Bank of Moberly v. Meals
| Decision Date | 11 April 1927 |
| Docket Number | No. 25473.,25473. |
| Citation | 295 S.W. 73 |
| Parties | BANK OF MOBERLY v. MEALS et al. |
| Court | Missouri Supreme Court |
Appeal from Circuit Court, Audrain County; E. S. Gantt, Judge.
Suit by the Bank of Moberly against Roswald Meals and others. From a judgment for defendants, plaintiff appeals. Reversed and remanded, with directions to enter judgment for plaintiff as against defendants Logan Meals, May Meals, and Otto Meals. Affirmed as to the other defendants.
Willard P. Cave and M. J. Lilly, both of Moberly, W. W. Fry, Jr., of Mexico, Mo., and Perry S. Rader, of Jefferson City, for appellant.
A. R. Hammett, of San Antonio, Tex., and Rodgers & Buffington, of Mexico, Mo., for respondents J. Marvin Meals and Ernest Cottingham.
This case comes to the writer for opinion on reassignment. It is a suit on a promissory note. The note was dated April 30, 1921. According to its purport, the defendants Roswald Meals, Logan Meals, May Meals, and Otto Meals, as makers, promised to pay to the order of plaintiff bank, one year after date, $15,200, with 6 per cent. per annum interest thereon from date, payable annually. Prior to its delivery it was indorsed in blank by defendants J. Marvin Meals and Ernest Cottingham for the accommodation of the makers; the indorsers waiving notice of demand and protest.
The petition is in the usual form. Defendant Roswald Meals by his answer pleads release from liability by reason of a discharge in bankruptcy. Defendant Otto Meals by verified answer denies that on the 30th day of April, 1921, he made and executed the note sued on. He further alleges a total failure of consideration. Defendant May Meals in her separate answer alleges in general terms a failure of consideration. Defendants J. Marvin Meals and Ernest Cottingham, in a joint and separate answer, set up two defenses: (1) That defendant Otto Meals signed the note sued on long after its execution and delivery by the other parties thereto, by reason of which there has been a material alteration of the note; and (2) that they were compelled to indorse the note through duress, in that the officers of plaintiff bank were threatening unless they did so to institute a criminal prosecution against Roswald Meals, their near relative. Defendant Logan Meals has filed no answer. The new matter in all of the answers except that of defendant Roswald Meals, is put in issue by replies.
No part of the answer of the defendants J. Marvin Meals and Ernest Cottingham purports on its face to be a cross-petition. The matters relating to material alteration and duress are apparently pleaded as defenses; yet the answer concludes with a prayer that "the decree of the chancellor be that the note in question be delivered up, declared to be null and void and canceled, and for such other and further relief," etc. The cause was tried in the circuit court as a suit in equity; the court found generally for the defendants on all issues, and entered a decree in conformity with the prayer just quoted. As the cause was tried below by both parties on the theory that it had been converted by answer into a suit in equity, it will be disposed of on that theory here.
Such of the uncontroverted facts as will show in a general way the setting of the case will first be noted. Defendants Logan Meals and May Meals are husband and wife; defendants Roswald and Otto are their sons. At the time of the occurrences herein referred to, Logan and May Meals resided on his farm of 120 acres, located in Randolph county, about 6 miles from Moberly. Roswald and Otto owned 80 acres of land adjoining, or near, that of their father. The father and the two sons were engaged in farming and in raising and buying and selling live stock. They operated as partners under the firm name of Logan Meals & Sons. Otto lived with his parents; Roswald was employed at the Kansas City stockyards as auctioneer, but he customarily spent the latter part of each week at his father's home.
