Henry County v. Citizens' Bank.

• Decision Date: 24 December 1907
• Citation: 208 Mo. 209,106 S.W. 622
• Parties: HENRY COUNTY v. CITIZENS' BANK OF WINDSOR.
• Court: Missouri Supreme Court

106 S.W. 622

208 Mo. 209

HENRY COUNTY v. CITIZENS' BANK OF WINDSOR.

Supreme Court of Missouri.

December 24, 1907.

1. DEPOSITARIES — DEPOSITS OF PUBLIC MONEYS — ACTIONS FOR RECOVERY — UNDISCLOSED PRINCIPALS.

A county suing a bank for county funds alleged to have been fraudulently received by the bank from the county depositary pursuant to an illegal agreement to stifle bidding for county funds, by which the successful bidder was to apportion funds deposited with it among the members of the illegal combination, cannot recover on the theory that the bank was an undisclosed principal, based on the ground that those entering into the combination were, as to the apportionment to them of the county funds, undisclosed principals.

2. PLEADING — ISSUES AND PROOFS.

One cannot sue on one cause of action, and recover on another.

3. APPEAL — PRESENTATION OF QUESTIONS IN LOWER COURT — THEORY OF CASE.

One cannot try his case on one theory in the trial court, and on another theory on appeal after his defeat in the trial court.

4. DEPOSITARIES — DEPOSITS OF PUBLIC MONEYS — SELECTION OF DEPOSITARY.

Rev. St. 1899, §§ 6817-6820 [Ann. St. 1906, pp. 3344-3345], providing for the selection of a depositary of county funds after competitive bidding, requiring that the bids shall be publicly opened and entered on the records of the county court, and that the bidder offering the highest rate of interest shall be selected, and stipulating for the execution of a bond by the depositary and the transfer of the county funds to it, require that the banks with whom the county court is authorized to deal in selecting a depositary shall be disclosed, and the county court has no authority to apportion the county funds among two or more banks, and therefore two or more banks cannot jointly submit a bid, nor can one bank be the undisclosed principal of another presenting a bid.

5. SAME — RECOVERING DEPOSITS — ACTIONS.

A county suing a bank for county funds fraudulently received by it from the county depositary pursuant to an illegal agreement to stifle bidding for county funds, by which the successful bidder was to apportion funds deposited with it among the members of the illegal combination, cannot recover on the theory that the bank and the depositary are joint tortfeasors.

6. SAME.

Several banks illegally combined to suppress bidding for county funds under an agreement providing that the successful bidder obtaining the funds should apportion the same among the banks. A bidder was designated depositary, and it gave a bond and received county funds. Held, that the bank selected as depositary and its sureties were alone responsible for a failure to account for the funds, there being no authority by which such bank and another bank in the illegal combination could vary the terms of the contract with the county, or render any one other than those disclosed in the contract liable for any breach of it.

7. CONTRACTS — AGREEMENT TO SUPPRESS BIDDING — VALIDITY.

Several banks combined to suppress bidding for county funds under an agreement providing that the bidder selected as depositary should apportion the county funds obtained among the banks in the combination. Held, that the combination was illegal.

8. DEPOSITARIES — DEPOSITS OF PUBLIC FUNDS — LIABILITY.

Several banks illegally combined to suppress bidding for county funds under an agreement providing that the bank selected as depositary should apportion among the banks in the combination the county funds received. A bank was selected as depositary, and it gave a bond, which was approved, and received county funds. It did not part with any of the funds by deposit with a bank in the combination. Held, that the latter bank was not liable to the county for any part of the funds which should have been apportioned to it under the agreement, there being no contractual relation between it and the county.

In Banc. Appeal from Circuit Court, Pettis County; Louis Hoffman, Judge.

Action by Henry county against the Citizens' Bank of Windsor. From a judgment for defendant, plaintiff appeals. Affirmed.

