cotrustee; and, as the trustees were authorized to sell the property, a sale by defendants was not a conversion. Appellant’s contention that the evidence was sufficient to maintain an action in trover cannot be sustained. If any additional reasons for our conclusion were required, it may be added that, the property delivered by Mclnnis Bros, in trust included the business of said firm conducted in a building occupied under a lease which included certain personal property of the lessor, and a leasehold of real estate is not the subject of an action [166]*166of trover. As beneficiaries under a trust authorizing a sale, the Goldschmidt Bros, could not maintain an action in trover for damages. It is true a trustee may not use the influence or power which his position gives him to obtain any advantage over his beneficiary, and section 2234 of the Civil Code provides, “Every violation of the preceding provisions of this article is a fraud against the beneficiary of the trust,” and fraud in the administration of a trust is peculiarly cognizable in equity.

The question whether defendants were authorized to sell the property on credit might be material in an action for an accounting, but here there is no allegation that a sale was made. The allegation is that defendants took exclusive possession, and converted the property and business to their own use; that the value thereof was $3,000, and plaintiff’s damages $1,400. None of the several cases cited by appellant have any application to this ease. As to what constitutes conversion, in its general application, there is no controversy. The case of People v. Van Ness, 79 Cal. 88, 12 Am. St. Rep. 134, 21 Pac. 554, was the case of a state officer who retained certain moneys received by him as such officer under a claim of right; but the state was not a cestui que trust or beneficiary under a trust, but a principal, and the officer its agent. Another was that of a factor who had disregarded the instructions of his principal. Others were bailees for hire. In all, the plaintiffs had the legal title. Counsel quote largely from Chetwood v. California National Bank, 113 Cal. 414, 45 Pac. 704. In that ease Chetwood, the plaintiff, was a stockholder in the bank, and brought the action—the corporation refusing to sue—to recover a large sum for the use and benefit of the corporation. The complaint was in form and was entitled a bill in equity for an accounting and settlement of a trust, but contained “nothing more than a charge ex delicto against certain directors for a breach and nonperformance of their duties” by the three directors who constituted the executive committee, who, not regarding their duties, “and contriving together to injure and deceive the said corporation, neglected and omitted, etc.,” and prayed that the defendants Thomas, Thompson and Wilson be held to an accounting of their said trust, that they restore the sum of $400,000, etc.

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Bluebook (online)
73 P. 984, 7 Cal. Unrep. 162, 1903 Cal. LEXIS 952, Counsel Stack Legal Research, https://law.counselstack.com/opinion/goldschmidt-v-maier-cal-1903.