Present: All the Justices 

HARTZELL FAN, INC. 

v. Record No. 971772 OPINION BY JUSTICE BARBARA MILANO KEENAN 

 September 18, 1998 

WACO, INC. 

FROM THE CIRCUIT COURT OF THE CITY OF RICHMOND 

Melvin R. Hughes, Jr., Judge 

 In this appeal from a judgment entered in a garnishment 

proceeding, we determine whether a manufacturer's sales 

representative was the "agent" of the manufacturer within the 

meaning of Code § 8.3A-420 and was liable to the manufacturer 

for conversion of six checks. 

Hartzell Fan, Inc. (Hartzell) is an Ohio corporation that 

manufactures ventilation equipment for industrial uses. In 

April 1992, Hartzell executed a contract with Intermetrix, Ltd., 

t/a Metrix, Ltd. (Metrix), a Virginia corporation, in which 

Metrix agreed to act as a sales representative for Hartzell's 

products (Agreement). 

In the Agreement, Hartzell contracted to pay Metrix a 

commission for all sales generated by Metrix. The Agreement 

authorized Metrix to obtain purchase orders from customers and 

to submit the orders to Hartzell for approval. After Hartzell 

approved an order and shipped the goods to the customer, 

Hartzell was required to bill the customer for the goods and, on 

receipt of the customer's payment, to pay Metrix a commission. 
Although Hartzell requested its customers to pay Hartzell 

directly, occasionally a customer would deliver payment to 

Metrix. In such cases, the Agreement authorized Metrix to 

"forward immediately to [Hartzell] any and all moneys or 

remittance in any form which it may receive from, or on behalf 

of, the customers in connection with orders placed pursuant 

hereto." The Agreement also provided that Metrix had "no 

authority to receipt for moneys payable to [Hartzell]," and that 

"[i]t is understood and agreed that [Metrix] is in no way the 

legal representative or employee of [Hartzell] and that [Metrix] 

shall perform this agreement as an independent contractor and 

nothing herein contained shall be construed to be inconsistent 

with this relationship or status."1 

In 1995, certain customers ordered Hartzell products from 

Metrix and sent Metrix a total of five checks in the aggregate 

amount of $34,387.93 (Hartzell checks) in payment for those 

products. Although each of the checks was made payable solely 

to Hartzell, Metrix improperly indorsed the checks and deposited 

them in Metrix's account without Hartzell's knowledge or 

consent. 

 1

Although the Agreement states that it is governed by Ohio 

law, the parties have stipulated, for purposes of this appeal, 

that the laws of Virginia and Ohio are the same regarding the 

issues presented. 

2
Another customer, American International, delivered to 

Metrix a check in the amount of $6,865.59 (American 

International check). This check was made payable solely to 

Metrix, which indorsed and negotiated the check. 

In April 1995, Waco, Inc. (Waco) obtained a judgment 

against Metrix in the amount of $147,856.97, plus interest and 

attorney's fees. Waco initiated garnishment proceedings against 

Hartzell in the trial court based on commissions Hartzell 

allegedly owed Metrix. In its answer, Hartzell stated that it 

did not hold any monies due Metrix because Metrix had 

"improperly cashed" the Hartzell checks and the American 

International check. 

Attached to Hartzell's answer was an affidavit of Edward A. 

Guillozet, Hartzell's Credit Manager. The affidavit stated that 

Hartzell owed Metrix commissions in the amount of $39,413.13, 

but that when Hartzell subtracted the amount of the checks 

Metrix "improperly cashed," Metrix actually owed Hartzell 

$723.48.2

The trial court stated that Waco's right to recover from 

Hartzell in the garnishment proceeding was the same as Metrix's 

right to recover from Hartzell. The court ruled that Hartzell 

"never acquired any interest" in either the Hartzell checks or 

 2

This amount reflects other minor adjustments made by 

Hartzell that are not at issue on appeal. 

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the American International check and, therefore, did not have a 

conversion claim against Metrix. The court concluded that 

Hartzell could not offset the amount of the six checks against 

the monies it owed Metrix, and the court awarded Waco judgment 

in the amount of $33,183.04. 

