Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Los Angeles County, Gregory W. Alarcon, Judge, Los Angeles County Super. Ct. No. BC390498
Law Office of Marilyn M. Smith, Marilyn M. Smith, Lisa Fisher; and Edward J. Horowitz for Defendant and Appellant.
Rebecca J. Birmingham for Plaintiff and Respondent.
EPSTEIN, P. J.
In this appeal from a jury verdict in favor of respondent Jonathan Marcus, we conclude that Marcus’s action for conversion was not barred by the one-year statute of limitations in Code of Civil Procedure section 366.2. But because the trial court prejudicially erred in rejecting appellant Marilyn Smith’s special jury instruction on her qualified refusal to turn over disputed property, we reverse the judgment and remand the cause for a new trial.
FACTUAL AND PROCEDURAL SUMMARY
Smith’s estranged husband, Steve Barker, died unexpectedly on July 23, 2007. Smith took control of Barker’s property without initiating a formal probate proceeding. Marcus, an editing engineer, had worked in “loose association” with Barker, a sound engineer, since at least 1994. They sometimes shared audio equipment. After Barker’s funeral, Marcus advised Smith that he owned some equipment stored at a facility rented by Barker. On January 14, 2008, Smith, Marcus, and Ben Maas (another sound engineer, familiar with the equipment) met at the storage facility in Tujunga, and Maas separated in a pile the equipment Marcus claimed to own. Maas brought receipts to this meeting purporting to establish Marcus’ ownership to some of the equipment but conditioned displaying them on return of the equipment. Smith refused to look at the receipts because she was not prepared to give up the equipment that day. Smith did not respond to Marcus’s subsequent and admittedly low offer to buy all the equipment for $10,000. In February 2008, Smith e-mailed Marcus that, even if he had receipts for the equipment, they would not “tell the whole story” because Barker could have come to own the disputed items through barter or work-off arrangements. Marcus did not remember any work-off arrangements he had with Barker that involved sound equipment, and after Smith’s e-mail, he thought it would be pointless to give her any receipts. Sometime in February or March 2008, Smith arranged that equipment stored at the facility be listed for sale online. Marcus objected to the listing of equipment he claimed to own in addition to that set aside at the storage facility, and the disputed equipment was returned to storage.
Divorce proceedings had not been finalized at the time of Barker’s death.
On May 8, 2008, Marcus sued Smith for conversion and intentional interference with prospective economic advantage, seeking only money damages. Smith demurred and later moved to dismiss the complaint under the one-year statute of limitations of Code of Civil Procedure section 366.2 as a claim for damages against Barker’s estate. Smith cross-complained for trespass against Barker’s landlord and Marcus, alleging they had entered Barker’s apartment and removed items from it after Barker died.
At trial, the only causes of action submitted to the jury were Marcus’s conversion claim against Smith and Smith’s trespass claim against Marcus. The trial court refused Smith’s proposed special instructions that a personal representative of an estate is entitled to a good faith defense and a possessor of disputed property is entitled to a qualified refusal to turn it over in order to investigate the claimant’s right to the property. The jury returned a general verdict of $75,000 on Marcus’s conversion claim and rejected Smith’s trespass claim. After judgment, the court denied Smith’s motions for a new trial and for judgment notwithstanding the verdict, in which she raised, among other claims of error, the court’s refusal to give the special instructions.
Smith settled her trespass claim against Barker’s landlord and dismissed the landlord from the case. The trial court granted Smith’s motion for directed verdict as to Marcus’s claim for intentional interference with prospective economic advantage.
Smith filed this timely appeal from the judgment and the denial of her motion for judgment notwithstanding the verdict.
DISCUSSION
I
Whether Code of Civil Procedure section 366.2 bars Markus’s conversion claim is a legal issue, which we review de novo. (Stoltenberg v. Newman (2009) 179 Cal.App.4th 287, 292.)
The one-year limitation period applies “[i]f a person against whom an action may be brought on a liability of the person, whether arising in contract, tort, or otherwise, and whether accrued or not accrued, dies before the expiration of the applicable limitations period, and the cause of action survives.” (Code Civ. Pro., § 366.2(a).) This limitation period may be tolled by filing a creditor’s claim under Probate Code section 9000 et seq. (Id., subd. (b)(2).) A “claim” is defined in relevant part as “a demand for payment for any of the following, whether due, not due, accrued or not accrued, or contingent, and whether liquidated or unliquidated: [¶] (1) Liability of the decedent, whether arising in contract, tort, or otherwise.” (Prob. Code, § 9000, subd. (a)(1).) This definition expressly excludes “a dispute regarding title of a decedent to specific property alleged to be included in the decedent’s estate.” (Id., subd. (b).)
