American Nat. Bank of Nashville, Tenn. v. Miller

• Decision Date: 16 March 1911
• Docket Number: 2,060.
• Citation: 185 F. 338
• Parties: AMERICAN NAT. BANK OF NASHVILLE, TENN., v. MILLER, Comptroller's Agent.
• Court: U.S. Court of Appeals — Sixth Circuit

185 F. 338

AMERICAN NAT. BANK OF NASHVILLE, TENN., v. MILLER, Comptroller's Agent.

No. 2,060.

United States Court of Appeals, Sixth Circuit.

March 16, 1911

John M Gaut, for plaintiff in error.

Sloss Baxter, for defendant in error.

Before SEVERENS and KNAPPEN, Circuit Judges, and DENISON, District judge.

KNAPPEN Circuit Judge.

The defendant in error (hereafter called the 'plaintiff') sued the plaintiff in error (hereafter called the 'defendant') for the recovery of a deposit of $3,000 made in the defendant bank by the First National Bank of Macon, Ga., of which bank the plaintiff has been duly appointed agent under the provisions of the national banking act. There was a trial by jury. At the conclusion of the testimony counsel for each party asked the court for direction of verdict in favor of such party. The court thereupon proceeded to find the facts and instruct the jury as to their verdict. The facts so found, as supplemented by the 'stipulation of agreed facts' presented in open court by counsel for the respective parties, and by the undisputed evidence, are, so far as material for present purposes, substantially these:

On May 14, 1904, R. H. Plant was a large stockholder in, as well as the president and general manager of, the First National Bank of Macon, Ga. (hereafter called the 'Macon National Bank'), and controlled the policy and management of that bank. He was at the same time the proprietor of a private bank doing business at Macon under the name of 'I. C Plant's Son's Bank.' Of this latter bank one Hurt was cashier and general manager. Hurt was also a director and a member of the finance committee of the Macon National Bank. On the date named Plant was insolvent and knew it. He was at the time indebted to the Macon National Bank in a large amount on account of clearing house balances. The Macon National Bank, as well as Plant individually, kept open deposit accounts with the defendant bank; Plant having on the date named more than $3,000 therein to his individual credit. At the same time he owed the defendant bank $50,000 upon time drafts to his own order, maturing after May 16th, 'drawn upon and accepted by R. H. Plant doing a banking business under the name of I. C. Plant's Son's Bank,' and indorsed to the defendant for value. On the day named (or the day preceding) Plant drew his check on the defendant bank in favor of the Macon National Bank for $3,000 and delivered the same, through Hurt, to the Macon National Bank, together with certain other financial items, for the purpose of discharging a large indebtedness to the latter bank on account of clearing house transactions. When this check was drawn and delivered, Plant was not at the Macon National Bank, but had been absent therefrom for several weeks on account of his own sickness, although 'in frequent if not daily communication with the officers of the bank.' The court found that Plant 'gave no specific directions in reference to this particular check to the officers of the First National Bank who were conducting his affairs during his sickness'; that it was 'a general custom in the (Macon National) bank to accept and discount any paper that he (Plant) might send to them and to credit upon his account any paper that he might send for the purposes of credit; but that paper received for the purpose of credit was generally credited by the bank irrespective of any such custom under the general habit to credit whatever a man would send for the purpose of credit.' The check in question was forwarded by the Macon National Bank to the defendant bank on Saturday May 14th, for deposit, with instructions to place the same to the credit of the former bank. The defendant bank received the check on Monday morning, May 16th, and pursuant to instructions credited the amount to the Macon National Bank and charged the same to Plant's account, notifying the Macon National Bank of this credit by advice by the night mail of that day. Plant's private bank did not open its doors on the morning of May 16th. A notice of its closing was posted upon its doors, and was seen by the cashier of the Macon National Bank as early as 9 o'clock. At about 9:30 a.m. the Macon National Bank closed its doors, being insolvent. At about 11:45 a.m. of that day a petition in involuntary bankruptcy was filed against Plant. When the check was forwarded to the defendant bank by the Macon National Bank, the latter's officers who were conducting its affairs had no knowledge of Plant's approaching bankruptcy or even of his insolvency, and no knowledge of his indebtedness to the defendant bank, nor did they have knowledge of such indebtedness at the time the defendant bank credited the check to the Macon National Bank. Whether the actual credit was given the Macon National Bank before or after the filing of the petition in bankruptcy against Plant does not definitely appear either from the findings or stipulation of agreed facts, or the undisputed testimony. The Macon National Bank did not advise the defendant bank by wire or otherwise of Plant's insolvency or of the bankruptcy proceedings against him. On May 25th the defendant bank credited back the $3,000 check to Plant's individual account, charging the same to the Macon National Bank (then in the hands of a receiver), upon the ground that it had the right to offset Plant's deposit account against the indebtedness upon the accepted drafts. There was due demand for the payment of the deposit to the representative of the Macon National Bank, which demand was refused. The court instructed the jury that Plant's knowledge of his own insolvency and of his debt to the defendant bank was not imputable to the Macon National Bank; that there was no breach of duty on the part of the Macon National Bank in not advising the defendant bank of Plant's insolvency at the time of forwarding the check, nor any breach of duty in not communicating to the defendant bank the fact of Plant's embarrassed condition after the officers of the bank other than Plant learned of it; that the check had been in fact paid by crediting the same to the Macon National Bank; and that the defendant bank had no authority to reverse the entries and withhold the amount of the deposit. The jury was accordingly instructed to render verdict for $3,000, with interest from the date suit was brought. There was verdict and judgment accordingly. The defendant excepted to the instruction to find for the plaintiff 'in any amount,' as well as to the instruction to include interest in the verdict. A motion for new trial was overruled, and this writ of error is brought to review the judgment.

The defendant insists that the trial judge erred in construing the request of counsel for both parties for a directed verdict as a request that the court find the facts. Setting to one side the question whether the right to raise this question has been reserved by appropriate exception, it is clear that the request by each party for peremptory instruction in its favor, unaccompanied by request for specific instruction in case the request for a directed verdict be denied, amounts to an admission by both parties that the evidence is not in conflict and to a request that the court determine the facts. Beuttell v. Magone, 157 U.S. 154, 157, 15 Sup.Ct. 566, 39 L.Ed. 654; Anderson v. Messenger (Sixth Circuit) 158 F. 250, 253, 85 C.C.A. 468. There was in this case no request for specific instruction in case the request for directed verdict was denied. The case is thus distinguished from Minahan v. Grand Trunk W. Ry. Co. (Sixth Circuit) 138 F. 37, 42, 70 C.C.A. 463;

Empire State Cattle Co. v. Atchison, etc., Ry. Co., 210 U.S. 1, 8, 28 Sup.Ct. 607, 52 L.Ed. 931; Farmers' & Merchants' Bank v. Maines (C.C.A. Sixth Circuit) 183 F. 37, 41. The court was not, however, required, in our opinion, to make formal findings of fact.

We are thus limited on this review to the considerations whether there is substantial evidence sustaining the conclusions reached by the trial court, and whether such conclusions support the verdict, subject, perhaps, to the limitation that the verdict should not stand as against undisputed evidence inconsistent therewith.

Assuming for the purposes of this opinion,...