Haas v. Kings County Fruit Co.

• Decision Date: 07 February 1916
• Docket Number: No. 11858.,11858.
• Citation: 183 S.W. 676
• Parties: HAAS v. KINGS COUNTY FRUIT CO. (SOUTHWEST NAT. BANK OF COMMERCE, Garnishee).
• Court: Missouri Court of Appeals

183 S.W. 676

HAAS v. KINGS COUNTY FRUIT CO. (SOUTHWEST NAT. BANK OF COMMERCE, Garnishee).

No. 11858.

Kansas City Court of Appeals. Missouri.

February 7, 1916.

On Motion for Rehearing, March 13, 1916.

Appeal from Circuit Court, Jackson County; O. A. Lucas, Judge.

"Not to be officially published."

Suit by Ed Haas against the Kings County Fruit Company and the Southwest National Bank of Commerce, garnishee. From a judgment for the garnishee, plaintiff appeals. Affirmed.

Ellis, Cook & Barnett, of Kansas City, and Hubbert & Hubbert, of Neosho, for appellant. Robinson & Goodrich, of Kansas City, for respondent.

ELLISON, P. J.

In October, 1912, the Kings County Raisin & Fruit Company of California, sold a quantity of fruit to plaintiff, who lives and does business at Neosho, Mo. The fruit was shipped by the fruit company, and the bill of lading with draft drawn on plaintiff by the fruit company attached for $2,635.39. The fruit company did business with the Farmers' & Merchants' National Bank of Hanford, Cal., and deposited the draft with that bank, and received credit on its checking account for the amount. That bank sent the draft to the Anglo & London Paris National Bank of San Francisco for collection, and the latter bank sent it to the Southwest National Bank of Kansas City, Mo., for collection, which, in turn, sent it to the Bank of Neosho, Mo. (plaintiff's residence), for collection. The Neosho bank presented it to plaintiff and he paid it, less $20.01 discount, agreed upon between him and the fruit company. Thereupon, the Neosho bank remitted the money by draft on a trust company in Kansas City to the Kansas City bank from which it had received the original draft. But before the latter bank collected from the trust company, the Bank of Neosho ordered the trust company not to pay it. It seems that plaintiff paid the draft before the fruit arrived, and, on its arrival, he discovered it was in bad condition; and he began this suit by attachment against the fruit company, summoning the Kansas City bank, thus left with the Neosho draft in its hand, as garnishee.

The garnishee filed its answer, denying that it was indebted to the fruit company, or that it had any of its property. Thereupon, plaintiff filed a denial of the answer, wherein he alleged that the garnishee had in its possession the Neosho bank's draft on the trust company, charging that such draft belonged to the defendant fruit company. The garnishee filed a reply to plaintiff's denial, consisting of a general denial and alleging that the proceeds of the collection of the original draft drawn by the fruit company belonged to the Hanford bank, which had received it as a deposit subject to the checks of the fruit company. On trial of the issues thus made up, the circuit court directed a verdict for the garnishee.

The question is: Which party had title to the draft — the fruit company, which drew it, or the Hanford bank, which received it as a deposit? The evidence showed that the Hanford bank received the original draft drawn by the fruit company as a deposit by that company in regular course; that it issued its deposit slip, or tag, to the fruit company, and that it entered the deposit on that company's regular checking account with the bank, and that that company afterwards checked out the amount. The detail of this evidence was substantially this: That the fruit company, on the day of the deposit of the original draft, deposited also several other items or amounts, aggregating, with the draft, over $5,000, which was regularly entered on the books of the bank to the credit of the fruit company's regular checking account, and deposit slip issued. That afterwards the fruit company checked on this account at various dates, frequently reducing it to a point below the amount of the draft, and finally its checks became overdrafts. In this way the entire amount of the draft was checked out by the fruit company.

In such circumstances, undoubtedly, the Hanford bank was not a mere collecting agent for the fruit company. The transaction made it the absolute owner Ayres v. Bank, 79 Mo. 421, 49 Am. Rep. 235; Bullene v. Coats, 79 Mo. 426, 49 Am. Rep. 235; Flannery v. Coates, 80 Mo. 445; Bank v. Refrigerating Co., 236 Mo. 407, 139 S. W. 545; Mudd v. Bank, 175 Mo. App. 398, 402, 162 S. W. 314; Bank v. Milling Co., 163 Mo. App. 135 145, 145 S. W. 508; Hendley v. Globe Refining Co., 106 Mo. App. 20, 79 S. W. 1163; Pollack v. Bank, 168 Mo. App. 368, 375, 151 S. W. 774. And the fact that the bank may intend to charge the amount of the draft back to the depositor, in case it was not paid, will not avoid its title. Authorities cited. Plaintiff has cited several authorities from other states, some of them, perhaps, not stating the rule as broadly as it has been stated by our Supreme Court; but with that we are not concerned. In some cases it has been said that if the draft or check is entered as a deposit only as a matter of convenience, intending that it shall be a deposit after collection, the title will not pass to the bank until collection is made. But it will be noted in this case, that, not only was a regular deposit made on the books of the bank and a deposit slip given, but the depositor drew out the money.

Letters were introduced tending to show that the fruit company was interested in payment of the draft. That was natural enough; for if payment were refused, or intercepted in the hands of other agencies, that company would be compelled to respond to the Hanford bank. But such consideration does not show that such bank did not become the owner by entering it as a deposit and paying out the amount on the company's checks. Bank v. Refrigerating Co., 236 Mo. 407, 416, 139 S. W. 545. We are satisfied with the rulings of the trial court on the evidence, and...