Carson Nat. Bank of Auburn, Neb. v. American Nat. Bank of St. Joseph

• Decision Date: 01 December 1930
• Citation: 34 S.W.2d 143,225 Mo.App. 948
• Parties: THE CARSON NATIONAL BANK OF AUBURN, NEBRASKA, RESPONDENT, v. THE AMERICAN NATIONAL BANK OF ST. JOSEPH ET AL., APPELLANTS. and THE FIRST NATIONAL BANK OF AUBURN, NEBRASKA, RESPONDENTS, v. THE AMERICAN NATIONAL BANK OF ST. JOSEPH ET AL., APPELLANTS
• Court: Kansas Court of Appeals

34 S.W.2d 143

225 Mo.App. 948

THE CARSON NATIONAL BANK OF AUBURN, NEBRASKA, RESPONDENT, v. THE AMERICAN NATIONAL BANK OF ST. JOSEPH ET AL., APPELLANTS. and THE FIRST NATIONAL BANK OF AUBURN, NEBRASKA, RESPONDENTS, v. THE AMERICAN NATIONAL BANK OF ST. JOSEPH ET AL., APPELLANTS

Court of Appeals of Missouri, Kansas City

December 1, 1930

Appeal from Circuit Court of Buchanan County.--Hon. J. V. Gaddy Judge.

Both cases: AFFIRMED.

Judgment affirmed.

Brown Douglas & Brown for respondent, Carson National Bank.

Culver Phillips & Voorhees for respondent, First National Bank.

Groves & Watkins, Fred M. Wagner and C. M. Skiles for appellants.

ARNOLD, J. Bland, J., concurs. Trimble, P. J., absent.

OPINION

ARNOLD, J.

These are suits in equity to impress a trust upon certain funds in the American National Bank at St. Joseph, Missouri, in favor of the plaintiffs. The two cases were consolidated below and tried together, the facts and questions of law in both cases being identical. There is but one abstract of the record, and the statements and briefs cover both cases. On this review, the two cases will be considered together.

The material facts are not in dispute; hence the only question for consideration here is the application of the law to the facts and on this, of course, the parties do not agree. The cases were tried upon an agreed statement of facts, which because of its necessarily extended recitation, will not be set out in full, but a more abbreviated statement, including all the material facts will be used. These facts briefly stated are as follows:

On June 13 and 14, 1929, plaintiff (case No. 17001) the First National Bank of Auburn, Nebraska, presented certain checks to the Nemaha County Bank of Auburn, for collection, and on June 14, 1929, plaintiff (case No. 16997) Carson National Bank of Auburn, Nebraska, likewise presented certain checks to the Nemaha County Bank for collection. The Nemaha County Bank collected all of said checks by charging same against the deposit account of the respective drawers. For the collection so made, on June 13, 1929, the Nemaha County Bank, on that date, delivered to the First National Bank a sight draft in the sum of $ 1127.17, payable to it, and drawn by the Nemaha County Bank on the American National Bank of St. Joseph, Missouri. For the collections similarly made by it on the 14th day of June, 1929, the Nemaha County Bank, on that date, delivered to the First National Bank a draft for $ 4549.02, payable to it, and drawn by the Nemaha County Bank on the American National Bank of St. Joseph, Missouri. For the collections made by it on June 14, 1929, for the Carson National Bank, the Nemaha County Bank similarly delivered a sight draft for $ 1446.17 to it, on the American National Bank. At the time the said collections were made and the said drafts delivered, the Nemaha County Bank was insolvent. On the dates named, the Nemaha County Bank had on deposit in the American National Bank at St. Joseph, Missouri, the sum of $ 11,659.12.

On June 15, 1929, Clarence G. Bliss, secretary of the department of trade and commerce of Nebraska, notified the American National Bank that on that day the Nemaha County Bank had closed its doors and that he had taken possession of the bank. A few moments after the receipt of this notification, the drafts were presented to the American National Bank, but payment was refused upon the ground that official notice of the closing of the Nemaha County Bank had been received. The Nemaha County Bank was indebted to the American National Bank in the sum of $ 21,866.24, evidenced by a promissory note, which at that time, had a credit of $ 1550. The said note was to mature on June 23, 1929.

