Court Opinion

ID: 9514285
Source: CourtListenerOpinion
Date Created: 2023-08-06 22:48:28.647378+00
Date Added: 2024-06-11T09:06:15.861902
License: Public Domain

*101SABERS, Justice,
concurring in part, concurring specially in part.
[¶ 48] The majority opinion errs by interpreting too narrowly SDCL 21-3-3, which provides in part:
SDCL 21-3-3. Presumed damages for wrongful conversion of personal property — Presumptions conclusive when possession wrongful from beginning. The detriment caused by the wrongful conversion of personal property is presumed to be:
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(3) A fair compensation for the time and money properly expended in pursuit of the property!].]
[¶ 44] The majority opinion concludes that “SDCL 21-3-3 is insufficiently specific to allow attorney fees as damages in a conversion action.” In my view, the language of the statute includes attorney fees as damages as long as they are shown to be “a fair compensation for the time and money properly expended in pursuit of the property.” In Northwestern Pub. Serv. Co. v. City of Aberdeen, 90 S.D. 627, 244 N.W.2d 544 (1976), this court denied the recovery of attorney fees under SDCL 21-3-3, not because they were unavailable under that statute but only because the defendants did not have a claim for wrongful conversion. Id. at 639, 244 N.W.2d at 550. Our statutes are to be given a liberal construction with a view to effect their objects and to promote justice. SDCL 2-14-12. The problem here was not in the statute, but in the proof. Schuldies never offered any evidence of the attorney fees and expenses incurred in pursuit of the property. In the absence of proof, the trial court had no option except to deny them.4
[¶45] The majority opinion gives short shrift to the case and treatise authorities it cites. See authorities cited in latter parts of ¶¶ 37 and 38 of the majority opinion. In fact, in Colton v. Decker, 540 N.W.2d 172, 178 (S.D.1995), Justice IConenkamp stated in part:

Attorney Fees

Colton incurred legal fees in South Dakota attempting to clear the title and retrieve the truck from Wyoming. The trial court allowed these fees as damages under SDCL 57A-2-715. As an element of damages, the attorney’s fees were reasonable expenses incident to the impoundment for clouded title. Kelynack v. Yamaha Motor Corp., 152 Mich.App. 105, 394 N.W.2d 17 (1986); Cady v. Dick Loehr’s, Inc., 100 Mich.App. 543, 299 N.W.2d 69 (1980).
It is unclear how SDCL 57A-2-715 could be deemed “specific” on the issue of attorney fees (allowing for “expenses reasonably incurred”) and SDCL 21-3-3 not specific enough (providing for “a fair compensation for the time and money properly expended in pursuit of the property.”). Although Colton held that the trial court did not abuse its discretion in denying other attorney fees as damages under other UCC provisions, it does not mean attorney fees cannot be awarded as damages in proper cases.
[¶ 46] Even the Leubsdorf treatise referred to by the majority contradicts the position taken in the majority opinion because it supports expansion of attorney fees as damages in proper cases.
[¶ 47] The majority opinion also relies upon Haines, 239 Cal.Rptr. at 181 for the California Court of Appeal’s holding that attorney fees were unrecoverable under an identical statute. One year later, that court modified its position:
When Civil Code section 3336 was enacted in 1872, the legislature may have contemplated compensation for time spent searching the countryside in search of misappropriated livestock or other chattels. But [the plaintiff in this case] could only rely on legal process to recover the property that [defendants] withheld.
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*102Under modem conditions, the legislative purpose of Civil Code section 3336 would be defeated by rigorously excluding all items having some connection with litigation. The statute should at least extend to efforts that had a purpose independent of the litigation, such as preparation of lists of missing property, inspection of inventories, meetings with [defendants], contacts with law enforcement authorities, and inquiries regarding appropriate courses of action. The record of these items is sufficient to sustain the relatively modest award of $10,000 here.
Gladstone v. Hillel, 203 Cal.App.3d 977, 250 Cal.Rptr. 372, 381 (1988) (upholding award despite defendants’ argument it was improper because it was based on time and expense incurred in preparation for litigation). Accord Harwood State Bank v. Charon, 466 N.W.2d 601, 606 (N.D.1991) (agreeing with Gladstone but refusing award when attorney submitted unitemized bill).
[¶ 48] Other jurisdictions have also found that “pursuit” expenses recoverable in a conversion action may properly include attorney fees. See, e.g., Rollins v. Leibold, 512 P.2d 937, 945 (Alaska 1973) (including attorney fees in a list of costs which flow directly from the conversion); Motors Ins. Corp. v. Singleton, 677 S.W.2d 309, 315 (Ky.Ct.App.1984) (“attorney fees incurred in recovering possession of the property [are compensable].”); Larson v. Van Horn, 110 Mich.App. 369, 313 N.W.2d 288, 295 (1981) (“[T]he intentional tort of conversion ... is not unlike actions for false imprisonment and malicious prosecution, where the recovery of attorney fees has been allowed.”); Bench Billboard Co. v. City of Columbus, 63 Ohio App.3d 421, 579 N.E.2d 240, 244 (1989) (noting plaintiffs’ attorney fees are properly recoverable as special damages in cases of conversion); Fulks v. Fulks, 95 Ohio App. 515, 121 N.E.2d 180, 182 (1953) (“Attorney fees incurred by the plaintiff in the prosecution of this action are not recoverable since the plaintiff is not seeking punitive damages, but attorney fees spent in recovering possession of the [property], which is properly pleaded in this case, is a proper item of special damages[.]”).
[¶ 49] Some cases hold that only the portion of the attorney fee which is traceable to pursuit of the property is recoverable. See Cincinnati Ins. Co. v. Diebold, Inc., 64 Ohio App.3d 273, 581 N.E.2d 566, 570 (1989) (pointing out Fulks was an action to recover possession of property and that plaintiffs would be responsible for their own fees in an action to recover money damages for wrongful conversion); Cf. First Nat’l Bank of Santa Fe v. Southwest Yacht & Marine Supply Corp., 101 N.M. 431, 684 P.2d 517, 522 (1984) (awarding defendant reasonable attorney fees incurred in quashing a wrongfully issued writ of replevin, but none for otherwise defending the replevin action).
[¶ 50] Therefore, I agree with the majority’s affirmance of the trial court’s denial of attorney fees as damages in this case because of lack of proof and evidence, but I do not agree with the narrow interpretation of the statute, SDCL 21-3-3.5

. It is interesting to note that the majority's narrow interpretation results in an overbroad conclusion. The decision should simply be that the trial court did not abuse its discretion. To express the holding in language that there is no “authority” to award attorney fees as damages in conversion cases is surplusage, unnecessary to the actual holding, and therefore dicta. This results in a minor paradox in the majority opinion. An interpretation too narrow, resulting in a holding expressed in language too broad.

. It should be noted that the Legislature even made "fair compensation for the time and money properly expended in pursuit of the property” a "presumed” damage or "conclusive” presumption which cannot be repelled in favor of one whose possession, as here, was wrongful from the beginning. SDCL 21-3-3.