Barnsdall Nat. Bank v. Dykes

• Decision Date: 17 July 1928
• Docket Number: 17619.
• Citation: 277 P. 219,136 Okla. 226,1928 OK 464
• Parties: BARNSDALL NAT. BANK et al. v. DYKES.
• Court: Oklahoma Supreme Court

277 P. 219

136 Okla. 226, 1928 OK 464

BARNSDALL NAT. BANK et al. v. DYKES.

No. 17619.

Supreme Court of Oklahoma

July 17, 1928

Rehearing Denied Jan. 22, 1929.

Application to File Second Petition for Rehearing Denied May 14, 1929.

Syllabus by the Court.

Where a contract is entered into between two banking corporations one of which is in a failing condition, by the terms of which one of said banks assumes all the debts and liabilities of the other, and also receives all the assets, and assumes charge of the same, and pays the depositors and other liabilities without any objection on the part of the stockholders, the failing bank or its officers and directors will be estopped from denying the authority of the officers of said bank to execute said contract because said officers were not authorized at a meeting of the board of directors or stockholders.

Where the plaintiff, a banking corporation, agrees to take over all the assets, and assume all the liabilities, of the defendant a failing banking corporation, and, in addition thereto, to pay to said defendant the sum of $7,000, and in consideration thereof the said defendant and its officers execute a contract guaranteeing to make good certain notes of the failing bank, in case the said notes are not collectible within a specified period, and where it further appears that all the debts and liabilities were paid by the plaintiff, and that they took full and complete charge of all the assets of the defendant bank, in the absence of proof on behalf of the defendant that $7,000 was not paid, it will be presumed that all the conditions of the contract were performed by the plaintiff.

Waiver and ratification must be specifically and distinctly pleaded and, if not so pleaded, evidence of such ratification or waiver is not admissible. But, where the trial court's attention is not called to the absence of such pleading by proper objection to the testimony, the pleading will be considered as amended, if an amendment would have been proper.

Although an attorney's argument to a jury may be improper, the case will not be reversed on account of the refusal of the trial court to sustain an objection thereto, unless the same has probably resulted in a miscarriage of justice, or constitutes a substantial violation of some constitutional or statutory right.

Although one instruction given to a jury may be objectionable or even reversible error, if taken by itself and considered separately, the cause will not be reversed for that reason if all the instructions considered together substantially state the law of the case and the entire record discloses no manifest injustice or prejudice to the complaining party.

Record examined, and held, that the evidence supports the verdict and judgment and the instructions fairly cover the law of the case.

Commissioners' Opinion, Division No. 1.

Appeal from District Court, Osage County; Jesse J. Worten, Judge.

Action by John H. Dykes, receiver of the First National Bank of Barnsdall, against the Barnsdall National Bank and others. Judgment for plaintiff, and defendants appeal. Affirmed.

A. M. Widdows, of Tulsa, and John T. Craig and Frank T. McCoy, both of Pawhuska, for plaintiffs in error.

Robert B. Keenan, of Tulsa, for defendant in error.

FOSTER C.

This action is based upon a contract made and entered into on the 12th day of November, 1923, between the Barnsdall National Bank, signed by its president, G. R. Little, and cashier, H. R. Little, as parties of the first part; the First National Bank of Barnsdall, by L. A. O'Brien, president, and L. D. Gray, vice president, as parties of the second part; and G. R. Little, H. R. Little, John Javine, Jr., and G. E. Gibson, on their own behalf, designated as parties of the third part.

The contract provided, in substance, that the First National Bank should take over all of the assets, and assume all of the liabilities, of the Barnsdall National Bank, including a lot designated as lot 9, block 17, of the original town of Barnsdall, that the Barnsdall National Bank was in a failing condition, and was insolvent, and that its vice president and managing officer had misappropriated its funds, and that it was unable to longer continue as a banking institution. All of the assets of the bank are listed in the contract.

There is also a list of securities in the form of notes and bonds in the sum of $27,833.98, which is designated as "bad assets," together with a list of securities in the sum of about $7,100, which is designated as "doubtful or objectionable assets," and a third list in the sum of over $82,000, which is designated as "good assets."

