Blackwelder v. Fergus Motor Co.
| Decision Date | 01 November 1927 |
| Docket Number | 6200. |
| Citation | 260 P. 734,80 Mont. 374 |
| Parties | BLACKWELDER v. FERGUS MOTOR CO. et al. |
| Court | Montana Supreme Court |
Appeal from District Court, Fergus County; Edgar J. Baker, Judge.
Action by Clarence Blackwelder against the Fergus Motor Company and another. From a judgment for plaintiff, defendants appeal. Affirmed.
Wm. M Blackford, of Lewistown, for appellants.
Ralph J. Anderson, of Lewistown, for respondent.
The defendants, Fergus Motor Company and Guy Tullock, as sheriff of Fergus county, have appealed from a judgment in favor of the plaintiff, Clarence Blackwelder, perpetually enjoining them from foreclosing a chattel mortgage for the sum of $435 found by the court to have been paid on the mortgage indebtedness by the plaintiff to the Fergus Motor Company mortgagee.
The undisputed facts, as they appear from the pleadings and proof, are substantially as follows: In May, 1925, plaintiff purchased of the motor company a Fordson tractor on a conditional sale contract, making a down payment, and giving his note for the balance of $435, payable October 1, 1925, with interest at 10 per cent. per annum, and, as additional security for the payment of this note, gave to the motor company a chattel mortgage on his 1925 wheat crop, raised on his ranch 17 miles from the town of Winifred, which town was 45 miles from Lewistown, the home of the motor company, and place of payment of the note. Winifred had but one bank, and at all times herein mentioned the plaintiff had on deposit therein more than the sum of $435.
The government maintained a rural mail route from Winifred to within a mile and a half of plaintiff's ranch, on which mail was collected and distributed on each Monday, Wednesday, and Saturday. On Wednesday, September 30, 1925, the day before the payment of the note was due, plaintiff placed in his mail box at the end of the rural route prior to the arrival of the mail carrier a letter addressed to the motor company, in which he inclosed his check on the Winifred bank for the sum of $435, being the principal of the note without the interest, which latter amounted to $16.70, and on which he indorsed "Final Payment on Tractor." Daily mail service was maintained between Winifred and Lewistown by rail on Mondays, Wednesdays, and Fridays; by stage on the remaining days of the week.
The custom of the motor company was to take its daily mail from its lock box at the Lewistown post office four times a day: At 8:30 and 10:30 a. m., at 12:30 p. m. and in the midafternoon. The Blackwelder letter was so received by the motor company after 3 p. m. on Saturday, October 3, 1925. It was the further custom of the motor company to make a daily deposit of all receipts up to that time at 12:30 p. m. each day in the Central Bank & Trust Company of Lewistown, which bank closed its business day at 2 p. m. As the Blackwelder check was received after banking hours on Saturday, it was not deposited until Monday, October 5th, and, on its receipt, it was on the same day transmitted in the usual course of business from the Lewistown bank to the Winifred bank, and was received by the latter on October 6th, and, if paid in the usual course of business, the collection should have been remitted on the 7th, the following day. On the 7th, numerous checks, including the Blackwelder check, not having been heard from, the cashier of the Lewistown bank called the president of the Winifred bank on the phone, and demanded remittance, and repeated the demand on the 9th. He then notified customers of the Lewistown bank, including the defendant bank, that thenceforth his bank would "only handle checks for collection on that bank."
The Winifred bank was in failing circumstances from October 3d on, and, after that date, cashed no checks received by mail, although for several days after the 5th it cashed all checks presented at the counter. It closed on the night of October 10th, and on the 13th the check in question was returned to the Lewistown bank by the bank examiner. The Lewistown bank charged the check back and returned it to the motor company.
