Cantley v. Piggott

• Decision Date: 03 September 1932
• Docket Number: No. 30482.,30482.
• Citation: 52 S.W.2d 846
• Court: Missouri Supreme Court
• Parties: S.L. CANTLEY, Commissioner of Finance, in charge of the Liquidation of the FEDERAL TRUST COMPANY of Kansas City, v. DERWOOD L. PIGGOTT and ELLEN PIGGOTT, Appellants, H.C. WALTNER, Trustee.

52 S.W.2d 846

S.L. CANTLEY, Commissioner of Finance, in charge of the Liquidation of the FEDERAL TRUST COMPANY of Kansas City, v. DERWOOD L. PIGGOTT and ELLEN PIGGOTT, Appellants, H.C. WALTNER, Trustee.

No. 30482.

Supreme Court of Missouri, Division 1.

September 3, 1932.

Appeal from Benton Circuit Court. — Hon. W.L.P. Burney, Judge.

TRANSFERRED TO THE KANSAS CITY COURT OF APPEALS.

James Davidson, James A. Lay and Henry P. Lay for appellants.

(1) That the note and deed of trust in suit were pledged with the Federal Trust Company for its accommodation and to enable it to meet the requirements of the State Bank Examiner, was a proper and available defense to this action and duly pleaded in the answer; therefore the trial court erred in refusing to admit in evidence offered proof of these facts. Farmers' Bank v. Harris, 250 S.W. 946; People's Bank v. Yager, 221 Mo. App. 955, 288 S.W. 954; Central Natl. Bank v. Walterchied, 204 Mo. App. 179, 222 S.W. 912; Farmers' Bank v. Schmidt, 297 S.W. 156. (2) The trial court erred in submitting the case to the jury upon only one instruction, requested by the plaintiff, requiring the jury to find facts not pleaded, and wholly failing to submit these defendants' defenses. Thomas v. Ins. Co., 297 S.W. 982; Farmers' State Bank v. Miller, 300 S.W. 834.

F.M. Brady, R.R. Brewster and William B. Bostian for respondent.

(1) Respondent was the holder in due course of the collateral signed by appellants. (a) Respondent became the holder in good faith before maturity without notice of any defect in the title of the person negotiating it. Sec. 838, R.S. 1919; Farmers' State Bank v. Miller, 300 S.W. 834; Investment Co. v. Whitlock, 217 Mo. App. 676; Aab v. French, 279 S.W. 435. (b) It is presumed a note delivered and negotiable, is given for a valuable consideration where the plaintiff is in possession, and the execution of the note is not denied, and respondent's evidence shows conclusively that H.C. Waltner received the money from the loan of $5000, for which he gave his note, and as collateral to which was pledged the $3000 note executed by appellants. Bank v. Equipment Co., 217 Mo. App. 131, 273 S.W. 197. (c) Appellants clothed H.C. Waltner with full power of disposition of the $3000 note, and respondent was led into dealing with H.C. Waltner as apparent owner, and received transfer of the instrument and will be protected. Ginter v. Commerce Trust Co., 14 S.W. (2d) 41. (d) Where a note is no longer in possession of the signer thereof, delivery by him will be presumed. Earle v. Woodruff, 274 S.W. 107. W.F. Shearer, the payee in appellant's note, endorsed the same on the back thereof, and this was sufficient to support future negotiations of the note by delivery. Secs. 820-833, R.S. 1919; Williams v. Schmeltz, 14 S.W. (2d) 966; Baade v. Cramer, 278 Mo. 516. (2) The trial court committed no error in rejecting appellants' offer of proof. (a) The rejection was plainly tentative (the court rejected the offer, "at this time"), and until the relevancy of all the testimony offered became apparent to the court, no error could be committed. (b) The offer was not again made, though appellants excused the witness Hund for the "present time" with the statement, "We may want to recall Mr. Hund for future cross-examination," and appellants thereby abandoned their position. Wills v. Sullivan, 211 Mo. App. 318, 242 S.W. 180; Enyeart v. Peterson, 184 Mo. App. 519.

FERGUSON, C.

In 1926 the "affairs and assets" of the Federal Trust Company of Kansas City, Missouri, a banking corporation organized under the laws of this State and doing a banking business in Kansas City, Missouri, were placed "under the control" of the Commissioner of Finance for liquidation. [Sec. 5316 (3), R.S. 1929.] Listed among the assets of the trust company was a promissory note for $3,000, and a deed of trust on 560 acres of land in Benton County, Missouri, securing the same, executed by defendants Derwood L. Piggott and Ellen Piggott, husband and wife. Defendant H.C. Waltner was named as trustee in the deed of trust. The note being due and unpaid the commissioner instituted this suit thereon in the Circuit Court of Benton County seeking judgment for the principal sum of the note with interest and the foreclosure of the deed of trust. Defendants Derwood L. Piggott and Ellen Piggott answered admitting the execution of the note sued upon, payable to the order of W.F. Shearer, and the deed of trust to H.C. Waltner as trustee to secure the payment of said note but denying "that said note and deed of trust was sold, assigned, transferred or delivered to the said Federal Trust Company prior to maturity for a valuable consideration" as alleged in the petition. Further answering the defendants, Derwood L. Piggott and Ellen Piggott state:

"That the deed of trust and note sued upon was executed by them and deposited with the defendant, H.C. Waltner, Attorney, in his safe for safe keeping with the intention of these defendants to later hypothecate, negotiate or otherwise use the same with which to obtain a loan, if it should become necessary, and that while said collateral was so deposited, the said H.C. Waltner delivered the said note to the plaintiff, the Federal Trust Company of Kansas City, Missouri, as a pretended security for a note or notes of the said H.C. Waltner that were or had been given the said bank as a substitute for a note or obligation of W.R. Waltner then being carried by the said bank as unpaid and which its officers were forced to remove from the list of unpaid notes at the insistent demands of the State Bank Examiner.

"That prior to and at the time of the delivery of said note to the Federal Trust Company it was informed and well knew that the said note was originally made to W.F. Shearer without consideration to these defendants and that the said H.C. Waltner was not the owner thereof and said defendants further state that no consideration was given or paid to the said W.F. Shearer or H.C. Waltner to secure the delivery of the said note to the said Federal Trust Company.

"That at the time of the delivery of defendants' note to the said Federal Trust Company it was understood and agreed between said bank and M.C. Waltner that the same was being put up as a pretended collateral security for the obligation of W.R. Waltner to the bank as aforesaid which was being withdrawn from the bank's files but still retained and considered as its assets and that payment of the amount for which said note was hypothecated or pledged would not be demanded of these defendants or their security subjected to foreclosure to satisfy the same.

"That the deposit of the W.R. Waltner note and the delivery of the defendants' note to...