Arnold v. Security Bank of St. Joseph

• Decision Date: 24 May 1926
• Parties: CLYDE C. ARNOLD, RESPONDENT, v. SECURITY BANK OF ST. JOSEPH, APPELLANT. [*]
• Court: Kansas Court of Appeals

285 S.W. 161

221 Mo.App. 683

CLYDE C. ARNOLD, RESPONDENT, v. SECURITY BANK OF ST. JOSEPH, APPELLANT. ^[*]

Court of Appeals of Missouri, Kansas City

May 24, 1926

Appeal from the Circuit Court of Buchanan County.--Hon. Sam Wilcox Judge.

AFFIRMED.

Judgment affirmed.

Eastin & McNeeley for respondents.

Groves & Watkins and R. L. Douglas for appellant.

ARNOLD J. Bland, J., concurs. Trimble, P. J., absent.

OPINION

ARNOLD, J.--

This is an action in assumpsit for money had and received.

Defendant is a banking corporation, organized and existing under the laws of the State of Missouri and located at St. Joseph in said State. The original petition herein was filed on April 21, 1923, and on February 4, 1925, by leave of court an amended petition was filed. On the same day defendant filed its motion to strike the amended petition from the files upon the grounds that the same was a departure and stated a different cause of action. The motion to strike out was overruled and defendant thereupon filed a term bill of exceptions against the said action and ruling of the court. The term bill of exceptions was allowed and by order of the court was made a part of the record herein.

The facts shown are that the plaintiff Clyde C. Arnold was, for a number of years, a customer of defendant bank; that at some time prior to August, 1917, he deposited the sum of $ 1500 with said bank for which he received a time certificate of deposit, due in six months and drawing interest at the rate of four per cent. On January 29, 1917, plaintiff indorsed said certificate in blank and delivered it to E. V. Cumberford, defendant's cashier, which the alleged understanding that in lieu of said certificate plaintiff was to receive a good bankable note drawing a higher rate of interest than the certificate of deposit.

At this point there is a sharp conflict in the evidence as to what was said by the parties. Plaintiff and his wife who was with him at the bank at the time the certificate was indorsed and delivered both testified that they were first approached by Mr. Cumberford, the cashier, with the suggestion that they leave the money with the bank to secure a higher rate of interest on a bankable note which the bank would deliver to plaintiff, and that the bank would stand behind such note. Mr. Cumberford, the cashier, testified that Mr. and Mrs. Arnold had requested him to find an investment for them that would pay a higher rate of interest than the certificate of deposit. Cumberford stated he negotiated the loan for one F. W. Paschal who, at the time, was a consulting attorney for the bank, in the amount of $ 1500 for which a note was given, dated January 29, 1917, payable to E. V. Cumberford, with interest at seven per cent, per annum from date, signed F. W. Paschal, and that said note was indorsed on the back in blank by the payee; that the note was made payable to Cumberford personally, as a means of enabling him to negotiate a loan for Paschal; that he (Cumberford) placed the money directly to Paschal's credit in what was designated on the book accounts of the bank as his "special account." Cumberford stated that he explained fully to plaintiff and Mrs. Arnold that it was not a bank transaction but that the note was good and that he, personally, would indorse it.

It is in evidence that at the time the certificate of deposit was surrendered, as above stated, Cumberford gave to plaintiff a receipt for a note for $ 1500 not specifically described, and signed it E. V. Cumberford, individually. This receipt was not introduced in evidence but the testimony shows it had either been surrendered to Cumberford and destroyed, or that it had been lost or misplaced by plaintiff. The note was not delivered to plaintiff at that time but was held in the bank. The interest on said note was paid by or through the bank up to and including January, 1922. On June 12, 1922 the defendant bank was closed by the State banking department, at which time Cumberford and the other directors resigned. A few weeks later, the bank was reorganized, a new board of directors elected, and the bank reopened.

It is shown that in March, 1918, plaintiff and his wife moved to Texas, at which time plaintiff borrowed $ 500 from defendant bank, executing his note therefor. This note was renewed several times and was still in possession of the bank at the time of filing the suit herein. The Paschal note remained in possession of the bank until January, 1922, when it was delivered to the wife of plaintiff and the receipt above mentioned was surrendered to Cumberford.

