City Nat. Bank of Dayton v. Kusworm

• Decision Date: 02 June 1894
• Citation: 59 N.W. 564,88 Wis. 188
• Parties: CITY NAT. BANK OF DAYTON v. KUSWORM.
• Court: Wisconsin Supreme Court

88 Wis. 188

59 N.W. 564

CITY NAT. BANK OF DAYTON

v.KUSWORM.

Supreme Court of Wisconsin.

June 2, 1894.

Appeal from circuit court, Dane county; R. G. Siebecker, Judge.

Action by the City National Bank of Dayton, Ohio, against Mollie Kusworm. There was a judgment for plaintiff, and defendant appeals. Reversed.

The plaintiff is a banking corporation, organized and existing under and by virtue of the laws of the United States, and located at Dayton, Ohio, and brings this action to recover the amount due upon a promissory note, of which the following is a copy, to wit: “$4,900. Chicago, Nov. 2, 1892. On demand, for value received, I promise to pay to the order of City National Bank the sum of $4,900, at Chicago, with interest at the rate of six per cent. per annum after date, having deposited with said City National Bank, as collateral security, my equity of six thousand dollars ($6,000), in a note of Frank M. Stringfield and Sarah Agnes Stringfield for $12,000, dated October 7, 1892, due sixty days after date, payable to the order of themselves and indorsed, together with the security of a trust deed to Abram L. Stone, recorded in book 3082 of records of Cook county, on page 146, which I hereby give the said City National Bank, its agents or assignee, authority to sell, or any part thereof, on the maturity of this note, or at any time thereafter or before, in the event of said security depreciating in value, in the opinion of said City National Bank, at public or private sale, at the discretion of said City National Bank, or its assignee, without advertising the same or demanding payment or giving me any notice, and to apply so much of the proceeds thereof to the payment of this note as may be necessary to pay the same, with all the interest due thereon, and also to the payment of all expenses attending the sale of the said note and trust deed, including attorney's fees; and in case the proceeds of the sale of the said note and trust deed shall not cover the principal, interest, and expenses, I promise to pay the deficiency forthwith, after such sale. Mollie Kusworm.” The plaintiff prayed judgment accordingly. The defendant answered the complaint, and, in effect, alleged: (1) That the note was obtained from her without any valuable consideration therefor, through the fraud of the plaintiff's agent; (2) that it was given to compound a felony; (3) that it was given under duress of threats to prosecute the defendant's husband, then very sick, and who died soon thereafter, for the crime of forgery, and in consideration of the suppression of documentary proof of his guilt. The court having ruled that under the pleadings the defendant was entitled to the opening and closing of the case, the defendant took the burden of the defense. At the close of the testimony on the part of the defendant, the court was asked to direct a verdict in favor of the plaintiff for the amount of the note and interest; that, before the decision of that motion, the defendant's counsel asked leave to amend the answer by setting up the disposition of the notes surrendered by Gebhart, her ignorance as to what was done with them by her husband, and her willingness to produce and restore the same to the plaintiff so far as she was able so to do; and further alleging that the defendant was a nonresident of the state of Wisconsin,--which amendment was disallowed by the court, except as to the allegation of the defendant's nonresidence. In determining the motion for an order directing a verdict in favor of the plaintiff, the court said: “As far as the question as to the power of making this contract on the part of the defendant, Mrs. Kusworm, is concerned, I am of the opinion, as I ruled once before this term, that that power exists, even under the laws of the state of Wisconsin; and I must say that, as to that point, I think that the contract is a binding one upon the defendant. As to the defense interposed,--that the transaction by which this note was given was compounding a felony,--I think the proof clearly shows that no such compounding was then made by the parties; that is, that the elements which constitute the compounding of a felony were absent in the dealings. “As to the other point of the defense,--that of duress,--the proof is undisputed but what matters occurred there tending to show that there was some duress or compulsion practiced on the part of the officer of the bank towards this woman. But, to entitle the defendant to recover on that, I think she must, as a matter of law, offer full restitution to the plaintiff, and, not having done so, I must direct a verdict for the plaintiff. The defendant admits the making of the note, and the amount. So a verdict for the plaintiff is directed for the principal sum, with interest thereon as specified in the note;” to wit, for the sum of $5,157.25. From the judgment entered in accordance with the verdict so directed the defendant brings this appeal.