The Barnsdall National Bank and the parties of the third part guarantee all those assets listed as "bad assets," in that, if the same are not collected with 60 days after the execution of the contract, they will pay the First National Bank for the same, and have the said assets assigned to these parties.

The contract further provides that the First National Bank shall use reasonable diligence in attempting to collect or liquidate the said bad assets, and in doing so will not extend any of the notes without the consent of the parties of the third part.

It further provides that, so far as the real estate above mentioned is concerned, they will take over said real estate and assume all the indebtedness against it, and will pay to the parties of the third part the sum of $7,700 in cash.

The petition in this case alleges a default in the performance of the terms of the contract, in that the 60 days has expired, and the defendants have failed and refused to pay for the bad assets above referred to, and that the same have not been collected.

As a defense to this action on the contract, the Barnsdall National Bank, G. R. Little, and H. R. Little filed their answer, in which they first deny all the allegations of plaintiffs' petition, and deny the execution of the contract; and as a further defense state that the contract was entered into under fraud and duress, practiced on these defendants at the time and before the execution of the contract; that said duress, threats, intimidations, false and fraudulent representations, consist of statements made by the bank examiner for the United States in the presence of the officers of the First National Bank at the time of the execution of said contract. They further deny in their answer that the contract is binding, because there was no authority given to either of the officers of the two banks to make and execute the contract; and, further, that the plaintiff First National Bank has never performed its part of the contract, and has failed, neglected, and refused to endeavor to collect the notes mentioned in said contract and listed as bad assets.

To this answer the First National Bank files its reply in the form of a general denial, and upon a trial of the case, before a jury, a judgment was rendered in favor of the plaintiff, from which the defendants Barnsdall National Bank, H. R. Little, and G. R. Little appeal.

The parties will be referred to as they appeared in the trial court.

Six assignments of error are set up by the defendants, as follows:

(1) That the defendants' demurrer to the evidence and the motion for an instructed verdict should have been sustained; (2) that it was error for the court to permit the question of waiver to enter said case by means of evidence, instruction, and argument of counsel, as the same was not within the issues; (3) that the court erred in giving certain instructions over the objections of the defendants and refusing certain requested instructions; (4) that it was error for the court to direct a verdict against the defendant Barnsdall National Bank, for the reason that the plaintiff failed to make a case against any of the defendants; (5) that the judgment rendered by the said court is erroneous; (6) that defendants' motion for a new trial should have been sustained.

In defendants' brief they argue the first proposition under two headings-that the demurrer should have been sustained, and the instructed verdict should have been given, first, for the reason that the contract was not sufficiently identified, and no proper authority was shown for its execution; and, second, that there was no evidence that the cash consideration of $7,700, as provided in the contract, had been paid by the plaintiff.

As to the first proposition under this assignment of error, the evidence shows that the president and cashier of the two banks executed this contract, and that they were the officers of the bank at the time they executed it, and that the signatures on the contract were genuine. There is some evidence that they were authorized by a majority of the board, and that a resolution was passed giving such authority to the officers. So far as the defendant bank was concerned, there was no resolution introduced, but a purported copy of such a resolution was introduced, and some of the witnesses testified that they were present when the resolution was passed; it being contended, however, that, since the bank was selling all of its assets, the authority must come from the stockholders, and there seems to be no testimony indicating a meeting of the stockholders for the purpose of authorizing the sale.

In support of this proposition, the defendants cite numerous cases, holding, as a general rule, that the managing officers of a corporation have no power, without authority from the board of directors, to pledge or sell corporate property. Quaker Oil & Gas Co. v. Jane Oil & Gas Co., 63 Okl 234, 164 P. 671; First Nat. Bank of Clifton v. Clifton Armory Co., 14 Ariz. 360, 128 P. 810, Ann. Cas. 1915A, 1061; Citizens' Securities Co. v. Hammel, 14 Cal.App. 564, 112 P. 731; De La Vergne...