Sanchez v. Saylor

2000-NMCA-099, 129 N.M. 742, 13 P.3d 960

 

RULE:

The appellate court indulges every presumption in favor of the correctness of the findings, conclusions, and judgment of the district court. When it reviews a substantial evidence claim, the question is not whether substantial evidence would have supported an opposite result; it is whether the evidence supports the result reached. There may be other facts that, if believed, might support a different result, but it disregards them. It is for the trial court to weigh the testimony, determine the credibility of witnesses, reconcile inconsistent statements, and determine where the truth lies.

FACTS:

Sanchez and Saylor were the general partners of RSRS, which was formed to purchase the Fidelity Square Shopping Center (the shopping center). RSRS sold the shopping center to Fidelity Square Limited (Fidelity-Arizona), an Arizona Limited Partnership, and received two unguaranteed promissory notes secured by a mortgage as partial consideration for the sale. Fidelity-Arizona defaulted on the notes. In a refinancing, Fidelity-Arizona received funds from Golddome Credit Corporation (Golddome), and RSRS subordinated its mortgage to a Golddome first mortgage. Fidelity-Arizona then defaulted on its obligations to RSRS and Golddome. After RSRS filed a foreclosure action, Fidelity-Arizona filed bankruptcy in Arizona. The court held Saylor liable in conversion.  Sanchez and Saylor also were the general partners in Coors. Saylor managed this partnership, which owned commercial rental property. The court denied Sanchez any profits derived from Saylor's conversion. Sanchez on the other hand refused to provide personal financial statements to obtain a refinancing for Coors because Sanchez feared that United would discover them and seek execution against his assets. The court found this refusal to be part of Sanchez's "ongoing efforts to deceive his creditors about his assets." The court concluded that this conduct constituted breaches by Sanchez of his fiduciary duties to Coors. Saylor now appeals from an adverse judgment holding him liable in conversion and awarding $ 250,000 to Sanchez.

ISSUE:

Whether there was sufficient evidence to hold Saylor liable for conversion.

ANSWER:

No.

CONCLUSION:

The court affirmed the $250,000 award to Sanchez. An appraisal, the market transaction that included forgiveness of the notes, and defendant's resale sufficiently evidenced the conversion amount awarded against him.  Thus, there was market evidence to justify the conversion amount. As for Saylor’s prayer for damages because of Sanchez’s alleged breach of fiduciary duty, Sanchez had been on notice that the suit involved the latter partnership as party, though it had not been so named. Sanchez had not objected to tabulation of Saylor’s services expenses nor sought relief as to allegedly frustrated discovery of their proof. Sanchez’s failure to provide personal financial statements for a certain failed refinancing did not constitute an intentional tort against the partnership.

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