Ashmead v. Kellogg

Storrs, J. On the facts appearing in this case, two points have been presented. First, whether the plaintiffs had a sufficient title to the property in question, to maintain this action; and secondly, whether there was a wrongful conversion of it, by the defendant, to his own use. Respecting the latter of these questions, it is too obvious to require argument, that, if the plaintiffs had a sufficient title — 75 — to the property, when it was sold by the defendant, such sale constituted a wrongful conversion of it, by the latter. It was an unauthorized deprivation of the plaintiffs of their property, and a direct -appropriation of it, by the defendant, to his own use. It is true, as stated by the defendant, that the plaintiffs did not, by such sale, lose their title to the property, and might have reclaimed it, if they had elected to do so, in the hands of the purchaser from the defendant, or those into whose hands it might afterwards come ; but they were not bound to do this, and had a right to resort immediately to the defendant, by whose means they had been wrongfully deprived of it. It is scarcely necessary to say, that the wrongful conversion of property, which is sufficient to sustain the action of trover, does not necessarily imply its destruction or even its removal, so that the owner cannot retake it. If the defendant had merely disposed of his own interest in the property, and sold it, subject to the encumbrance of the mortgage of it to the plaintiffs, there would have been no interference with the rights of the plaintiffs: but here the defendant assumed to sell the entire vessel, as unincumbered, and retained the proceeds as his own, which was a clear invasion of the rights of the plaintiffs, and a wrongful conversion of their property, by the defendant, to his own use. The defendant has endeavored to assimilate the present to the case of a sale, by one tenant in common, of personal property, of not only his own share, but also that of his co-tenants, without their authority : in which case it is claimed, ón the authority of Oviatt v. Sage, 7 Conn. R., 95, that, in order to constitute a conversion of the property, there must be a destruction of it, and that such sale does not amount to a destruction of it. That case, however, is not applicable to the present. It did not necessarily involve the enquiry, whether such a sale would be equivalent to the destruction of the share of the co-tenants, and therefore constitute a conversion of it, and it may well be doubted whether .the court intended to express an opinion that it would not be. It — 76 — may be remarked, that the cases elsewhere adopt the principle, that a sale of the entire property, by one tenant in common, amounts to the conversion of the interest of his co-tenants. But, whatever may be the doctrine, in regard to the effect of a sale by a tenant in common, of the whole of the common property, it is sufficient to say, that there is no resemblance or analogy between such a case and the present. There was no common or joint interest in the property here in question, between the plaintiffs and the defendant. The interest of the plaintiffs was that of mortgagees, and that of the defendant, of a mortgagor; and the interest of the former was wholly distinct, and different from, that of the latter. There was no connection between them, in this respect. The remaining question is, whether the plaintiffs, at the time of the conversion, had a sufficient title to the property, to maintain this action. It is claimed by them, that they then had a present or immediate right of possession to the property; and it is justly conceded, that such a right constitutes a sufficient title. Whether the plaintiffs, then, had such a title, depends on the construction and effect of the condition of the mortgage to them from the defendant: and the question is, how far, by the terms of that condition, the plaintiffs were divested of the absolute and unqualified right of possession, to which they would, but for that condition, 'have been entitled, by virtue of the general ownership of the property conveyed to them by the mortgage. That condition is, that the defendant should pay to the plaintiffs, the sum therein mentioned, with interest, without specifying any particular time for the payment of the same, and provides further, that, until default should be made in the payment thereof, the defendant should remain in the quiet and peaceable possession, and the full and free enjoyment of the property mortgaged, and that, in case of such default, it should be,lawful for the plaintiffs to take possession of it, and dispose of it, paying said sum from the avails, and rendering the surplus, if any, to the defendant. The plaintiffs — 77 — claim, that, as no time is specified for the payment of said sum, it was payable immediately on the execution of the mortgage, and that, it not being then paid, there was a breach of the condition, immediately, which terminated the defendant’s right to the possession of the property. We do not accede to this claim, because such a construction would be manifestly unreasonable and inconsistent with the intention of the parties, as evinced by the terms of the condition, the provision respecting the continued possession and use of the property, by the defendant, and the resumption of it by the plaintiffs; but we consider the sum to be payable, on request, and that, until such request, there would be no such default as was contemplated, and consequently, -no breach of the condition, or forfeiture of the defendant’s right of possession. Nor do we view the stipulation in the light of a mere covenant, on the part of the defendant, for the breach of which the remedy of the plaintiffs would be by an action against the defendant. Neither do we think that the effect of that stipulation was to create abatement by the plaintiffs, to the defendant, of the property, during the will of either of them; although it was indeed competent for the plaintiffs, to request payment of the sum, which the mortgage was given to secure, at any time when they should choose, and on non-payment,.the condition would be broken, and the possessory right of the plaintiffs to the property, would thereupon immediately revert to the plaintiffs : but this would be so, rather in consequence of the non-payment of the money, than of a direct determination, by an expression of the will of the plaintiffs, of a term for which the defendant held the use of the property, and the right of the plaintiffs to the possession might be defeated by the defendant’s compliance with the condition, in paying said sum, on such request. But we consider the effect of that stipulation to be the same as if the plaintiffs had made a grant or demise of the property to the defendant, until a default in the payment of said sum on the plaintiffs’ request, and defeasible on such default, — 78 — and which would, of course, vest a right to the possession of the property in the defendant, during said period, and such right would continue, by virtue of said agreement, until it should be defeated by a breach of said condition, by the defendant, or otherwise forfeited by him. During said term, he would have a right to use the property in the manner, and for the purposes, for which such use was granted. But he would have no right to appropriate it for another and different use, and if he should do so, we think that such appropriation would amount to a wrongful conversion of it, which would deprive him of the right of possession conferred by the stipulation in the condition of the mortgage, and revest it in the plaintiffs. The plaintiffs claim, that the sale of the property, by the defendant, in this instance, constituted such a misappropriation and conversion, and we are of that opinion. It could not be doubted, that a destruction of it by the defendant, during the limited period during which he was entitled to its use, would be a conversion of it, for which the plaintiffs might immediately maintain an action of trover, and we think, that a sale was equivalent to a destruction of it, as between these parties. It may indeed, after such sale, have remained in specie, but it is not for the defendant to insist, that the plaintiffs should follow it, in the hands of the purchaser. The plaintiffs may treat it as if it were lost or destroyed. The sale of it, moreover, by the defendant, was an act of disloyalty to the plaintiffs, and a disclaimer, by him, of their title, and of his holding it under them, and should, in reason and justice, be attended with the same effect of forfeiting his interest in it, as a tenant or lessee, as would follow a similar act of disclaimer or renunciation, by a lessee of real estate. The views which we have expressed, as to the effect of the sale of the property, are fully sustained both by the American and English authorities. See Fenn et al. v. Bittlestone et al., 8 Eng. Law & Eq. R., 482, and cases cited. White v. Phelps, 12 N. H. R., 382. 14 Verm. R., 367, and the cases cited by the plaintiff. — 79 — We think, therefore, that a new trial should not be granted. In this opinion, the other judges concurred, except Ells-worth, J., who was disqualified. New trial not to be granted.