Austin v. Cochran

• Decision Date: 22 February 1928
• Docket Number: (No. 877-4417.)
• Parties: AUSTIN, State Banking Com'r, et al. v. COCHRAN.
• Court: Texas Supreme Court

Page 831

2 S.W.2d 831

AUSTIN, State Banking Com'r, et al. v. COCHRAN.

(No. 877-4417.)

Commission of Appeals of Texas, Section B.

February 22, 1928.

Error to Court of Civil Appeals of Ninth Supreme Judicial District.

Suit by Jeff Cochran against Charles O. Austin, State Banking Commissioner, and another. Judgment for plaintiff was affirmed by the Court of Civil Appeals (271 S. W. 169), and defendants bring error. Reversed and rendered.

W. A. Keeling, of Austin, and Riley Strickland, of Amarillo, for plaintiffs in error.

Campbell, Myer, Simmons & Hawkins, of Houston, for defendant in error.

SPEER, J.

Jeff Cochran filed suit against the state banking commissioner, the Shepherd State Bank, and San Jacinto county, claiming to be the owner of a deposit in the Shepherd State Bank in the sum of $16,000, which he alleged was a noninterest-bearing, unsecured deposit on August 19, 1921, the date when the bank ceased to do business and was closed by the banking commissioner. By amendment, San Jacinto county was dropped from the suit, and upon trial the plaintiff had judgment against the remaining defendants according to his prayer. The judgment was affirmed by the Court of Civil Appeals for the Ninth District. 271 S. W. 169.

The claim of defendant in error grew out of an assignment to him of two certificates of deposit for the sum of $8,000 each. originally issued by the bank to Harold G. Wise & Co., along with another in the same amount, each of which certificates was in the following form:

                "The Shepherd State Bank.   No. 8. 88-1291
                     "Shepherd, Texas, December 16, 1919
                "Certificate of Deposit.  Not Subject to Check
                

"Harold G. Wise & Co. has deposited in this bank eight thousand dollars ($8,000.00) payable to the order of Harold G. Wise & Co. in current funds on the return of this certificate properly indorsed 19 mos. after date, with interest at none per cent. per annum if left none months.

                                       "Ed. Cochran, Cashier
                  "No interest after maturity
                  "Maturity 19 mos. after date.
                  "July 16, 1921."
                

Indorsed on back:

"Without recourse, pay to the order of J. E. Phillips, county treasurer of San Jacinto county, Texas. Harold G. Wise & Co., by W. W. Wise.

                  "J. E. Phillips, Co. Treas.
                  "Jeff Cochran." 
                

Certificate No. 9, one of the two held by defendant in error, was identical with the above, save that it was payable 20 months after date.

We will not consider the interesting question whether or not defendant in error as assignee, without any prior or other relations with the bank than of these certificates of deposit, would in any event be a depositor within the meaning of our Guaranty Fund Bank Law (Rev. St. 1925, arts. 437-489), since our conclusion upon the question of interest renders such decision unnecessary.

The Court of Civil Appeals upon this issue sustained the judgment of the trial court to the effect that the deposit was a noninterest-bearing one. That court's statement as to this issue and its conclusions are as follows:

"But appellants say that interest in the sum of $1,900 was paid by the Shepherd State Bank in advance on the deposit of $24,000, and to prove this introduced a cashier's check drawn on the Shepherd State Bank for the sum of $1,900, of date December 16, 1919, the same date as the deposit certificates, payable to Harold G. Wise & Co., and signed by Ed. Cochran, cashier of said bank. This check was indorsed by Harold G. Wise & Co., and also bears the indorsement of two Houston banks, but it is not stamped or stencilled `Paid,' and there is no evidence that it was paid, other than the inference to be drawn from the fact that it was found in the Shepherd State Bank among the papers of the bank. This check was found in what is called a `note envelope,' that is an envelope that has a note printed on the outside, which it was testified, is used for the convenience of putting collateral on the inside. The note printed on the envelope was a regular printed form used by the Shepherd State Bank, and dated `Shepherd, Texas, January 8, 1920' (23 days after the issuance of the certificates of deposit), for the sum of $1,900, payable to the order of the Shepherd State Bank on demand and in the blank space...