APPEAL
from Jackson Circuit Court, HON TURNER A. GILL, Judge.
Affirmed.
Statement
of case by the court.
This is
a suit for money alleged to have been collected and received
by defendant of James Mathews " to and for the use of
these plaintiffs."
Plaintiffs
were a firm doing business at Kansas City, Mo., under the
style of the Kansas City Agricultural Implement Co. March 11
1878, said Mathews executed his two negotiable promissory
notes to said firm, under said firm name, one due June 1
1878, for $313.65, and the other (the one in controversy) for
$162.30 due August 1, 1878. At and prior to said dates the
defendant was a banker at Wellington, Kansas. The Mastin Bank
at Kansas City sent defendant all its collections in the
county in which he was located. The maker of these notes
lived there.
The
plaintiffs did business with the Mastin Bank, and had at the
time of its failure, about August 3, 1878, over $1000 to
their credit. Defendant also at same time had about the same
sum to his credit in said bank.
About
July 22, 1878, plaintiffs left with the Mastin Bank for
collection the said note of $162.30. The note was endorsed in
blank by plaintiffs, and was delivered to the Mastin Bank
solely for the purpose of collection, and the plaintiffs got
no benefit therefrom, and received no credit in said bank on
account thereof. Among other witnesses, the defendant was a
witness for himself, and testified: " I have been in the
banking business at Wellington, Kansas, since the fall of
1878; I commenced to do business with the Mastin Bank in
February, 1878. At the time the Mastin Bank failed it owed me
between nine and ten hundred dollars, exclusive of the note
in question, which had been credited. It was necessary that I
should keep an account with a bank at Kansas City in order to
furnish exchange to the business men at Wellington. I had no
St. Louis account, and all the St. Louis exchange was sent to
the Mastin Bank to my credit. In order to draw on the Mastin
Bank I deposited money with them, and exchange from time to
time. I was the correspondent for the Mastin Bank at
Wellington. All drafts or notes payable in Sumner county
Kansas, were sent to me endorsed by the Mastin Bank for
collection and credit. When I made a collection for the
Mastin Bank, I gave it credit for same and notified them. If
a collection was made before ten o'clock A. M., I gave
notice to said bank of such collection; if after that time
notice went over till next day. When I collected the note in
controversy, I gave the Mastin Bank credit for it. I
collected the note of $313.65, filed as exhibit "
A" with the deposition of James Mathews filed in this
case. I gave the Mastin Bank credit with the proceeds of the
collection of that note. The note in controversy was endorsed
in the same manner as the note last referred to, and was
collected and credited to the Mastin Bank."
Cross-examination. " I was not able to keep my account
up at the Mastin Bank by exchange and collections alone, as I
remember, and I sent them currency for that purpose. I kept
this account at the Mastin Bank for my own accommodation, and
for the convenience of serving my customers with exchange. *
* * * * * During the entire course of my dealing with the
Mastin Bank, the balance was always in my favor, that is, to
my credit, unless it may have been for a day or so, once or
twice. I always aimed to keep money to my credit there, and
don't suppose they would have allowed it otherwise. * * *
* * * Q. Then, as this note in question was good, and
endorsed for collection and credit of the Mastin Bank, you
gave it credit, by the amount, on receiving the note? A. I
did not. Q. Why did not you? A. I did not consider it
business. Q. Do you think it business to send funds to meet a
possible collection before it is made? A. No. Q. Why did you
do so in this instance? A. As I stated, my funds were kept in
the Mastin Bank to draw on, and meet collections, and this
was one of the collections. Q. Then your sole purpose in
keeping a balance to your credit in the Mastin Bank was to be
able to draw and sell exchange thereon, and to draw against
the same in payment of such collections as you should make
for it? A. If I understand the question, it was."
The
court, for plaintiffs, declared the law to be: " If the
court shall believe from the evidence that the plaintiffs
being the payees of the note on Mathews, mentioned in the
evidence, and the holders and owners thereof, on or about
July 22, 1878, without consideration therefor, endorsed and
delivered said note to the Mastin Bank, only for the purpose
of collection thereof; that said The Mastin Bank endorsed and
transmitted the same to defendant for collection, and that
said defendant paid said The Mastin Bank nothing for said
note or the endorsement thereof, then the court should find
for the plaintiff,--unless it shall also further find and
believe from the evidence that said defendant and said The
Mastin bank had an agreement expressed or to be implied from
their course of dealing; that said defendant and said The
Mastin Bank relied upon the reception of such collection to
meet balance accruing in their favor respectively, and
allowed such balance to accumulate and remain undrawn for
with the understanding or expectation that such balances
would be met and discharged by such collection, so to be
received by such creditor. And if the court shall believe and
find from the evidence that said defendant kept his account
with, and a balance at said The Mastin Bank to his credit,
for his own convenience, made and kept up in part by money
sent and placed there by defendant upon and against which to
draw exchange, then he is not entitled to claim the proceeds
of such collection to pay the balance due him from said
Mastin Bank." The defendant asked the two following
declarations of law, which were refused by the trial court:
1.
" The court declares the law to be that plaintiffs
cannot recover if defendant received the note in controversy
before the same was due, endorsed by the payee thereof, and
that the same was received by defendant from the Mastin Bank
for collection and account of said bank, providing the
defendant made advance, from time to time upon such paper to
said bank, and that said bank did at the time of its failure
owe defendant a large sum of money after giving said bank
credit for said collection."
2.
" The court declares the law to be that under the
pleadings and evidence, plaintiffs cannot recover."
The
court, sitting as a jury, found for plaintiffs. The cause is
here on appeal by defendant.
C. O.
TICHENOR, for the appellant.
I.
Although there may have been a verbal agreement between the
Mastin Bank and plaintiffs limiting their endorsement, it was
not binding on defendant, who had advanced money on the
strength thereof, without notice, and in the ordinary course
of business.-- Lewis v. Dunlap, 72 Mo. 174.
II. Had
there been no advancement, plaintiffs cannot recover, as the
Mastin Bank got credit for the money paid by the maker of the
note. This was in pursuance of the agreement between said
Mastin Bank and defendant, and was according to the ordinary
course of business. The money collected belonged to
defendant, and he became the debtor of the Mastin Bank to
that amount. These facts were not disputed, hence the
demurrer to the evidence should have been sustained.--
Ayres v. Farmers and Merchants Bank, 79 Mo. 421;
Bullene v. Coates, 79 Mo. 426; First National
Bank v. Gregg, 79 Pa.St. 384.
R. O.
BOGGESS, for the respondents.
I. The
appellant was duly served by publication and was in default
for not pleading in time, and a judgment by default was
regularly rendered against him, March 11, 1880. He could not
answer till that judgment was set aside.-- Gilstrap v
Felts, 50 Mo. 429. All done subsequent to the judgment
by default is in substance and in law merely an assessment of
damages, Woods appearing as he had a right to do. * * A
judgment by default clearly establishes the right of
plaintiffs to recover. The assessment of damages merely
determined the amount to be...
