Mattson v. Commercial Credit Business Loans, Inc.
Oregon Supreme Court
723 P.2d 996 (1986)
West Coast Lumber Sales, contracted to remove and sell timber from Mattson's (plaintiff's) property, removed and sold additional timber without permission; while Mattson's separate conversion suit against West Coast was pending, and with West Coast having informed Commercial Credit Business Loans (defendant) of that pending litigation, Commercial extended West Coast a line of credit. After Mattson won a money judgment against West Coast, West Coast filed for bankruptcy, and Commercial claimed a security interest in all West Coast assets, including proceeds from the wrongfully taken timber; Mattson sued Commercial for those proceeds, the trial court granted Commercial summary judgment, and the court of appeals affirmed before Mattson appealed further.
Whether, if a person knowingly wrongfully transfers another's property to a third party, the other person can enforce a constructive trust so long as the third party is not a bona fide purchaser.