GOLDBERG v. LIST (1937)

The plaintiff has appealed from a judgment in an action for the conversion of personal property and for the recovery of an amount paid for rent. Although the trial court found that certain personal property belonging to the plaintiff was converted by the defendants, it refused to give him damages therefor because it was being purchased by him under contracts of conditional sale which were then in default and the defendants had returned the property to the vendors. The judgment is in favor of plaintiff against the defendants Stevenson and List only for the sum of $175 for rent, but the parties apparently agree that this issue was correctly determined as the recovery of this amount is not challenged.

The appeal is presented upon the judgment roll alone. The findings of fact show that prior to the acts of the respondents which are complained of the appellant, as lessee of respondents List and Stevenson, was in possession of certain premises in which he was conducting a restaurant. The findings of fact also show that the appellant had installed in these premises certain fixtures and equipment which were being purchased by him under contracts of conditional sale; that while the appellant was in possession of the premises and the personal property, the respondents ‘without cause wrongfully, forcibly, unlawfully, willfully and maliciously entered upon and took possession of the said demised premises, together with the furniture, fixtures and equipment therein contained, against the will and without the consent of plaintiff * * * and converted said personal property to their own use, and refused to return same to plaintiff after demand therefor.’ A further finding is that after such conversion ‘said defendants delivered, upon demand of the vendors thereof, said personal property then being purchased by plaintiff on conditional sales contracts, to the various persons from whom plaintiff had purchased same’ but that ‘by virtue of the plaintiff being in arrears in his payments under said conditional sales contracts, the demand for the possession thereof by the vendors, and the return by said defendants of said personal property to said vendors, that plaintiff did not suffer any damages by reason of the conversion of said personal property by said defendants.’

Section 3336 of the Civil Code provides: ‘The detriment caused by the wrongful conversion of personal property is presumed to be: First—The value of the property at the time of the conversion, with the interest from that time, or, an amount sufficient to indemnify the party injured for the loss which is the natural, reasonable and proximate result of the wrongful act complained of and which a proper degree of prudence on his part would not have averted.’ Section 3337 of the same code provides: ‘The presumption declared by the last section cannot be repelled, in favor of one whose possession was wrongful from the beginning, by his subsequent application of the property to the benefit of the owner, without his consent.’ The defendants had no consent from the plaintiff to make any application of the property. The latter had a limited interest in it coupled with the right of possession, and this entitled him to recover its full value. Carvell v. Weaver, 54 Cal.App. 734, 202 P. 897. ‘The rule that the owners of a special interest in property may recover only to the extent of such interest applies only to cases where the suit is brought against the owner of the remaining interest or his assignee.’ Corey v. Struve, 170 Cal. 170, 149 P. 48, 49; Booth v. People's Finance, etc., Co., 124 Cal.App. 131, 12 P.(2d) 50.

Nor does the fact that the plaintiff was ‘in arrears in his payments' under the conditional sales contracts bar him from a recovery. What rights the vendors had under such circumstances does not appear. Assuming that they might terminate plaintiff's rights in the property because of his failure to make payments as agreed, it is not claimed that they had taken any action to do so prior to the date the defendants took possession of it. ‘The mere failure of a conditional vendee to make his payments on time does not change the status of the parties in the absence of an exercise of the option to declare a forfeiture by the vendor. The clause in the contract allowing the vendor to retake the property is not operative in the absence of affirmative action on his part.’ Lacey v. Great Northern Ry. Co., 70 Mont. 346, 225 P. 808, 809, 38 A.L.R. 1331. Jones on Chattel Mortgages and Conditional Sales, vol. 3, § 1284.

The findings of the court are explicit that the acts of the defendants were wrongful and constituted a conversion of the property. Under the provisions of section 3337 of the Civil Code, the fact that the defendants, without the consent of the plaintiff, delivered it to his vendors, is no defense to the plaintiff's claim for damages. Hull v. Laugharn, 3 Cal.App.(2d) 310, 39 P.(2d) 478. He is entitled to damages in an amount to be determined under the provisions of section 3336 of the Civil Code. While there is a finding that, pursuant to the terms of a lease made for a period commencing February 1, 1935, the plaintiff entered into possession of the premises and installed fixtures and equipment therein for his business ‘at a value of $2,500’ this does not fix their value at the time of the conversion in July of the same year. The judgment is, therefore, reversed, and the cause remanded for a new trial solely upon the issue of the amount of damages, with directions to the trial court to render judgment in favor of the plaintiff against all defendants for the amount of damages so found upon a determination of that issue and for the sum of $175 against the defendants List and Stevenson only.

EDMONDS, Justice.

We concur: WASTE, C. J.; CURTIS, J.; SEAWELL, J.; LANGDON, J.