On appeal, Hartzell argues that it has a claim for 

conversion against Metrix based on Code § 8.3A-420(a), which 

provides: 

The law applicable to conversion of personal property 

applies to instruments. An instrument is also converted if 

it is taken by transfer, other than a negotiation, from a 

person not entitled to enforce the instrument or a bank 

makes or obtains payment with respect to the instrument for 

a person not entitled to enforce the instrument or receive 

payment. An action for conversion of an instrument may not 

be brought by (i) the issuer or acceptor of the instrument 

or (ii) a payee or indorsee who did not receive delivery of 

the instrument either directly or through delivery to an 

agent or a co-payee. 

 Hartzell asserts that under the Agreement, Metrix was its 

"agent" for the limited purpose of receiving checks sent or 

presented to Metrix by purchasers of Hartzell products. Thus, 

Hartzell contends that the six checks at issue were delivered to 

Hartzell when Metrix received the purchasers' checks, and that 

Metrix converted the checks when it wrongfully indorsed and 

negotiated them. As a result, Hartzell asserts that it had the 

right to offset the amount converted by Metrix from the 

commissions owed Metrix. 

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In response, Waco contends that Hartzell does not have a 

right to offset the amount of the six checks because the checks 

were never delivered to Hartzell. Waco relies on the language 

in the Agreement denying Metrix the right to "receipt for" 

monies delivered by Hartzell customers. Waco asserts that since 

Metrix was not authorized to "receipt for" those monies, Metrix 

was not Hartzell's agent and Hartzell did not receive delivery 

of the checks within the meaning of Code § 8.3A-420. Waco also 

argues that Hartzell cannot claim Metrix was its agent because 

the Agreement clearly provided that Metrix was an independent 

contractor, and that "each party [was] an independent entity.” 

Thus, Waco contends that Hartzell is liable to Waco on the 

garnishment summons because Hartzell did not have a conversion 

claim against Metrix and could not offset the amount of the 

checks from the monies Hartzell owed Metrix. 

Initially, we observe that, under Code § 8.01-511, 

garnishment effectively is a proceeding by the judgment debtor 

in the name of the judgment creditor against the garnishee. 

Virginia Builders' Supply, Inc. v. Brooks & Co. Gen. 

Contractors, 250 Va. 209, 213, 462 S.E.2d 85, 88 (1995); 

Virginia Nat'l Bank v. Blofeld, 234 Va. 395, 399, 362 S.E.2d 

692, 694 (1987); Lynch v. Johnson, 196 Va. 516, 521, 84 S.E.2d 

419, 422 (1954); Ayres v. Harleysville Mut. Cas. Co., 172 Va. 

383, 394, 2 S.E.2d 303, 307 (1939). The judgment creditor 

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stands on no higher ground than the judgment debtor and can have 

no right greater than the judgment debtor possesses. Lynch, 196 

Va. at 521, 84 S.E.2d at 422; see International Fidelity Ins. 

Co. v. Ashland Lumber Co., 250 Va. 507, 511, 463 S.E.2d 664, 

666-67 (1995); Jetco, Inc. v. Bank of Virginia, 209 Va. 482, 

488, 165 S.E.2d 276, 280 (1969). Thus, the garnishee may offset 

against the lien of the judgment creditor any amount for which 

the judgment debtor is liable to the garnishee as of the return 

date of the garnishment summons. See id.; Blofeld, 234 Va. at 

400, 362 S.E.2d at 695; see also Curl v. Sparkle Brite, Inc., 

518 S.W.2d 775, 776 (Ky. 1975). 

Under these principles, Waco can assert no greater rights 

in this garnishment proceeding against Hartzell than those 

possessed by Metrix. Therefore, we must consider what right 

Metrix had to recover monies against Hartzell as of the return 

date of the garnishment summons. The parties agree that the 

central issue in resolving this question is whether Metrix was 

acting as Hartzell's agent when it received the checks at issue. 

Under Code § 8.3A-420, Hartzell can maintain a claim for 

conversion of the checks in offset of the commissions due Metrix 

only if Hartzell received delivery of the checks through Metrix 

acting as its agent. 

Agency is defined as a fiduciary relationship arising from 

"the manifestation of consent by one person to another that the 

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other shall act on his behalf and subject to his control, and 

the agreement by the other so to act." Allen v. Lindstrom, 237 

Va. 489, 496, 379 S.E.2d 450, 454 (1989) (quoting Raney v. 

