Gillett v. Citizens' Nat. Bank
| Citation | 104 N.E. 775,56 Ind.App. 694 |
| Decision Date | 31 March 1914 |
| Docket Number | No. 8253.,8253. |
| Parties | GILLETT v. CITIZENS' NAT. BANK. |
| Court | Court of Appeals of Indiana |
OPINION TEXT STARTS HERE
Appeal from Superior Court, Vanderburg County; Fred. M. Hostetter, Judge.
Action by the Citizens' National Bank against Grace L. Gillett. From a judgment for plaintiff, defendant appeals. Reversed and remanded.G. V. Menzies, of Mt. Vernon, and Azro Dyer, of Evansville, for appellant. Woodfin D. Robinson, of Evansville, and William E. Stilwell, of Terre Haute, for appellee.
This action was brought by appellee on four promissory notes executed by appellant, Grace L. Gillett, individually, and to foreclose a mortgage given by appellant and her husband on appellant's lands. The husband died after the action was brought, and before judgment.
The complaint was in four paragraphs. The causes of action set out in the second, third, and fourth paragraphs were paid and satisfied before judgment, so that the present controversy is based on the first paragraph only and the issues arising thereon. This paragraph declared on a promissory note of $4,500, dated December 10, 1909, payable 30 days after date, and, in addition to the general denial, appellant filed an affirmative answer thereto averring coverture, no consideration, and suretyship. Reply by appellee in general denial.
The cause was tried by the court, and a general finding made in favor of appellee bank; that there remained due it on the note sued on in the first paragraph of complaint the sum of $5,377.31. The court rendered judgment for this amount against appellant, and decreed a foreclosure of the mortgage.
It is assigned that the court erred in overruling appellant's motion for a new trial. The only questions presented by counsel for appellant in their brief, in support of this assignment, are: (1) The decision of the court is not sustained by sufficient evidence. (2) The decision of the court is contrary to law.
[1] The facts appearing from the evidence are substantially as follows: In the latter part of 1909 appellee bank was in failing circumstances. Appellant had been, for many years prior to the occurrences herein set out, a resident of the city of Evansville, Ind. Her husband, Simeon P. Gillett, was from 1892 until January 15, 1910, president and manager of the Citizens' National Bank. In 1893 appellant bought certain city lots in Chicago as an investment, borrowing the purchase money from the bank, and executing her individual notes therefor. As sales were made subsequently, the proceeds were applied on her bank debt; the unpaid balance being renewed from time to time. Throughout the Chicago deal, Mrs. Gillett acted mainly upon the advice of her husband, and relied upon him to keep her informed as to the maturity of the notes, and remind her to sign the renewal notes at the proper time and in the proper amount. In the usual course, these renewal notes were signed by appellant at her home. Her husband, being president and manager of the bank, took up the matured notes by delivering the renewal notes to the bank.
The evidence discloses that in December, 1909, appellant was indebted to the bank in the sum of about $7,200, and owned Chicago real estate of the estimated value of $5,000. On December 6, 1909, she signed three renewal notes for $3,882.75, $1,304.50, and $2,500, respectively, and executed a mortgage to secure the same. These were the notes in suit paid before judgment. It was the custom of the bank to number each note received and belonging to it with its distinctive number, and to record such note by its proper number in the discount register of the bank. The three renewal notes of appellant were accordingly on that day, December 6, 1909, duly registered in the discount register of the bank by their respective numbers, 114,569, 114,570, and 114,571. On December 10, 1909, four days thereafter, the note now in dispute was signed by appellant at the request of her husband while she was ill at home; that is to say, she signed a printed form of a promissory note which was entirely blank, reciting neither date nor amount, and returned it to her husband without inquiry as to the use to be made of it. Nothing was said on that subject by either party, although it was her understanding and belief at the time that the note was to be used in renewal of some part of her Chicago debt. However, in point of fact, so far as the books of the bank disclose, she was not at that time indebted to the bank in any sum; her entire indebtedness having been embraced in the three renewal notes made four days before. Just where the blank note was kept during the month following the signing of her name by appellant is not disclosed by the evidence. It was next seen about January 12, 1910, when it was found among the notes and papers of the bank, at which time it was in the form of a promissory note as follows: It appears to have been discovered by William L. Swormstedt, who had been cashier of the bank from 1883 until January 15, 1910, continuously. At that time the note bore no number stamped upon its face, as was the custom with respect to notes belonging to the bank. There was, however, attached to the note, by a pin, a slip of paper with a number thereon, which number was much smaller than those running in the discount register of the bank at that time. Swormstedt made an examination of the books of the bank and discovered that this smaller number corresponded with the number used in the discount register of 1895, 15 years before, which number indicated a check of John J. Chandler, dated July 13, 1895. The Chandler check was not produced in evidence, and it does not appear that any witness ever saw it, but, as indicated in the discount register of that year, it was numbered 59,976, dated as above, for the amount of $5,000, drawn by John J. Chandler on the Citizens' National Bank as payer. The column of the register used for indicating payment remains blank. Chandler testified that he never at any time drew a check for that amount on the bank, and denies that he ever had any business dealings with appellant. Appellant also testified that she never had any business transactions with Chandler. From the day the blank form of note was signed, December 10, 1909, until it was seen by Swormstedt, about the middle of January, 1910, no officer or employé of the bank ever saw the paper. There is nothing to explain how or why the paper got into the bank's possession. Appellant denies that she ever received any consideration for the note, or derived any benefit from it, either in her person or estate. It does not appear in evidence that any officer or employé of the bank knew anything of the note, or of any consideration for the note, or that the bank had parted with anything on account of it, except the fact that the note was found among the bank's papers. The books and papers of the bank make no mention of the note, or of any consideration for it, as far as the evidence in this case shows. In answer to an interrogatory which was read in evidence, the bank says there was nothing in the books of the bank to indicate that the note was given in renewal of any former indebtedness.
During the summer of 1910, Manual Cronback, a banker of experience, at the instance of appellant's husband, made an examination of the books of the bank covering the period of December, 1909, and again in May, 1911, he examined the books for the express purpose of determining all the facts in connection with the note in controversy. His evidence shows that it does not appear from the books of the bank that the $4,500 note was carried as an asset; that, according to the books of the bank, appellant did not get any money for it, but that the books would disclose and did disclose that she got nothing for the note. James C. Johnson, vice president of appellee bank, represented it throughout the trial of this cause. He testified in so far as he knew there was nothing in the books of the bank to show that appellant had received any consideration for the note; that there is no entry on the subject, and the books throw no light on the transaction; that, except for the fact that the note was found among the papers of the bank, he could not say appellant had received any consideration for the note. At the time of signing the blank note, December 10, 1909, and for some time afterward, appellant believed that the note in dispute was to be used in renewal of some part of her Chicago debt. About January 10, 1910, in a conversation with Hilary Bacon, a director of the bank, she told him that her debt in the bank represented her Chicago property; it came about by investments in Chicago real estate. She testified that at the time she acknowledged the second mortgage, dated January 12, 1910, in which were included the three notes signed December 6, 1909, and the $4,500 note in controversy, she told Duncan C. Givens, attorney for the bank, that the bank debt represented her Chicago property; that it was money borrowed from the bank to pay for Chicago property. She continued to believe this until January 29, 1910, when she learned from her attorneys that the $4,500 note was not a renewal note, and that she was only surety thereon. She had, in several conversations with persons interested in the bank prior to that time, stated that the $4,500 note was her debt, under a misapprehension of the fact, as she claims. It is undisputed that she believed up to that time that it was a part of her debt to the bank...
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