Opinion
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
Alameda County Super. Ct. No. HG03111025.
GEMELLO, J.
Following a bench trial, the trial court entered judgment against plaintiff Dean C. Hanson on his complaint alleging that defendants converted a helicopter stored by defendant Rodger Ainsworth. Hanson contends that the court erred in concluding that his conversion claim is barred by the three-year statute of limitations. We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
Plaintiff Dean Hanson purchased the helicopter in 1972. The helicopter was registered with the Federal Aviation Administration (FAA) to D & H Enterprises at an address in Nevada. In August 1993, Hanson reinstated the registration.
In 1995, Hanson asked defendant Rodger Ainsworth, a helicopter mechanic doing business as The Flight Center, to perform an inspection of the helicopter in order to return the helicopter to an airworthy condition. Ainsworth transported the helicopter from Concord Airport to his facilities in Stockton.
When Ainsworth took possession of the helicopter in 1995, its registered owner was still D & H Enterprises in Nevada. Hanson never changed the registered address or the name of the registered owner. He never provided Ainsworth with another address.
Ainsworth disassembled the helicopter to inspect it and faxed a report to Hanson on October 31, 1995. After receiving the repair estimate, Hanson decided not to go forward with the repairs because he intended to sell the helicopter and did not have a buyer at that time. Hanson testified that Ainsworth agreed to store the helicopter for $100 a month.
Ainsworth testified that he asked Hanson to pay for the inspection and remove the helicopter; he did not agree to store the helicopter. After October 1995, he repeatedly tried to reach Hanson by telephone and fax, without success. He ultimately decided to charge Hanson for storage because the helicopter was left in his facility for so long. He sent Hanson monthly invoices by fax starting in June 1996 but received no response.
In October 1996, Ainsworth sent a letter to D & H Enterprises in Nevada. He wrote that he had been unsuccessful in contacting Hanson, that he discovered through a title search that D & H Enterprises was the legal owner of the helicopter, and that “[t]he storage bill is getting quite costly.” In April 1997, Ainsworth’s counsel wrote to Hanson at the D & H Enterprises address, informed him of the outstanding storage charges, and advised him that Ainsworth would begin lien foreclosure proceedings if payment was not made within ten days. Ainsworth caused a notice of sale to be published in the Stockton Record, a newspaper of general circulation. In June 1997, Ainsworth conducted a lien sale of the helicopter. At the sale, he purchased the helicopter for the amount he was owed.
In August 1999, Ainsworth sold the disassembled helicopter to defendant Dennis James, who does business as Plain Parts. James sold it in turn to Perry Walton, president of defendant P & N Corporation, in December 1999.
Hanson testified that he did not receive the invoices for storage costs or notice of the lien sale. In 2002, Hanson discovered that the helicopter was missing from Ainsworth’s facilities in Stockton. In the approximately six preceding years, Hanson did not contact Ainsworth to inquire about the status of his helicopter. A subsequent search of the FAA’s title reports disclosed that defendant P & N had registered title to the helicopter in 2001. Hanson traveled to Iowa and discovered that the helicopter was being used at a flight school there. P & N refused Hanson’s demand for return of the helicopter.
In August 2003, Hanson filed the present action against Ainsworth, James, and P & N. Hanson challenged the validity of the lien sale and alleged that the sale constituted a conversion of the helicopter. Following a court trial, the court issued a statement of decision concluding that Hanson’s conversion claim is barred by the three-year statute of limitations. The court entered judgment in favor of defendants on Hanson’s complaint.
We rely on the trial court’s statement of decision for some of the procedural facts because the appendix filed by appellant Hanson lacks many basic documents, such as the complaint and the parties’ legal briefs below.
DISCUSSION
I. Statute of Limitations for Conversion
“ ‘ “ ‘Conversion is any act of dominion wrongfully exerted over another’s personal property in denial of or inconsistent with his rights therein.’ ” ’ [Citation.] One who buys property in good faith from a party lacking title and the right to sell may be liable for conversion. [Citations.] The remedies for conversion include specific recovery of the property, damages, and a quieting of title.” (State Farm Mut. Auto. Ins. Co. v. Department of Motor Vehicles (1997) 53 Cal.App.4th 1076, 1081.)
