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Error
from Butler District Court.
ACTION
commenced September 8, 1882, by S. L. Shotwell against The
Emporia National Bank, to recover $ 840, with interest. On
October 1, 1883, the plaintiff filed in said cause his
amended petition, in words and figures following, to wit,
(title of cause and exhibits omitted:)
"Now
comes said plaintiff, and for a cause of action against said
defendant says:
"1.
Defendant is a corporation duly incorporated under the laws
of the United States, and doing business as a banking
institution in said state.
"2.
Heretofore, to wit, on the 11th day of November, 1881, the
Exchange Bank of El Dorado, a corporation duly incorporated
under the laws of the state of Kansas, and doing business as
a banking institution in the city of El Dorado, Butler county
aforesaid, for a valuable consideration to it paid by this
plaintiff, issued to him a bill of exchange or draft for the
sum of $ 840, payable to the order of Daniel Guernsey and
drawn on the defendant, where the said Exchange Bank had
funds to meet that and similar drafts, a copy of which draft
is hereto attached, marked 'Exhibit A,' and made a
part hereof.
"3.
Said draft was by said Exchange Bank delivered to this
plaintiff, and by him forwarded in a letter to said Daniel
Guernsey, by mail, at Florence, Kansas.
"4.
One Noe and W. Hod. Harvey obtained possession of said letter
and draft without authority, and forged the indorsement of
Daniel Guernsey on the back of said draft, and then presented
the same to defendant, and the same was paid, to wit, the sum
of $ 840, by defendant to said Noe and Harvey, and that
amount charged to the said Exchange Bank.
"5.
Said Exchange Bank and said Daniel Guernsey have duly
transferred and assigned all their interest in and to said
draft and the money due thereon, and all rights of action
arising therefrom or by reason of all the matters alleged in
this petition against defendant to this plaintiff; copies of
which are hereto attached and made a part hereof, marked
'B' and 'C.'
"6.
Defendant, though often requested, has refused to pay to this
plaintiff said draft or said money, or any part thereof, but
on the contrary, has charged the same to said Exchange Bank
and refused to pay to said Exchange Bank the balance due it
without first deducting therefrom the amount of said draft.
"7.
By reason of the premises there is due, owing and unpaid from
defendant to plaintiff the sum of $ 840, with 7 per cent.
interest from November 12, 1881.
"Wherefore,
he asks judgment against defendant for the sum of $ 840, with
7 per cent. interest from November 12, 1881, and costs of
suit."
On
September 23, 1884, the defendant, having first obtained
leave so to do, filed its amended answer. The plaintiff filed
his reply, and at the September Term of the court for 1884
the cause was tried by the court, a jury being waived. Upon
the attempt of the plaintiff to introduce his evidence, the
defendant objected, upon the ground that the petition did not
state facts sufficient to constitute any cause of action; and
after the plaintiff had rested his case, the defendant filed
its demurrer to the evidence, which demurrer was considered
by the court, and overruled. Upon the close of the evidence,
and after the argument of counsel, the court made and filed
its findings of fact, as follows:
"1.
The Exchange Bank of El Dorado, being a banking corporation
doing business at El Dorado, in Butler county, Kansas, on the
tenth day of November, 1881, made its draft or check upon the
defendant bank, payable at sight, to the order of Daniel
Guernsey, for the sum of eight hundred and forty dollars.
"2.
At the time of issuing said draft, and at all times
thereafter, until the commencement of this action, the said
Exchange Bank of El Dorado, had on deposit with the defendant
bank, subject to checks, more than the amount of said draft.
"3.
The said draft was intended for a certain Daniel Guernsey,
who was then a real person and the owner of the N.W. 1/4 of
section 12, township 29 south, range 5 east, in Butler
county, Kansas.
"4.
The said Exchange Bank delivered said draft to S. L.
Shotwell, who delivered the same to C. E. Lobdell, who
deposited the same in the U.S. post office at El Dorado,
Kansas, in an envelope addressed to Daniel Guernsey, at
Florence, Kansas, postage prepaid.
"5.
Some unknown person wrongfully obtained possession of said
draft and forged the signature of Daniel Guernsey to an
indorsement of said draft in blank upon the back thereof.
"6.
The said draft never came into the actual possession of said
Daniel Guernsey, and he never signed any indorsement thereof,
and never authorized the same to be done, nor disposed of the
same, except as hereinafter stated.
