Kipp Supply Co. v. Richfield Oil Co.

YORK, J.

This is an action in conversion to recover the value of certain oil-well machinery and equipment. At the trial of the cause the plaintiff presented its case, and at the conclusion thereof, defendants made a motion for a non-suit, which motion was granted. From the judgment based thereon this appeal is taken by the plaintiff.

The facts involved in the controversy are these: The plaintiff sold on conditional sales contract to C. P. Harrel on February 4, 1925, a lot of machinery and equipment to be used in oil-drilling operations upon certain real property situated in Athens; and under date of March 2, 1925, sold another lot of similar equipment under a like contract to E. E. Short, which was delivered to another parcel of land situated in the city of Los Angeles, upon which latter parcel a party named Brice owned an oil lease. Said Brice, on March 11, 1925, assigned his interest in the oil lease to John

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W. Henderson and made an agreement with him, whereby Henderson was to drill upon the property in return for a percentage of the oil produced, the contract reciting that Brice had made arrangements to secure and pay for out of oil, etc., certain drilling equipment. A similar agreement was made between Harrel and Henderson as regards the parcel of land in Athens. Henderson then assigned his interests to the Henderson Petroleum Company on March 28, 1925, which company in turn assigned all its property and assets to the Richfield Oil Company on October 21, 1926, and was later officially dissolved by a decree of court. Meantime, on May 14, 1926, the plaintiff corporation made an assignment of its assets for the benefit of creditors, reserving to itself any surplus after satisfaction of creditors.

The complaint herein alleged that during the period of ownership of the various pieces of machinery and equipment by the plaintiff, and on or about July 1, 1925, the Henderson Petroleum Corporation and John W. Henderson, being then in possession of all of said personal property and with full knowledge of plaintiff’s ownership and right of possession thereof, unlawfully and without consent of the plaintiff, converted the same to their own use and disposed thereof to the defendant Richfield Oil Company.

The answer of defendants denied knowledge or notice of any right or interest of the plaintiff in or to the said personal property and alleged that the plaintiff, by its own negligence, clothed said Short and Harrel with all