In Estate of Yool (2007) 151 Cal.App.4th 867, 873-874 (Yool), the court recognized that claims to specific property can be resolved under Probate Code section 850. That section allows any interested person to petition the probate court for an order in cases “[w]here the decedent died in possession of, or holding title to, real or personal property, and the property or some interest therein is claimed to belong to another.” (Prob. Code, § 850, subd. (a)(2)(C).) Probate Code section 856 allows the probate court to order a conveyance, transfer or “other appropriate relief” on such petitions. In Yool, the court rejected the argument that Code of Civil Procedure section 366.2 applies to such petitions. (Estate of Yool, supra, at p. 875.) Not only was the decedent in that case not personally liable on a resulting trust, but no cause of action, accrued or not, existed at the time of her death because no wrongful act had occurred while she was alive and the ownership of the property had not been disputed until after her death. (Id. at pp. 876-877).
Smith argues that because Marcus did not file a petition in the probate court and sought only money damages in his civil suit, his conversion claim is a creditor’s claim against Barker’s estate subject to the one-year statute of limitations. Either party in this case could have filed an “interested person” petition under Probate Code section 850 to have the probate court determine the ownership of the disputed property. Their choice not to do so does not transform Marcus’s conversion claim against Smith into a creditor’s claim against her as Barker’s successor because the conversion claim is not premised on Barker’s liability. Conversion is the wrongful exercise of dominion over personal property in denial of or inconsistent with another person’s rights in the property. (Weiss v. Marcus (1975) 51 Cal.App.3d 590, 599.) Because he never resisted turning over any of the sound equipment in his possession, Barker did not commit a wrongful act that would make him personally liable for conversion. Thus, no cause of action for conversion, whether accrued or not, existed against Barker while he was alive.
Smith’s reliance on Kircher v. Kircher (2010) 189 Cal.App.4th 1105, is similarly misplaced. That case involved a claim for spousal support, which was a pre-existing debt of the decedent for which his widow was held personally liable up to the value of properties the two held in joint tenancy. (Id. at p. 1110.) Barker’s relationship to the sound equipment during his life cannot be characterized as a debt to Marcus for which his successor would be personally liable under Probate Code section 13109.
Because no wrong had occurred while Barker was alive and no debt to Marcus existed when Barker died, the conversion claim is not a cause of action against Barker that survived his death. Rather, it is premised on alleged wrongful acts that Smith committed and for which, if proven, she would be personally liable. Code of Civil Procedure section 366.2 does not apply to this cause of action.
II
A party is entitled to request that the jury be instructed correctly on any of the party’s theories of the case that are supported by substantial evidence. (Soule v. General Motors Corp. (1994) 8 Cal.4th 548, 572 (Soule).) A refusal to instruct the jury is reversible error if it is probable that the error prejudicially affected the verdict. (Id. at p. 580.) Relevant to the determination are “(1) the state of the evidence, (2) the effect of other instructions, (3) the effect of counsel’s arguments, and (4) any indications by the jury itself that it was misled.” (Id. at pp. 580-581) In this situation, we review the evidence in the light most favorable to the appellant and assume that, had it been properly instructed, the jury might have believed the evidence upon which the rejected instruction was based, drawn inferences favorable to appellant, and rendered a different verdict. (Logacz v. Limansky (1999) 71 Cal.App.4th 1149, 1156 (Logacz).)
Smith requested that the jury be specially instructed that “[a] personal representative of an estate who in good faith takes into possession personal property, and reasonably believes that the property is part of the estate of the decedent, is not liable for conversion.” The special instruction traced the language of Probate Code section 9651, subdivision (a)(2). Marcus objected on the ground that the instruction would mislead the jury because Smith was not a personal representative. A personal representative is appointed by the probate court to administer the probate of a decedent’s estate. (Estate of Hilton (1996) 44 Cal.App.4th 890, 894, fn.1, 895.) Smith was not appointed by the probate court and was therefore not a personal representative. Rather, at her request, the court instructed the jury that, as the intestate decedent’s surviving spouse, she was not required to open a probate in order to receive, sell, or transfer his personal property. Because Smith was not a personal representative of Barker’s estate, the special instruction regarding the good faith defense available to a personal representative was likely to mislead the jury. The court did not err in refusing to give a misleading instruction.
Probate Code section 13100 et seq. allows a decedent’s successor in interest to receive the decedent’s personal property by affidavit when the value of property is less than $100,000; section 13500 et seq. allows the passing of property to the surviving spouse without probate. Marcus claims that because Smith did not comply with various provisions of the Probate Code, she is not entitled to the protection it affords to personal representatives. We agree that Smith was not a personal representative and need not consider whether she complied with other code provisions.
