Dill v. City Council of Charleston

• Decision Date: 16 April 1870
• Docket Number: CASE No. 716.
• Citation: 11 S.C. 486
• Court: South Carolina Supreme Court
• Parties: FRASER & DILL ET AL. v. CITY COUNCIL OF CHARLESTON ET AL.

11 S.C. 486

FRASER & DILL ET AL.

v.CITY COUNCIL OF CHARLESTON ET AL.

CASE No. 716.

Supreme Court of South Carolina.

November Term, 1878

Apr. 16th, 1870.

1. An appeal from findings of fact by a referee, which were sustained by the Circuit decree, dismissed-there being neither a lack of evidence to warrant such findings, nor such preponderance of evidence on the other side as would justify a reversal.

2. Where an executor has been removed from office and a receiver appointed in his stead, by the judgment of the Circuit Court, in accordance with a prayer of the complaint, and no exception is taken thereto on an appeal from other parts of the same judgment, the property passes into the possession of the court; and a subsequent judgment, in so far as it provides for a proper administration of the estate, furnishes no ground for appeal.

3. A certificate of city stock, transferable, according to its terms, only at the office of the city treasurer, by appearance in person or by attorney, was endorsed in blank by the legal owner, and delivered to one who pledged the same to a bank as collateral security for a loan; the owner died, and the certificate was, by virtue of a transfer written over his name by the cashier, transferred to the bank on the books of the city treasurer, after the death of said owner. Held, that the endorsement and delivery was an equitable assignment, and that the subsequent transfer to the bank was proper.

4. The provisions of the certificate itself, as to its transfer, are designed solely for the safety and security of the corporation itself, and of purchasers without notice.

5. Query: Will the hypothecation of a certificate of stock by the legal owner, or with his consent or subsequent acquiescence, without endorsement or power of attorney, constitute by delivery an equitable assignment, and act as an estoppel against the legal owner and creditors claiming through him?

6. A defence, even if not alleged in the answer, may be relied upon by defendants, when it is the point involved in an issue framed by order of this court for trial in the court below.

7. A general denial of title admits the defence of title diverted by equitable assignment.

Before WALLACE, J., at Charleston, February Term, 1878.

This case, having been before this court once before on appeal, will be found fully reported in 8 S. C. 318. It is unnecessary to repeat here any portion of the case up to that time. The subsequent proceedings are set forth in the referee's supplemental report, which is as follows:

To the Honorable the Presiding Judge of the First Circuit:

I beg leave to make to the court the following report:

Chief Justice Moses, in delivering the opinion of the Supreme Court on the appeal taken in this cause, filed on the 12th of December, 1876, says:

“The only question presented by the appeal arises out of the exception of the city council of Charleston, one of the defendants in the cause, to so much of the Circuit decree as established the right to certain city stock in Col. Joseph Whaley, at the time of his death, and requires the said council to account for so much of the same as it has sold and transferred;” and the case was remanded to the Circuit Court to be referred to the referee “for the purpose of allowing the city council to offer evidence of their right to the stock which, on the death of Joseph Whaley, stood in his name, or to show how he may have been divested of his title thereto; the respondents to be at liberty to offer testimony in rebuttal.” And by an order of the Circuit Court of the 28th of February, 1877, the cause was referred back to me, as special referee, to take the testimony which might be offered under the provisions of the order of the Supreme Court. By the original order of reference, filed on the 12th of September, 1874, I was appointed special referee to inquire and report upon the facts, with leave to report any special matter. Under the order of the Circuit of the 28th of February, 1877, I have held numerous references, and have taken the testimony offered by the city council, defendant, and the testimony offered by the plaintiffs in rebuttal, as provided for by the said order. I have been attended at these references by counsel representing the plaintiffs, and the other creditors of the late Joseph Whaley, deceased, and by counsel representing the city council of Charleston, defendant; counsel also appearing for the executor of Joseph Whaley, deceased, co-operating with the counsel for the city council.

The testimony was carefully taken down, and is filed with the report. Photographic copies were also made of all the signatures of Joseph Whaley introduced in evidence.

A considerable portion of the testimony was directed to the proof of handwriting and the examination of experts; and a comparison was instituted between the disputed signatures of Joseph Whaley and his acknowledged genuine signatures.

