Imperial Valley Land Co. v. Globe Grain & Milling Co.

This is an action to recover $8,470.37 damages for the conversion of ninety-four hales of cotton. The plaintiff secured judgment against the defendants R. G. Erskine and C. Curtis for this amount sued for, less a payment of $1,499.80 made after the complaint was filed, but the judgment was in favor of the other defendants, Globe Grain and Milling Company, California Food Products Company, First National Bank of Calexico, and First National Bank of Los Angeles. Plaintiff appeals from that portion of the judgment in favor of the defendants upon the judgment-roll containing a bill of exceptions in which the only specification of error is that the findings do not support the conclusions of law or the judgment. In appellant’s briefs, however, the only portion of the judgment complained of is that in favor of the First National Bank of Los Angeles. Before stating the points relied upon by the parties some additional facts should be stated.

Plaintiff leased one thousand acres of land in Lower California, Mexico, to defendants R. G. Erskine and C. Curtis. The lessees were to raise cotton upon the land, and upon harvesting and ginning the same, agreed to render and deliver to the plaintiff one-fourth of the crop as rental". The cotton crop so raised amounted to 378 hales, ninety-four bales of which plaintiff claims that defendants wrongfully converted to their own use. It is evident that plaintiff’s rights must turn upon the question of whether or

[2] The complaint does not state a cause of action against the First National Bank of Los Angeles, for the reason that it fails to allege that plaintiff owned the ninety-four bales of cotton alleged to have been converted by the bank. This point is made for the first time in respondents’ final brief, filed after argument. A summary of the allegations of the complaint upon that subject follows.

It is alleged that the cotton crop grown upon the leased land was delivered to the compress-yard in Calexico, California, by C. Curtis, one of the tenants; that warehouse receipts were taken by him and pledged to the First National Bank of Los Angeles. It is alleged: “That all of said warehouse receipts including the warehouse receipts for the one-fourth (]¡4) of said cotton owned by the plaintiff herein, the title to which one-fourth (%) interest was transferred to the plaintiff herein by the said Erskine and Curtis as payment for rent of the said premises hereinbefore described, and that all of said warehouse receipts are now being held by the said defendant, First National Bank of Los Angeles, or by its agent, the First National Bank of Calexico, and held by them in escrow to satisfy a purported bill of sale and a chattel mortgage, said bill of sale and mortgage heretofore made and delivered by said Erskine and Curtis to the defendant California Food Products Company.” This parenthetical recital cannot take the place of a direct allegation of ownership, nor can it be so construed on appeal to reverse the judgment where the recital is directly contrary to the direct and specific allegations of the complaint. In that regard it is expressly alleged that, under the lease, Erskine and Curtis, the tenants, were to yield and pay as rental one-fourth of the cotton grown on the premises and that the defendants have, notwithstanding

We will not dispose of the appeal wholly upon the ground that the complaint does not state a cause of action against the First National Bank of Los Angeles, because this point was not raised by respondent until its final brief, and no reply was filed thereto. However, the sufficiency of the complaint is involved in the points presented which we will now consider. For that purpose we will state additional facts.

The defendants answered the complaint, after a general demurrer interposed by the Globe Grain & Milling Company was overruled. The answer contained a denial of the allegations of the plaintiff relating to the lease and cotton crop. Among other things, it was denied that the cotton

The district court of appeal reversed the judgment in favor of the First National Bank and ordered judgment against it upon the ground that the findings showed that the bank’s claim had been fully paid and there remained in its hand sufficient of the proceeds of the cotton crop grown upon the land to pay the indebtedness due to the plaintiff. We will, therefore, first address ourselves to a consideration of that question.

The defendants’ answer, after a denial of the allegations of the complaint, affirmatively alleges the facts concerning the pledging of the cotton by Erskine and Curtis to the First National Bank of Los Angeles. It alleges the loaning of money by the California Food Products Company to defendant Curtis upon the security of certain cotton, • and that this company also advanced money to R. G. Erskine & Company upon a chattel mortgage and bill of sale of cotton grown on other lands farmed by them, with a guaranty of such indebtedness by C. Curtis. That these obligations and securities were all transferred to the bank, and were all paid, and thereafter the First National Bank of Los Angelos advanced twenty-one thousand dollars to Erskine and Curtis, for which Curtis executed and delivered the collateral notes of Erskine and Curtis, and did pledge to and deposit with the First National Bank of Los Angeles cotton represented by negotiable compress receipts as collateral security for the payment of the new liability created by said note, and that at the same time and under the

The findings of the court follow' word for word the affirmative allegations of the answer with reference to the twenty-one thousand dollar and the nine thousand dollar loans, and recites, in the language of the answer, “all of which said sums have since been paid by said C. Curtis.” From this answer it appeared that the defendants were contending not only that the cotton had been hypothecated to the bank by C. Curtis for an indebtedness, but also admitting that said indebtedness had been fully paid. The answer does not state what became of the cotton, but it does deny any conversion of any interest of the plaintiff therein and denies that plaintiff had any interest therein. The findings, in addition to covering and conforming to the affirmative allegations of the answer, contain the following statement concerning the disposition of the cotton not made an issue by either the complaint of the answer.

