642 N.Y.S.2d 403 | N.Y. App. Div. | 1996
Appeal from a judgment of the Supreme Court (Ceresia, Jr., J.), entered May 4, 1995 in Albany County, upon a decision of the court in favor of plaintiff.
Plaintiff commenced this action to recover damages from the
On this appeal, defendants argue that the two corporations which contracted with plaintiff in connection with the auction sales are necessary parties and that only the corporations can be held liable for what is essentially a breach of the contracts between plaintiff and the corporations. We find no merit in defendants’ arguments and conclude that the judgment should be affirmed.
The stipulated facts establish that in September 1991 plaintiff entered into an oral agreement with Quintro Corporation and another corporation for the storage and sale of vehicles and boats repossessed by plaintiff. Pursuant to the agreement, Quintro was required to deposit the proceeds of each sale into its checking account at Apple Bank. Quintro would then send a check for the sale proceeds to plaintiff within 7 to 10 days after the sale or after completion of the paper work. Pursuant to the agreement, more than 100 vehicles were sold during the ensuing year and Quintro transmitted its checks for the sales proceéds to plaintiff without incident.
As a result of business transactions unrelated to plaintiff, Quintro encountered financial trouble in August 1992 when checks payable to it, which Quintro had deposited in its Apple Bank checking account, were returned for insufficient funds. As Quintro had already written its own checks against the deposit, the returned checks created a deficiency in Quintro’s checking account. Defendants, who were officers of Quintro and shared the day-to-day responsibilities of running the corporation, were both aware of the returned checks and resulting deficiency in Quintro’s checking account.
In September and October 1992, Quintro sold three vehicles and a boat that had been repossessed by plaintiff. The proceeds of the sales were deposited into Quintro’s Apple Bank checking account. As a result of the deficiency in the account, the proceeds of the sales were used to pay customers or creditors of Quintro other than plaintiff. Quintro did not transmit the proceeds of the sales to plaintiff, despite plaintiff’s demand therefor.
"The tort of conversion is established when one who owns and has a right to possession of personal property proves that the property is in the unauthorized possession of another who has acted to exclude the rights of the owner * * *. Where the property is money, it must be specifically identifiable and be subject to an obligation to be returned or to be otherwise treated in a particular manner” (Republic of Haiti v Duvalier, 211 AD2d 379, 384 [citations omitted]). There can belittle doubt that plaintiff, who was the owner of the personal property sold at auction, was also the owner of the proceeds of the sales. It is also clear that the proceeds of the sales were sufficiently identifiable for the purposes of an action for conversion (see, Payne v White, 101 AD2d 975, 976). The stipulated facts establish that although Quintro had the right to possess the proceeds of the sales, it was required to treat the proceeds in a particu
Mikoll, J. P., Mercure, White and Spain, JJ., concur. Ordered that the judgment is affirmed, with costs.