The trial court also rejected the following special instruction: “A person in possession of personal property is allowed a reasonable opportunity to investigate claims of ownership by a third party who claims ownership. Refusal to turn over disputed property in order to make a reasonable investigation is not conversion.” The instruction was based on Giacomelos v. Bank of America (1965) 237 Cal.App.2d 99 (Giacomelos). There, the court acknowledged that good faith was not a defense to conversion but proceeded to state: “The law does recognize the dilemma of one in possession as a bailee or similar holder upon demand by a third party for the goods. Such holder does not become a converter by making a qualified refusal to surrender if his real and stated purpose is to secure a reasonable opportunity to inquire into the claimant’s right (Rest.2d Torts, § 240).” (Id. at pp. 100-101.) Marcus challenges the special instruction on the ground that good faith is not a defense to conversion. This challenge is inapposite because, regardless of the lack of a good faith defense to conversion, the law recognizes a possessor’s qualified refusal to surrender disputed property in order to investigate a claimant’s right to it.
Marcus argues further that the qualified refusal to surrender property does not apply because his is not a third-party claim. For this argument, he posits that Smith stepped into Barker’s shoes as the bailee with Marcus as the bailor, rather than a third-party claimant, of the sound equipment. In the bailment context, a bailee may refuse to surrender property to the bailor when the bailor’s right to immediate possession is doubtful because of the bailee’s lien or a third-party’s claim to the property. (Lambert v. Valentine (1923) 61 Cal.App. 712, 713-714; Rest.2d Torts, § 240, subd. (1), com. c, p. 469 & subd. (2).) A bailee has a duty to investigate an adverse claim and may require that a claimant provide proof of the claim. (Messerall v. Fulwider (1988) 199 Cal.App.3d 1324, 1331-1332 (Messerall).) Once the claimant provides such proof, the burden falls on the bailee to investigate the validity of the claim. (Id. at p. 1332.) In Messerall, a secured creditor of a boat submitted “reasonably compelling proof” of his claim in the form of “the registration certificate in his name, a statement executed under penalty of perjury asserting his right to immediate possession, and a copy of the security agreement upon which that right was founded”; the burden then fell on the boat repairer in possession of the boat to investigate the validity of his claim. (Ibid.) The boat repairer’s insistence on a court order establishing the creditor’s right to possession was an unreasonable refusal to surrender the boat to the creditor in the absence of any independent investigation. (Ibid.)
Neither Smith nor Marcus relied on the law of bailment at trial. But the qualified refusal to surrender disputed property is not limited to the bailment context because, as we have discussed, it applies to “a bailee or similar holder.” (Giacomelos, supra, 237 Cal.App.2d at p. 100; see also Rest.2d Torts, § 240, subd. (1) [“one in possession of a chattel who is in reasonable doubt as to the right of a claimant to its immediate possession does not become a converter by making a qualified refusal to surrender the chattel to the claimant for the purpose of affording a reasonable opportunity to inquire into such right”].) That Smith claimed an interest in the stored equipment is not dispositive because she did so only as Barker’s successor. Items Barker possessed are initially presumed to be owned by him. (See Evid. Code § 637.) In light of Marcus’s adverse claim, Smith became a possessor of disputed property. She was entitled to the special instruction if her qualified refusal to surrender the disputed property was in order to have a reasonable opportunity to inquire into Marcus’s claim.
Marcus argues that the special instruction is not warranted because Smith did not independently investigate his claim or Barker’s ownership of the equipment. By analogy to the law of bailments, Smith could first require Marcus to present proof of his claim. Only after Marcus presented his proof would the burden to investigate fall back on Smith. (Messerall, supra, 199 Cal.App.3d at p. 1332.) The instruction Smith requested was, if anything, incomplete because it did not make clear that she could first require Marcus to present proof of his claim. It would have nevertheless correctly informed the jury that as a possessor of disputed property Smith had the right to make a qualified refusal to surrender it in order to inquire into the claim.
The remaining question is whether it is probable that the court’s refusal to give the special instruction prejudicially affected the verdict. (Soule, supra, 8 Cal.4th at p. 580.) Marcus argues that Smith cannot establish prejudice because she delayed responding to the requests that she return the equipment, refused to look at his proof of ownership, and refused to independently investigate.
The testimony at trial indicated that, beginning in August 2007, first Maas and then Marcus requested that Smith turn over some sound equipment that had been stored by Barker. In September 2007, Barker’s sister-in-law asked Smith to respond to these requests. In October 2007, Maas let Smith know that he and Marcus were getting tired of waiting for her to return the equipment. The testimony indicated further that Smith asked Marcus for receipts proving his ownership of the equipment, that Maas (rather than Marcus) brought some receipts to their January 2008 meeting at the storage facility, and that Marcus produced no other receipts until he sued Smith for conversion. Smith testified that she did not look at the unidentified receipts brought to the January 2008 meeting because they were offered to her on the condition that she release all equipment on that day. She testified that her February 2008 e-mail to Marcus did not state that receipts did not matter, only that they would not tell the whole story. Her testimony indicated that she had not gone through all of Barker’s papers at the time of trial and that, except for one item, she had not located proof of Barker’s ownership of equipment.