The circumstance of the borrowing of the $ 500 from defendant by plaintiff is explained by plaintiff who stated that he and his wife desired some money to defray their expenses in moving to Texas; that he wanted $ 500 of the $ 1500 involved in this suit, and that the transaction was as follows:

"Q. At that time you borrowed five hundred dollars from the Security Bank? A. No, I never borrowed.

"Q. Did you give your note to the bank? A. I gave my note, and I asked him why and he said 'that will be all right. We will keep that for you and when you settle the other, we will square the deal.'

"Q. He said 'when you collect the note that I am holding in the bank, you can pay the debt?' A. He says, 'any time I pay you that note, you can pay us the five hundred dollars and I will not charge you any more interest on this than you are getting on your note--' and I got five hundred dollars from Mr. Cumberland on this note.

"Q. They would charge you interest on your note that you had given the bank for five hundred dollars and would pay you interest on the Paschal note, is that right? A. He would pay me what was coming. He would take it off my note that I owed him.

"Q. He would take the interest money out? A. He would take the interest money out of the five hundred dollars and send me the balance."

Indorsements upon the back of the $ 1500 note shows interest paid as follows:

"E. V. Cumberford.

Cr. March 4, 1918 Int.

$ 90.00

Cr. March 4, 1919 Int.

60.00

Cr. March 4, 1919 Int.

30.00

Cr. Int. to January 29, 1920

90.00

Cr. Int. to January 29, 1921

105.00

Cr. Int. to January 29, 1922

105.00"

Plaintiff's wife testified that about February 1, 1922, when she drew the interest on the $ 1500 note, Cumberford demanded the receipt given by him, heretofore mentioned, and that she surrendered it to him and he delivered to her the Paschal note; that until then the Paschal note had never been seen by plaintiff or his wife and had not been in the possession of either of them.

The cause was tried to a jury resulting in a verdict and judgment for plaintiff in the sum of $ 1500. Motions for a new trial and in arrest of judgment were overruled and defendant appealed.

The first point demanding our consideration is the action of the court in overruling defendant's motion to strike out plaintiff's amended petition. As stated above, defendant filed a term bill of exceptions to the said ruling of the court, thereby saving its exceptions. The point was saved, also, in the motions for a new trial and in arrest of judgment but is not included in the assignments of error nor referred to in the briefs. We must conclude, therefore, that the point is abandoned and requires no further discussion.

It is charged that the court erred in refusing to give defendant's instruction in the nature of a demurrer offered at the close of all the evidence. In support of this charge it is urged that it was incumbent upon the plaintiff, as a condition precedent, to his right to maintain this action, to plead and prove a return, or offer to return, the Paschal note held by plaintiff at the time of the trial, which he failed to do.

The amended petition charges that defendant is, and was, a banking corporation and that up to June 12, 1922, E. V. Cumberford was the cashier thereof, and as such was in charge and control of its affairs and performed the usual duties of a cashier, accepted money on deposit, made loans for said bank, discounted commercial paper, and managed and handled the funds on deposit, and

"Plaintiff further states that on the---day of----1918, he had on deposit in said bank a sum of money in excess of $ 1500, and on said date defendant, by and through its officers and agents, promised and agreed with plaintiff that if he would turn over to defendant the sum of $ 1500 out of his said account, defendant would deliver to him a promissory note for a like sum signed by a solvent maker and bearing interest at the rate of six per cent per annum; that plaintiff, pursuant to said promise and relying thereon, gave to defendant and defendant accepted from plaintiff the said sum of $ 1500; but said defendant failed and refused ever to turn over to plaintiff any note signed by a solvent maker, pursuant to said agreement; that upon said failure, the defendant promised and agreed to return to plaintiff the said sum of $ 1500 but has failed to do so, though demand therefor has often been made."

As to the point urged that no tender of the return of the $ 1500 Paschal note was made, it must be concluded that the point is not well taken. The record shows that during the progress of the trial plaintiff's counsel did make tender of the return of the note. There is testimony tending to show that the note was in the possession of defendant bank until about February 1, 1922, and that the bank was closed soon after that date. Moreover, from the pleadings, it is clear that this is an action for money had and received, and not one in conversion.

In support of its contention defendant urges that plaintiff is without the right to maintain this action unless it be shown that there was a tender of the note, and cites the case of Andrews v. Bank, 208 Mo.App. 366, ...