In April, 1917, Logan Meals & Sons, through Roswald, opened an account with plaintiff bank, and thereafter each member of the copartnership, as occasion offered, drew checks against the firm's account. At about the same time that the account was opened, Logan Meals and his two sons borrowed of plaintiff $6,600 and gave as security a deed of trust on the 200 acres of land heretofore referred to; the copartnership also borrowed from the bank $1,900 on their unsecured note. Thereafter the firm's unsecured indebtedness to the Bank was increased from time to time by additional loans until, on December 24, 1920, it had reached the sum of $21,000. On that date Roswald Meals applied for a further loan of $6,165.05, and was told by the bank's officers that no further advances would be made on his firm's unsecured paper. Thereupon Roswald represented that the copartnership owned, and then had out on the farms belonging to his father and to himself and Otto, live stock of the value of about $17,000. It was then arranged that the bank would make the additional loan, and that Logan Meals and his two sons would execute two new notes, one for $12,000, to be secured by a second deed of trust on the 200 acres of land, and one for $15,976.40, to be secured by chattel mortgage on the live stock, thereby securing all of the then unsecured indebtedness of the firm to the bank as well as the loan applied for. This arrangement was carried into execution. The $12,000 note and deed of trust were signed by Logan Meals and his wife, May, and by each of his two sons. The $15,976.40 note and chattel mortgage were signed individually by the father and each of the sons. Logan and Otto each denied that he signed these two documents, but, according to the great weight of the evidence, both signed them.
On April 29, 1921, in response to the insistence of the bank's officials that such of the live stock described in the chattel mortgage as was in a marketable condition be sold and the proceeds applied on the mortgage indebtedness, Roswald Meals confessed that Logan Meals & Sons did not have, either then or at the time the mortgage was given, any such live stock as was described therein. He stated, however, that he could furnish personal security that would be satisfactory to the bank. In that connection he named J. Marvin Meals and Ernest Cottingham and two others as persons whom he might be able to procure as sureties on a new note. He was told that any two of the four named would be acceptable, but that the matter must be fixed up at once. He immediately went to see first Meals, a brother of his father, and then Cottingham, a brother of his mother. Both were farmers and at that time were living near Moberly. He explained to each his dilemma, and each promised to come to town the next day and see what could be done to extricate him from his embarrassment. The next day, at about 2:30 o'clock in the afternoon, Roswald Meals, Logan Meals, and May Meals appeared at plaintiff's banking rooms and signed as makers, in the order just named, the note in suit (whether Otto Meals signed the note on that day will be considered in subsequent paragraphs). After the three had signed they went out on the street to see if they could find J. Marvin Meals and Cottingham. Presently the latter made their appearance and inumerable conferences then followed between them and the members of the Meals family who were present, and between all of them (through intermediaries) and the officials of the bank. Finally, about 4:30 p. m., long after the bank's regular closing hour, J. Marvin Meals and Cottingham indorsed the note, and it was delivered to the bank.
According to the testimony of Logan Meals and May Meals, Otto did not go to Moberly with them the day they signed the note. They and Roswald ate an early dinner and then drove to Moberly in an automobile, leaving Otto at home at work harrowing in oats. When they returned about 5 o'clock or a little later, they summoned him from the field, where he was still at work, to drive Roswald to Moberly to enable the latter to take a 6 o'clock train to Kansas City.
Mrs. Sarah Cottingham, Mrs. Meals' aged mother who was then staying at the home of her daughter, testified that Otto was at work all day harrowing in oats in a field in sight of the, house, that he did not leave the place until late in the evening when he left with Roswald to take him to a train, and that he was then gone but a short time.
Otto Meals testified that on April 30, 1921, he was at work all day on the farm harrowing in oats; that when he came in at noon he inquired of his grandmother where the other members of the family were and was told that they had gone to Moberly; that he returned to the field and continued to work until about 5 o'clock, when he was called to the house to take Roswald to the train; that he drove Roswald to Moberly, and, without getting out of the automobile, immediately returned home; that on the following Thursday Roswald on his return from Kansas City told him about the note and the bank's direction that he come in and sign it; and that on the next day he and Roswald drove to Moberly, and he went into the bank and placed his signature on the note.
J. Marvin Meals and Ernest Cottingham each testified that he did not see Otto Meals in Moberly on the day on which the note was executed, and that his signature was not on the note at the time they indorsed it and at the time it was delivered to the bank.
Plaintiff called three of its officers as witnesses: Frank Harvey, cashier, John S. Lamb, vice president, and John E. Lynch, president. Mr. Lynch, at the time of the occurrences giving rise to this controversy, was United States marshal for the Eastern district of Missouri, with headquarters at St. Louis. He customarily spent Saturday of each week at the bank in Moberly, where he acted in an advisory...
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