The Buyers contend that a plaintiff is permitted to maintain an action in tort even where the parties are contractually bound. To buttress that contention, the Buyers rely on Key Corporate Capital, Inc. v. Tilley, 216 Fed. Appx. 193 (3d Cir. 2007) (not precedential). In that case, the Third Circuit concluded that the plaintiff could assert a tort claim against the defendant notwithstanding the parties' settlement agreement, reasoning that the defendant's duty to pay the plaintiff did not arise from obligations created by the settlement agreement.
The Buyers contend that a plaintiff is permitted to maintain an action in tort even where the parties are contractually bound. To buttress that contention, the Buyers rely on Key Corporate Capital, Inc. v. Tilley, 216 Fed. Appx. 193 (3d Cir. 2007) (not precedential). In that case, the Third Circuit concluded that the plaintiff could assert a tort claim against the defendant notwithstanding the parties' settlement agreement, reasoning that the defendant's duty to pay the plaintiff did not arise from obligations created by the settlement agreement.
See 13 Pa.C.S. § 9307(a) ("A buyer in the ordinary course of business ... takes free of a security interest created by his seller even though the security interest is perfected and even though the buyer knows of its existence.") Therefore, in order to not be considered a buyer in the ordinary course of business, the buyer must not only have actual knowledge of a security interest in the goods by a third party, but must also have actual knowledge that the proposed sale to that buyer is in violation of the third party's security interest. 13 Pa.C.S. § 1201(9) See also Key Corporate Capital, Inc. v. Tilley , 2006 WL 487936 at *2 (E.D. Pa. Feb. 27, 2006), aff'd. , Key Corporate Capital, Inc. v. Tilley , 216 Fed. Appx. 193, 195-96 (3d Cir. 2007). Here, there is no evidence in the record that Sports Car Leasing actually knew at the time it purchased Vehicles from the Dealerships that any of the Vehicles were either subject to a security interest by Nissan (even if it suspected as much) and more importantly , actually knew that the Dealerships were violating Nissan's security interest in the Vehicles by selling the Vehicles to Sports Car Leasing out of trust.
"[A] corporate officer can be held personally liable for a tort committed by the corporation when or she is sufficiently involved in the commission of the tort." N. Am. Steel Connection, Inc. v. Watson Metal Prods. Corp., No. 12-2296, 2013 WL 1095445, at *4 (3d Cir. Mar. 18, 2013); see also Key Corporate Capital, Inc. v. Tilley, 216 F. App'x 193, 195 (3d Cir. 2007) (recognizing that, pursuant to Pennsylvania law, "[u]nder the officer participation theory, corporate officers who take part in the commission of a tort by a corporation face personal liability."). Notably, "[u]nless the corporate officer extends promises in his individual capacity, the theory does not apply in the context of an action for breach of contract."
Id. (surveying case law); see also Key Corporate Capital, Inc. v. Tilley, 216 Fed Appx. 193, 195 (3d Cir. 2007) (recognizing that, pursuant to Pennsylvania law, "[u]nder the officer participation theory, corporate officers who take part in the commission of a tort by a corporation face personal liability."). The mere fact that the tort occurred during a breach of contract between the corporation and the plaintiff is of no moment; "[t]he Restatement . . . unambiguously demonstrates that a corporate agent may be held liable for a tort he personally commits in violation of his principal's contract with the plaintiff.
Glenfed Fin. Corp. v. Penick Corp., 276 N.J. Super. 163, 181, 647 A.2d 852 (App. Div. 1994); Key Corporate Capital, Inc. v. Tilley, 216 Fed.Appx. 193, 195-96 (3d Cir. 2007). Conversion, however, is not a per se willful and malicious injury to the property of another.Peklar v. Ikerd (In re Peklar), 260 F.3d 1035, 1037 (9th Cir. 2001).
Where a sum of money is identifiable, courts look to the relative rights of each party to possession and use of the money to determine whether a cause of action lies for conversion. See Key Corporate Capital, Inc. v. Tilley, 216 Fed.Appx. 193, 195-96 (3d Cir. 2007) (under Pennsylvania law, sales agent converted proceeds of sale but buyer of equipment was not liable for conversion); Kentuckiana Healthcare, Inc. v. Fourth St. Solutions, LLC, 517 F.3d 446, 447-48 (7th Cir. 2008) (under Indiana law, owner of healthcare facility was liable for conversion where it received and kept Medicare and Medicaid reimbursements intended for former manager of facility); Navid v. Uiterwyk Corp., 130 B.R. 594, 595-96 (M.D.Fla. 1991) (under Florida law, agent of shipowner converted money belonging to shipper when it received and kept insurance reimbursement for damaged goods). The crux of conversion is wrongful exercise of dominion or control over property of another without authorization and to the exclusion of the owner's rights in that property.