On receipt of the check on October 3d the motor company had written plaintiff acknowledging receipt and calling his attention that the payment left a balance of $16.70, on receipt of which the whole matter would be closed. When the check was returned, the motor company wrote plaintiff that, inasmuch as the check "never cleared," the status of his account was the same as before the check was sent, and requested him to make arrangements to make the check good. In response, plaintiff conferred with officers of the motor company, who agreed that, if plaintiff paid the sum of $150 on December 1st following, payment of the balance due would be extended until the following crop season. Plaintiff failed to pay the amount agreed upon on December 1st, or any part thereof then or at any time thereafter, and, in March, 1926, the defendant company placed the chattel mortgage in the hands of the defendant sheriff for foreclosure under the power therein contained, and thereupon plaintiff commenced this action to enjoin such foreclosure on the ground that, through the negligence of the defendant company in presenting the check for payment as it did, the check became payment of the principal sum of the mortgage indebtedness. The acts of negligence on the part of the defendant company, as alleged in the complaint, are that, at the time the company received the check, it had knowledge that the Winifred bank was in "a failing condition," while that fact was not known to the plaintiff, but that, notwithstanding such knowledge, the defendant company deposited the check in the Lewistown bank for collection in the ordinary course of business, whereas it might have proceeded to Winifred by automobile, and presented the check at the counter, when it would have been paid as other checks so presented were paid, from funds on hand. It is further alleged in the complaint that the American Railway Express Company maintained an office with an agent in charge at Winifred, and "engages in the business, for a reasonable compensation, of presenting checks for collection drawn upon banks in towns where it maintains an office and agent."
The complaint alleges that, if there is any further sum due defendant company, "the plaintiff has been ready, willing, and able at all times, and now, is ready, willing, and able to pay" the same; that plaintiff has no "adequate remedy at law whereby he can prevent the sale and wrongful appropriation of his property," which consisted of 235 bushels of wheat in the granary. It closes with a prayer for injunctive relief, and for "such other and further relief as may be proper in the premises."
While the defendants admitted such statements as appear in the foregoing recital of uncontradicted facts, and were alleged in the complaint, they denied the above allegations of the complaint. Issue being joined, the cause was tried to the court, and, on the disputed allegations of the complaint, the testimony was substantially as follows:
The receiver of the Winifred bank showed to the court that the bank had cash on hand each day from October 1st to October 10th, in excess of the amount covered by plaintiff's check. It was shown that the plaintiff and others at Winifred had no knowledge of the bank's condition during that period, and that local customers presented checks for payment, and these were paid during all of that period.
The plaintiff then testified that one Bisher, a salesman and collector for the motor company, during the week following the closing of the bank, told plaintiff that "they presented this check to the bank at Lewistown, and they didn't want to carry this said check; that they were afraid of these checks on the Winifred bank; the only way they would cash it was on the Fergus Motor Company's guarantee."
Howard C. Gee, an attorney practicing at Winifred, testified that Bisher came to him about the first of the year 1926, and requested him to take the defendant company's claim against plaintiff for collection, but that he informed Bisher that he had already advised plaintiff in the matter; that they got into a discussion of the matter; and that he asked Bisher why they did not present the checks personally at the Winifred bank, to which Bisher replied that they presented them through the usual course of business. The witness then testified that he then told Bisher that he understood that it was known to the defendant company and to other concerns in Lewistown that, at the time the check was received, the Winifred bank was "in a shaky condition; that Bisher's answer was argumentative; that he said it did not make any difference then whether they did or not." Asked the question, "Did he say anything about the bank being in a failing condition at that time?" the witness replied: "To the best of my knowledge and belief he stated that not only they knew it but others in Lewistown, and we had quite an extensive argument over it."
The plaintiff, recalled, testified that one Hagelund, the manager and treasurer of the defendant company, at the time they reached the agreement as to payment of a portion of the amount of the check on December 1st, told him "the same as Mr. Bisher, they presented this check, and they didn't want to cash it at this bank, they seemed to be afraid of checks on the Winifred bank," and that "he told me that, if they had got in a car * * * and came to Winifred with the check, they would have saved me $435." He further stated that his agreement was that he would make the payment December 1st if he could raise that much money by the date fixed.
On behalf of the defendants, Bisher testified that he had no knowledge of the condition of the Winifred bank until after...
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