Madden v. Condon Nat. Bank

Mr. Justice Benson

delivered the opinion of the court.

Defendant’s first assignment of error is that the trial court erred in denying its motion for a nonsuit. We need only to say that a careful examination of the plaintiff’s testimony discloses sufficient evidence to justify a submission of the case to the jury, and the motion was properly denied.

1. Defendant assigns as error some improper remarks of counsel for plaintiff in his argument to the jury; but, while the remarks were unquestionably improper, there is no sufficient record of any exception to the ruling of the court, and therefore they cannot be considered here.-

2, 3. The court gave the following instructions to the jury:

“Conversion consists in the exercise of dominion and control over property inconsistent with, and in denial of, the rights of the true owner, or the party having the right of possession. It is the exercise of such a claim or right or dominion over the property as assumes that he is entitled to the possession, or to deprive the party of it. The very assuming to *368 one’s self the property and right of disposing of another man’s goods is a conversion. The intent with which the wrongful act is done on the part of the defendant is not an essential element of the conversion. It is enough that the true owner has been deprived of his property by the unauthorized act of some person who assumes dominion or control over it. Any abuse of possession lawfully acquired, or any breach of the trust, under which the collateral security is placed, is a conversion. And it is a rule of law that the conversion of a part amounts to a conversion of the whole of a chattel when the circumstances show a purpose to control or dispose of the whole of it, or whenever the remaining part is thereby impaired in value or utility. And it matters not that it resulted in no profit or benefit to the defendant, or resulted in a benefit to the plaintiffs.”

This instruction in a general way correctly states the law as to conversion, except as to the last sentence, which advises the jury that:

“It matters not that it resulted in no profit or benefit to the defendant or resulted in a benefit to the plaintiffs.”

It is true that there are many authorities which sustain this doctrine, but we think that good reasoning and simple justice sustain the opposing line of cases whose reasoning is well expressed in the case of Exeter Bank v. Gordon, 8 N. H. 80, in the following language:

“There seems to be no reason to suppose that the compromise was not, on the whole, highly advantageous to the Gordons and the bank. And the complaint of this defendant is not that anything was, in fact, lost °by it, but that it was made without authority. If the bank had wrongfully taken the note and converted it to their own use, they would have been answerable only for the value: [Cortelyou v. Lansing] 2 Caines’ Cases, 215; [Gray v. Portland Bank] 3 Mass. 364 [ 3 Am. Dec. 156 ] ; [Rogers v. Crombie] 4 Greenl. *369 [Me.] 274; [Clowes v. Hawley] 12 Johns. [N. Y.] 484; Clowes v. Hawley, 2 B. & P. 451; [Todd v. Crooks hanks] 3 Johns. [N. Y.] 432; [Murray v. Burling] 10 Johns. [N. Y.] 172; McLean v. Walk, 10 Johns. [N. Y.] 471; 3 Starkie’s Ev. 1503; 8 Taunton, 264; Ingalls v. Lord, 1 Cow. [N. Y.] 240; [Day v. Whitney] 1 Pick. [Mass.] 503; Kingman v. Pierce, 17 Mass. 247 ; [Jones v. Farley] 6 Greenl. [Me.] 226; 1 Barnw. & Adolphus 528; 1 C. & P. 625; [Hussey v. Manufacturers & Merchants’ Bank] 10 Pick. [Mass.] 415. And we are of opinion that, if the compromise in this case is, under the circumstances, to be considered as a wrongful disposition of the note, which was lawfully in the possession of the bank, it cannot and ought not to place the bank in a worse situation than it would have been, if the note had been wrongfully taken from the possession of the owner and converted to the use of the bank. It is said that this case is analogous to the case if an executor or administrator who compounds a debt due to the estate of the deceased for less than the amount. But how is the law in such a case? The general rule is that a reléase of a certain debt due to the testator makes it assets in the hands of the executor, because it shall be intended that he would not have made the release unless the money had been paid. And it seems to have been holden in former times that a release in such a case was conclusive evidence that the executor had received the money; and he was chargeable with the whole amount, although he might have received only a part: Lovelass on Wills, 48; [Hooker v. Bancroft] 4 Pick. [Mass.] 50; Wentworth’s Executors, 70, 71, 158, 159; Comyn’s Digest, 'Administration,’ I, 1 and 2; Cro. Eliz. 43; T. Jones, 88; 2 Levintz, 189; [Dawes v. Boylston] 9 Mass. 352 [ 6 Am. Dec. 72 ], But in modern times a more reasonable and equitable view of the subject seems to have been gaining ground. In many cases an executor can, obtain nothing unless by way of compromise; and it is supposed that no court would now hold an executor liable for thé whole debt in a case where he had, upon *370 a compromise on the whole advantageous to the estate, released the debt on receiving a part; for that would be to make him liable for the whole, merely because by his care and diligence he had been able to save a part: 2 Eq. Ca. Ab. 454, pl. 13; 3 P. Williams, 381; [De Diemar v. Van Wagenen] 7 Johns. [N. Y.] 411, 412. If, then, we follow that analogy in this case, we must hold that the bank is liable only for what it received, if the compromise was on the whole advantageous to all concerned. ’ ’

In the recent case of State v. West, 74 Or. 112 ( 145 Pac. 15 ), this court has held that in an action for conversion no recovery can be had unless the plaintiff has actually suffered injury. The trial court therefore committed reversible error in giving this instruction. For the reasons above suggested, it was also error for the court to refuse the following requested instruction:

“I instruct you that, if you find that the defendant, without the consent of plaintiffs, exchanged securities, then before the plaintiffs can recover of the defendant they must have proven to you by a preponderance of the evidence that by such exchange they have been damaged. ’ ’

4. Instruction No. 7 as given by the court is as follows :

“I instruct you that the material consideration for you, gentlemen of the jury, in this case is whether or not the Condon National Bank was authorized by New Madden and E. L. Madden to make the disposition of the pledged securities admitted by all to have been made, and whether or not the said New Madden and E. L. Madden afterward ratified the action of the bank. Either authorization before the transaction or ratification after the transaction, under such circumstances as would make you believe that authorization or ratification was definitely intended by the said New Madden and E. L. Madden, would be a defense. ’ ’

*371 It will be noted that tbe court uses tbe expression, “tbe disposition of tbe pledged securities admitted by-all to have been made. ’ ’ An examination of tbe pleadings and the evidence discloses that it is not admitted by tbe defendant that any disposition of tbe collateral notes was made, but that, on tbe contrary they are still in its possession uncanceled, undisposed of and held subject to tbe conditions under wbieb they were first deposited. It follows that tbe use of such language was clearly erroneous.

There are other assignments of error, but tbe views herein expressed sufficiently cover tbe material questions involved.

Tbe judgment of tbe lower court is reversed, and tbe cause remanded for a new trial.

Reversed and Remanded.