Alford v. Barnett Nat. Bank of Jacksonville

• Decision Date: 11 April 1939
• Citation: 137 Fla. 564,188 So. 322
• Court: Florida Supreme Court
• Parties: ALFORD v. BARNETT NAT. BANK OF JACKSONVILLE.

188 So. 322

137 Fla. 564

ALFORD v. BARNETT NAT. BANK OF JACKSONVILLE.

Florida Supreme Court, Division B.

April 11, 1939

Rehearing Denied May 5, 1939.

Error to Circuit Court, Duval County; Miles W. Lewis, Judge.

Action by Eleanor B. Alford against the Barnett National Bank of Jacksonville for conversion of a nonnegotiable promissory note. To review an adverse judgment, the plaintiff brings error.

Affirmed.

On Petition for Rehearing.

COUNSEL

Tos. B. Adams, R. R. Axtell, and W. Gregory Smith all of Jacksonville, for plaintiff in error.

Fleming Hamilton & Diver and F. P. Fleming, all of Jacksonville, for defendant in error.

OPINION

PER CURIAM.

This case is here for review on writ of error to a judgment in behalf of the defendant below entered by the Circuit Court of Duval County, Florida. The cause was submitted to a jury on the first count of the revised declarations, viz:

'For that said defendant, the Barnett National Bank of Jacksonville, on to-wit, April 15, 1929, converted to its own use or wrongfully deprived the said plaintiff of the use and possession of the plaintiff's goods, that is to say one non-negotiable promissory note in words and figures following, to-wit:

"Mortgage Note

"#4

"$25,000.00

Jacksonville, Florida,

April 14th, 1925,

"on or before Four (4) years after date, for value received, I promise to pay to Charles A. Brown, Jr., Twenty-five Thousand and no/100 Dollars, together with interest thereon at, the rate of six per centum per annum from date until paid, said interest being payable quarter annually, according to the tenor of sixteen interest coupon notes of Three Hundred Seventy-five and no/100 Dollars each attached hereto and bearing even date herewith, both principal and interest payable in United States Gold Coin of the present standard of weight and fineness or its equivalent, together with current rate of exchange on the City of New York, at the Barnett National Bank of Jacksonville, Florida.

"This note and interest secured by mortgage on real estate of even date herewith.

"Avondale Company (Corporate Seal)

'By (Signed) Raymond D. Knight

'Its President

"Attest (Signed) J. P. LeMaster

"Its Secretary.

"Indorsed:

"Charles A. Brown, Jr.'

'That said note was then and there of great value, to-wit, of the value of Twenty-five Thousand ($25,000.00) Dollars.

'Wherefore Plaintiff sues and claims $50,000.00 damages.'

Pleas to the count, supra, were: (a) first plea, not guilty; (b) third plea denied that the note, on April 15, 1929, was plaintiff's good; (c) fourth plea, on April 15, 1929, plaintiff was not entitled to the use of the note; (d) fifth plea, on April 15, 1929, the plaintiff was not entitled to the possession of the note; (e) the sixth plea, on April 15, 1929, plaintiff was not entitled to the use and possession of the note; (f) the sixty-second plea averred that Charles A. Brown, Jr., the payee in the Avondale note, delivered the same to the defendant on the 28th day of February, 1929, with the plaintiff's leave and license; (g) the sixty-fourth plea was to the effect that the plaintiff voluntarily delivered the Avondale Company note to the Secretary of Charles A. Brown, Jr., with the plaintiff's knowledge and consent, and that Charles A. Brown, Jr., payee of the Avondale Company note, with the consent and approval of the plaintiff, on the 28th day of February, 1929, delivered the note to the defendant, who is the holder in due course for value. The defendant, at the time or obtaining the note, had no advice or suggestion of any right, title or interest of the plaintiff in and to the Avondale note, nor did the defendant have the means of knowing that the plaintiff claimed any right, title or interest in the note. The jury heard all the evidence, argument of counsel and charge of the Court and then rendered a verdict for the defendant below, which is defendant in error in this Court.