Marcus characterizes Smith’s actions as the antithesis of a reasonable investigation. But in evaluating the prejudicial effect of the refused jury instruction we cannot draw inferences favorable to Marcus. On the contrary, we must assume that a properly instructed jury would believe Smith’s testimony and draw from it inferences favorable to Smith. (See Logacz, supra, 71 Cal.App.4th at p. 1156.) For instance, the jury could infer that Smith never made an unqualified refusal to return the equipment, that her request for receipts was reasonable, and that Maas’s conditional offer of some receipts for all equipment was unreasonable, as was Marcus’s conclusion that producing additional receipts would be pointless. In the absence of a statement by Smith that she would not turn over the equipment regardless of any proof of ownership Marcus might submit, the jury could conclude that Smith made only a qualified refusal to surrender it. And in the absence of an unqualified offer of receipts proving Marcus’s ownership of equipment, the jury could conclude that the burden did not shift back to Smith to investigate the validity of Marcus’s claim, so that any delay or inaction on her part was immaterial. (See Messerall, supra, 199 Cal.App.3d at p. 1332.)
The only instruction on conversion that was given at trial was CACI No. 2100, which as adapted to the facts of this case stated: “Jonathan Marcus claims that Marilyn Smith wrongfully exercised control over certain items of personal property. To establish this claim, Jonathan Marcus must prove all of the following: [¶] 1. That Jonathan Marcus owned as of July 23, 2007 [a list of items that was read to the jury]. [¶] 2. That Marilyn Smith intentionally took possession of one or more of the items of personal property that Jonathan Marcus owned on July 23, 2000 [sic], for a significant period or prevented Jonathan Marcus from having access to certain items of personal property for a significant period of time. [¶] 3. That Jonathan Marcus did not consent. [¶] 4. That Jonathan Marcus was harmed. [¶] And, 5, that Marilyn Smith’s conduct was a substantial factor in causing Jonathan Marcus’s harm.” The jury was not instructed that Smith refused to return Marcus’s personal property after Marcus demanded its return even though CACI No. 2100 lists it as an alternative; nor was the jury instructed to consider her reasons for doing so. Thus, the instruction given to the jury did not allow it to consider the evidence pertaining to Smith’s refusal to turn over the sound equipment to Marcus.
In a footnote, Smith argues that the instruction was defective because it did not explain what “a significant period of time” means. The argument that the instruction was unclear was forfeited because no objection or a request for a clarifying instruction was made at trial. (See Conservatorship of Gregory (2000) 80 Cal.App.4th 514, 520.)
The court’s error in refusing to instruct the jury that Smith had a qualified right to refuse to surrender the sound equipment was further aggravated by the fact that the parties delivered their closing arguments before the court informed them of the instructions it would give to the jury. As a result, neither side presented a coherent argument on the propriety of Smith’s refusal to turn over the disputed property. Marcus’s attorney mentioned Smith’s insistence on seeing receipts several times in closing, but the gist of her argument was that receipts were eventually produced in discovery and that Smith failed to investigate what equipment her husband owned. Smith’s attorney listed all the reasons why Smith was suspicious of Marcus’s claim of ownership, but his argument suggested that Smith was justified in refusing to turn over property because Marcus had entered Barker’s apartment after Barker’s death and Maas was holding some equipment of Barker’s hostage rather than because she had a right to investigate Marcus’s claim. Neither attorney attempted to pinpoint when the alleged conversion occurred.
Smith argues that a jury’s note to the court during deliberations indicated that it was confused whether a conversion actually occurred. The jury asked whether it was limited to money damages or could ask the court to order specific items returned to Marcus. The note may indicate the jury’s confusion about the relief to which Marcus was entitled, but it does not indicate that, as instructed, the jury was confused whether Smith converted property Marcus claimed to own. The only actions by Smith the jury was instructed to consider were her undisputed taking possession of the equipment and denying Marcus access to it. That the jury did not articulate its confusion does not mean that it was not misled by the jury instruction.
The trial court’s refusal to instruct the jury that Smith had a qualified right to refuse to turn over sound equipment in order to investigate Marcus’s claim was prejudicial error, requiring reversal.
DISPOSITION
The judgment is reversed and the cause is remanded for a new trial. Appellant is to have her costs on appeal.
We concur: MANELLA, J., SUZUKAWA, J.