Barnes Lumber Corp., 195 Va. 956, 966, 81 S.E.2d 578, 584 

(1954)); accord State Farm Mut. Auto. Ins. Co. v. Weisman, 247 

Va. 199, 203, 441 S.E.2d 16, 19 (1994); Reistroffer v. Person, 

247 Va. 45, 48, 439 S.E.2d 376, 378 (1994). The party who 

alleges an agency relationship has the burden of proving it. 

Weisman, 247 Va. at 203, 441 S.E.2d at 19; Allen, 237 Va. at 

496, 379 S.E.2d at 454. 

A special agent is one who is authorized to perform one or 

more specific acts in pursuance of particular instructions, or 

within restrictions necessarily implied from the stated acts to 

be performed. Lacey v. Cardwell, 216 Va. 212, 220, 217 S.E.2d 

835, 841 (1975); Bowles v. Rice, 107 Va. 51, 52, 57 S.E. 575, 

576 (1907); see Stacy v. J.C. Montgomery Ins. Corp., 235 Va. 

328, 331, 367 S.E.2d 499, 500-01 (1988). The powers of a 

special agent must be strictly construed. Id., 367 S.E.2d at 

501; Lacey, 216 Va. at 221, 217 S.E.2d at 842; Bowles, 107 Va. 

at 53, 57 S.E. at 576. 

When, as here, the question of special agency rests on a 

written document, the question presents an issue of law. We are 

not bound by the trial court's ruling on this issue, and we are 

permitted the same opportunity as the trial court to consider 

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the contract language. See C.F. Garcia Enterprises, Inc. v. 

Enterprise Ford Tractor, Inc., 253 Va. 104, 107, 480 S.E.2d 497, 

498-99 (1997); Murphy v. Holiday Inns, Inc., 216 Va. 490, 492, 

219 S.E.2d 874, 875 (1975). 

The authority of a special agent must be ascertained from 

the terms of the instrument itself. Lacey, 216 Va. at 217, 217 

S.E.2d at 839. No authority will be implied from the terms of 

the instrument, except that authority indispensable to the 

exercise of the powers expressly conferred. See Stacy, 235 Va. 

at 331, 367 S.E.2d at 501; Lacey, 216 Va. at 221, 217 S.E.2d at 

841-42; Bowles, 107 Va. at 53, 57 S.E. at 576. 

Although the Agreement specifically stated that Metrix was 

an independent contractor, and not the "legal representative" of 

Hartzell, the use of these terms does not end our inquiry. The 

relationship of parties to a contract does not depend on what 

the parties themselves call the relationship, but rather on what 

the relationship actually is in law. Murphy, 216 Va. at 492, 

219 S.E.2d at 876; Chandler v. Kelley, 149 Va. 221, 231, 141 

S.E. 389, 391-92 (1928). 

Here, the Agreement narrowly defined Metrix's authority 

with regard to payments made by the purchasers of Hartzell 

products. The Agreement specifically stated that Metrix "has no 

authority to receipt for moneys payable to [Hartzell]." 

However, Metrix was authorized by the Agreement to "forward 

8
immediately to [Hartzell] any and all moneys or remittance in 

any form which it may receive from, or on behalf of, the 

[Hartzell] customers." 

This authority to forward payments to Hartzell necessarily 

implied the authority of Metrix to receive payments for 

Hartzell, rather than to return the payments to the customers 

with instructions to pay Hartzell directly. Thus, the language 

of the Agreement, and the authority indispensable to the 

exercise of the power expressly conferred therein, made Metrix 

the special agent of Hartzell for the limited purpose of 

receiving payments from customers and forwarding those payments 

to Hartzell. See Stacy, 235 Va. at 331, 367 S.E.2d at 500-01; 

Lacey, 216 Va. at 220-21, 217 S.E.2d at 841-42. 

Since Metrix was the special agent of Hartzell for this 

limited purpose, Metrix was acting as an "agent" of Hartzell 

within the meaning of Code § 8.3A-420 when Metrix received the 

checks. Therefore, under the terms of the statute, the five 

Hartzell checks were delivered to Hartzell when they were 

delivered to its special agent, Metrix. Because Hartzell 

received delivery of these checks, Hartzell could maintain an 

action against Metrix for their conversion. See Code § 8.3A420. 

The stipulated facts further state that the American 

International check was made payable to and was indorsed and 

9
negotiated by Metrix. Because of this factual difference, we 

will consider the sufficiency of the evidence of the conversion 

claim based on the Hartzell checks before considering the issue 

whether Hartzell could maintain a conversion claim based on the 

American International check. 

