Opinion:W.P. Bistro Tulsa v. Henry Real Estate, 2022 OK CIV APP 24
Subject matter:Conversion
Date Decided:October 19, 2021
Trial Court:District Court of Tulsa County
Route to this Court:Henry Real Estate and Tony R. Henry appealed the trial court’s September 26, 2020 Journal Entry of Judgment in favor of Appellee W. P. Bistro Tulsa, following a non-jury trial, on the claim of conversion, including the awards for damages, plus interest thereon, and for expenses in connection with the pursuit of the items Appellants converted.
Facts:W.P. Bistro executed a sublease with Henry Real Estate (HRE) for commercial restaurant space. W.P. Bistro opened in 2010 and closed in October 2013. A second restaurant, HopBunz, which was owned by Defendant All Natural Burgers (ANB) of Tulsa #2, operated in the space from October 2013 until September 2016. In 2017, Torchy’s Tacos, which was owned by Defendant Success Foods Management Group, LLC, opened and continues to operate to this day.

After W. P. Bistro’s concept failed, the space was subsequently leased by HRE to ANB. Concurrently, Henry, on behalf of the Appellee, negotiated the sale of furniture, fixtures, and equipment (“FF&E”) and leasehold improvements located in the restaurant space to ANB. While ANB initially made payments, HopBunz ultimately closed and ANB defaulted on the note that was perfected by a lien on the FF&E. After HotBunz’s closure, Henry marketed the restaurant space and entered into a sublease with Torchy’s Tacos  Appellee sought to gather all its assets and sell its collateral and began its dissolution.

The FF&E was all left in the space, and Torchy’s Tacos planned to begin its renovation of the property. It requested that Henry clear out the space and he sold the FF&E. Appellee alleged that the Appellants and the mentioned Defendant’s committed conversion by knowingly and wrongfully transferring and disposing of some part or all of the FF&E in complete disregard for Appellee’s ownership and its perfected security interest.

The conversion claim was taken at a non-jury trial and the court rendered judgment in favor of the Appellee on the conversion claim, finding that Appellants were jointly and severally liable to W. P. Bistro in the amount of $78,500 as the value of the converted collateral, interest for $17,073.75, plus reasonable recovery cost of the items converted in the amount of $10,350, for a total judgment of $105,923.75.
Standard of Review:When a motion for summary judgment is denied (as it was in this case) and a trial occurs, this Court will not inquire “into the correctness of the pretrial ruling” nor “review th[e] case on pretrial submissions alone” because the post-trial review of a motion for summary judgment is not reviewable on appeal. Myers v. Missouri Pacific Railroad Co., 2002 OK 60, ¶ 39. While “[o]ur refusal to grant review of a denial of summary adjudication does not preclude post-trial appellate review of the contention that a party was entitled to judgment as a matter of law,” Myers, 2002 OK 60, ¶ 41, “[w]e review only that process by which the actual disposition of the case was made,” id. ¶ 39.
Analysis:The Court first addressed the appeal on the trial court’s rejection of HRE’s motion for summary judgment on the issue of standing. The Court rapidly disregarded this argument, because HRE argued that Mr. Eller, who was the analyst hired by Appellee’s to perform an analysis of the assets of the entity and provide assistance in the entity’s dissolution, and Mr. Eller did not file the suit. Therefore, there clearly was standing.

HRE argued that there was insufficient evidence to support the trial court’s judgment. In response, the Court utilized the deferential standard of “any competence standard.” Here, the trial judge acted as the trier of fact and the Court thus had to accept the trial court’s findings only “if those findings are supported by competent evidence.” Hagen v. Indep. School Dist. No. I-004, 2007 OK 19, ¶ 7.

Next, the Court dealt with the contention that the trial court erred in ruling that Appellee did not abandon the property. In support of its argument, HRE used Murray v. Borg Compressed Steel Co., 1954 OK 182. While Appellants rightly stated that Murray reinforces Oklahoma law in that abandonment is a valid defense for conversion, the trial court found that there was no abandonment. In order for the Court to overrule the trial court’s finding, since it was the trier of fact, reversible error must be demonstrated only by proof that there was no competent evidence to support the judgment. The Court relied on the standard set forth in Gowens v. Barstow, 2015 OK 85, ¶ 26., which stated that if there is competent evidence to support the judgment of the bench trial, then that judgment is not to be disturbed even if the record might also support a conclusion different from the trial court’s decision.

In response to HRE’s argument that the trial court erred in its valuation judgment of the converted property, the Court rejected that argument despite the appraisal that was relied on was performed more than two years before the date the items were converted. The appraisal was not outdated, because that was the value that a customer would have paid for the items at the time the appraisal was conducted.

In responding to the contention that the trial court erred in rewarding $10,350 as the cost of recovery of the converted items, the Court rejected that argument because the trial court had the opportunity to hear and review competent evidence, which included Mr. Eller’s efforts to recover the items, the Court did not want to second-guess the trial court’s reward. The Court reasoned this way because trial judges are in the best position to evaluate the demeanor of the witnesses and to gauge the credibility of the evidence.

The Court distinguished between the Appellants’ liability on this matter, holding that Mr. Henry was at fault because of his physical actions of removing the furniture and disposing of it. HRE was liable only under the theory of respondeat superior based on its legal relationship between the parties rather than just one party being at fault. Vicarious liability does not, in other words, constitute liability “based on fault” as defined in 23 O.S. § 15. Because only Henry (rather than both Henry and HRE) was technically at fault, the trial court’s finding that Henry and HRE were jointly and severally liable on the judgment was based on competent evidence, and the Court would not disturb it here.
Outcome:The trial court’s journal entry of judgment on these matters is affirmed in its entirety.
Vote:3-0. Goree, P.J., Mitchell, J., and Prince, J. (author) concur.
Other: N/A.