Summary
affirming dismissal of conversion claim where funds were commingled
Summary of this case from Sheeder v. JamisonOpinion
2030204.
December 17, 2004.
Appeal from the Mobile Circuit Court, No. CV-01-2998, Herman Y. Thomas, J.
Ellen T. Turner, Mobile, for appellants.
Donald M. Briskman Binion, P.C., Mobile, for appellee.
On April 3, 2001, Juanita Delmore sued James Gonzales, her stepfather, in the Mobile District Court, alleging conversion of personal property left to her by her deceased mother's will. Delmore also alleged negligence and a breach of contract. On June 11, 2001, Delmore filed a petition to probate her mother's will in the Probate Court of Mobile County. On June 8, 2001, Augustus Gomez, Delmore's half-brother, sued Gonzales, his stepfather, in the Mobile Circuit Court, alleging conversion of personal property left to him by his mother's will. At some point, Gonzales was declared incompetent by the probate court and a conservator was appointed to represent his interests. On October 25, 2001, Gonzales's conservator petitioned the probate court to exempt $15,500 as a homestead, personal property, and family allowance pursuant to §§ 43-8-110 through -112, Ala. Code 1975. Pursuant to Rule 42(a), Ala. R. Civ. P., the three actions were consolidated in the circuit court.
During the trial of these actions, Gonzales objected to any attempt by Delmore or Gomez to testify as to the value of any item of their mother's personal property. Gomez had prepared a report that detailed each item of personal property that he alleged had been left to him and Delmore under their mother's will and assigned a dollar value to each one of those items; Gomez assigned values to the items of personal property partly based on his sentimental attachment to the items Gonzales also objected to Gomez's value assessments contained in the report. During the trial, Gomez testified that he was familiar with the personal property that his mother owned because he lived with his mother when she married Gonzales and, after Gomez moved out of his mother's house, he frequently visited her. Delmore also testified that her mother had obtained many of the items of personal property before her mother had married Gonzales and that she was familiar with all of her mother's personal property.
At the close of Delmore and Gomez's case-in-chief, Gonzales moved for a judgment as a matter of law ("JML") pursuant to Rule 50, Ala. R. Civ. P., because Delmore and Gomez had not established the value of any of the items of personal property. The trial court granted this motion on October 9, 2003. Delmore and Gomez filed a timely notice of appeal. This case was transferred to this court by the supreme court, pursuant to § 12-2-7(6), Ala. Code 1975.
Delmore and Gomez allege that the trial court improperly excluded a report prepared by Gomez that included a dollar value for each piece of personal property that they alleged was due to them under their mother's will. They also argue that the trial court improperly excluded from their claims of conversion $17,000 dollars in cash found in their mother's bedroom.
Our supreme court has stated:
"When reviewing a ruling on a motion for a JML, this Court uses the same standard the trial court used initially in granting or denying a JML. Palm Harbor Homes, Inc. v. Crawford, 689 So.2d 3 (Ala. 1997). Regarding questions of fact, the ultimate question is whether the nonmovant has presented sufficient evidence to allow the case or the issue to be submitted to the jury for a factual resolution. Carter v. Henderson, 598 So.2d 1350 (Ala. 1992). For actions filed after June 11, 1987, the nonmovant must present `substantial evidence' in order to withstand a motion for a JML. See § 12-21-12, Ala. Code 1975; West v. Founders Life Assurance Co. of Florida, 547 So.2d 870, 871 (Ala. 1989). A reviewing court must determine whether the party who bears the burden of proof has produced substantial evidence creating a factual dispute requiring resolution by the jury. Carter, 598 So.2d at 1353. In reviewing a ruling on a motion for a JML, this Court views the evidence in the light most favorable to the nonmovant and entertains such reasonable inferences as the jury would have been free to draw. Motion Industries, Inc. v. Pate, 678 So.2d 724 (Ala. 1996). Regarding a question of law, however, this Court indulges no presumption of correctness as to the trial court's ruling. Ricwil, Inc. v. S.L. Pappas Co., 599 So.2d 1126 (Ala. 1992)."
Delchamps, Inc. v. Bryant, 738 So.2d 824, 830 (Ala. 1999).
