Murray v. Burling — 10 Johns. 172

Majority

p. 174

Murray and Ogden against S. Burling.

NEWYORK,

May, 1813.

Headnote

A. having money to pay on account of B., at a certain day, on the suggestion of C., in order to raise the money lor that purpose, made a note, payable to tí. and delivered it to him, and B. gave it to C. who promised to obne° on The note, from one immediately* paid8 óvTr to A. But C. on note, immedjTray To E* to to7 himTvom B. and o., as

Thenote havcounted*1 ''hi bank for E„ rant of tile awldchTT had paidTnd*took wh U‘-t nole due; and after-Tn1 action 8of trover against damages for ofthenoteby held that the action was

"CHIS was an action of trover. The cause ,was tried at the, New-York sittings, in November, 1812, before Mr. Justice Spencer. - i

The plaintiffs’ counsel, in opening the cause, stated that the action was brought to-recover damages for the conversion of a promissory note, made by the plaintiffs, partners in trade, under the firm of John Murray & Sons, dated the 26th of July, 1812, by which they promised to pay, sixty days after date, to William Swan, or order, 2,800 dollars, for value received; that it would be proved, on the part of the plaintiffs, by William Swan, that plaintiffs having become liable, on certain bills of exchange endorsed by them, for the individual and. private account of Swan, the payee of the note in question, which bills had been dishonoured, and for which the plaintiffs had given their own note, which would become due the 31st of July, Swan, desirous t® prevent the necessity of the plaintiffs’ advancing the money, which would become payable on the 31st of July, on account of the ^Is, informed the plaintiffs, that the defendant had told Swan that he (the defendant) could procure for the plaintiffs, on their note, from Charles Kauman, the brother-in-law of the defendant, money which would be wanted by the plaintiffs, on the 31st of July; that the plaintiffs thereupon made the note in question, on the 24th of July, and delivered it to Swan, the payee, to procure the money on it, for the plaintiffs, from Kauman. Swan carried note to the defendant, who took it, and said he would immec^atety S° to Kauman and procure the money, and give it to Swan, for the plaintiffs: but the defendant, instead of taking the n°te to Kauman, immediately after receiving it, passed it to Min- turn <§* Champlin, in payment of a debt due to them from the firm of Burling <y Swan, of which the defendant was a partner, The note was presented by Minium <§• Champlin to the Mecha lucs’ Bank, and- discounted for them, by the bank; and was afterwards, when due, paid and taken up by the plaintiffs, before the commencement of the present suit, and was then in the hands of the counsel for the plaintiffs.

Upon this statement, the defendant’s counsel moved for a non-suit, 1. Because, under the circumstances stated, an action of

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irover for the note could not be supported; and, 2. Because, if the action was maintainable, Swan was an incompetent witness to prove the facts stated. The judge granted the motion, on the first ground, and the plaintiffs were nonsuited.

A motion was made to set aside the nonsuit, and for a new trial-

Colden, for the plaintiffs.

Trover lies for a bill of exchange, bond, or promissory note.^[5] The note was the property of the plaintiffs. It was made by them, for their own purposes, and to raise money for their own use. The possession of the note, afterwards, by the defendant, will not be disputed- Has there not, then, been a conversion of it by him ? The mere passing away the note, without any authority from the plaintiffs, was, of itself, a conversion. Any unauthorized disposition of the property of another, is a conversion.^[6] Indeed, here has been not only a legal, but an absolute conversion of the property, by the defendant.

It may be said that the action of trover will not lie, because, at the time the suit was commenced, the note was in the hands of the plaintiffs. But the return of the chattel into the hands of the original owner, after a conversion, does not destroy the right to bring trover, because the action is not to recover the thing itself, but damages for the conversion.^[3] The restoration of the property goes only in mitigation of damages. In the present case, however, the repossession of the note by the plaintiffs would not even mitigate the damages; for in order to regain (he possession of it, they have been obliged to pay to the persons who were innocent holders, the full amount of it.

Todd v. Crookshanks^[4] was an action of detinue for a note, after it was paid, and the court considered it of no value, and the action as not maintainable; but they also said that the note did not belong to the plaintiff, and the defendant, who was a co-executor, might retain it as a voucher. That case is not applicable to the present.

Wells, contra,

admitted that trover would lie for a promissory note, but he contended that it could not be brought by the maker of a note, payable to another. Trover will not lie for the mere non-performance of a contract. The defendant came into possession of the note, under a contract made with Swati, in pursuance of one made by him. with the plaintiffs. Swan, being the

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agent of the plaintiffs, they might maintain an action on the contract against the defendant, The defendant, as well as Swan, came rightfully and lawfully into possession of the note under that contract. The only evidence of a conversion was the non-performance of that contract; but as that does not, of itself, amount to a tortious conversion, trover is not maintainable without showing a demand and refusal.^[5]

* Again, how can it be said that the maker of a note, payable to another, has any property in that note 1 The payee, or holder, has the property, till the note is paid. When paid, the note is extinct, and of no value whatever.^[6] All the cases in which it is said that trover lies for a note, refer to an action by the payee, or person entitled to recover the( money, not to an action by the maker; or person who is to pay it.

