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Jurgis George Geguzis vs. Brockton Standard Shoe Company & others

Massachusetts Supreme Judicial Court1935-06-27
291 Mass. 368

Summary

Holding. The court affirmed the judgment for damages for conversion against the Brockton Standard Shoe Company and assignees Wychunas and Winneg, finding they had converted the plaintiff's machinery by taking possession without authority and disposing of it, though the specific items could not be returned because they were no longer in the defendants' possession.

In 1922, the plaintiff owned a factory and shoe manufacturing machinery. He allowed a newly formed corporation (Brockton Standard Shoe Company) to occupy the factory and use the equipment, with the understanding that the corporation would eventually purchase both. The corporation acquired title to the real estate but never completed the purchase of the personal property (machinery and equipment), which remained the plaintiff's property. In April 1929, the corporation assigned its assets to three assignees, who took physical possession of all property in the building, including the plaintiff's machinery. The plaintiff subsequently foreclosed on his mortgage, secured the building with padlocks, and discovered that some of the machinery had disappeared.

The plaintiff sued for return of the property, but the court found that the machinery had likely been sold or disposed of by the assignees after they took possession but before the plaintiff locked up the building. Because the defendants no longer possessed the specific items, the court could not grant the equitable remedy of return. However, the court determined that the assignees had committed conversion by taking possession of property they had no right to possess and subsequently disposing of it. The corporation was also liable because it had improperly transferred the plaintiff's property to the assignees without authority to do so.

The trial court entered judgment against the defendants for monetary damages equal to the value of the missing machinery, calculated at the amount determined by the master's findings. The court rejected arguments that the plaintiff was estopped from claiming ownership and found no basis to keep one of the assignees (Becker) as a defendant after he had transferred his interest to the other assignees.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

  • Whether a decree requiring return of specific property is available when the property has been disposed of and is no longer in the defendant's possession
  • Whether taking possession of another's property under an assignment that does not convey title to that property constitutes conversion
  • Whether a corporation that permits use of its owner's property may transfer possession of that property to assignees without the owner's consent

Procedural posture

The plaintiff filed an equity bill in May 1929 seeking return of machinery he claimed was wrongfully withheld, and the defendants filed a cross bill; the trial court entered a final decree for monetary damages based on the master's findings, and the appellate court reviewed interlocutory and final decrees on appeal.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion

majority opinion

Qua, J.

This bill was filed May 2, 1929, to compel the delivery to the plaintiff of certain shoe manufacturing machinery and equipment, in a factory at Brockton, which machinery and equipment are alleged to be the property of the plaintiff and to be so withheld that they cannot be replevied. G. L. c. 214, § 3 (1). There is also a cross bill against the plaintiff brought by the defendants Wychunas and Winneg as assignees of the defendant Brockton Standard Shoe Company under an assignment for the benefit of creditors. The object of the cross bill is to recover for the alleged conversion by the plaintiff of machinery and other property in the same building claimed to have passed to the assignees under the assignment.

Material findings of the master are as follows: In 1922, the plaintiff was the owner of the factory and of the machinery and equipment contained in it. He and others caused the defendant corporation Brockton Standard Shoe Company to.be organized for the purpose of manufacturing shoes in this factory. He permitted the corporation to occupy the factory and to use the machinery and equipment. It was expected that the corporation would buy both the real and the personal property, and a vote was passed by the corporation authorizing such purchase. Pursuant to the vote, the corporation took title to the real estate and gave the plaintiff a mortgage back thereon for a part of the purchase price, but failed to make the cash payment required by the terms of the purchase, and the plaintiff never conveyed the personal property to the corporation. The corporation continued to use the real and personal property in its business until it made the assignment of all its assets April 15, 1929, to the defendants Winneg, Wychunas and Becker. All three assignees accepted the assignment, and on or about said April 15 Winneg and Wychunas took physical possession of all the property contained in the building, but Becker did not take possession and shortly afterwards he assigned his title under the assignment to the other two assignees and took no further part in the assignment. On or about May 2, 1929, which was the day on which the bill was filed, the plaintiff foreclosed his mortgage on the real estate, bought it himself at the sale and thereafter, on either May 2 or May 3, entered and caused the building to be fastened by padlocks. The plaintiff never parted with title to his personal property. Before beginning suit he made demand upon the corporation for its return and was refused. Part of it “has been diverted from said premises,” and its present whereabouts is unknown to the plaintiff. The plaintiff “is entitled to recover” the missing property.

The master found from subsidiary findings of fact aided by permissible inferences what the articles were which had been “diverted” and that their value was $3,420.65. In the Superior Court a final decree was entered in favor of the plaintiff against the defendants Brockton Standard Shoe Company, Wychunas and Winneg for the payment of that sum with interest and dismissing the cross bill.

