This is an action of tort to recover damages for the alleged conversion of certain personal property belonging to the plaintiff. The case is here on the plaintiff’s exceptions to the direction of verdicts for the defendants.
The plaintiff was engaged in the business of financing retail dealers of electrical refrigerators, washing machines, gas dryers, television sets, and other similar appliances. The C & C Appliance Company was such a dealer. The plaintiff paid The Eastern Company, a distributor, for nine lots of goods which were then shipped by the distributor between March 5, 1948, and June 29, 1948, to the dealer, the C & C Appliance Company, a corporation. The plain-' tiff received from the dealer on each shipment a promissory note payable to the plaintiff in three months and a trust receipt. The notes were in the ordinary form and referred to the trust receipt numbers. The trust receipt identified each article by a number and set forth the release price for each article. The release price was the amount due the plaintiff after deducting the down payment made by the dealer at the time the plaintiff purchased the appliance from the distributor. It was agreed that the release price was the fair value of the article. One Kelley, the plaintiff’s representative, on July 12, 1948, called at the dealer’s store and found that some of the articles included in the trust receipts were missing and complained to the defendant *232 Catino that these articles should not have been sold unless the plaintiff had first been paid for them. Catino replied that business was poor and promised to remit funds to the plaintiff in about a week, and promised not to sell any more of the trust receipt goods until the dealer had paid the amounts due. Kelley again visited the store in August, 1948, and found that more of the goods had been sold.
There was evidence that Catino notified Kelley that the goods in the store were about to be attached and that Kelley had better remove the plaintiff’s merchandise. Kelley had the goods removed and checked up what he had taken from the total shipments. The plaintiff then brought this action for conversion for the merchandise not returned. The dealer made an assignment for the benefit of its creditors on September 23, 1948.
It could be found that the plaintiff did not lose its security interest in the appliances by taking the notes. The promissory note and the trust receipt given by the dealer on each lot of merchandise must be construed together in the setting in which they were employed in order to ascertain the intent of the parties.
Skilton
v.
R. H. Long Cadillac La Salle Co.
A jury could find that the plaintiff in accepting the dealer’s notes did not intend to waive its security interest,
Reed
v.
Upton,
The failure of Kelley to demand and repossess the plaintiff’s goods on July 12, 1948, when he learned that the goods were being sold without making any payments to the plaintiff, does not in itself bar the maintenance of this action against the defendants. Neither was the plaintiff precluded from recovery merely because it was unable to distinguish the appliances sold prior to July 12, 1948, from those subsequently sold. The plaintiff is not suing to enforce any rights in the proceeds from those sales. See G. L. (Ter. Ed.) c. 255A, § 10. In so far as waiver is urged by the defendants, if it could be said to be of any materiality, it was at most a question of fact. In passing it may be noted that there was evidence of a voluntary surrender of the dealer’s interest in the goods taken by Kelley. C. 255A, § 6, cl. 4. Whatever remedies an entruster may have against a trustee who has broken the terms of the contract in accordance with which goods had been delivered to him, we see nothing contained in G. L. (Ter. Ed.) c. 255A, inserted by St. 1936, c. 264, the uniform trust receipts act, which indicates any intent to prevent the entruster from maintaining an action in tort for conversion, in appropriate instances, like the present, where all the elements of such a cause of action exist.
The dealer in giving the trust receipts expressly acknowledged that the merchandise was held by it “for the purpose of storing said property,” but the dealer also agreed “not to sell, loan, deliver, pledge, mortgage, or otherwise dispose of said appliances to any other person until after payment of amounts shown in Release Price column above.” It is plain that both parties knew that the merchandise was furnished to the dealer for the purpose of display and sale in the dealer’s store in accordance with a method well known
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in the trade as “floor planning.”
Associates Discount Corp.
v.
Haynes Garage, Inc.
All these trust receipt goods which were sold by the dealer
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were sold by the defendant Catino or under his immediate supervision. Catino was the president, a director, and the general manager of the dealer and acted knowingly in violation of the terms of the trust receipts. He presumably knew the contents of these receipts which he had duly executed in behalf of the dealer. It was agreed that the release price of none of the articles sold was ever transmitted to the plaintiff. It could be found that the disposal of the articles by Catino constituted a conversion of the plaintiff’s property for which he could be held personally liable even though he was acting as the dealer’s general manager and for its benefit.
Joyce
v.
Sage Bros. Co.
The remaining question is the liability of the defendant Chase. All parties engaged in committing a conversion of the goods of another may be held jointly or severally for the wrong.
