Riley v. Bank Of Allendale

• Citation: 35 S.E. 535,57 S.C. 98
• Parties: RILEY v. BANK OF ALLENDALE.
• Decision Date: 30 March 1900
• Court: United States State Supreme Court of South Carolina

35 S.E. 535

57 S.C. 98

RILEY

v.BANK OF ALLENDALE.

Supreme Court of South Carolina.

March 30, 1900.

ACCOUNTING BY BANK—COLLATERALS.

1. Where a bank that has been placed in charge of the property of a customer is called upon to account for its dealings with such property, the accounting should be exact.

2. Complainant, being indebted to defendant, deeded to it a tract of land as security. Thereafter complainant contracted with W. to sell her timber on the land for $980, to he paid in installments. On an installment falling due, defendant, to whom the contract had been assigned, extended the time for payment of part of the installments, taking certain security from W. Defendant collected $73S.90 under the contract, and thereafter complainant, after the installments under the first lease were overdue, made another contract with W. for timber on the same lands, and received payment therefor. Held that, in view of the fact that the extension was not made while W. could have met the payment, complainant could not hold defendant liable for the difference between the amount collected and the contract price.of the timber.

Appeal from common pleas circuit court of Barnwell county; W. C. Benet, Judge.

Suit by M. M. Riley against the Bank of Allendale. From a decree in favor of plaintiff, defendant appeals. Modified.

J. O. Patterson and Bellinger, Townsend & O'Bannon, for appellant.

Robt Aldrich and J. E. Allen, for respondent.

POPE, J. The action was brought against the defendant bank for an accounting, and came on for hearing before his honor, Judge Benet. By his decree he found the defendant was indebted to the plaintiff, on the 3d day of July, 1899, in the sum of $714.74, with Interest from that date. The defendant has appealed from said decree on the following grounds, to wit: "(1) Because his honor, the presiding Judge, erred in finding as a matter of fact that defendant, without the knowledge or consent of the plaintiff, relaxed the terms and conditions of the first timber contract by extending the time of payment, upon Woodward giving additional security in the shape of chattel mortgage and stock in manufacturing company, and in holding that the deponent became liable to the plaintiff for the entire amount due by Woodward on said timber contract, whether the same was collected or not. (2) Because his honor, the presiding judge, erred in finding as matter of fact that the second timber contract was not intended to replace the first contract, and covered timber not embraced in the first timber contract, whereas he should have found that the second timber contract was intended to operate as a rescission of the first contract, and take the place thereof. (3) Because his honor, the presiding judge, erred in finding as matter of fact that the plaintiff claims, and that her contention is sustained by the evidence, that her indebtedness to the defendant on the 17th day of April, 1894, was $1,093.70. (4) Because his honor, the presiding judge, erred in finding as matter of fact that the plaintiff surcharged the defendant's account, and that her objections to said account are well taken, whereas his honor should have found that the sworn statement of account introduced in evidence by defendant should be taken and deemed as a correct and true accounting until surcharged by the introduction of testimony to show error therein. (5) Because his honor, the presiding judge, erred in finding that there was no testimony to sustain the charges of $186.50 paid to Richie Riley and others, and the charge of $15 attorney's fee, and in holding that these items should be stricken out, whereas his honor should have held that these items contained in the sworn statement of account introduced by defendant should be accepted as correct until surcharged by evidence. (6) Because his honor, the presiding judge, erred in holding that no credit was allowed for the $55 that the sawmill sold for. (7) Because his honor, the presiding Judge, erred in holding that the defendant must be charged with the whole amount due upon the first timber contract, and fixing that amount at the sum of $980. (8) Because his honor, the presiding judge, erred in holding that the plaintiff is entitled to recover of the defendant the amount of $189.50, paid to Richie Riley and others. (9) Because his honor, the presiding judge, erred in holding that the plaintiff is entitled to recover of the defendant the sum of $15 charged as attorney's fee. (10) Because his honor, the presiding judge, erred in holding that the plaintiff is entitled to recover of the defendant the sum of $391, balance due on timber contract (11) Because his honor, the presiding Judge, erred in holding that, when the defendant submitted a sworn statement of account in the form of debtor and creditor, it was necessary for defendant to go further, and produce vouchers, or show the authority for making said charges, in the absence of testimony on the part of the plaintiff denying such authority or the correctness of the charges contained in said statement of account."

When a bank, —and, as for that matter, an individual—who has been placed in charge of money and bonds and leases of land, which all belong to one of Its customers, is called upon by such customer to account for this property, there is no excuse for the want of exactness in such accounting. The rule is not relaxed In the interest of a banking corporation. If anything, the rule is sterner on that account; for its business is to keep books showing in detail every transaction with its customers. Still, while all this is true, the rules of lawcontrolling the exercise of a discretion, within the limits agreed upon between said bank and its customers in relation to any particular business, are the same for banks and natural persons. Hence, when the plaintiff, Mrs. M. M. Riley, took a lease of one Mrs. Woodward for certain timber on a part of the plantation of the former, at $5 per acre, —the quantity of land upon which the timber was to be cut was 196 acres, and this, at $5 per acre, amounted to $980, —this amount of $980 was to be paid in installments. To secure the payment of this amount, under the lease, a chattel mortgage on an engine and mill was executed by Mrs. Woodward to Mrs. Riley. When some of the installments fell due, Mrs. Woodward failed to met them; whereupon the Bank of Allendale, to whom the lease and the chattel mortgage had been assigned, agreed to extend the payment of part of installments upon the assignment of five shares of stock in a manufacturing company and some other collaterals. Inasmuch as the amount collected by the bank under the lease of Mrs. Woodward did not amount to $080, Mrs. Riley, the plaintiff, seeks to hold the defendant responsible for the difference between the amount actually received and the $980. It does not appear in the testimony that the waiver by the bank of the payment of the installments as fixed by the lease was made while Mrs. Woodward could have performed the same. Indeed, she allowed the mill and engine to be sold under the chattel mortgage before all the installments under the lease matured. Besides, in April, 1894, just two months after the last installment under the lease matured, Mrs. Riley made another contract with Mrs. Woodward for the timber, on the same lands she had leased to her in the year 1893, and received payment, to wit, $150, therefor. Under such circumstances, we think the circuit judge was in error in charging the bank to a liability for the full $980, when in fact it only received $738.90 thereof. Therefore we sustain the first exception.

So far as the second exception is concerned, we think it is immaterial whether the second timber contract was accepted in lieu of the first, so far as these parties litigant are affected. It is overruled.

The third exception has received close attention. The circuit judge was correct if he meant to find that the note for $1,093.70 was the renewal of so much of the $1,700 as was left unpaid on the 17th April, 1894, as well as the note for $19, dated February 13, 1893, and which matured on the 1st November, 1893, and was then due. A calculation of the interest on $1,700 and on $19 up to 17th April, 1894, after applying as credits the sum of $200 paid in March, 1893, by Mrs. Woodward, and applied by the bank to the two notes above described, and also the sum of $451.31, so applied as a credit thereto, will show that this was a renewal of all then due. But the note for $200, which was given to said bank by the plaintiff, Mrs. Riley, is an independent transaction from the note for $1,093.70, and is dated the same day, to wit, 17th April, 1894. This exception is overruled.

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