There are no findings by the master to the effect that the defendants or any of them had, when the bill was filed or subsequently thereto, actual possession and control of the articles which were missing and were secreting and withholding the same, nor do we think that under the circumstances of this case we should infer that such was the fact. It is consistent with the facts found that these articles had been sold or disposed of by the assignees after they took possession on or about April 15 and before May 2. The plaintiff has therefore failed to establish facts essential to equitable relief by way of a decree for the return of specified property. G. L. (Ter. Ed.) c. .214, § 3 (1). Travis v. Tyler, 7 Gray, 146.

But there are adequate findings to show that the defendants Wychunas and Winneg converted to their own use property of the plaintiff by taking physical possession of it, together with .property of the corporation, under an assign ment which conveyed no title to the plaintiff’s property. A few days later they had an inventory made “with a view of disposing of the property.” Assuming as we must that the master’s findings of facts are correct, we agree with the trial judge in drawing the inference that it was the defendant assignees who in fact did dispose of the missing articles after they took possession and before the plaintiff entered upon the premises. This was an assertion of dominion over the plaintiff’s property. Gilmore v. Newton, 9 Allen, 171. Dugan v. Nichols, 125 Mass. 576. McPartland v. Read, 11 Allen, 231. Westheimer v. State Loan Co. 195 Mass. 510. Lancaster v. Stanetsky, 221 Mass. 312. Lawyers Mortgage Investment Corp. of Boston v. Paramount Laundries Inc. 287 Mass. 357. New England Road Machinery Co. v. Quincy Oil Co. 290 Mass. 242. It was followed up shortly afterwards by asserting title in the answers filed to this suit and in the cross bill. No demand upon the assignees was necessary, for their possession was never rightful but began with an act of conversion. Riley v. Boston Water Power Co. 11 Cush. 11. Lawyers Mortgage Investment Corp. of Boston v. Paramount Laundries Inc. 287 Mass. 357. New England Road Machinery Co. v. Quincy Oil Co. 290 Mass. 242. We think the defendant corporation is also liable for conversion, as it appears by fair inference that it delivered over to its assignees property of the plaintiff as part of its plant. The permission which the corporation had to use the plaintiff’s property did not carry with it permission to turn over its possession to others in this way. Goell v. Smith, 128 Mass. 238.

It fairly appears that when the plaintiff brought suit he reasonably believed in good faith that he was entitled to equitable relief on the allegations of his bill. When, after hearing, it was found that such relief could not be granted, the judge properly entered a final decree against the defendants Brockton Standard Shoe Company, Wychunas and Winneg for damages for the conversion. Reynolds v. Grow, 265 Mass. 578, 580, and cases cited.

There is no support in the findings for the contention that the plaintiff is estopped from asserting his ownership of the articles in question. The elements necessary to make out estoppel are not shown. Boston & Albany Railroad v. Reardon, 226 Mass. 286, 291. Orcutt v. Gast, 231 Mass. 305. See Gilson v. Nesson, 208 Mass. 368.

Whether the decree dismissing the bill as to the defendant Becker was correct need not be determined. The plaintiff alone was interested in the question whether Becker should remain a party. The plaintiff has not appealed. At least in a case like this, which has come down to a matter of damages for conversion, where joint tortfeasors have no remedy by way of contribution, one cannot insist that another remain a party. D’Almeida v. Boston & Maine Railroad, 209 Mass. 81, 87. Old Colony Street Railway v. Brockton & Plymouth Street Railway, 218 Mass. 84, 90. Boott Mills v. Boston & Maine Railroad, 218 Mass. 582, 592. George W. Gale Lumber Co. v. Bush, 227 Mass. 203. The defendants who have appealed were not parties aggrieved by the dismissal of the bill as to Becker. G. L. (Ter. Ed.) c. 214, § 19. Finer v. Steuer, 255 Mass. 611, 617.

The dismissal of the cross bill was not error, as there are no findings by the master as to what, if any, personal property not belonging to the plaintiff was retained by him in the factory when he took possession and put on the padlocks on or about May 2. It is unnecessary to determine whether the filing of a cross bill was proper practice under Equity Rule 6 (1926), 252 Mass. 602. See now Rule 32 of the Superior Court (1932).

We have carefully examined the interlocutory decrees which have been appealed from in so far as they relate to matters which can in any way affect the result of the case and find no error in them.

No objection in writing was brought in to the exclusion by the master of testimony of Wychunas as to what he found in the building nearly four years after May 2, 1929. Rule 90 of the Superior Court (1932). Commissioner of Banks v. Tremont Trust Co. 267 Mass. 331, 337. We do not intimate that this evidence was not properly excluded.

The judge correctly based the sum named in the final decree upon the findings made by the master. The master finds that on July 15, 1922, the plaintiff was the owner of the property described in the bill of sale from Tamulevicz et al. dated July 6. The machines held on lease and not conveyed in the bill of sale were nevertheless “described” therein, and there is nothing to contradict or control the finding that the plaintiff owned them on July 15.

The interlocutory decrees are affirmed. The final decree is affirmed with costs to the plaintiff against the defendants Brockton Standard Shoe Company, Wychunas and Winneg.

Ordered accordingly.