The following occurred during oral arguments on Gonzales's motion for a JML:
"THE COURT: There is one issue I think is controlling whether or not the Plaintiffs can give — establish the question of value to go to the jury. If they cannot do that, I think the case is due to go out on the Defense's motion. If either one of the Plaintiffs wants to research that issue and think there is clear-cut law, that based on what is already presented before this jury that they have — that their clients could establish the value. I think — I will deny [Gonzales's] motion.
"I'll be very [candid], I don't think that there is. . . . The question for me to determine, in my opinion, is whether or not the personal property, the assets, the personal property in the home exceeds the statutory exemption.
". . . .
"[Counsel for Delmore]: Your Honor, what about the fact that we offered Exhibit Nine and you never ruled on what —
"THE COURT: Because of that particular issue, that's the issue. That's why I did not allow Exhibit Nine in based on that issue. I was not satisfied that I can allow the Plaintiffs to establish that value, that's the whole issue. If I would have allowed that, then I would automatically be denying [Gonzales's] motion, that's the issue.
". . . .
"THE COURT: We're taking that up now because that's the sole basis of his motion for a [judgment as a matter of law,] in my opinion. ". . . .
"THE COURT: . . . I think the law is that a Plaintiff — the owner can testify to the value of his or her property, an example, in a car accident, you can — say if my car was in an accident, I can tell you the fair market before and the fair market value afterwards. It doesn't matter if I have no expertise in that area, I can do that and I think they make an exception for that in the law, not only in this State but I think that's true in most jurisdictions. Can I get on the stand and tell the value of a car if I didn't — if I was involved in an accident and it was the other driver's car, I cannot give an opinion as to what I think was the fair market value before and after, because that's not my car and I've not laid a basis of my — the basis of my knowledge or expertise in that area. What you're asking me to do is to allow these Plaintiffs to give an opinion as to property that they're claiming, but not as yet been determined to be theirs. You're asking me to jump. Now if I accept the fact that it's their property, then I can and should allow them to give their opinion, but that has not been determined yet because before we can determine whose property it is, [Gonzales] has the right to do for a share, so that's why I stated prior to me even bringing the jury in, in the Court's opinion, we have to determine the value of the estate of Mrs. Gonzales at the time of her death, because they brought in the statutory exemption, which they're entitled to exercise. I don't know if I'm making myself clear or not. So if you can give me some fact — some law — not that the owner can give an opinion but that the Plaintiffs are individuals who are claiming the property can give an opinion, because what's based before me, they've stated that that's an opinion based on sentimental value and they think it's less than what it's actually worth but I've not allowed that actual exhibit into evidence because of that concern. And there was no testimony solicited from either Plaintiff as far as any particular item. The Plaintiff was relying on that exhibit that I've not allowed in because of the objection from the Defense counsel, so to me that's the issue.
". . . .
"THE COURT: It's the value. If whether or not someone can give the opinion — the best way I can phrase it is whether or not someone can give an opinion as to property that they're claiming is theirs.
". . . .
"[Counsel for Gonzales]: Okay. We also know that someone who does not own the property, unless properly qualified, cannot give the value of the property.
"THE COURT: I think that is the law in Alabama."
Rule 701, Ala. R. Evid., provides:
"If the witness is not testifying as an expert, the witness's testimony in the form of opinions or inferences is limited to those opinions or inferences which are (a) rationally based on the perception of the witness and (b) helpful to a clear understanding of the witness's testimony or the determination of a fact in issue."
Section 12-21-114, Ala. Code 1975, provides:
"Direct testimony as to the market value is in the nature of opinion evidence; one need not be an expert or dealer in the article, but may testify as to value if he has had an opportunity for forming a correct opinion."
Our supreme court has held that, "pursuant to the express legislative declaration in § 12-1-1, when this Court adopted the Alabama Rules of Evidence effective January 1, 1996, those rules supplanted and superseded any provision of Title 12 of the Code of Alabama 1975 inconsistent with those rules. . . ." Schoenvogel v. Venator Group Retail, Inc., 895 So.2d 225, 235 (Ala. 2004). We find that § 12-21-114, Ala. Code 1975, is consistent with the Rule 701, Ala. R. Evid., and is therefore applicable.
