147 A. 103 | Pa. | 1929
Argued May 14, 1929. This is an action of trespass in the nature of trover and conversion brought to recover the value of merchandise belonging to plaintiffs, which it is alleged defendants *456 sold, and converted the proceeds therefrom to the use of the Wearever Knitting Mills, a corporation in which they were all directors. A nonsuit was entered in the court below and from the refusal to take it off plaintiffs appeal.
Appellants purchased hosiery from the Wearever Knitting Mills which it had manufactured valued, so they claimed, at $5,186.15 and paid the corporation therefor. The merchandise was left with it and set apart to plaintiffs, subject to their shipping directions. The Knitting Mills became bankrupt and upon investigation appellants discovered that the goods belonging to them had been resold to a third party and the proceeds realized therefrom received by the Knitting Mills. Upon so ascertaining, this action was brought to recover from appellees individually the amount of appellants' loss under the claim that they had unlawfully and wrongfully converted the proceeds of the goods sold to the use of the Knitting Mills. The theory upon which it is sought to hold defendants individually liable is embodied in the following question stated by appellants' counsel in their brief: Are directors of a corporation individually liable for the conversion of plaintiffs' goods by the corporation or the general manager thereof where the facts of the conversion appeared on the books of the corporation and could have been known to the directors and the conversion prevented by them through the use of ordinary diligence? The trial judge answered "no" to this proposition, saying there was no testimony showing that any of the defendants, save Maus, knew of the sale by the company of the merchandise to plaintiffs and that none of them had any knowledge of the sale of it, after plaintiffs' purchase thereof, to the person who acquired it and that it was not shown that they had wilfully, knowingly and intentionally participated in the trespass. Our reading of the testimony convinces us that this determination was correct as to all of the defendants except Maus. This is not an action by the corporation or its *457
receiver or trustee or in behalf of its creditors or stockholders against directors alleging loss due to their default where such rulings, cited by appellants, as Fell v. Pitts,
The situation would, however, seem to be different so far as the defendant Maus is concerned. He was not only a director, but also general manager of the corporation. He not only knew of the sale of the merchandise to plaintiffs, but actually made it. While it is earnestly argued that he did not participate in the resale of their goods and in the conversion, we have reached the conclusion that this question is sufficiently doubtful to warrant its fuller investigation on another trial. A nonsuit having been entered, plaintiffs' evidence must be considered in the light most favorable to them (Lerch v. Bard,
The judgment of nonsuit is affirmed as to all of defendants except J. W. Maus; as to him the nonsuit is set aside and a procedendo awarded.