Code of Civil Procedure section 338, subdivision (c) provides for a three-year statute of limitations for conversion actions. Ordinarily, the statute of limitations begins to run from the date of the conversion even though the injured owner is ignorant of the violation of his property rights. (Strasberg v. Odyssey Group, Inc. (1996) 51 Cal.App.4th 906, 916 (Strasberg); Naftzger v. American Numismatic Society (1996) 42 Cal.App.4th 421, 429 (Naftzger).) This is consistent with the general rule that the statute of limitations begins to run when a cause of action accrues and that an action accrues on the date of injury. (Naftzger, at p. 428.)
Code of Civil Procedure section 338, subdivision (c) states in relevant part that an action “for taking, detaining, or injuring any goods or chattels, including actions for the specific recovery of personal property” must be filed within three years.
Hanson’s conversion cause of action is based on the alleged invalidity of the lien sale. If we assume that the lien sale was invalid, then the conversion took place in 1997 and the statute of limitations began to run on that date. (AmerUS Life Ins. Co. v. Bank of America, N.A. (2006) 143 Cal.App.4th 631, 637, 641-642.)
Hanson argues that P & N’s refusal to return the helicopter in 2002 constituted a separate conversion and commenced a new limitations period. However, the doctrine of conversion by demand and refusal only applies where there has been no prior act inconsistent with the owner’s property rights, that is, where the wrongful dominion over the owner’s property does not arise until the refusal of the demand. (Coy v. County of Los Angeles (1991) 235 Cal.App.3d 1077, 1087-1088; see also Naftzger, supra, 42 Cal.App.4th at p. 429.) The court in Coy v. E. F. Hutton & Co. (1941) 44 Cal.App.2d 386, rejected a plaintiff’s argument that refusal of a demand started a new limitations period where a conversion had taken place earlier. There, the defendant brokerage firm sold plaintiff’s stock without plaintiff’s authorization. Plaintiff failed to file his lawsuit within three years of that conversion, but he argued that his cause of action for conversion did not accrue until he demanded return of the stock. (Id. at p. 390.) The court rejected the argument, stating “It is well settled . . . that where possession is obtained lawfully and there has been an actual conversion, a demand is not necessary [citations]; the cause of action for conversion is complete at the time of the wrongful disposal of the property, and the statute starts to run from that time.” (Ibid.) “ ‘[T]he running of the statute cannot be extended by making a tender and demand at a later date.’ ” (Ibid.)
First National Bk. v. Thompson (1943) 60 Cal.App.2d 79, is directly on point. There, the plaintiff bank was the owner of a gas shovel, which it authorized an individual named Higgins to sell. Higgins sold the shovel to the defendants, representing himself to be the owner, and kept the proceeds for himself. More than three years later the bank discovered that the shovel was in possession of defendants, and it demanded return of the equipment. The shovel was not returned. The bank filed suit alleging conversion and the court held that the action was barred by the statute of limitations, which started to run on the date of the sale to defendants. (Id. at pp. 81-82.) The court rejected the bank’s contention that the limitations period started to run from the date of its demand for return of the shovel, reasoning “The facts prove a conversion by [defendants] though innocent purchasers of the property. . . . under such circumstances no demand was legally necessary as a prerequisite to the accrual of the cause of action.” (Id. at p. 82.)
Because Hanson alleges that the lien sale was unlawful, as he must to assert a present right to the helicopter, the statute of limitations began to run in 1997 and his lawsuit is untimely. Hanson does not contend that the defendants had lawful possession of the helicopter until the moment when his demand for return was refused; rather, Hanson contends that possession by all the defendants was unlawful throughout. (See Strasberg, supra, 51 Cal.App.4th at p. 919 [persons who receive property from one without legal title have no claim to the property as against the rightful owner].)
Hanson points out that commentary to section 229 of the Restatement of Torts 2d suggests that a subsequent purchaser’s refusal to surrender property on demand “may constitute a separate act of conversion.” However, the text does not discuss the statute of limitations; in particular, it does not state that such a refusal could extend a limitations period that began to run at the time of the initial conversion.