In Williamson v. Stephens, 577 So.2d 1272 (Ala. 1991), our supreme court considered a case that is substantially similar to the present case. In Williamson, Williamson sued Stephens alleging conversion. 577 So.2d at 1273. Williamson's son had sold his house at which Williamson had stored some of his personal property. Stephens alleged that he had bought the son's house "contents and all." During the trial, Williamson tried to introduce a document that listed the items of personal property he had stored at his son's house. Williamson had also assigned a value to each item of personal property listed in the document. The trial court would not admit the list into evidence, and it granted Stephens's motion for a directed verdict on the basis that Williamson had not proven the value of the items he alleged had been converted. Our supreme court cited this court's previous application of § 12-21-114, Ala. Code 1975, with approval:
Rule 50, Ala. R. Civ. P., as amended in 1995, renamed the "motion for a directed verdict" as a "motion for a judgment as a matter of law" and renamed the "motion for a judgment notwithstanding the verdict" as a "renewed motion for a judgment as a matter of law."
"Construing [§ 12-21-114], the Court of Civil Appeals has held that the question of whether a witness has had ample opportunity of forming a correct opinion of the value of an article is a preliminary question for the court; that a determination on that question is largely within the court's discretion; and that such a determination will not be overturned unless it is clearly unjust. Hamrick v. Daniel, 449 So.2d 1247 (Ala.Civ.App. 1984)."
Williamson, 577 So.2d at 1273. Our supreme court held that the list of personal property containing the value determinations should have been admitted into evidence by the trial court. See also 1 Charles W. Gamble, McElroy's Alabama Evidence § 128.11 (5th ed. 1996).
In the present case, the trial court appears to have concluded that as a matter of law Gomez and Delmore cannot testify as to the value of their mother's personal property because they did not own the property. However, all that is required under § 12-21-114, Ala. Code 1975; Rule 701, Ala. R. Evid., and Williamson is that a person's testimony as to value be rationally based on their perception or based on an opportunity to form a correct opinion. The evidence, when viewed in a light most favorable to Gomez and Delmore, shows that their testimony was rationally based on their perceptions or that they had an opportunity for forming a correct opinion as to the value of their mother's personal property because their mother owned some of the property when Gomez lived with her and they both visited their mother's home on a frequent basis. The manner in which Gomez and Delmore determined the value of their mother's personal property goes to the weight that will be assigned by the jury but is not a question of admissibility. The trial court erroneously excluded the list of personal property that included Gomez's determination of the value of the personal property. The judgment is reversed as to this issue, and the case is remanded for further proceedings consistent with this opinion.
Delmore and Gomez also allege that Gonzales wrongfully converted $17,000 in cash found in their mother's bedroom after her death. The undisputed testimony shows the following occurred with regard to the cash found in the mother's bedroom. Approximately one week after Delmore and Gomez's mother died, Gonzales asked Gomez and Gomez's wife if they would help him clean out her bedroom. Gomez testified that his mother and stepfather had slept in separate bedrooms. While Gomez was cleaning out his mother's closet, he found "cash at different locations in the closet, in purses, shoe boxes, clothes in drawers. . . ." The cash totaled in excess of $17,000 dollars. Once the money was counted, Gomez took Gonzales to the bank and deposited the cash in Gonzales's bank account. The bank statement admitted into evidence showed that Gonzales actually deposited $34,026.30 on the day Gomez took him to the bank; however, the record is silent concerning the source of the additional cash.
Our supreme court has held:
"To constitute conversion, there must be a wrongful taking or wrongful detention or interference, or an illegal assumption of ownership, or an illegal use or misuse of another's property. The gist of the action is the wrongful exercise of dominion over property to the exclusion or in defiance of a plaintiff's rights, where the plaintiff has a general or special title to the property or the immediate right to possession. Ex parte SouthTrust Bank of Alabama, N.A., 523 So.2d 407 (Ala. 1988).
"Generally, an action will not lie for the conversion of money. However, if the money at issue is capable of identification, then a claim of conversion may be appropriate."
Greene County Bd. of Educ. v. Bailey, 586 So.2d 893, 898 (Ala. 1991).
"`"[T]rover lies for the conversion of `ear marked' money or specific money capable of identification, e.g., money in a bag or coins or notes which have been entrusted to defendant's care."' Hunnicutt v. Higginbotham, 138 Ala. 472, at 475, 35 So. 469, at 470 (1903) (quoting from 21 Enc. Pl. Prac., 1020, 1021). See also Moody v. Keener, 7 Port. 218 (Ala. 1838), and Humana of Alabama, Inc. v. Rice, 380 So.2d 862 (Ala.Civ.App. 1979), cert. denied, 380 So.2d 86[4] (Ala. 1980).