Winslow and Pinney, JJ., dissenting.Bashford, O'Connor, Polleys & Aylward, for appellant.

C. N. Gregory, for respondent.

CASSODAY, J. (after stating the facts).

The execution of the note in suit having been admitted, the plaintiff offered no evidence. On the part of the defendant, the evidence, in effect, tends to prove: That on and for some time prior to November 1, 1892, the plaintiff held two promissory notes which it had received from the defendant's husband, Moses Kusworm, each of which was signed, “M. Kusworm,” one being for $4,100 and the other being for $800, making an aggregate indebtedness of $4,900, for money loaned by the plaintiff to him; and that the same were secured by four, five, or six other notes, purporting to be executed by other parties, aggregating in amount seven or eight thousand dollars, as collateral security for the payment of such indebtedness of $4,900. That in the forenoon of November 1, 1892, one Gebhart, agent for the plaintiff, having both of said notes, and also said notes so held as collateral, in his possession, called on the defendant, and requested to see her husband. That she told him her husband was very sick. That he said it made no matter, that he must see him, that her husband had borrowed $4,900 from the plaintiff bank, and that he had come there to either get the money or security. That she then obtained permission from the nurse for Gebhart to see Mr. Kusworm. That Gebhart then had an interview with Mr. Kusworm in his room alone, neither she nor the nurse being present; that, finally, Mr. Kusworm called the defendant, and she went into his room. That Mr. Kusworm then told her to put on her coat and hat, and go with Mr. Gebhart to Mr. Stone's house, and secure Gebhart for $4,900 on the mortgage of $12,000 in which the defendant had an equity of $6,000, the other $6,000 of which belonged to Stone, a cousin of Mr. Kusworm. That Gebhart then told her that he had notes with him for $4,900 which her husband had forged; that he would have the Pinkerton detectives take her husband back to Ohio and put him in the hospital until he was able to go to jail, and would then put him in prison. That she protested, on account of her husband's dying condition, and that it would rob her home and her two little children of a father. That she almost fainted. That Gebhart then said, “No matter;” that he had come as agent of the bank, and must fulfill his duty; that he must either take Mr. Kusworm back to Ohio or she must take up these notes which Mr. Kusworm had forged. That thereupon she and Gebhart took a cab, and drove to the office of the plaintiff's attorney, and that the attorney then got into the cab, and they all drove to the house of Stone. That Stone was not at home, and so she left a note, requesting him to call at the attorney's office at three o'clock that afternoon. That she then returned to her home, and found her husband under the effects of a sleeping powder, but she was cautioned by the nurse not to speak to him for fear that he might die from the effects. That the defendant was in a very delicate condition and weak at the time, having been in the family way for more than three months, but that she managed to get back to the attorney's office at the time appointed. That she found Gebhart and his attorney there, but Stone did not arrive until some minutes afterwards. That Gebhart at once repeated his threats. That, when Stone came, she introduced Gebhart to him as the man who claimed that her husband had forged notes to the amount of $4,900, and that he had come there to secure the debt Mr. Kusworm was liable for, or take him back to Ohio. That she said that, in order to prevent her husband from being taken back to Ohio and prosecuted, she was willing to turn over her equity in the mortgage mentioned to secure the plaintiff. Stone stepped out and got the mortgage, and returned with it in a few minutes, and thereupon Gebhart and his attorney took the matter under advisement, with an agreement that she and Stone, respectively, would meet them at the same office the next morning at 11 o'clock. That she was compelled to wait in the rain for a long time for the cable cars. That she got home about 8 o'clock in the evening. That she found her children waiting, and her husband scarcely able to open his eyes. That she retired without eating anything, and spent a sleepless night. That, upon returning to the attorney's office the next morning, she found Gebhart and Stone there. That Gebhart refused to accept the security she had offered, for the reason that Stone's part of the mortgage was prior to hers. That Gebhart finally offered to accept the security if Stone would agree in writing to pro rate with the plaintiff in the mortgage. That Stone at first refused. That Gebhart then repeated his threats, and the defendant cried and begged of Stone to consent, and thus save her husband, and that he would lose nothing by it; and thereupon Stone consented, and signed the agreement, and the defendant...