German Nat. Bank of Hastings v. First Nat. Bank of Hastings
| Decision Date | 21 September 1899 |
| Citation | 59 Neb. 7,80 N.W. 48 |
| Parties | GERMAN NAT. BANK OF HASTINGS v. FIRST NAT. BANK OF HASTINGS ET AL. |
| Court | Nebraska Supreme Court |
1. A suit by a judgment creditor, under section 532, Code Civ. Proc., to recover assets of his debtor not reachable by execution, can be maintained only where the debtor had himself an actionable demand at the time the suit was instituted.
2. A sale of corporate assets, made by an agent in excess of his authority, will be, ordinarily, ratified by the acts of the corporation in dealing with the purchaser as the owner of the property.
3. The sale of corporate property and the disposition of the proceeds thereof being distinct acts, a director may be qualified to vote upon a proposition to ratify the sale, although disqualified from voting upon a question affecting the application of the purchase money.
4. Ratification of the unauthorized act of a corporate officer may be inferred from silence, inaction, and other circumstances indicating acquiescence and consent.
5. The authority of counsel to ratify a pleading for one of the parties to an action cannot be first raised in this court.
6. The rule that when a principal, with knowledge of all the facts, adopts or acquiesces in acts done by his agent in excess of his authority, he cannot afterwards disavow such acts, applies to corporations as well as to natural persons.
7. A principal will not be permitted to accept and confirm so much of a contract as may be beneficial to him, and reject the remainder.
8. Equity will not lend its aid to one who, in violation of an agreement, seeks to appropriate to his own use property which, according to the agreement, should be distributed among all the parties thereto.
9. One holding a judgment as the trustee of an express trust is entitled to enforce it for the beneficial owners according to the terms of the trust.
10. It would seem that a judgment cannot be enforced piecemeal by each of the owners whose claims have been merged therein issuing an execution for the collection of his part.
Appeal from district court, Adams county; Beall, Judge.
Action by the German National Bank of Hastings, Neb., against the First National Bank of Hastings, Neb., and others. Judgment for plaintiff, and defendant bank appeals. Reversed.J. B. Cessna, Capps & Stevens, and A. M. Post, for appellant.
Tibbets Bros. & Morey and Frank Irvine, for appellee.
At a former term a judgment in favor of the First National Bank of Hastings was reversed, and the cause remanded to the district court for further proceedings. German Nat. Bank of Hastings v. First Nat. Bank of Hastings, 55 Neb. 86, 75 N. W. 531. Thereupon the plaintiff filed an amended petition, and brought John Slaker and the Burger-Alexander Hardware Company into the case as parties defendant. The hardware company answered, alleging that it had ratified the sale to Carson Hamot, and had also ratified the application of the proceeds of the sale upon its indebtedness to the defendant bank. The second amended petition was framed on the theory that Clark and Oliver had converted the stock of hardware, and that the appellant was, therefore, liable, either for the value of the property or for the proceeds of the sale. The court found against the First National Bank, and made no finding as to Clark and Oliver. As the bank could not possibly be liable for conversion unless Clark and Oliver were also liable, this action of the court can be accounted for only on the hypothesis that there was a ratification of the sale, but not of the application of the proceeds. The sale to Hamot was an act entirely distinct from the disposition of the purchase price. The directors and stockholders of the hardware company might, of course, have been quite willing to sanction the sale, but unwilling to give the whole sum realized therefrom to a single creditor. It would seem that the learned trial court, having this obvious distinction in mind, found against the plaintiff on the charge of conversion, but nevertheless gave judgment in its favor on the assumption that the sale had been ratified, and that the defendant bank had, without right or authority, become possessed of the vendor's money. The evidence undoubtedly justifies the conclusion that there was a ratification of the sale, but it is, in our opinion, plainly insufficient to warrant a finding that the payment to appellant was not ratified. It appears that at the time the Burger-Alexander Hardware Company effected a consolidation with the Denver Hardware Company there was an understanding among the officers of the former corporation that the stock retained in Hastings should be sold at the first favorable opportunity, and the proceeds of the sale applied in liquidation of the company's indebtedness. It also appears that the sale to Hamot was for a fair price; that the stock was turned over to him without objection from any one; that the directors of the hardware company distinctly recognized the validity of the sale by authorizing, on October 12, 1891, the repurchase of an iron safe, which was part of the property sold to Hamot; that the appellant, upon receiving the proceeds of the sale, surrendered notes of the company to the amount of $9,600, and the same were canceled, and new notes given for the balance remaining due; that such balance was consolidated with the claim of the German National Bank and the claims of other creditors; that the company gave a new note to John Slaker for the aggregate amounts; that Slaker, who was cashier of the appellee, executed a writing acknowledging that he held such note in trust, and agreeing to undertake the collection of the same, and to make a pro rata distribution of any sums collected; that Slaker afterwards reduced the trust note to judgment, and that the plaintiff, as a basis for this action, caused an execution to be issued thereon for the amount of its claim. It further appears that the assets of the hardware company were thought to be sufficient to pay its debts until the failure of the Denver Hardware Company rendered...
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