First Nat. Bank v. DiCkson

• Decision Date: 01 October 1888
• Citation: 40 N.W. 351,5 Dak. 286
• Parties: First Nat. Bank v. Dickson et al.
• Court: South Dakota Supreme Court

40 N.W. 351

5 Dak. 286

First Nat. Bank

v.Dickson et al.

Supreme Court of the Territory of Dakota.

October 1, 1888.

Appeal from district court, Minnehaha county; before Justice Spencer.

Action by the First National Bank of Los Angeles against Joseph M. Dickson and George H. Hollister for the conversion of certificates of deposit. Judgment for plaintiff, and defendants appeal.Bailey & Davis, for appellants. Winsor & Kittredge, for respondent.

CARLAND, J.

The respondent commenced an action in the district court of Minnehaha county against appellants for the conversion of three certificates of deposit issued by the First National Bank of Sioux Falls to J. B. Young, on December 24, 1885, for the aggregate sum of $4,600. The appellants justified the taking by said Joseph M. Dickson under a warrant of attachment issued in an action wherein George H. Hollister was plaintiff and J. B. Young was defendant. At the trial the respondent called the appellant Dickson, who produced the certificates of deposit, which were introduced in evidence, together with the indorsement of J. B. Young thereon, transferring the same to respondent. It was admitted that said certificates were levied upon by the appellant Dickson as sheriff on the 6th day of March, 1886, in an action then pending wherein George H. Hollister was plaintiff and J. B. Young defendant. The respondent then rested. The appellants introduced in evidence certificates of protest showing that the certificates of deposit had been protested for non-payment prior to the date of the alleged conversion; and, after several ineffectual attempts to show that said certificates of deposit were worth less than their face value, called E. A. Sherman as a witness, who testified that he was president of the Minnehaha National Bank of Sioux Falls, and had been ever since its organization; that between February 1 and March 6, 1887, and after the bank was attached, he looked over the assets of the First National Bank of Sioux Falls; that he went through them with Mr. Garretson, the cashier of the Sioux National Bank of Sioux City, Iowa, with a view of ascertaining if it would be safe to assume the liabilities of said bank, and take their assets, in order to prevent a failure. The witness was then asked this question: “State what you found the character of the assets to be, whether they were good or bad, and whether you found the bank solvent or insolvent.” The question was objected to as incompetent and immaterial. The objection was sustained, and exception taken. The witness further testified that he could judge of such assets as he saw; was acquainted with most of the men, and knew their financial standing. The witness was then asked, “What was the value of those assets?” to which an objection was made and sustained, and an exception taken. The respondent then moved the court to direct a verdict in its favor for the face value of the certificates and interest, which motion was granted by the court; to which ruling of the court appellants duly excepted. From the judgment rendered on said verdict appellants appeal, and assign the rulings of the court herein specified as error.

In actions for the conversion of instruments for the payment of money of the character mentioned in this action, the amount appearing to be due thereon, of principal and interest, at the time of the conversion, and the interest upon that aggregate from thence to the trial, is prima facie the measure of damages. Civil Code, §§ 1970-1982; Booth v. Powers, 56 N. Y. 22;Potter v. Bank, 28 N. Y. 654; 2 Phil. Ev. (Cow. & H. Ed. 228;) 2 Pars. Cont. 471; Decker v. Mathews, 12 N. Y. 324; Sedg. Dam. 513; Paine v. Pritchard, 2 Car. & P. 558; Mercer v. Jones, 3 Camp. 477; Evans v. Kymer, 1 Barn. & Adol. 528; St. John v. O'Connel, 7 Port. (Ala.) 466. It will then be seen that when the respondent had introduced the certificates of deposit in evidence, with the indorsement of the payee thereon, transferring same to the respondent, accompanied with proof of the conversion of the same by appellants, a prima facie case had been made. The appellants, however, had the right to introduce any legal evidence which would tend to show that the certificates of deposit were not worth their face value at the time of the alleged conversion. Among the facts which were competent to show the value of said certificates of deposit was the fact that the maker thereof was at the time of the alleged conversion insolvent. Potter v. Bank, 28 N. Y. 655;McPeters v. Phillips, 46 Ala. 496;Latham v. Brown, 16 Iowa, 118;Zeigler v. Wells, 23 Cal. 179;Cothran v. Bank, 40 N. Y. Super. Ct. 401. See, also, cases herein cited as to measure of damages. That it was competent to show by proper testimony that the maker of the certificates of deposit was insolvent, does not seem to have been disputed at the trial. The contention of counsel for respondent was that appellants had not introduced, or offered to introduce, any competent evidence of the insolvency of the maker of the certificates, viz., the First National Bank of Sioux Falls. The appellants had introduced evidence which showed beyond dispute that at the time of the alleged conversion of the certificates of deposit they had been presented to the maker thereof for payment, and payment had been refused. Was this evidence,-with the cause of the refusal to pay unexplained,-evidence in any degree tending to show the insolvency of the bank? A debtor is insolvent when he is unable to pay his debts from his own means, as they become due. Civil Code, § 2028. In Brown v. Montgomery, 20 N. Y. 287, the trial court had charged the jury that the non-payment and protest of a bank-check was evidence tending to show insolvency. Denio, J., in delivering the opinion of the court affirming the correctness of such a charge, said: “For when a business man in a commercial town fails to meet his paper, payable at a bank, and especially his checks upon the bank at which he keeps his accounts, the natural inference which every one draws is that he is no longer able to pay his debts.” In Booth v. Powers. 56 N. Y. 22, which was an action for the conversion of a promissory note for the sum of $1,500, the defendants in the court below offered to show that the note had been presented for payment, and payment refused, which offer was excluded. Folger, J., in delivering the opinion of the court of appeals, uses the following language: “The defendant also offered to prove that their testator took the necessary and proper steps to present the note for payment, but that it was not paid, and that the makers resided at the place in which the bank was situated, at which the note was made payable. This proof was excluded. We think that this was error. Proof of the inability of the maker to pay his note affects its value. Evidence tending to show disability is given, when it is testified that there is neglect or refusal to pay it according to its terms.” “Doubtless the fact of non-payment is not of the same weight in every case. We have seen that in the case last cited the non-payment of a check upon the bank at which the drawer kept his account...