The plaintiffs being in possession of the note again, there can be no conversion, for the conversion does not consist in the defendant’s receiving the money, but in passing the note away to Minturn & Champlin, in violation of his contract. It is true, in regard to a chattel, that trover lies for damages, for the conversion, notwithstanding it is restored before suit brought. These damages are for the use of the chattel, or for the inconvenience the plaintiff has been put to, in being deprived of its use. How is the damage, or value arising from the mere use of this note to be ascertained ?

The object of this suit is, avowedly, to recover the full amount of the note; so that it must be contended'by the plaintiffs, that for the mere use of a chattel, they may recover the full value of the chattel, and yet have it, at the same time, in their possession. Why not bring an action for the breach of the contract; or for money had and received to the use of the plaintiffs, which would be an adequate remedy ?

Colden, in reply, said he could see no difference, as to the right of action, between a chattel, and a chose in action. The defendant has made all the use of the note of which the thing was susceptible. Because the plaintiffs have another remedy, it is no reason why they may not pursue the one they have thought proper to select.

delivered the opinion of the court. The -opening on the part of the plaintiffs, and which was considered by the judge as insufficient to maintain the action, contained a state»

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meat of facts showing the most palpable misconduct on the part of the defendant. The note in question was drawn, and put into his hands, on his own suggestion, that he would procure the money for it, from Charles Kauman, to answer what he well knew to be the then necessities of the plaintiffs, and upon an express promise* on his part, thus to dispose of the note, and pay the money to Swan, to be paid over to the plaintiffs. Instead of doing this, he immediately passed it to Minium <§- Ckamplin, to pay a debt due from himself and Swan. The note was not put into his hands under a general authority to raise money upon it Had that been the nature of his trust, he might not have exceeded his power, or violated his duty, by passing it away to any person from whom he could raise the money; and the conversion or breach of trust would have consisted in the misapplication of the money, and not in the act of transferring the note, in which case trover might not have lain for the note. But the note was put into Ms hands for a definite and specific purpose, to pass to Kauman, and any other use of it was a violation1 of his trust Although the note was drawn payable to Swan, the defendant received it as the property of the plaintiffs, for the purpose of raising money for them. The circumstances being all known to the defendant, the manner and form in which the business was done cannot alter the substance and merits of the transaction.

Assuming to one’s self the property and right of disposing of another man’s goods is a conversion, says Lord Molt, in the case of Baldwin v. Cole. (6 Mod. 212.) And this principle is adopted and sanctioned by Lord Ellenborough, in the case of M‘Combie v. Davies. (6 East, 540.) The defendant having come lawfully into possession of the note forms no objection to the action. This is admitted in every action of trover, which always supposes the defendant to have come legally into the possession of the goods. It is the breach of the trust, or the abuse of such lawful possession, which constitutes the conversion. These are familiar principles, as applicable to chattels, and there can be no good reason for not applying them to chases in action. The case of Syed v. Hay (4 Term Rep. 260.) contains principles applicable to the present case. It was an action of trover against a carrier for having delivered goods into the possession of a third person, contrary to orders, and it was objected that the action should have been case for not delivering the goods, and not trover; but the objection was not sustained: and Buller, J. said, “ if one man who is intrusted with the goods of another, puts them into the hands of a third person, contrary to orders, it is

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a conversion. As if a man takes my horse to ride, and leaves it at an jnD) that is a conversion, for though I may have him by send» ing for him, and paying for his keeping, yet it brings a charge uPon me” 1* is this charge which is to regulate the damages; but whether it be more or less cannot vary the question as to the conversion. If the charge was to the full value of the horse, it would still be a conversion. Suppose the note in question had been pledged for a small sum of money, much below the face of it, and the plaintiffs had redeemed it, by paying the pledge, would not an action of trover have lain for the damages. Whether the party has to pay more or less to get back his property, does not alter the principle, as to the form of action.

That the plaintiffs have paid up their note, and have it now in their possession, is no objection to maintaining trover for the damages sustained by the conversion. It is every day’s practice to sustain this action for the injury suffered, although the owner has repossessed himself of his property. (2 Esp. N. P. 190, 191.) The note went into the defendant’s hands as the plaintiffs’ property, and it is the misuse or disposition of it, contrary to orders, that constitutes the cause of action. It is no answer to say that the plaintiff has a remedy by an action for the money. There are many cases in which a party has an election of actions: as if I intrust a man with my horse to ride, and he sells him, I may bring trover against him for the horse, or affirm the sale, and bring an action for the money. The defendant comes with an ill grace to turn the ' plaintiffs round to another form of action, which may better accommodate his own views. It is a sound maxim, that no man shall found any claim or defence upon his own iniquity. There cannot ■ be a doubt but that the defendant is liable in some form of action, and we see no objection to maintaining trover.

The court are of opinion that the nonsuit ought to be set aside»-

Rule granted;.