Fergen v. Lonie
| Decision Date | 05 May 1927 |
| Docket Number | 6270. |
| Parties | FERGEN v. LONIE (SMITH, State Superintendent of Banks, Intervener). |
| Court | South Dakota Supreme Court |
Appeal from Circuit Court, Codington County; W. N. Skinner, Judge.
Action by F. C. Fergen against W. G. Lonie, wherein the Presho State Bank of Presho was made garnishee, and F. R. Smith, as Superintendent of Banks, was required to intervene after insolvency of the garnishee. From an order denying an application of the Superintendent of Banks to amend a stipulation and judgment entered in accordance therewith, the Superintendent of Banks appeals. Reversed and remanded.
See also, 210 N.W. 102.
Perry F. Loucks, of Watertown, and Roy E. Willy, of Platte, for appellant.
Eugene P. Campbell, of Watertown, for respondent.
This case was commenced by plaintiff against the defendant in the circuit court of Codington county on or about November 19 1923, and the Presho State Bank, of Lyman county, was made garnishee defendant. The garnishee answered, and plaintiff took issue thereon. Later judgment was rendered against the principal defendant, but the issue between the garnishee and plaintiff was not tried. In February, 1924, the garnishee Presho State Bank, suspended business because of insolvency, and went into the hands of the superintendent of banks for liquidation. Because of this change in the management of the garnishee bank the issue between the garnishee and plaintiff was not tried in the regular manner. By means of show cause orders, the superintendent of banks was required to intervene, the issues were enlarged, and the court not only tried the liability of the garnishee as a debtor of the principal defendant, but, because of the insolvency of the garnishee, undertook to establish the deposit as a special deposit, to follow the deposit into a trust fund subject to the payment of plaintiff's judgment as a preferred claim, and to compel payment thereof into court. The superintendent of banks did not file a complaint in intervention, but instead entered into a stipulation of fact upon which it was agreed judgment should be entered. Among other things, it was stipulated that the claim was a preferred claim for $6,000; that there were other preferred claims amounting to $3,704.73, which were entitled to share pro rata with plaintiff's claim out of the cash on hand, cash items, and money due from correspondent banks, amounting to approximately $3,160. Judgment was entered in accordance with the stipulation, and the superintendent of banks was ordered to pay plaintiff's pro rata share into court. After this judgment was rendered, the superintendent ascertained there was only $46.16 cash on hand in the bank when he took charge, and, being of the opinion that this amount was all that could be applied in payment of such preferred claims, applied to the court for leave to amend the stipulation by setting out the items composing the $3,160 so the stipulation would show "Cash on hand, $46.16; balance due from Standard Trust & Savings Bank, Chicago, on open account, $428.64; balance due from Sioux National Bank, Sioux City, Iowa, open account, $129.63; balance due from Northwestern National Bank, Minneapolis, Minn., open account, $2,065.41; checks for clearance, $142.86," and asked to be relieved of the earlier stipulation and judgment thereon. The application was denied, and from the order denying the application the superintendent of banks appealed.
The single assignment of error is that the court erred in denying the superintendent's application "to be relieved from the stipulation and judgment."
The proposed amendment to the stipulation was a separation and itemizing of the fund which was in the first stipulation conceded to be subject to the payment of preferred claims. The first stipulation did not state the amount of cash and the amount of the cash items, but it did state that the $3,160, was composed of cash and other items. Respondent contends that, if it was a mistake to include the money due from banks and cash items, it was a mistake of law and not of fact. That would be true, if the first stipulation had set out the items composing the amount conceded to be subject to the payment of preferred claims. But to correct the mistake of law additional facts were necessary, if the cash items and money due from banks could not be used to pay preferred claims. The facts necessary to a proper judgment should have been before the court either by proof or stipulation. From the stipulation without amendment the court could not find the necessary facts, and consequently the conclusion of law stipulated and afterwards found by the court was not supported by the evidence, and could not support the judgment. Except where the claimant has been able to trace his trust fund into specific property, it is well settled in this state that only cash on hand in the bank on the date of its suspension...
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