“6. The crop of cotton raised by the defendants Erskine and Curtis on the land of plaintiff under the aforesaid lease between said defendants and plaintiff was sold as aforesaid and the proceeds thereof paid on the indebtedness of Erskine and Curtis to the First National Bank of Los Angeles, leaving an excess, the amount of which -was the sum of ten thousand four hundred thirty-four and 58/100 Dollars ($10,434.58); that the rent due plaintiff under its lease with the defendants Erskine and Curtis was the sum of eight thousand four hundred seventy and 37/100 dollars ($8,470.37), of which amount one thousand four hundred ninety-nine ($1,499.00) dollars was paid by the defendants Erskine and Curtis, after all indebtedness to said First National Bank of Los Angeles was satisfied, leaving unpaid and due from the defendants Erskine and Curtis to plaintiff the sum of six thousand nine hundred seventy-one and 37/100 dollars ($6,971.37).”

From this condition of the record and findings the court of appeal deduced the following conclusion: “Neither the findings nor the evidence give any justification for the retention of plaintiff’s money by the First National Bank of Los Angeles, and, in view of the findings of the trial

Thus the district court of appeal reached the conclusion that the bank had in its hands ten thousand dollars belonging to Erskine and Curtis after the payment of all indebtedness due to it by them. We mention this because it now seems to be conceded by both parties that the real situation with reference to the ten thousand dollars is this: That while it is true there was a surplus of ten thousand dollars received from the cotton crop raised upon plaintiff’s land, over and above the indebtedness of Erskine and Curtis to the First National Bank, that this balance, with the exception of $1,499 paid to the plaintiff, was applied by the bank to the indebtedness owing by R. G, Erskine & Company and guaranteed by C. Curtis, and that it was the application of this amount that paid the nine thousand dollar indebtedness of E. G. Erskine & Company, guaranteed by Curtis. In other words, the bank, instead of having ten thousand dollars over and above all indebtedness due it, had only $1,499, which has already been applied to the plaintiff’s claim. Viewed in the light of this admission, a critical analysis of finding 6, above quoted, reveals that the finding is not inconsistent with the facts as now admitted. That finding was evidently for the purpose of fixing the liability of the defendants Erskine and Curtis and not of the bank.

Before considering the other contentions of the parties, it is proper to say that the district court of appeal was no doubt misled as to the facts by the statements and admissions in the briefs of the parties, and, in view of the situation now developed, it is proper to call attention to some of the statements in those briefs. In appellant’s opening brief, after reciting the advancement of the twenty-one thousand dollars and the nine thousand dollars, it is said: “These loans were made on the additional security of a

The contentions of the parties in this court are therefore directed mainly to the question as to whether or not it was proper for the bank to apply the balance of the money received from the cotton grown on plaintiff’s land to the indebtedness of R. G. Erskine & Company guaranteed by C. Curtis, when authorized so to do by C. Curtis. In short, the question raised here is as to the authority of Curtis to pledge the interest of Erskine, as copartner or cotenant, in the cotton grown upon plaintiff’s land. [3] This question, which the appellant now seeks to have us determine, was not raised in the lower court and cannot be determined upon this appeal. The allegation of the plaintiff with

Not only was there no issue upon the question as to the application of the balance due Erskine 'and Curtis to the guaranty of Curtis on the R. G. Erskine & Company indebtedness, but the plaintiff objected to testimony along that line. The objection is as follows: “Here plaintiff objected to any testimony regarding any negotiations between Clifton Curtis and the First National Bank of Los Angeles and R. G. Erskine & Co., upon the ground that plaintiff is not concerned with any negotiations had between those parties and upon the ground that said negotiations are incompetent, irrelevant, and immaterial and not within the issues made by the complaint, and upon the further ground that the only subject in controversy is whether or not the Imperial Valley Land Company is entitled to one-fourth of defendant’s share of the cotton crop grown upon their land, which objection was overruled by the court and to which ruling plaintiff now excepts” (italics ours).' Although the objection was overruled, no evidence was offered with reference thereto other than the stipulation of facts literally conforming to the affirmative allegations of the answer subsequently quoted in the findings of fact by the court referred to above, and so far as the record shows, apart from the admissions of the parties in their briefs in this court, it is

[5] On appeal, presumptions are indulged in favor of judgments, and not against them, but, if we assume that the issue of title to the ninety-four bales of cotton was in fact submitted to and decided by the trial court, its decision was against plaintiff on that issue. The respondent bank has contended throughout the progress of the case in the trial court and on appeal that plaintiff had failed to show any title to the cotton and hence could not recover damages for its conversion. In view of our conclusions, it is unnecessary to consider the effect of the negotiability of the warehouse receipts.

Judgment affirmed.

Sloane, J., Lennon, J., Shurtleff, J., and Lawlor, J., concurred.

Rehearing denied.

All the Justices concurred.