"Money in any form is generally regarded and treated as property, and it is well settled that an action will lie for the conversion thereof, where there is an obligation to keep intact and deliver the specific money in question, and where such money can be identified. Moody v. Keener, supra (money sealed up in a particular letter); Hunnicutt v. Higginbotham, supra ($180 in $20 gold pieces and $102 in paper money which was `wrapped up to itself' and placed in a safe). In England, it was first held that money could not be converted so as to support an action in trover unless it was in a `bag or chest.' Holiday v. Hicks, 78 Eng. Rep. 878, 900 (1599).
"The requirement that there be `earmarked money or specific money capable of identification' before there can be a conversion has been complicated as a result of the evolution of our economic system.
"Now, in conversion cases, the courts are not confronted so much with a particular piece of money, i.e., a coin or a bill, but with identified or segregated sources from which money has come or types of accounts into which money has been deposited."
Lewis v. Fowler, 479 So.2d 725, 726 (Ala. 1985).
In Covington v. Exxon Co., U.S.A., 551 So.2d 935 (Ala. 1989), our supreme court affirmed the directed verdict entered by the trial court against the Covingtons on their claim of conversion. The Covingtons alleged that Exxon had wrongfully converted money due to them under a royalty agreement. Exxon had held the royalty funds, asserting that it was unsure who owned the mineral rights because of an ambiguity in the deed. Our supreme court held:
"[During the time] the royalty funds were held in suspense, the monies attributable to Exxon's royalty owner accounts were located in numerous banks nationwide. The funds in these accounts are commingled. The Covingtons' royalty funds were never segregated into a separate account.
"For the foregoing reasons, we conclude that the royalty funds were not sufficiently identified to be converted."
551 So.2d at 939.
In the present case, the cash that was found in their mother's room that Delmore and Gomez claim was converted by Gonzales was commingled with other money before being deposited into Gonzales's bank account. Like the royalty funds in Covington, the $17,000 was no longer "separate money capable of identification." The trial court did not err in excluding from Delmore's and Gomez's claims of conversion the $17,000 found in their mother's bedroom. The judgment is affirmed as to this issue.
AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.
CRAWLEY, J., concurs.
PITTMAN, J., concurs in the result, without writing.
MURDOCK, J., concurs in the result in part and dissents in part, with writing, which THOMPSON, J., joins.
I concur in the result with respect to that portion of the main opinion concluding that the trial court erred in excluding the testimony of Gomez and Delmore as to the value of their mother's personal property. I respectfully dissent, however, as to that portion of the main opinion affirming the trial court's exclusion from Delmore's and Gomez's conversion claims of the $17,000 in currency found in their mother's bedroom.
It is true that, generally, an action will not lie for the conversion of money. As the main opinion notes, however, "`if the money at issue is capable of identification, then a claim of conversion may be appropriate.'" 903 So.2d at 145 (quoting Greene County Bd. of Educ. v. Bailey, 586 So.2d 893, 898 (Ala. 1991)).
At the time it was found and entrusted to Gonzales for safekeeping, the money at issue in the present case was specific currency — i.e., specific notes found in "purses, shoe boxes and clothes" in the bedroom of Delmore and Gomez's mother. In contrast, the money at issue in Covington v. Exxon Co., U.S.A., 551 So.2d 935 (Ala. 1989), a case upon which the main opinion relies, never took the form of specifically identified notes or coinage, but rather was a general debt from one party to another. As a result, the outcome in Exxon Co. was simply in line with the principle that "a conversion action will not lie when there is merely a relationship of debtor and creditor." Green Tree Acceptance, Inc. v. Tunstall, 645 So.2d 1384, 1387 (Ala. 1994). In contrast to the debt at issue in Exxon Co., the money at issue in the specific case was, in the words of our Supreme Court in Lewis v. Fowler, 479 So.2d 725, 726 (Ala. 1985), "`"specific money capable of identification, e.g., money in a bag or coins or notes which have been entrusted to defendant's care."'"
