## Facts

- Harry L. Mitchneck operated a coal mine and employed workers who bought goods on credit from A. Vagnoni’s store.
- The employees signed written orders directing Mitchneck to deduct specified amounts from their wages and pay those sums to Vagnoni.
- Mitchneck agreed to honor the orders and made wage deductions totaling about $259.26 from employees named in the indictment.
- Mitchneck did not pay Vagnoni the deducted amounts, and the store accounts remained unpaid.
- The Commonwealth charged Mitchneck under a statute criminalizing fraudulent conversion of “the money or property of another” by one who lawfully received it.

## Issues

1. Whether an employer’s failure to pay a third party amounts deducted from wages under employee orders constitutes fraudulent conversion of “the money or property of another.”
2. Whether the employees or the storekeeper held a property interest in specific funds in Mitchneck’s possession, as opposed to a mere right to payment.

## Decision

- The Superior Court reversed the conviction and ordered Mitchneck discharged.
- The evidence was legally insufficient to prove Mitchneck possessed money belonging to the employees or Vagnoni.
- The wage-deduction arrangement, even if accepted by Mitchneck, established a debtor–creditor relationship and, at most, a failure to pay a debt.
- Nonpayment under these circumstances supported civil liability, not criminal fraudulent conversion.

## Legal Principles

- Fraudulent conversion requires proof that the defendant had possession of identifiable money or property that belonged to another.
- A wage obligation does not transfer ownership of an employer’s general funds to the employee before payment.
- An employee’s order directing payment to a third party, and an employer’s acceptance, ordinarily substitutes the creditor (a change in who is owed) rather than transferring title to a specific fund.
- Absent segregation, entrustment, or proof of a specific res belonging to the alleged victim, nonpayment is treated as breach of an obligation enforceable in civil court, not theft-type criminal conduct.

## Conclusion

Because the Commonwealth proved only that Mitchneck failed to pay a debt arising from wage obligations and accepted payment orders—without showing possession or conversion of money owned by the employees or the storekeeper—the fraudulent conversion conviction could not stand, and Mitchneck was discharged.


Commonwealth v. Mitchneck, 130 Pa. Super. 433, 198 A. 463 (Pa. Super. Ct. 1938)