Lamb, trustee, &c, v. Cecil.

• Decision Date: 23 October 1886
• Citation: 28 W.Va. 653
• Court: West Virginia Supreme Court
• Parties: Lamb, trustee, &c, v. Cecil.

28 W.Va. 653

Lamb, trustee, &c,

v.Cecil.

Supreme Court of Appeals of West Virginia.

Submitted September 12, 1886.

Decided October 23, 1886.

1. A plaintiff can not under the pretence of an amendmentof his bill introduce an original and different cause of action or ground for relief. But if the cause of action and the relief sought are substantially the same, it is immaterial that the form, in which the claim is presented by the amendment, differs essentially from that in the original bill. (p. 650.)

2, When an amended bill is rightly filed according to rule above stated, so far at bast as the statute of limitations is concerned, it will have the same effect, as if it had been filed at the time the suit was commenced; and a cause, which was not then barred, will not be treated as barred at the time of the amendment, (p. 658)

The power to sell and transfer the discounted bills and notes of the bank does not belong to the ordinary powers of the cashier, but inasmuch as he may do so under some circumstances, a transfer made by him in the usual course of the business of the bank to a person, who has no cause to question the propriety or good faith of the transaction, will be prima facie valid, (p. 659.)

4. When a director of a bank, who is also a depositor, has knowledge that the bank is probably insolvent and will likely be unable to continue its business, or pay its depositors, in order to avoid the loss of his deposits obtains from the cashier, without authority from the board of directors, discounted bills and notes of the bank equal to the amount of his deposits, the transaction will be held invalid and the assignee of the bank may recover the amount of said bills and notes from him. (p. 661.)

5. When such depositor is entitled to dividends from the assignee of the bank, which have not been declared or paid by reason of the controversy in the suit, he will be entitled to be paid out of the fund recovered from him dividends on his deposit equal to those paid to the other depositors with interest on the same from the time the same would have been paid if there had been no controversy or suit, (p. 062)

W. P. Hubbard and H. M. Russell tor appellant,

Caldwell & Caldwell for appellee. Snyder, Judge:

Suit in equity brought February 23, 1876, in the circuit court of Ohio county by Daniel Lamb, trustee, against Alexander J. Cecil, to recover the amount of certain deposits withdrawn by the defendant from the Wheeling Savings Institution on February 28, 1871, and which it is claimed were unlawfully and fraudulently withdrawn and converted to the use of the defendant. This cause was before this Court on a former appeal and the decrees then appealed from were reversed and the cause remanded to the circuit court with leave to the plaintiff to amend his bill so as to make its allegations conform to the facts proved and for further proceedings. The report of the cause on the former appeal contains a full history and statement of the proceedings and facts as they then appeared, and it is therefore unnecessary to do more here than to refer to said report for the facts and proceedings. 25 W. Va. 288 to 297 inclusive.

On January 31, 1885, a few days after the mandate of this Court had been entered in the circuit court, the plaintff exhibited in that court an amended bill in which were repeated many of the allegations of the original bill, and in addition thereto the plaintiff alleged, that the defendant, Cecil, on February 23, 1871, drew and presented for payment at the Wheeling Savings Institution his two checks, one in his own name for $3,915.81, and the other as "trustee" for $3,366.95 and in payment thereof he obtained from A. C. Quarrier, the treasurer of said institution, without authority from the board of directors, not money or currency in the ordinary course of banking business, but discounted notes and bills not yet due, the property of the institution, to the amount of said checks: that before the said notes and bills were so obtained the said institution had become and was then wholly insolvent and unable to pay its debts, and that this was known to the said Cecil as a director and was the cause of his withdrawing the said deposits; that the said treasurer occupied a position of trust, and it was a fraud upon the bank for him to give said Cecil the said notes and bills, a fraud in which the said Cecil participated, and he acquired no title thereto, and is liable to the plaintiff as trustee under the assignment made to him by the bank, for the amount of said notes and bills, to-wit: $7,284.74. There are many other allegations in the bill, but the above is the material matter introduced by the amendment.