This cause is now pending in this court upon appeal by plaintiff, the county of Henry, from a judgment of the Pettis county circuit court in favor of the defendant. We know of no better way of indicating the nature and character of this controversy than by the reproduction of the petition and answer which present the issues that were determined by the trial court. Omitting formal parts, the petition thus states the cause of action by the plaintiff: "Now at this time comes the plaintiff, the county of Henry, in the state of Missouri, and for its amended petition and cause of action against the defendant states that the plaintiff is a municipal corporation and political subdivision of the state of Missouri, and as such is entitled to sue in the courts of this state; that the defendant, the Citizens' Bank of Windsor, is a banking corporation, duly organized and existing under the laws of this state, and was, at all the times mentioned in this petition, and now is, such corporation, and engaged in the banking business at the city of Windsor, in the county of Henry; that at the regular May term, 1903, of the county court of said Henry county it was the duty of said court to select and designate a county depositary for the deposit of the money belonging to said county, including school funds, and the duty of said county court prior to said term to advertise for bids from banking corporations, individual bankers, and others, for the privilege of being selected as such depositary, and said county court, as provided by law, did advertise for bids from such banking corporations, individuals, and others for said purpose; that at, and prior to, the time of the term of said county court, the Farmers' Bank of Windsor and the Citizens' Bank of Clinton were banking corporations, doing a banking business at the cities of Windsor and Clinton, respectively, in said Henry county, and Salmon & Salmon, a firm composed of George Y. Salmon and Harvey W. Salmon, were engaged in the banking business at the city of Clinton aforesaid, as individual private bankers; that prior to the said May term, 1903, and in anticipation of the selection of a county depositary by said county court, the defendant, the Citizens' Bank of Windsor, and the Farmers' Bank of Windsor, the Citizens' Bank of Clinton, and the said Salmon & Salmon entered into an agreement, by the terms of which it was understood and agreed that the bids of said banks and of said Salmon & Salmon should be so placed with said county court that the bid of said Salmon & Salmon should be the highest bid, and that said Salmon & Salmon should be selected and designated the county depositary of said Henry county at said May term, 1903, of said county court, and that the funds of said Henry county, after being received by said Salmon & Salmon as such depositary, should be divided and apportioned among the said banks, to wit, the defendant, Citizens' Bank of Windsor, said Citizens' Bank of Clinton, and said Farmers' Bank of Windsor, and said Salmon & Salmon, for the use and benefit of said several banks; that in pursuance of said arrangement and agreement bids were so made that the bid of said Salmon & Salmon was the highest bid for the county money of said Henry county, made to the county court at said May term, 1903, and said Salmon & Salmon were, at said term, selected by said county court as such county depositary for Henry county, for the term of 2 years and 60 days next ensuing said May term, 1903; that said Salmon & Salmon qualified under such selection and gave bond and were duly designated by said county court the depositary of the funds of Henry county, for the term above mentioned, and all the funds of said Henry county, including the school funds, amounting in all to the sum of $65,000, became and were deposited with said Salmon & Salmon as such depositary, and thereafter, and until the 20th day of June, 1905, all the moneys belonging to the county of Henry, including school funds, were paid to and deposited with the said Salmon & Salmon, amounting in the aggregate to the sum of $320,000; that after the selection and designation of Salmon & Salmon as county depositary, as aforesaid, to wit, on the ____ day of July, 1903, said Salmon & Salmon, in pursuance of the agreement aforesaid, for the division of the county funds among said above-named banks, turned over and delivered to the defendant, Citizens' Bank of Windsor, out of the county money belonging to Henry county, the sum agreed upon to be apportioned to the defendant, to wit, the sum of $10,000, and defendant, Citizens' Bank of Windsor, took and received the said sum of $10,000, as and for its share of the moneys obtained from the county of Henry, by the means and under the arrangement and agreement aforesaid, and did use and lend and receive the benefits thereof; that on the 20th day of June 1905, said Salmon & Salmon were, and for many years prior thereto had been, insolvent, and on said day their bank was closed, and has ever since remained closed, and on said day they failed and ever since have failed to pay checks drawn upon them for the county funds of Henry county, by the proper officer; that there was due to Henry county on said 20th day of June, 1905, and still remains due and unpaid, on account of moneys belonging to plaintiff, Henry county, deposited with said Salmon & Salmon as such depositary, the sum of $63,976.76; and that the defendant, Citizens' Bank of Windsor, has wholly failed and refused to pay the aforesaid sum of $10,000 of the money of Henry county, received by it as aforesaid, but now retains and holds the same, though plaintiff has demanded the payment thereof. Wherefore, the plaintiff asks for judgment against the defendant, Citizens' Bank of Windsor, for the sum of $10,000, and for costs, and for all other proper relief in the premises."

The answer of the defendant...