Statement of Facts

The facts are substantially, viz: Mrs. Eleanor B. Alford, in the early part of 1928, owned stock in the Gair Corporation, the par value of each share of stock being $100, and she had an opportunity of receiving stock in a new corporation in the process of reorganization which was to take over the Gair Corporation, or in lieu thereof receive $93.50 cash per share of stock. She had or owned 180 shares. Mrs. Alford was the widow of a Presbyterian minister, and Mr. Brown, a real estate dealer, an elder in the same Church. Mrs. Alford, in April, 1928, consulted Mr. Brown about the investment of her money. Mr. Brown pointed out that he was in a position to advantageously use her money and then agreed to assume one-half of the loss of the sale of her stock in the Gair Corporation if she would accept the cash offered by the Gair Corporation and provided that Mrs. Alford would let him have the money, and he would pay her 8% per annum quarterly, which she accepted, and when Mr. Brown delivered to her his note in the sum of $17,600 dated the 27th day of April, 1928, he likewise secured the payment to Mrs. Alford by the delivery to her of a non-negotiable note issued by the Avondale Company payable to him in the sum of $25,000. The payment of the full face of the Avondale Company note was contingent upon the quieting of the title to lands which Mr. Brown had sold the Avondale Company, and the non-negotiable note represented the purchase price thereof. It had been suggested that the note would be paid by the Avondale Company in July, 1928, and Mrs. Alford was planning a vacation trip North and it was suggested that Mrs. Alford, in her absence, leave the note with Mrs. Wood, Secretary to Mr. Brown, so the delivery thereof could be made to the Avondale Company for payment, if payment was desired.

The Avondale note, on July 18, 1928, was by Mrs. Alford delivered to Mrs. Wood, Secretary of Mr. Brown, to be kept by her in a lock box so as to be available for payment in the event payment was desired, and if made, 600 shares of Walkill Corporation stock would be substituted as security for the Brown note then held by Mrs. Alford. The note was not paid during Mrs. Alford's absence, but remained in the lock box kept by Mrs. Wood. Mr. Brown made quarterly payments of interest on his note held by Mrs. Alford until May or June, 1931. He then explained to her that because of financial difficulties it was impossible for him to continue interest payments on his note, and upon receiving this information Mrs. Alford immediately consulted an attorney for advice as to her legal rights, and she immediately requested of Mrs. Wood the return of the Avondale Company to her.

It was testified to by Mr. Brown, according to the record, that prior to February, 1929, he had a conference with Mrs. Alford and pointed out to her that it was necessary for him to raise some money and requested that she permit a return to him of the Avondale Company note held by her as security and substitute as security with her in lieu of the Avondale note 600 shares of Walkill Farms corporation stock. She consented to this change of security, according to Mr. Brown's testimony, and with her consent and approval did exchange the Avondale Company note for 600 shares of stock in the Walkill Farms Corporation as security for the $17,600 note of Mr. Brown then hald by Mrs. Alford. It was made to appear that Mr. Brown represented to his Secretary, Mrs. Wood, custodian of the Avondale note in behalf of Mrs. Alford, that he had obtained Mrs. Alford's consent and approval to a substitution of the security, when Mrs. Wood then and there delivered the Avondale Company note to Mr. Brown. While the testimony of Mr. Brown was positive as to obtaining the consent and approval of Mrs. Alford for the substitution of the security, Mrs. Alford was equally positive, as shown by her testimony in the record, that she did not agree or consent to a substitution of the Avondale Company note then with Mrs. Wood for safe keeping in her behalf, and did not authorize Mr. Brown or Mrs. Wood to take the Avondale Company note and deliver it to Mr. Brown and substitute therefor 600 shares of stock in the Walkill Farms Corporation.

It is shown that the Walkill Farms Corporation owned 12,000 acres of land situated in Clay County, Florida. The land was bought in 1925 for $300,000; the sum of $150,000 was paid in cash and a purchase price mortgage given on the land for the remaining $150,000. The Walkill Farms Corporation was organized and a conveyance was made to it subject to the purchase price mortgage. It was shown at the time the stock was given to Mrs. Alford as security for the payment of her note on the part of Charles A. Brown, Jr., the purchase price mortgage, or a part thereof, on the Clay County lands was due, and the texes thereon unpaid. It is not disputed that the indebtedness due on the Clay county lands exceeded its market value and as a result the stock of the Walkill Farms Corporation was worthless and this fact was known to Brown in July, 1928, when Mrs. Alford was leaving Jacksonville on her vacation, but this fact was carefully guarded by Brown and Mrs. Wood so that Mrs. Alford did not acquire the information, and these facts and other incidents in connection with obtaining the surrender of the Avondale Company note, if believed by the jury, would in law amount to fraud on Mrs. Alford.

During the Month of February, 1929, Charles A. Brown, Jr., obtained a loan from the defendant Barnett National Bank in the sum of $11,000 and secured the payment thereof with the Avondale Company note, and he then and there endorsed upon the Avondale Company note the name of Charles A. Brown, Jr., and delivered the same to the Barnett National Bank as security for the payment of his $11,000 note.

This suit is...