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filed: September 23, 1983.


No. 17 Harrisburg, 1982, Appeal from the Order of the Court of Common Pleas, Dauphin County, Civil, at No. 48 January Term, 1975.


Jack M. Hartman, Harrisburg, for appellant.

Wayne C. Parsil, Harrisburg, for appellees.

Wickersham, Beck and Montemuro, JJ.

Author: Montemuro

[ 319 Pa. Super. Page 435]

Plaintiff-appellees, Darrell and Ivan Northcraft, brought an action in trespass for conversion against defendant-appellant, Edward C. Michener Associates, Inc., t/d/b/a Technical Diversification Services (hereinafter TDS). Appellees alleged that the appellant converted, by refusal to deliver upon proper demand, parts and plans of an invention of Darrell Northcraft, alleged to be in the possession of the appellants. The jury found in favor of the Northcrafts and awarded them damages in the amount of Ten Thousand, Five Hundred ($10,500.00) Dollars. The appellant's post-verdict motions were denied and the present appeal followed.

Appellant raises two issues herein. First, that the trial judge erred in denying the appellant's post-verdict motions for judgment n.o.v., or for a new trial, because the evidence was insufficient to make out a cause of action for conversion. Second, the appellant contends that the trial court erred in allowing improper evidence regarding damages. Since the plaintiff's cause of action is premised upon a somewhat novel theory, we believe a full recitation of the pertinent facts is in order.

Darrell Northcraft is a mechanic who operates a garage specializing in automobile repairs. He has also been involved in auto racing, specifically the racing of "modified sport cars." His experience with racing led him to invent a device called a two speed quick change differential. This differential would allow race drivers to change the gear ratios between the drive shaft and the rear wheels while on the track without making a pit stop. The device increases the car's efficiency and adaptability to changing track conditions. Northcraft obtained a patent for the device on

[ 319 Pa. Super. Page 436]

February 29, 1972. He then set out to have a prototype of the differential constructed.

In pursuit of this goal, Northcraft met with one Wayne Culver, the head of TDS. TDS was the engineering branch of Edward C. Michener Associates, Inc., which is primarily a company which seeks out new consumer products and attempts to market them. Culver agreed, on behalf of TDS, to construct a prototype of the differential at a cost of $4,150.00. Northcraft also turned over to TDS the patent abstract and several parts which might be used or adapted for use in the differential, including a differential housing and a ring gear and pinion. TDS apparently commenced work on the project in August, 1972.

In January, 1973, the appellant sent a bill to Northcraft for work completed on the project. The accompanying letter read, in part: "As you know, we are waiting for the return of new gears from the vendor. As soon as these come in we can quickly assemble the device and you are ready for testing." Northcraft testified that after reading the letter he "thought that we were almost ready to test the differential . . . that we could quickly assemble it, I assumed that most of the parts was [sic] there and he was only waiting for a couple of gears." (N.T. 16-17).*fn1

Subsequently, TDS wrote to Northcraft requesting his approval for the expenditure of additional funds; which approval was granted. In April, 1973, TDS sent a letter to Northcraft stating, in part: "Ed is hard at work on the changes that you asked for." This letter was in response to a request by Northcraft for certain technical changes in the "spur gears"; i.e., the use of "needle bearings" instead of "brass bushings." In May, 1973, in a meeting at the offices of TDS, Northcraft was told by Wayne Culver concerning the differential parts that, "[T]hey had not come in, they were in different vendors or manufacturing places."

[ 319 Pa. Super. Page 437]

Northcraft testified that he never saw any plans for, or components of, the differential. However, he did not think this was unusual because TDS had no design or production facilities on the premises.

In February, 1974, TDS instituted legal proceedings to compel the payment of Northcraft's bill. Northcraft agreed to pay the bill, but wanted to take all parts and drawings that had been completed as of that time and terminate their relationship. Northcraft paid the bill. In all, he paid TDS $6,995.00 for its services. In return, TDS gave to Northcraft two drawings and a ring gear and pinion; all of which had been developed by the Philadelphia Gear Corporation. Additionally, they returned all materials which Northcraft had originally submitted.

Northcraft subsequently had the prototype constructed by another engineer at a cost of $11,559.96. This amount included $2,000.00 paid to the engineer, Michael Kahl, for drafting approximately twenty (20) drawings of different components of the differential. Kahl did not make use of the drawings from TDS. Moreover, the ring gear and pinion obtained from TDS, although used in the prototype, were made from unsuitable materials which wore out quickly and had to be replaced.

The appellant presented the testimony of Wayne Culver, who stated that all materials in the possession of TDS were returned to Northcraft, and that he contacted Philadelphia Gear and requested that they do the same.

The appellant also presented as a witness Edward Koons, who was a staff designer, indeed the only staff designer, employed by TDS. Koons testified that he completed three drawings on the Northcraft differential project. One was a drawing of the "spiral bevel gear" and "spiral bevel pinion" which was sent to Philadelphia. Presumably, this drawing was the basis for, and was later supplanted by, the two drawings and components made by Philadelphia Gear, which were later returned to Northcraft.

[ 319 Pa. Super. Page 438]

The second drawing was a rendition of the "spur gear system" which Koons claimed was sent to the Christiana Machine Company. The third was a drawing of the "clutch mechanism." Koons testified that he also made two preliminary "sketches" of the "shift linkage."

There is no indication of the ultimate fate of the latter two drawings and the preliminary "sketches." Koons left TDS in March or April of 1973 and never saw them again. He testified that they might have been left in a credenza behind his desk, but he was not sure.

The appellant's initial claim is that the evidence was insufficient to establish a cause of action for conversion. It specifically contends that the Northcrafts failed to prove the existence of any property which was capable of being converted. The appellant argues that the only evidence of the existence of plans or parts of the prototype differential was Northcraft's statement that he assumed that they existed.

The Northcrafts, on the other hand, characterize the issue differently. They assert that the existence of the plans and components and the prototype itself was established by circumstantial evidence; i.e., the representations ...

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