"7.
The unknown person who so forged the signature of Daniel
Guernsey to the indorsement upon said draft presented the
draft to the defendant bank for payment, and the defendant
bank thereupon paid said unknown person for and upon and in
payment of said draft the sum of eight hundred and forty
dollars.
"8.
The person to whom the defendant bank paid the amount of said
draft was not the owner thereof, or of any interest therein,
and had no authority to collect the same.
"9.
Upon the payment of said draft the defendant bank charged the
amount thereof to the said Exchange Bank of El Dorado in its
account as such depositor, and continues to so charge the
same.
"10.
Afterward, on the 1st day of March, 1882, the said Exchange
Bank of El Dorado demanded of the defendant bank that the
said sum so charged on account of said draft be restored and
allowed as a credit in the deposit account of said Exchange
Bank, which the defendant bank refused.
"11.
Afterward, the said Daniel Guernsey assigned the said draft
and the right to receive payment thereof, and all his right
growing out of the issuance of said draft, to the plaintiff,
which assignment was in writing, and is the assignment, a
copy of which is attached to the plaintiff's petition,
marked 'Exhibit C.'
"12.
Afterward, the Exchange Bank of El Dorado executed and
delivered to the plaintiff an assignment, a copy of which is
attached to the plaintiff's petition, marked 'Exhibit
B,' that it was the intention of the Exchange Bank of El
Dorado, by said writing, to transfer to the plaintiff the sum
of money and the right to receive and recover the same so
charged by the defendant bank to the said Exchange Bank of El
Dorado, in the account of said Exchange Bank of El Dorado, as
such depositor with the defendant bank.
"13.
No part of said money has ever been repaid, or in anywise
allowed, by the defendant bank."
Thereupon
the defendant presented and asked the court to make the
following additional findings of fact, which the court
complied with:
"1.
During the year 1881, the plaintiff was engaged in the
business of loaning money for a firm in Kansas City, Mo
known as Underwood, Clark & Co.; during this year one C.
E. Lobdell, a resident of El Dorado, Kansas, had arrangements
with the plaintiff whereby Lobdell was to receive
applications for loans upon real estate and give them to the
plaintiff, who would forward them to Underwood, Clark &
Co., and upon the approval of such applications and the
making of the loans, the plaintiff divided the commissions he
received on such loans with Lobdell.
"A
man by the name of DeTalent, of the firm of DeTalent &
Harvey, real estate agents at El Dorado, was appointed
inspector by the plaintiff to inspect the real estate on
which loans were applied for; the duty of the inspector was
to examine the real estate, make report upon its value, its
improvements, and the financial standing and condition of the
applicant; the duties of Mr. DeTalent were frequently
performed by his partner, W. Hod. Harvey, who would make the
report and Mr. DeTalent would sign it; the plaintiff and Mr.
Lobdell both were aware that Mr. Harvey performed these
duties and made these reports at different times and upon
different occasions.
"2.
During the year 1881, a man by the name of Daniel Guernsey
owned the N.W. quarter of section 12, township 29, range 5,
Butler county, Kansas; this Daniel Guernsey had formerly
resided upon this land, but during this year was a resident
of the state of Iowa, and the plaintiff had formerly resided
in the neighborhood where this land is situated, and knew of
Daniel Guernsey and of his owning this land, by reputation
and report.
"3.
Some time prior to the 11th of November, 1881, C. E. Lobdell
received a letter from a man purporting to have been written
at Wichita, Kan., in which the man writing it stated that he
owned the real estate belonging to Daniel Guernsey, and that
he desired to obtain a loan upon it, stating the amount. This
letter was signed in the name of Daniel Guernsey. Upon
receipt of this letter Mr. Lobdell answered it, inclosing a
blank application for a loan; afterward, Mr. Lobdell received
another letter, dated at Wichita, written by the same man,
returning the application for a loan, filled out, and signed
in the name of Daniel Guernsey. This letter was also signed
in the same name. The writer of the letter requested Mr.
Lobdell, in case the application was accepted, to send the
notes and mortgages to him at Florence, Kansas, to be
executed by him there.
"4.
Upon receipt of this letter and application, Mr. Lobdell gave
the application to Mr. DeTalent, to have the land inspected
and a report made upon the application; afterward the report
was made, written out by Mr. Harvey and signed by Mr
DeTalent; upon receiving this report, Mr. Lobdell gave it...