On the closing of the testimony, the points raised were very elaborately argued before me by Edward McCrady, Jr., Esq., and Samuel Lord, Jr., Esq., for the plaintiffs. Mr. Mitchell, representing the city council of Charleston, was present at the argument of plaintiffs' counsel, but declined to submit any argument himself. Mr. Mitchell took the position that the referee was not directed by the order of reference to do anything more than take the testimony and report the same to the court, and protested in advance against the argument proceeding, and against any waiver of his rights by his presence at the argument.

I proceed now, after a careful consideration of the whole case, to announce the conclusions of fact to which I have arrived.

The city stock, which stood in the name of Joseph Whaley, at the time of his death, is represented by certificates numbered 7, 12, 382, 383, 384, 386, 387, 393, 394, 395 and 396, and the object of the testimony offered by the city council was to show their right to this stock, or how the said Joseph Whaley may have been divested of his title thereto. I propose to take each certificate of stock separately, and state my conclusions as to each of them in turn.

Certificate No. 7, city stock, issue of June, 1852, for $23,000, principal sum.

This certificate, with the name of Joseph Whaley endorsed in blank, was pledged on the 5th of January, 1871, to the First National Bank, to secure a note of that date of William Whaley, endorsed Joseph Whaley, for $8000. This note was paid on the 20th of January, 1871.

On the 20th of January, 1871, this certificate was pledged to Pelzer, Rodgers & Co., to secure a note of William Whaley, for $10,000, at sixty days. The note of $8000, in the First National Bank, was paid out of this loan.

On the 3d of June, 1871, this certificate was pledged to Wm. C. Bee & Co., to secure a note of William Whaley and Joseph Whaley of $11,500, at sixty days. The note was renewed for thirty days, and paid on the 8th of September, 1871.

On the 11th of January, 1872, this certificate, together with certificate No. 395, for $8000, and certificate No. 398, for $6000, and $6000 state bonds, was pledged by William Whaley to the People's National Bank, to secure his note of that date of $21,900. In this note were consolidated all the notes of Mr. William Whaley held by this bank. It was a “call loan,” and was marked paid on the 12th of April, 1872.

On the 19th of February, 1872, this certificate, No. 7, was transferred on the books of the city treasurer to H. G. Loper, cashier of the People's National Bank, and a new certificate, No. 51, issued therefor in his name.

On the 23d of May, 1872, this stock certificate, No. 51, was bought for account of P. J. Coogan, city treasurer, by J. H. Wilson, broker.

The above-mentioned certificate, No. 398, for $6,000, had been transferred on the 13th of September, 1871, from certificate No. 385, standing in the name of Joseph Whaley, to the South Carolina Loan and Trust Company.

It does not appear from the evidence how this scrip was redeemed and became pledged to the People's National Bank, to secure the aforesaid loan to William Whaley, of the 11th of February, 1872; nor does it appear from the evidence, by whose order the sale of the stock, represented by certificate No. 51, for $23,000, in the name of H. G. Loper, cashier, was made, or for whose account.

I find that the above-mentioned certificate, No. 7, for $23,000, with the name of Joseph Whaley endorsed thereon, was in the possession of H. G. Loper, cashier of the People's National Bank, prior to the death of Joseph Whaley, and was, by virtue of a transfer, written over the name of Joseph Whaley, transferred to him, in the books of the city treasurer, after the death of the said Joseph Whaley.

I find that the signature of Joseph Whaley, endorsed on this certificate, transferring the same to H. G. Loper, cashier, is the handwriting of Joseph Whaley.

Certificate of city stock No. 12, issue of January, 1866, for $5220, principal sum.

This certificate, with the name of Joseph Whaley endorsed thereon, was in the possession of the People's National Bank some time prior to the 11th of January, 1872, as collateral security for loan. On the 19th of February, 1872, it was, by virtue of a transfer, written over the name of Joseph Whaley, transferred on the books of the city treasurer to H. G. Loper, cashier, and a new certificate, No. 1745, issued therefor in his name.

On the 1st of March, 1872, the new certificate, No. 1745, was transferred by H. G. Loper, cashier, to William Whaley; and on the 3d of May, 1872, William Whaley transferred of this certificate $3220 to Wm. C. Bee & Co., $1000 to Robert Hunter, and $1000 to C. F. Hencken.

I find that the above certificate, No 12, for $5220, with the name of Joseph Whaley endorsed thereon, was in the possession of H. G. Loper, cashier, prior to the death of Joseph Whaley, and was, by virtue of a transfer, written over the name of Joseph Whaley, transferred to him on the books of the city treasurer,...