The defendant, Cecil, objected to the filing of the amended bill and also demurred to it, but the court overruled both the objection and demurrer. Subsequently the plaintiff filed a second amended bill alleging a want of knowledge of certain facts to avoid the defence of the statute of limitations. The defendant answered both bills, controverting the right of the plaintiff to maintain this suit and relying upon the statute of limitations. The cause was finally heard on February 27, 1886, and a decree then entered in favor of the plaintiff, tor the amount of said bills and notes less certain dividends deducted therefrom, From this decree the defendant, Cecil, has appealed.

The appellant insists that his demurrer to the amended bill should have been sustained, because the cause of action asserted in it differs from that presented in the original bill not only in form but in substance that it is in fact a new suit and not a continuation or amendment of the original suit.

In the opinion delivered on the former appeal this Court says: "It will be seen that a good case is made by the proof, one that gave the institution a right to recover the full amount of such notes so improperly disposed of. It is also a different case entirely from that set out in the bill. The case made, or attempted to be made, in the bill is beset with difficulty, * * * * The case proved is free from all these difficulties and shows clearly that the defendant had no right to take from the cashier, and the cashier without the authority of the board of directors had no right to give him in payment of his deposits, either of himself or those for whom he was trustee, the discounted bills and notes of the bank. The cashier certainly occupies a position of trust, and it was a fraud upon the bank and its stockholders for him to give to Cecil those bills and notes, a fraud in which Cecil participated; and he got no title whatever to the same by taking them from the cashier either with or without his indorsement; he is liable to the bank or its assignee for the full amount of such notes so taken and the interest thereon. I deem it, (therefore,) unnecessary to decide whether the bill filed stated a proper case for relief or not, as it is not the case proved. The case proved entitles the plaintiff to recover, but he must amend his bill. As the property taken from the bank is the thing the original bill sought to have repaid, but stated it to be money when it was not money, but other property improperly and fraudulently taken from the bank. the bill can be amended in accordance with the facts." 25 W. Va. 295. The cause was then remanded " with leave to the plaintiff to amend his bill as indicated in this opinion, and for further proceedings to be had" 25 W. Va. 297.

This, it would seem, was a positive and direct adjudication of the right of the plaintiff to amend his bill, and his amendment is substantially if not in terms just what was indicated by this Court. The question, therefore, whether or not such an amendment was proper or improper in this cause, it seems to me, is res judicata as to the appellant here and beyond the control ot this Court. But as we are earnestly asked by counsel to reconsider that question, 1 will briefly state my views in regard thereto. It is certainly well settled, that a plaintiff can not, under the rule allowing amendments, abandon his original cause and substitute therefor one which is essentially different. He can not under the pretence of amendment introduce an original and different cause of action. The amendment must relate to the same identical cause, and demand substantially the same relief. But if these are the same it is not required that the form in which the claim is stated or the relief demanded shall be the same. One of the very purposes of the rule and practice allowing amendments is to relieve against informal and defective averments of the plaintiff's cause of action. Whenever the bill states facts from which the court can determine that the plaintiff has a cause which, if properly pleaded, would entitle him to relief, although the bill may not formally allege facts that entitle him to any relief, the plaintiff will be entitled to amend his bill so as to obtain the relief which his bill shows he would be entitled to it properly pleaded. But in all cases the cause of action must be in substance the same both in the original and amended bills, otherwise the amendment will be held to be a departure in pleading, treated as a new suit and therefore disallowed, or if allowed be subject to all the incidents and disadvantages ot an original bill. Piercy v. Beckett, 15 W. Va. 444; The Mercantile Insurance Company v. Ver-plauck, 1 Edw. eh. 46; Doonan v. Glynn, 26 W. Va. 225. The general rule thus announced has been professedly followed in Virginia and this State, but in some instances here and especially in the English courts this rule has been departed from so far that it is scarcely possible to give any very accurate idea of the scope ot amended bills. See 1 Bart. Ch'y Pr. 324.

In the case at bar the original bill sought to recover $7,-282.74, the amount of money or currency improperly obtained by the defendant from the bank upon two checks drawn by him for that amount. It did not seek to recover the identical money so...