Genin v. Schwenk

Barrett, J.

I dissent from the proposition that it was necessary to characterize the defendant’s relation to the plaintiff in the formal words of the Code. The complaint clearly showed such relation, and upon the facts stated the notes or their proceeds were fraudulently misapplied by the defendant while acting in a strictly fiduciary capacity. It is not a case of reasonable inference on that head, but of absolute certainty. It was not a case of a business agency, but of a single and special transaction, where the defendant was to do just one thing for the plaintiff, and where, in doing that one thing, he necessarily acted in a fiduciary capacity. I dissent, also, from the proposition that it was necessary to repay the $901 before the plaintiff had a right to demand the Holly notes. It is alleged that the payment of this sum was really on account of the notes, although the pretense of a loan or advance was put forward. If the defendant had the plaintiff’s money in his hands, and turned over part of it, the plaintiff had a perfect right to sue for the balance. He surely cannot be required to return his own money, which was part of the sum fraudulently converted, as a prerequisite to suing for the balance. But I concur in the result, for the reason that the complaint is improperly in the alternative, arid that it is impossible, as it reads, to frame such a distinct issue as is contemplated by subdivision 2 of section 549 of the Code. The plaintiff cannot state that' the defendant parted with the notes for his own benefit, and in the same sentence aver that the defendant still retains the notes. Still less can he allege, in an alternative sequence, that the defendant yet retains the notes, or renewals thereof, or the proceeds realized from the discount of the notes. Under this subdivision of section 549 the defendant can only be arrested where the action is brought to recover for money received in a fiduciary capacity, or to recover property or damages for the conversion or misapplication of property by some person in such fiduciary capacity. And it must be alleged in the complaint that the money was received, or the property embezzled or fraudulently misapplied, by such person in a fiduciary capacity. The issue to be thus tendered must be clear and precise. Here it is impossible to tell whether the plaintiff is suing for the conversion of the original Holly notes, or for the conversion of the renewals, ■or for the proceeds of the original notes, or for the proceeds of the renewals. "We cannot, say, therefore, whether the action is for money received in a fiduciary capacity, or for property fraudulently misapplied. Considering the provision that the plaintiff cannot recover upon the trial unless he proves the allegation of his complaint on this head, it is perfectly evident that an order of arrest should only be granted in such a case where a single cause of action embracing some one ground specified in the section is clearly and definitely stated. The order should therefore be affirmed, with costs.