Citizens Savings Bank v. Marr

• Decision Date: 04 February 1908
• Citation: 107 S.W. 1009,129 Mo.App. 26
• Parties: CITIZENS SAVINGS BANK, of Cedar Falls, Iowa, Appellant, v. MARR, Administrator of the Estate of GIBSON, Respondent
• Court: Missouri Court of Appeals

107 S.W. 1009

129 Mo.App. 26

CITIZENS SAVINGS BANK, of Cedar Falls, Iowa, Appellant, v. MARR, Administrator of the Estate of GIBSON, Respondent

Court of Appeals of Missouri, St. Louis

February 4, 1908

Appeal from Monroe Circuit Court.--Hon. David H. Eby, Judge.

REVERSED AND REMANDED (with directions).

Ragland & McAllister for appellant.

J. M Crutcher, R. N. Bodine and James P. Boyd for respondent.

OPINION

BLAND P. J.

--H. H Clay and T. F. Murray, in 1902, were partners dealing in horses under the firm name of Clay & Murray, in Cedar Falls, Iowa. On January 18, 1902, Douglas S. Gibson, of Monroe county, Missouri, bought two horses of Clay & Murray for the sum of $ 2,500, for which he executed to said firm his three promissory notes, dated January 18, 1902; one for $ 834, due August 1, 1903, and two for $ 833, each due August 1, 1904 and August 1, 1905, all of which notes drew interest from date at the rate of six per cent per annum. Immediately after receiving the notes Clay & Murray indorsed and sold them to the Cedar Falls National Bank. On February 10, 1902, Gibson bought two other horses from Clay & Murray for $ 2,500 and gave the firm his three promissory notes for the purchase price; one for $ 800, due August 1, 1904; one for $ 800, due August 1, 1905, and one for $ 900 due at an earlier date. These notes also bore six per cent interest per annum from date and were immediately indorsed by Clay & Murray and sold to the State Bank of Cedar Falls, Iowa. Later on this bank, with its assets, including the three notes, was taken over by the Citizens Savings Bank of Cedar Falls, the plaintiff herein. On November 23, 1903, Gibson, Clay and Murray appeared at the Cedar Falls National Bank and took up the note for $ 834, dated January 18, 1902, and paid the interest on the other two notes of the same date, by Gibson executing a new note for $ 1,066.50, payable to Clay & Murray, which was indorsed and delivered to the bank. (Their indorsement was required to continue their liability as indorser for the original note.) On the same day Gibson went to the State Bank of Cedar Falls and took up the note of February 10, 1902, for $ 900 and paid the interest on the two $ 800 notes of the same date, by executing two new notes for $ 583.97, each due in thirty and sixty days. These notes were also made payable to Clay & Murray and were indorsed by them so as to continue their liability as endorsers. These two renewal notes and the two notes for $ 800 each dated February 10, 1902, are the notes in controversy. Gibson failed to pay these notes, or the notes held by the Cedar Falls National Bank when they matured. On October, 1905, the Cedar Falls National Bank placed the three notes it held in Murray's possession and instructed him to go to Missouri, where Gibson resided, and collect the notes or get them secured. Murray came to Missouri and entered into negotiations with Gibson which resulted in Gibson going to Cedar Falls, where he delivered to H. H. Clay and T. F. Murray the warranty deed of Roy Gibson and wife, conveying to Clay & Murray three hundred and twenty acres of land in Monroe county, Missouri, subject to two deeds of trust, one for $ 8,500, the other for $ 2,700. The deed to Clay & Murray recited that the grantees assumed the payment of these two deeds of trust. The consideration recited in the warranty deed from Gibson to Clay & Murray is $ 17,600. On the execution and delivery of this deed Murray marked the three notes held by the Cedar Falls National Bank "Paid" and delivered them to Gibson, and contemporaneously with the execution and delivery of the deed the following agreement was entered into:

"This contract made and entered into by and between D. S. Gibson and H. H. Clay and T. F. Murray, witnesseth: That the said Gibson having this day delivered a deed to said Clay and Murray for three hundred twenty acres of land in Monroe county, Missouri, in satisfaction of certain indebtedness due from him to the said Clay & Murray, it is agreed that the said Clay & Murray shall within thirty days deliver to the said D. S. Gibson his three certain promissory notes aggregating about twenty-nine hundred dollars, cancelled.

"Whereas the said land conveyed to Clay & Murray is subject to a certain mortgage or trust deed for twenty-seven hundred dollars with other lands belonging to said D. S. Gibson, now, if the said Gibson shall pay off any portion or all of the said twenty-seven hundred dollars to release his said land, then the said Clay & Murray agree to give to the said D. S. Gibson, or such person as he shall name a trust deed on the 320 acres conveyed to them, but subject to a prior trust deed for $ 8,500, to secure to him such amount as he shall pay to release his said lands.

"It is further agreed that the rents of the lands conveyed to the said Clay & Murray shall belong to them from and after the fifteenth day of November, 1904.

"Dated November 12, 1904.

D. S. GIBSON.

H. H. CLAY.

T. F. MURRAY."

The three notes, referred to in the collateral agreement, which Murray agreed to deliver to Gibson in thirty days, represent the debt sued for in this action. Murray had the deed recorded in Monroe county and then deposited it with the Cedar Falls National Bank, and afterwards, to-wit, on November 21, 1905, Clay & Murray and their wives executed and acknowledged a general warranty deed, leaving the name of the grantee blank, conveying the Gibson land for the express consideration of $ 17,600, subject to the two deeds of trust mentioned in the deed from Gibson to Clay & Murray, and deposited this deed with the Cedar Falls National...