First Nat. Bank v. Lowery

• Decision Date: 25 March 1937
• Docket Number: 6 Div. 50
• Citation: 173 So. 382,234 Ala. 56
• Parties: FIRST NAT. BANK OF ONEONTA et al. v. LOWERY.
• Court: Alabama Supreme Court

173 So. 382

234 Ala. 56

FIRST NAT. BANK OF ONEONTA et al. v. LOWERY.

6 Div. 50

Supreme Court of Alabama

March 25, 1937

Appeal from Circuit Court, Blount County; J.H. Disque, Jr., Judge.

Suit by Street Lowery against the First National Bank of Oneonta and others. From a decree overruling demurrers to the bill respondents appeal.

Affirmed.

Bill for accounting and discovery against national bank and officers, seeking to discover whether discount charges were in excess of agreed rate and seeking statement of account according to rate agreement, held not demurrable as attempt to charge bank with usury and to have usurious interest payments applied in reduction of debt to bank, which attempt could only be made by action of debt within two years to recover twice the amount of interest paid. 12 U.S.C.A. § 86.

Pertinent parts of the bill are as follows:

"6. That the Account between Complainant and the Respondent covers a period of more than fourteen years, involving several hundred thousand dollars, is complicated in that some of the notes and mortgages discounted by the Complainant to the Respondent were not paid at maturity, or possibly not paid at all, and were charged back by the Respondent to Complainant, in many cases without notice or statement thereof being furnished by the Respondent to the Complainant, nor the papers returned to the Complainant. And the Complainant says that the Respondent did not make regular and accurate reports of collections on these various notes and mortgages to the Complainant, and by reason of the large number of Complainant's debtors the various amounts involved in the volume of such transactions covering a long period of time, with partial payments by debtors to Respondent, and extensions given by the Respondent, and Complainant is not able to determine with any reasonable accuracy the amount of the notes and the mortgages discounted by him to the Respondent, the amount paid thereon and dates of payment, the amounts charged back to his account, nor the interest collected by the Respondent thereon, especially is this true by reason of the fact that the Complainant did not keep an accurate set of books, showing in detail his transactions with the Respondent, and the further fact of the destruction of a large part of his records in the fire of 1931 above mentioned."

"9 1/2. That the Complainant has no adequate remedy at law in seeking to enforce his demands against the Respondent, for that Complainant cannot reasonably fix the amount of his demands in a law action, and the state of accounts between Complainant and Respondent is complicated and could not be reasonably considered and determined in a Court of law because of the vast multitude of transactions during the above mentioned period of about fourteen years, with payments, renewals, extensions, charged back against the Complainant by Respondent, and partial payments in great numbers, the details of which are unknown to the Complainant, and so involved that Complainant could not present them in an orderly manner in a law court, and could not in the course of a trial at law produce witnesses to contradict showings made by the Respondent, for the reason that the names of witnesses to be produced could only be developed in the course of such trial at law, with the likelihood that numbers of witnesses would be found to reside at considerable distances from the seat of the Court, and more time to call such witnesses into court would be required than the trial Judge would allow.

"And the Complainant further says that the evidence and knowledge of hundreds and possibly thousands of transactions between Complainant and Respondent is almost exclusively in the hands of the Respondent, and at least, partially shown by its records; and that the evidence for a proper consideration of the hundreds and possibly thousands of transactions had between these parties, which will absolutely be necessary for the determination of their respective rights, would be so voluminous and complicated, that no trial judge or jury could fairly consider the same except he or they be trained accountants.

"And the Complainant further says that the Respondent holds the Complainant liable upon his indorsement of papers indorsed by the Complainant and now in its hands, and that the Respondent claims that the Complainant is still indebted to the Respondent for and on account of indorsements upon notes yet uncollected, but the Respondent has declined to make Complainant a statement showing the state of accounts between Complainant and Respondent, and showing Complainant's alleged liability upon the yet uncollected notes.

"And Complainant further says that in taking over these notes indorsed by the Complainant, and in undertaking the collection thereof for the protection of the Complainant, the Respondent assumed a position of trustee or quasi trustee, for the Complainant, for the proper collection of said notes and a proper accounting for the proceeds thereof to the Complainant; and the Complainant says that a discovery and an accounting are necessary for the determination of Complainant's rights, if any, against the Respondent, and for a determination of Complainant's liability, if any, to the Respondent."

J.T. Johnson, of Oneonta, for appellants.

Vasser L. Allen, of Birmingham, for appellee.

KNIGHT Justice.

Bill for an accounting and discovery, filed by complainant, Street Lowery, against the First National Bank of Oneonta, and its president and cashier.

It appears from the averments of the bill, as last amended, that the complainant's business dealings with the First National Bank of Oneonta commenced in January 1921, and were continued uninterruptedly until a short time prior to the filing of the bill in this cause; that the complainant, in the beginning of his transaction with said bank, had an agreement with it by which the said bank would discount at the lawful rate of interest notes and mortgages brought to it by complainant if the respondent (bank) saw fit to accept such as were offered by the complainant; that under the above arrangement the respondent bank did receive from, and discounted for, the complainant numerous notes and mortgages representing several hundred thousand dollars; that said notes and mortgages were indorsed by the complainant; and that many of the...