Opinion ID: 1927947
Heading Depth: 2
Heading Rank: 1

Heading: Conversion by Murphy

Text: The Superior Court was well justified in finding defendant Murphy liable for conversion. The record shows that Murphy (1) received certified notice of the Bank's lien on the proceeds of Crochere's settlement with Wentworth; (2) never informed the Bank that he had received a $6,500 settlement check from Fireman's; (3) disbursed the settlement funds during the 30 days after the Superior Court, in Northeast Bank N.A. v. Crochere , ruled that the lien was void ab initio, even though as a lawyer he was charged with knowing that M.R.Civ.P. 62 kept the lien order in force until the appeal period expired; (4) gave Crochere her money during the appeal period and told her that it was hers to spend and did so in knowing violation of the Bank's lien; and (5) after Crochere had spent all the settlement proceeds, filed for her bankruptcy. The record amply supports the Superior Court's conclusion that Murphy committed an intentional exercise of dominion and control over the Crochere v. Wentworth settlement proceeds and in fact seriously interfered with the Bank's lien rights therein. See Ocean National Bank, 462 A.2d at 39-40. Murphy argues that the Superior Court erred in finding him liable for conversion because the lien order was invalid and unenforcible and thus no conversion of any valid property interest of the Bank occurred. However, the validity of the lien on the settlement proceeds in Crochere v. Wentworth is not open to dispute. We held in Northeast Bank N.A. v. Crochere, 438 A.2d 266, 268 (Me.1981), that the lien order of March 24, 1978, became final and beyond attack by any collateral means when Crochere took no appeal therefrom. After the appeal period provided by M.D.C. Civ.R. 73(a) had expired, the Bank had a property interest that Murphy could not lawfully interfere with. Murphy bases the remainder of his argument on three defenses: (1) that the lien was discharged in the bankruptcy of Crochere and that the Bank therefore has no convertible interest; (2) that the Superior Court's order in the Northeast Bank N.A. v. Crochere case finding the lien void ab initio protected Murphy from liability between the time the order was entered and the date the Bank filed its notice of appeal to the Law Court; and (3) that he disbursed the settlement proceeds to himself and other professional creditors of Crochere, which payees had liens superior to the Bank's, thus making him privileged to disburse those amounts. The bankruptcy discharge defense is without merit. Murphy's tortious interference with the Bank's lien rights, by disbursing the entire settlement proceeds, took place well before Crochere filed her petition in bankruptcy on March 28, 1979. Other arguments of Murphy about what might have happened in the bankruptcy proceeding will not be considered because they were not raised in the trial court. See Blanchette v. York Mutual Insurance Co., 455 A.2d 426, 428 (Me.1983). Murphy next argues that he committed no conversion because he disbursed the funds after March 9, 1979, when the Superior Court directed the District Court to rescind the Bank's lien in Northeast Bank N.A. v. Crochere but before April 3, 1979, when the Bank filed its notice of appeal to the Law Court. In doing so, however, Murphy was clearly in violation of both the letter and the spirit of M.R. Civ.P. 62. Rule 62(a) states in pertinent part, [N]o execution shall issue upon a judgment nor shall proceedings be taken for its enforcement until the expiration of 30 days after its entry or until the time for appeal ... has expired. The principle implemented in Rule 62 is that an unsuccessful defendant should have the full appeal period to decide whether to exercise his right to appellate review unharrassed by enforcement of the judgment. 2 Field, McKusick & Wroth, Maine Civil Practice § 62.1, at 86 (2d ed. 1970). Cf. M.R.Civ.P. 62(f) (an attachment remains in force during the time for appeal); 2 Field, McKusick & Wroth, § 62.5, at 90 ([i]f judgment is for the defendant, the attachment is `dissolved forthwith' when a judgment becomes final by virtue of expiration of the time for appeal or by dismissal or decision of an appeal). The Superior Court acted in Northeast Bank N.A. v. Crochere as merely an intermediate appellate court, and Murphy acted entirely at his own peril in relying upon its intermediate decision at a time when it was still subject to appeal to the Law Court. At that time, as at all times after the settlement proceeds came into existence on or before January 9, 1978, the Bank had a lien interest in those proceeds with which Murphy had no legal right to interfere. Finally, we reject Murphy's attempt to justify his action in cutting off the Bank's lien rights on the ground that the physicians, hospital, and attorneys to whom he disbursed the settlement proceeds had liens enjoying a priority ahead of the Bank's. At common law physicians have no lien on damages recovered on a personal injury claim, Marsh v. LaMarco, 75 Misc.2d 139, 351 N.Y.S.2d 253, 258-59 (1973); and no Maine statute gives physicians any such lien. Maine hospitals, however, do have a statutory lien, see 10 M.R.S.A. § 3411 (Supp.1985); and attorneys, we will assume without deciding, have a common law lien on settlement proceeds. But see Averill v. Longfellow, 66 Me. 237, 238 (1876) (Before [judgment], the parties may settle and disregard the claims of the attorney). Nonetheless, Murphy's priorities argument is in the nature of an affirmative defense on which he bears the burden of proof. See Dougherty v. Oliviero, 427 A.2d 487, 489 (Me.1981). See also 1 Field, McKusick & Wroth, §§ 8.7, 8.20. He failed to establish that the attorney's fees he disbursed related only to legal services on Crochere v. Wentworth or that the hospital payee ever did anything to assert or perfect its potential statutory lien. Overall, Murphy's priorities argument is unconvincing as an after-the-fact justification for his complete destruction of the Bank's lien interest, because he did nothing to have the District Court that created the Bank's lien, or any other tribunal, determine the existence or relative priorities of any liens against those settlement proceeds. It is now too late to claim that his actions were taken in an attempt to conform to some hypothetical and at best uncertain legal priorities. In conclusion, we find no merit in Murphy's attack upon the Superior Court's conclusion that he is liable to the Bank for conversion of its lien interest in the Crochere v. Wentworth settlement proceeds.