Arkansas Nat. Bank v. Martin

• Decision Date: 12 January 1914
• Citation: 163 S.W. 795
• Parties: ARKANSAS NAT. BANK v. MARTIN.
• Court: Arkansas Supreme Court

Page 795

163 S.W. 795

ARKANSAS NAT. BANK v. MARTIN.

Supreme Court of Arkansas.

January 12, 1914.

Appeal from Circuit Court, Garland County; Calvin T. Cotham, Judge.

Action by Ferdinand Piper, after whose death his special administrator, W. H. Martin, was substituted, against the Arkansas National Bank. From a judgment for plaintiff, defendant appeals. Affirmed.

Rector & Sawyer, of Hot Springs, for appellant. Martin & Wooton, of Hot Springs, for appellee.

McCULLOCH, C. J.

The plaintiff, Ferdinand Piper, instituted this action in the circuit court of Garland county against defendant, the Arkansas National Bank, of Hot Springs, to recover the amount of a check drawn by him on a bank at Fargo, N. D which was deposited for collection with defendant and collected. The check was drawn to plaintiff's own order and indorsed in blank, and he claims that he was induced to part with the check through a swindling device of two men that he met in Hot Springs. The check was for the sum of $10,200, and was forwarded for collection through defendant bank and collected. Plaintiff recovered judgment for the amount in the trial below, and defendant appealed.

The facts, so far as they are material to the questions presented on this appeal, are undisputed. Plaintiff lived at Fargo, N. D., and seems to have been a man of some means. He had property there, and also in Cuba. In December, 1912, he started on a trip to Cuba, and stopped at Hot Springs for a short visit. On his arrival there he met in a restaurant a stranger who gave his name as Hammond, and who invited him to go out to the ostrich farm. After making a short visit to the ostrich farm, and just as they came out, Hammond introduced him to a man named Miller, who claimed to be connected with what is termed a "commission house" near by. The place was really a poolroom for betting on fake horse races. Miller claimed that his uncle was the proprietor of the place and was a very rich man and furnished him advance tips on the winners of each race. Hammond and Miller were evidently acting together for the purpose of swindling the plaintiff, and they induced him to go to the so-called commission house and bet on a horse race; Miller giving plaintiff a tip on the horse that was to win. Miller and Hammond were to have a share in the winnings. Plaintiff gave checks aggregating $12,000, including the one involved in this suit, and bet that amount on the horse designated by Miller. He was given odds of 3 to 1, and won the bet; his winnings being the sum of $36,000. When they called for the money, payment of the bet was refused on the ground that only bets made in currency were allowed, and that payment would not be made until the checks which plaintiff had put up should be paid. The checks were in the hands of a clerk or bookkeeper of the concern, evidently a confederate, and it was agreed that they should be forwarded for collection, and, when paid, the plaintiff should receive the $36,000 which had been won on the horse race. The sum of $1,800 was in the form of traveler's checks, upon which there was no recovery and need not be further mentioned in this case. The check on the bank at Fargo was delivered by Hammond or Miller or some of their confederates to one Spear, who, in turn, placed it with defendant bank for collection, indorsing his initials thereon for identification. Plaintiff remained in and about Hot Springs at the request of Miller and Hammond in order to collect his winnings after the check should be paid, and in a few days they reported to him that the check had been paid, and invited him out to the commission house to get his winnings. When they got there, Miller told plaintiff that the money would be ready for him in about 15 minutes, and in the meantime he gave plaintiff $500, with instructions to bet it for him on a certain horse which he said he had received information would win second place in the race, and the instruction was to bet it on that horse to win second place. He did so and won the bet, turning the winnings over to Miller. Hammond bet the full amount of plaintiff's winnings on the same horse race, but, instead of betting that the horse would run second, he bet that the horse would run first, and thus lost the bet. This, of course, was just a play on the part of Hammond and Miller to swindle the plaintiff and induce him to believe that he had fairly lost the money, and he seems to have accepted that situation at the time. He states that, when Hammond reported the loss of the $36,000, Miller cried and offered to make restitution to him as far as he could. Miller claimed that he had $25,000 in New York and that he would accompany plaintiff on the trip to Cuba as far as Jacksonville, Fla., and would send Hammond to New York to arrange to get the $25,000. Miller did accompany plaintiff as far as Jacksonville, but on their arrival there plaintiff seems to have begun to realize that he had been swindled out of his money, and separated himself from Miller, and went to Key West, Fla., where he sent a telegram, addressed to defendant bank at Hot Springs, in the following words: "Don't pay check that was sent from National Bank of Fargo, N. D., and Ferdinand Piper, $10,200. I am going to Cuba. When I come back I will get the money. [Signed] Ferdinand." That message was sent, and was received by defendant bank, on December 23, 1912, after the check had been paid by the Fargo bank and report of the collection had been made to defendant through its St. Louis correspondent. The officers of defendant bank accepted this telegram as notice that there was something wrong about the ownership of the funds thus collected and declined to pay the money over to Spear, who was a regular customer of the bank, and on December 28th Spear instituted an action of replevin against the bank to recover the sum of $10,200 in currency. An order of delivery was issued, directed to the sheriff of the county, commanding him to take from defendant, the Arkansas National Bank, $10,200 "in money, currency of the United States." The sheriff proceeded to serve the writ by making demand upon the bank for delivery of funds in the amount named, and the bank, in lieu of delivery of the funds, gave the sheriff a certificate of deposit and placed the same to the credit of the sheriff. The sheriff subsequently gave Spear a check on the bank for the amount, and it was placed to Spear's credit. That case came on for trial, and the court sustained a demurrer to the complaint and rendered final judgment in favor of defendant bank against Spear and the sureties on his bond. The record in that case was introduced in evidence in this and is in the record on this appeal.

A day or two after the receipt by the bank of plaintiff's message, it received another telegraphic message, same purporting to be from plaintiff, sent from Tampa, Fla., and directed the bank to ignore the former telegram; but plaintiff testified that he did not send this message, and there was no testimony that he did send it.

The question whether the bank was put upon notice as to plaintiff's ownership was fairly submitted to the jury, and the verdict is conclusive on that question. The other undisputed facts establish the liability of the bank to the plaintiff, and the assignments of error in regard to the charge of the court to the jury need not be discussed.

This is not an action sounding in tort, but is one corresponding with the common-law action of assumpsit for money had and received. Counsel for defendant are in error in their insistence that this is either an action in tort or upon implied contract arising out of an alleged wrongful act of defendant. The action does not involve any wrongful act of the defendant, except the failure to pay over the money, but it is based upon the contention that the plaintiff was induced to part with the check through fraud of another person; that the title, for that reason, never passed out of the plaintiff; and that the bank received and had in its possession, with notice, the proceeds of the collected check, from which the law implied an agreement to hold the money for plaintiff's use and pay it over to him on demand. Therefore, the question of waiving the tort and suing upon implied contract is not involved in this case.

Plaintiff's right to sue for the money received is very clear, and is based upon the plain principle that, where one...