McAvoy
v.
Wright,
The plaintiff, while disclaiming any liability upon the part of Chase for the conversion of the articles set forth in the declaration because of the mere receipt by Chase of the proceeds of the sales made by Catino, 1 contends that Chase knew that a part of the funds turned over to him by Catino came from the conversion by the latter of the plaintiff’s property, and that Chase continued to receive these funds without objection, thus assenting to and acquiescing in the wrongdoing of Catino, and used them for the payment of the operating expenses of the dealer. The participation of Chase if shown in the wrongdoing of Catino would make him hable with Catino. 2 On the other hand, unless Chase had a part in the conversion of the goods he could not be held responsible for their loss. 3 The question is whether the evidence was sufficient to require submission of that issue to a jury.
There was evidence that Chase knew that some of the merchandise in the store was obtained by trust receipts issued to the plaintiff but that he did not know the particular articles covered by these receipts. There were articles in the store other than this trust receipt merchandise. Chase made no sales. He visited the store each week and *237 received from Catino a slip showing the business done during the previous week together with the money received by the dealer. He went over the books each month with an accountant. So far as appears none of these slips nor the books were put in evidence. Chase testified that there was nothing on the slips or in the books that indicated that any of the trust receipt goods were being sold. The receipts which he received each week from Catino were deposited in the dealer’s account and paid out to its creditors. There was evidence that at a conference, held after remaining merchandise had been removed from the dealer’s store, between Kelley, Catino, and Chase, Kelley requested payment for all the goods supplied by the plaintiff other than those repossessed by the plaintiff. Chase stated that the corporate dealer and not he had bought the goods, that he knew nothing about the merchandise being sold, that he saw no reason why he should pay, that he had not sold any of the merchandise, and that he did not know that it had been sold. Catino then stated that Chase knew about it as Catino had turned in the money and they had used it to pay other bills. Catino asked Chase how they could have obtained the money to pay these bills if it was not derived from selling this merchandise. Chase made no reply. The conference ended shortly thereafter when Kelley suggested that the defendants were not getting anywhere, arguing between themselves about the matter.
The plaintiff relies principally upon the failure of Chase to reply to Catino’s statement, alleged to have been made at their conference with Kelley, to prove that Chase was cognizant of the fact that Catino was selling this trust receipt merchandise and continued to receive and apply the proceeds for the benefit of the dealer corporation. It is not every failure of a person to deny a statement made to him that can be regarded as an admission by him of the truth of the statement. Evidence of this nature is to be received with care and caution. We are not inclined to extend the scope of the doctrine of admission by silence,
Larry
v.
Sherburne,
It is to be noticed that, just before these statements of Catino, Chase had disclaimed liability and had stated and repeated that he had no knowledge of the sales by Catino. His position as to lack of knowledge was plainly and categorically set forth. These statements of Catino were based upon a conclusion which did not logically follow from the premises from which it was sought to be drawn. The statements of Catino were hardly that Chase knew but were rather the expression of an opinion that Chase possessed such knowledge. Catino at no time stated that Chase knew because he told him, or because he knew from the weekly slips, the examination of the books, or in some other way. What Catino said was an assumption predicated entirely upon the ground that knowledge followed from the weekly receipts turned over by Catino to Chase. In view of the position taken by Chase at this conference we do not think that he was required to repeat his denial of knowledge or to enter into a debate with Catino in order to avoid an inference that Catino was telling the truth. Indeed, as far as appears, there was nothing on the weekly receipt slips to show that any part of these receipts came from this trust receipt property. As already stated, the plaintiff conceded that the mere receipt of these funds from Catino was not sufficient to make out a case of conversion against Chase. We do not think it could be properly found that the circumstances attending the making of these statements by Catino,
*239
if they were made, were such that the natural and reasonable inference from Chase’s silence was an admission by him as to the truth of what Catino had said.
Whitney
v.
Houghton,
It follows that the judge was in error in directing a verdict for Catino and the plaintiff’s exception thereto is sustained, but that the judge was right in directing a verdict for Chase and the exception thereto is overruled. -
So ordered.
Notes
The dealer would have liberty of sale to a bona fide customer in the ordinary course of business without payment of the release price by virtue of G. L. (Ter. Ed.) c. 255A, § 9, cl. 2 (c), if a controversy arose between the plaintiff or the dealer and the customer. •
Fillebrown
v.
Hayward,
See
Polley
v.
Lenox Iron Works,
Lawrence Trust Co.
v.
Sun-American Publishing Co.
Goodwin
v.
Simpson,