Hall v. Merchants State Bank

202 N.W. 256, 199 Iowa 483
CourtSupreme Court of Iowa
DecidedFebruary 17, 1925
StatusPublished
Cited by9 cases

This text of 202 N.W. 256 (Hall v. Merchants State Bank) is published on Counsel Stack Legal Research, covering Supreme Court of Iowa primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hall v. Merchants State Bank, 202 N.W. 256, 199 Iowa 483 (iowa 1925).

Opinion

Faville, C. J. —

-I. Appellees entered into a written lease with one Conklin for certain lands in Woodbury County, for a term of three years commencing March 1, 1918. By the terms of the lease the tenant was to pay a yearly cash rental for said premises. Appellant held chattel mortgages upon the personal property of the tenant. In December, 1920, the tenant and his wife executed to appellant a bill of sale upon all of the property owned and held by the tenant upon the leased premises. Subsequently, the son of the tenant shipped certain hogs from the leased premises to Sioux City. It appears that the hogs were shipped to the firm of Clay Robinson Company, and under the instructions of the son, a remittance of the proceeds was made to appellant, where the funds were credited to the account of the tenant, who subsequently checked out a portion of the same for his own use, and gave to appellant a check' for a portion of said funds, which was applied upon the indebtedness of the tenant to appellant. A substantial portion of the rental due to appellees being unpaid, this action is brought against appellant in conversion, to recover the value of the hogs so sold.

II. The proposition before us resolves itself into the one question as to whether or not the taking of the bill of sale by appellant from the tenant constituted a conversion of the property ipso facto.

The appellant had chattel mortgages on the personal property of the tenant. No question is urged but that such chattel *485 mortgages were subject to appellees’ landlord’s lien on tbe property. Appellant took the bill of sale before the lease expired. The bill of sale contained the following recital:

“It being understood and agreed by all parties hereto that this bill of sale is given by the grantors for the purpose and with the intention of turning over to the mortgagee all of said described property in order to save the expense of foreclosure of said chattel mortgages and other expense.”

■ Appellees thus state the question:

“It is our contention that the taking of this bill of sale by the appellant in itself constituted a conversion, and, having converted the property upon which the appellees had a lien, which was. prior. to any lien of appellant derived from the chattel mortgages, appellant is liable to appellees for the reasonable value of all the property converted upon which appellees’ lien is superior. * -* * The only question is whether or not it was converted by appellant by the acceptance of the bill of sale from the tenant.”.

Did the taking of such bill of sale, without more, constitute a conversion of the property for which appellant is liable to appellees ?

Many definitions of conversion are to be found in the books. See 2 Words & Phrases 1562; 1 Words & Phrases (2d Ser.) 1030. In Brown v. Dubuque Altar Mfg. Co., 163 Iowa 343, we quoted from 2 Cooley on Torts (3d Ed.) 859, as follows:

‘-‘Any distinct act of dominion, wrongfully exerted over one’s property, in denial of his right or inconsistent with it, is a conversion. ‘The action of trover being founded on a-conjoint right of property and possession, any act of the defendant which negatives or is inconsistent with such right amounts in law to a conversion. It is not necessary to a conversion that there should be a manual taking of the thing in question by the defendant ; it is not necessary that it should be shown that he has applied it to his own use. Does he exercise a dominion over it in exclusion or in defiance of the plaintiff’s right? If he does, that is in law a conversion, be it for his own or for another person’s use.’ ”

See, also, Cutter v. Fanning, 2 Iowa 580; Reizenstein v. *486 Marquardt, 75 Iowa 294; Iowa Farm Credits Co. v. Peoples Sav. Bank, 196 Iowa 967.

The precise question here presented does not appear to have heretofore been before this court.

In Davis v. Buffum, 51 Me. 160, the defendant leased a sawmill to parties who placed machinery therein. The lessees assigned the lease and sold the machinery -to the plaintiffs, who took possession. During the occupation, the defendant deeded the mill and all appurtenances to third parties. The plaintiffs subsequently left the premises, and sued the defendant for conversion of the machinery. The court said:

“This being an action of trover, the only question presented is whether the plaintiffs have shown an act of conversion on the part of the defendant. The plaintiffs claim to recover on the ground that the defendant’s deed to Dane and Perkins was per se a conversion- — -before the expiration of his lease. But this is not so. When that deed was executed, the plaintiffs were in the undisturbed enjoyment of their property, and so remained during the whole duration of the lease. The deed of the defendant conveyed nothing he did not own; certainly not to grantees with notice of all the facts. The giving a bill of personal, property in the possession of a third person, who is the owner of the same, without any other interference therewith or delivery thereof, is not, as against such owner, a conversion by either the person giving or receiving such bill of sale. In Fuller v. Taber, 39 Maine 519, the plaintiff brought an action of trover for a building, which had been placed on the land of another by his precedent consent, or subsequent assent. The defendant, when a demand was .made, said he had bought it and paid for it. The court instructed the jury that taking a quitclaim deed of the land and building and putting it on record would not of itself constitute a conversion on the part of the individual so receiving the deed. Neither can the mere giving a deed of land leased, the lessee continuing in quiet possession, be deemed a conversion of fixtures which the tenant has the right to remove during his term. The lease was as valid after as before the deed. The rights of the lessee remained the same. The deed was nó more a conversion of the tenant’s fixtures than it was a breach of the covenants of the lease. The mere taking a mortgage *487 of personal property from one having no title and recording the same, without taking possession of the mortgaged property or interfering with the same, constitutes no conversion for which trover will lie.”

In Bean v. Cushman, 95 Maine 454, a mortgagor of chattels sold the same to a good-faith purchaser, without notice, who exercised no dominion or control over them. In that ease, the chattel was hay, which had been placed, in the purchaser’s barn. The court said:

“But although the mortgagor was clearly guilty of a conversion by the sale and removal of the hay, it does not necessarily follow that the purchaser would be likewise guilty. Taking all inferences as strongly as possible against the defendant, it appears that, besides the purchase and payment, the only other act for which the purchaser could in any way be responsible was the delivery of the hay into his barn by the mortgagor. It may be inferrible that this delivery was made in pursuance of the contract of sale, to which the defendant was a party. But the defendant had not sold, used, or abused the hay.

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202 N.W. 256, 199 Iowa 483, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hall-v-merchants-state-bank-iowa-1925.