Co. v. Bank

• Decision Date: 10 July 1897
• Docket Number: 9850
• Citation: 58 Kan. 414,49 P. 521
• Parties: THE SECURITY INVESTMENT CO. et al. v. THE RICHMOND NATIONAL BANK et al
• Court: Kansas Supreme Court

49 P. 521

58 Kan. 414

THE SECURITY INVESTMENT CO. et al. v. THE RICHMOND NATIONAL BANK et al

No. 9850

Supreme Court of Kansas

July 10, 1897

Decided January, 1897.

Error from Mitchell District Court. Hon. Cyrus Heren, Judge.

Judgment reversed and remanded.

D. M Thorp, J. W. Tucker and V. H. Branch, for plaintiffs in error.

C. A Smith, for defendants in error.

OPINION

JOHNSTON, J.

The Security Investment Company of Cawker City, Kan., made a number of loans to B. H. North, M. A. F. North and J. H North, taking promissory notes secured by mortgages on property in Jewell County. Before maturity, these notes were indorsed and transferred to several banks in different parts of the country. On February 7, 1891, the Security Investment Company made an assignment of all its property to W. T. Branch for the benefit of its creditors. Branch was subsequently elected as permanent assignee, and since that time has continued to act in that capacity. On August 4, 1891, the Richmond National Bank and fifteen other banks, to which the North notes and mortgages had been assigned, filed claims before the assignee against the Company upon its liability as indorser of the North notes. The claims were disallowed by the assignee, and from that decision each claimant took an appeal to the District Court of Mitchell County. In June, 1891, prior to the presentation of these claims to the assignee for allowance, a foreclosure proceeding against the Norths was begun in Jewell County, and all the banks above mentioned came in and set up their notes as well as claims to liens upon the mortgaged property. The Security Investment Company and the assignee were made parties, and judgment was asked against them upon the liability assumed by the Company by its indorsement of the notes. A receiver was appointed by the District Court of Jewell County to take possession and control of the mortgaged property during the pendency of the action. On June 23, 1892, a trial of the action was had in Jewell County and judgment upon all the notes was rendered against the Norths, and also against the Security Investment Company and the assignee, except upon the note of the Lambertville National Bank. As to the Lambertville National Bank, it was held that there was no proof of protest, and therefore judgment was given in favor of the Security Investment Company. The mortgages were foreclosed, and there was an order that the proceeds of the sale of property which had been sold by the receiver should be paid into the court and applied to the discharge of the several judgments. At the January term of the District Court of Mitchell County the appeals from the decision of the assignee came on for trial. By agreement of all the parties the appeals were consolidated and tried together as a single case. The court allowed each of the appellants the amounts of the respective judgments which had been rendered in their favor by the District Court of Jewell County, and directed that the clerk of the court should certify to the assignee of the Security Investment Company the amounts so determined for participation and dividends in the assigned estate.

Several grounds are assigned for reversal, one of which is that the judgments upon the notes rendered in the District Court of Jewell County are final and conclusive upon the parties, and that the District Court of Mitchell County had no jurisdiction to proceed further with the appeals or to make allowances based upon the judgments. It will be observed that when the claims were presented to the assignee the judgments had not been rendered. To secure the allowances and protect their rights to...