Angola State Bank v. State ex rel. Sanders

• Decision Date: 24 January 1944
• Docket Number: 27846.
• Citation: 52 N.E.2d 620,222 Ind. 244
• Parties: ANGOLA STATE BANK et al. v. STATE ex rel. SANDERS.
• Court: Indiana Supreme Court

52 N.E.2d 620

222 Ind. 244

ANGOLA STATE BANK et al. v. STATE ex rel. SANDERS.

No. 27846.

Supreme Court of Indiana

January 24, 1944

Appeal from Steuben Circuit Court; Rex S. Emerick Judge.

Wood & Wood, of Angola, for appellants.

Hugh G. Sanders and Edgar W. Atkinson, both of Auburn, for appellee.

O'MALLEY Judge.

This is an action by appellee, relatrix, against appellant, Angola State Bank, to require the bank to recognize her as the owner of five shares of the capital stock of said bank. The appellant, R. Waldo Sheffer, intervened and claimed ownership of the same stock.

The 'special finding of facts' discloses that appellee purchased the five shares of stock in 1927 and received certificate number 33. That in 1929 the husband and son of the appellee borrowed four hundred dollars ($400) from the First National Bank of Angola and gave an unsecured note. Later the president of the bank asked for some security for this loan, and appellee signed her name to the form assignment on certificate number 33 and delivered it to her husband who in turn delivered it to the bank, as collateral for this note and for no other purpose. This note was paid in 1930, but the stock was not returned. Later, some other loans were made to the husband and son of appellee, but the books of the bank did not show any unpaid loans for which the bank held the stock as collateral. That appellant, R. Waldo Sheffer, was assistant cashier of the First National Bank at the time of the loan and knew the terms under which the stock was placed with the bank. The First National Bank merged with the Steuben County State Bank and under the direction of the State Banking Department the assets of the Steuben County State Bank were separated into two classes, and the certificate number 33 was placed in the undesirable class and turned over to three trustees along with other assets for liquidation for the benefit of the stockholders of the Steuben County State Bank. In the meantime, appellant Sheffer had become cashier of appellant, Angola State Bank, and traded stock of the Steuben County State Bank for the five shares of stock of the Angola State Bank represented by certificate number 33, and thereupon the trustees delivered this certificate to appellant Sheffer. Sheffer then filled in the blanks on the assignment above the name of appellee and turned the certificate over to the appellant bank and received a new certificate for five shares of stock of the Angola State Bank. In 1937, about a year and a half after Sheffer received the stock, the appellant bank started to pay dividends and appellee having heard of the dividends requested information as to why she received none and was informed that she owned no stock, and that the stock then belonged to Sheffer. She then demanded her certificate and upon refusal, she filed an action first against Sheffer and later against the bank, in each of which she claimed ownership of the stock and asked its return. The suit against Sheffer is still pending, but appellee was successful in her suit against the bank and recovered damages in the sum of forty-five dollars ($45) and judgment that the bank either return the stock or pay its value in the sum of seven hundred fifty dollars ($750). When Sheffer was sued, he went to the three trustees of the Steuben County State Bank and told them of the situation, and they agreed to defend actions against him and the Angola State Bank, to employ and pay for attorneys, costs, and damages, and in addition they turned over another certificate for five shares of stock of the Angola State Bank to the appellant bank. Neither Sheffer nor the Angola State Bank employed attorneys, but this was done by the trustees, who really conducted each case through the attorneys selected and paid by them.

The appellant bank claimed that there was a defect of parties and that the officers of the bank and R. Waldo Sheffer were necessary parties. The rule seems to be that where, as in this case, the defendant is a corporation capable of being sued, it is sufficient to proceed against it in its corporate capacity, without joining the officers or agents who must carry out the command to the corporation. Board of Commissioners of Leavenworth County v. Sellew, 1879, 99 U.S. 624, 25 L.Ed. 333; Wren v. City of Indianapolis, 1884, 96 Ind. 206; § 3-2202, Burns' 1933, § 1091, Baldwin's 1934.

The complaint is also challenged for failing to allege a demand but an examination of the complaint shows that it does allege facts from which it can be inferred that a demand would have been a useless thing, and from which a refusal could be inferred. That is sufficient, and the court did not err in overruling the demurrer for insufficiency of facts. Lake Erie & W. R. Co. v. State ex rel. Mushlitz 1894, 139 Ind. 158, 38 N.E. 596; Finerty, Auditor, v. State ex rel. Greenwald, 1939, 215 Ind. 346, 19 N.E.2d 846.

While questions are raised relative to the overruling of demurrers to answers to cross-complaints, we feel that no harm could have been caused the appellants by these rulings because the cross-complaints were not in effect what the name would imply. The appellants merely alleged the same facts in those so-called cross-complaints as were averred in their answers and all evidence admissible under the cross-complaints or under the answers to cross-complaints was admissible under the complaint and answers. This was true in all except one answer to the cross-complaint of appellant Sheffer. This answer pleaded a pending cause as a bar to the cross-complaint. However, no evidence of the pending cause was admitted and no harm was done, therefore the ruling did not constitute reversible error. Washington Hotel Realty Co. v. Bedford Stone, etc., Co., 1924, 195 Ind. 128, 143 N.E. 156.

The findings disclose that in a prior action the...