The Iowa case cited by Hanson, Schwanz v. Farmers’ Co-op Co. (1927) 214 N.W. 491, is consistent with the California cases. There, a bank sought to assert its mortgage over livestock sold to a third party. The court emphasized that the sale itself did not affect a conversion, stating “Neither the lien nor the right of the mortgagee to at any time possess itself of the property under its mortgage or to recover its value… was in any way affected by the sale thereof by the mortgagor or its purchase by appellant.” (Id. at p. 494.) Instead, a conversion would only occur if the purchaser refused to turn over the property upon demand from the bank. (Ibid.) The court did not consider whether, where a conversion is complete at the time of sale, a subsequent refusal creates a new conversion that extends the statute of limitations.
Hanson appears to argue that Iowa law controls. Even assuming that Hanson raised the issue below, he fails to provide reasoned analysis and citations to authorities showing the trial court’s implied choice of law determination was in error. (Badie v. Bank of America (1998) 67 Cal.App.4th 779, 784-785.)
II. Fraudulent Concealment
Hanson contends that the statute of limitations was tolled until his discovery of the sale of the helicopter in 2002 because Ainsworth fraudulently concealed the conversion. (Strasberg, supra, 51 Cal.App.4th at p. 916; Naftzger, supra, 42 Cal.App.4th at p. 429.) The trial court found that there was no fraudulent concealment. The trial court noted that Ainsworth tried to contact Hanson by telephone and fax, sent registered mail to the address listed with the FAA, and published notice of the lien sale. The trial court further reasoned, “Plaintiff could point to no active misrepresentations by Ainsworth. Plaintiff made no inquiry of Ainsworth for six years, he admitted that he knew of no efforts by Ainsworth to hide the helicopter from him, that Ainsworth made no misrepresentations to him and that Ainsworth never concealed the fact that he would charge for the inspection. In short, the court can find no active misrepresentations or concealments on the part of Ainsworth.” Substantial evidence supports trial court’s finding of no fraudulent concealment. (Winograd v. American Broadcasting Co. (1998) 68 Cal.App.4th 624, 632.)
Hanson contends that there was fraudulent concealment in that Ainsworth and the other defendants failed to properly document their sales and register the sales with the FAA. However, he cites to no evidence showing that more careful documentation would have resulted in notice to him or that he made any efforts to track down the helicopter before 2002.
Hanson contends that he “deposit[ed]” the helicopter with Ainsworth and that Ainsworth had a duty under Civil Code section 1825 to provide “prompt notice” to Hanson of the lien sale. Even assuming that to be true, Hanson fails to explain why Ainsworth’s efforts to contact Hanson by phone and fax and by written notice to the registered owner in Nevada did not satisfy Ainsworth’s duty under the statute. As the trial court found, Hanson “provided no credible explanation as to why he did not comply with the FAA recording requirements and registered the aircraft under an unrecorded, unpublished fictitious name. [Hanson’s] assertion that he did not receive actual knowledge of the lien sale is a problem of his own making. Both Ainsworth and Walton made extensive efforts to contact [Hanson] and were unable to find him.”
This case is in marked contrast to Strasberg, supra, 51 Cal.App.4th 906 and Naftzger, supra, 42 Cal.App.4th 421, cited by Hanson. In Strasberg, the court found fraudulent concealment where the administrator of an estate concealed the existence of personal property from the beneficiary (Strasberg, at p. 918), and in Naftzger, a thief stole coins from a museum and substituted coins of lesser quality so the theft was not discovered for decades (Naftzger, at p. 429). The plaintiffs had no reasonable opportunity to discover the wrongs that had been committed because in Strasberg the plaintiff had no idea the property existed and in Naftzger the plaintiff had no reason to inspect the substituted coins. In contrast, Hanson knew that his helicopter was in Ainsworth’s possession and that Ainsworth was not storing it free of charge, yet he failed to inquire about the helicopter for six years. (See Naftzger, at p. 431.)
The statute of limitations started to run in 1997 and it was not tolled by fraudulent concealment. Hanson’s lawsuit is untimely. Because we conclude that Hanson’s claim is barred by the statute of limitations, we need not address his contention that the lien sale was unconstitutional.
DISPOSITION
The judgment is affirmed.
We concur. JONES, P.J., SIMONS, J.
Hanson separately argues that the statute of limitations was tolled until 2002 under the “doctrine of delayed discovery.” However, the delayed discovery rule does not apply to conversion actions absent evidence of fraudulent concealment or breach of a fiduciary obligation. (AmerUS Life Ins. Co. v. Bank of America, N.A., supra, 143 Cal.App.4th at p. 639.)