The law governing the conversion of personal property is 

applicable to negotiable instruments. Code § 8.3A-420(a). 

Conversion is a tort involving injury to property, in which one 

wrongfully exercises or assumes authority over another's goods, 

depriving him of their possession. Hairston Motor Co. v. 

Newsome, 253 Va. 129, 135, 480 S.E.2d 741, 744 (1997); Bader v. 

Central Fidelity Bank, 245 Va. 286, 289, 427 S.E.2d 184, 186 

(1993). Conversion includes any distinct act of dominion 

wrongfully exerted over property that is in denial of, or 

inconsistent with, the owner's rights. Hairston, 253 Va. at 

135, 480 S.E.2d at 744; Universal C.I.T. Credit Corp. v. Kaplan, 

198 Va. 67, 76, 92 S.E.2d 359, 365 (1956). Generally, the 

measure of damages for the conversion of commercial paper is 

prima facie the face value of the converted instrument. Code 

§ 8.3A-420(b); see American Nat'l Bank of Portsmouth v. Ames, 

169 Va. 711, 746, 194 S.E. 784, 796 (1938). 

The Hartzell checks had a total face value of $34,387.93. 

The stipulated evidence showed that Metrix wrongfully indorsed 

and negotiated these checks, contrary to the express 

10
instructions of the Agreement. Metrix's indorsement and 

negotiation of the checks without permission constitutes a 

conversion because it was a wrongful exercise of authority 

depriving Hartzell of possession and an act of dominion 

wrongfully exerted over the checks inconsistent with Hartzell's 

ownership rights. See Hairston, 253 Va. at 135, 480 S.E.2d at 

744; Bader, 245 Va. at 289, 427 S.E.2d at 186; see also Code 

§ 8.3A-420. Since Metrix converted these checks in violation of 

Hartzell's rights, Hartzell was entitled to offset the total 

amount of those checks from the commissions owed Metrix in 

determining the amount Hartzell owed Waco. See Lynch, 196 Va. 

at 521, 84 S.E.2d at 422; Trust Co. of Norfolk v. Snyder, 152 

Va. 572, 585, 147 S.E. 234, 238 (1929). 

The stipulated facts, however, state that the American 

International check was made payable solely to Metrix and do not 

indicate whether this payment was made for the purchase of 

Hartzell products.3 Based on this record, Hartzell failed to 

present sufficient evidence to support a conversion claim with 

regard to the American International check and, thus, cannot 

deduct the amount of that check from the commissions owed 

Metrix. For the same reason, Waco has no claim against Hartzell 

for any commission allegedly due Metrix based on this check. 

11
In conclusion, we hold that the trial court erred in 

failing to allow Hartzell to offset the amount of $34,387.93 

against the commissions due Metrix, based on Metrix's conversion 

of the Hartzell checks. The trial court did not err, however, 

in failing to allow Hartzell to offset the amount of the 

American International check, because Hartzell failed to prove 

this part of its conversion claim. When, as here, the trial 

court has reached the correct result for the wrong reason in a 

portion of its judgment, we will assign the correct reason and 

affirm that portion of the judgment. Ridgwell v. Brasco Bay 

Corp., 254 Va. 458, 462, 493 S.E.2d 123, 125 (1997); Harrison & 

Bates, Inc. v. Featherstone Assoc. Ltd. Partnership, 253 Va. 

364, 369, 484 S.E.2d 883, 886 (1997); Mathy v. Commonwealth, 253 

Va. 356, 362, 483 S.E.2d 802, 805, cert. denied, ___ U.S. ___, 

118 S.Ct. 414 (1997). On remand, the trial court is instructed 

to offset the amount of $34,387.93 from the total amount due 

Metrix from Hartzell, and to enter final judgment against 

Hartzell in favor of Waco for any sum remaining due to Metrix as 

of the return date of the garnishment summons. See Blofeld, 234 

Va. at 400, 362 S.E.2d at 695. 

For these reasons, we will affirm in part, and reverse in 

part, the trial court's judgment and remand the case for entry 

 3

The affidavit of Edward Guillozet does not resolve this 

question because it refers only to checks made payable to 

12
of a final judgment order in accordance with the principles and 

directives stated in this opinion. 

Affirmed in part,

reversed in part,

 and remanded. 

 

Hartzell. 

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