It is true that a conversion does not occur until such time as there is a "wrongful taking or wrongful detention or interference, or an illegal assumption of ownership, or an illegal use or misuse of another's property. The gist of the action is the wrongful exercise of dominion over property to the exclusion or in defiance of a plaintiff's rights." Greene County Bd. of Educ. v. Bailey, 586 So.2d at 898 (emphasis added). Thus, it could be argued that the conversion in this case did not occur at the time the money at issue was commingled with other money and deposited by Gonzales into his account, but only at such subsequent point in time at which he refused to pay over the $17,000 from that account, and that only then did he wrongfully detain and exercise dominion over property which was merely entrusted to him for safekeeping. At that point in time, the object of the conversion would no longer be specific notes or coins. As our Supreme Court explained in Lewis v. Fowler, however:
"The requirement that there by `earmarked money or specific money capable of identification' before there can be a conversion has been complicated as a result of the evolution of our economic system.
"Now, in conversion cases, the courts are not confronted so much with a particular piece of money, i.e., a coin or a bill, but with identified or segregated sources from which money has come or types of accounts into which money has been deposited."
Lewis v. Fowler, 479 So.2d at 726. It has been stated that "[t]he rule is elementary that if a bailee accepts money and places it in a private safe mixed with his own money, or deposits it with his bankers upon his own private account, such treatment of the funds is a conversion, and renders the bailee absolutely liable." Peltola v. Western Workman's Publ'g Soc'y, 113 Wash. 283, 289, 193 P. 691, 693 (1920).
Similarly it has been held in Alabama that, where an attorney diverts money placed by a client into the attorney's trust account, although a "conversion does not ordinarily lie for money represented by a general debt. . . . the rule is otherwise as to funds placed in the custody of another for a specific purpose and their diversion for other than such specified purpose subjects the holder to liability in conversion." Dillard v. Payne, 615 S.W.2d 53, 54 (Mo. 1981). See also Craven v. Wright, 114 Or. 692, 693-94, 236 P. 1043, 1044 (1925) ("Where a check has been given to a person for one purpose and it has been diverted to a purpose different from that from which it was given, an action in trover may be maintained by the maker thereof for the conversion of the money paid thereon."); Taylor v. Dwyer, 129 Ala. 325, 29 So. 692 (1901) (citing with approval Farrand v. Hurlbut, 7 Minn. 477 (1862)) (holding that a conversion claim could be brought with respect to $436 placed in the hands of the defendant to be loaned or invested by the defendant in the name of the plaintiff, but which the defendant loaned and invested in his own name).
The gravamen of a conversion claim is the wrongful converting of someone else's property to the defendant's own use. In the present case, specific money was taken by Gonzales. It was converted into a credit in his bank account. The fact that the specific currency is no longer in Gonzales's physical possession is not dispositive; the fact is that there is a credit in Gonzales's bank account directly traceable to the money at issue. If we hold that a credit in a bank account directly traceable to moneys rightfully belonging to another party cannot be the object of a conversion merely because other moneys have also been deposited into that account, then we will indeed have made it easy for anyone who converts the money of another to insulate himself or herself from tort liability for conversion.
In Greene County Board of Education v. Bailey, 586 So.2d at 899-900, our Supreme Court reversed a Rule 12(b)(6), Ala. R. Civ. P., dismissal of an action because
"[t]he allegations of the complaint suggest[ed] that the plaintiff may be able to prove that the defendants . . . converted to their own use funds that had been specifically deposited in the `[Paramount High School] lunchroom account' to pay for the high school's breakfast and lunch programs."
As the Supreme Court explained:
"[T]he evolution of our economic system has resulted in courts' today being asked more often than not to determine whether money traceable to identified or segregated sources or accounts can be the subject of a conversion action. Although Lewis [v. Fowler, 479 So.2d 725, 726 (Ala. 1985),] did not involve money that was traceable to a special account,2 this Court, citing Limbaugh v. Merrill Lynch, Pierce, Fenner Smith, Inc., 732 F.2d 859 (11th Cir. 1984), recognized that money directly traceable to a special account is sufficiently identifiable to support an action for conversion.
"_______________
"² Lewis involved a debtor-creditor relationship between the plaintiff and the defendant. That relationship formed the alternative basis for this Court's holding that the plaintiff's conversion action would not lie."
Greene County Bd. of Educ., 586 So.2d at 899 (emphasis added).
In light of the foregoing, I respectfully dissent from that portion of the main opinion affirming the trial court's exclusion from Gomez's and Delmore's conversion claims of the $17,000 in currency found in their mother's bedroom.
THOMPSON, J., concurs.