On June 17, 1929, the vice-president of the American National Bank was informed by the cashier of the First National Bank of Auburn of the circumstances under which the drafts had been received. It appears the $ 11,659.12 remained to the credit of the Nemaha County Bank in the American National Bank until July 1st, at which time the latter bank applied the same on its note and charged the amount to the account of the Nemaha County Bank. It appears that as collateral security for the payment of said note, the American National Bank also held a number of notes aggregating about $ 29,000, and that said bank collected from the makers of these collateral notes an amount sufficient to pay the balance on the note executed by the Nemaha County Bank, after applying the $ 11,659.12 on deposit and leave $ 1179.09 to the credit of the Nemaha County Bank, and the collateral notes which remained uncollected in the hands of the American National Bank.

The Carson National Bank and the First National Bank of Auburn, Nebraska, instituted suits in the circuit court of Buchanan county, Missouri, against the American National Bank, to recover the amounts of their respective drafts. These suits were instituted and prosecuted upon the theory that the collections made by the Nemaha County Bank were the property of the claimants, and that the proceeds of the collections were a trust fund and that a trust was impressed upon the assets of the Nemaha County Bank wherever situated; and that the drafts drawn for the purpose of transferring to the respective plaintiffs the trust fund belonging to them, operated as an equitable assignment of the funds on deposit in the American National Bank.

Defendant, the American National Bank, answered, setting up the fact that the Nemaha County Bank was indebted to it, as stated above; that the Nemaha County Bank had on deposit in said bank $ 11,659.12; that to secure its indebtedness, the said defendant held collateral notes pledged to it by the Nemaha County Bank; that it applied said deposit of $ 11,659.12 on notes held by it and collected a sufficient amount of said collateral notes to satisfy the remainder due on said notes and leave $ 1179.09 cash in its hands, which said sum and the uncollected collateral notes defendant was holding "for further orders of the court, and the further disposition of the persons entitled thereto." The answer further pleads that on August 29, 1929, the district court of Nemaha county, Nebraska, appointed Clarence G. Bliss, secretary of the department of trade and commerce of Nebraska, receiver of the Nemaha County Bank; that said court is one of general jurisdiction and has full, complete and exclusive jurisdiction of the persons and the subject-matter of said suit in which the receiver was appointed, and had full and complete jurisdiction of the assets of the failed bank; that such receiver had made demand on defendant, claiming ownership and title to possession of $ 1179.09, balance collected on said collateral notes, and of the collateral notes remaining uncollected in the hands of defendant, and that the district court of Nemaha county, Nebraska, has full, complete and exclusive jurisdiction over said funds and notes; and said receiver further claimed that the circuit court of Buchanan county, Missouri, had no jurisdiction over the subject-matter of the suit. The answer further states:

"This defendant further states that it is holding said sum of $ 1179.09 and the remaining collateral notes, as aforesaid, for the persons lawfully entitled thereto, and that as said cash and notes are claimed by Clarence G. Bliss, receiver of said Nemaha County Bank of Auburn, Nebraska, as aforesaid, that the Nemaha County Bank of Auburn, Nebraska, and the said Clarence G. Bliss, should be required to intervene in this case, and that this proceeding should not proceed further until the said Clarence G. Bliss and the Nemaha County Bank of Auburn Nebraska, as aforesaid, are made parties defendant, and the court obtains jurisdiction over the said receiver and said bank.

"That substantial doubts have arisen as to the ownership of said funds, and notes, now held by this defendant, and that this defendant is desirous of delivering the same to the person, or persons, lawfully entitled thereto, and now tenders into court said sum of $ 1179.09 and said remaining collateral notes uncollected, for further disposition under the orders of the court herein."

The court made no order requiring the receiver to interplead. But the record shows the receiver voluntarily appeared and filed answer, in which a denial was made of plaintiff's allegations in the petition, and an intervening petition was filed wherein it was alleged the Nemaha County Bank borrowed from the American National the sum of $ 21,866.24, and had deposited collateral notes to secure the same, which said notes were held by defendant bank with the right to collect them as they matured; that on June 15, 1929, the Nemaha County Bank had on deposit in defendant bank $ 11,659.12, and that said defendant bank claimed the right to offset the amount of its indebtedness to the Nemaha County Bank against the indebtedness of the Nemaha County Bank to it, and that the American National had in its hands $ 1179.09, and nine collateral notes belonging to the intervenor (describing them), aggregating approximately $ 21,000.

The intervenor then pleaded an act of the legislature of Nebraska providing that claims of depositors for deposits not otherwise secured, and claims of holders of exchange, shall have priority over all other claims, except federal, state and county taxes, of every bank, trust company and banking institution in the State of Nebraska, and, subject to such taxes, shall, at the time of the closing of the bank, be a first lien on all of the assets of the banking corporation, from which they are due, and thus under receivership, including the liability of stockholders and upon proof thereof they shall be paid immediately out of available cash in the hands of the receiver.

The...