Irons v. Price

• Decision Date: 19 June 1883
• Citation: 14 Mo.App. 179
• Parties: D. S. IRONS ET AL. v. THOMAS J. PRICE, Appellant, and EMPORIA NATIONAL BANK, Respondent.
• Court: Missouri Court of Appeals

14 Mo.App. 179

D. S. IRONS ET AL.

v.THOMAS J. PRICE, Appellant, and EMPORIA NATIONAL BANK, Respondent.

St. Louis Court of Appeals, Missouri.

Jun. 19, 1883.

APPEAL from the St. Louis Circuit Court, HORNER, J.

Affirmed.

SCOTT & LYNN and E. J. O'BRIEN, for the appellant; BROADHEAD & HAUESSLER, of counsel: If Hamer, Stewart & Burnside had any claim for the money advanced on the cattle in question and assigned it either in law or equity, such assignment is only an assignment of a chose of action and therefore the bank took just what rights the assignors, Hamer, Stewart & Burnside had in the matter, subject to all legal and equitable set-offs, Phelps & Price, or either of them might have against the assignors. Price had a claim of $13,000, Phelps had a claim of $2,000, and Phelps & Price had a claim jointly of $2,000. The defendant bank, at most, only stands in the shoes of Hamer, Stewart & Burnside, therefore our claims against Hamer, Stewart & Burnside, being more than the amount in controversy is a good legal and equitable set-off against it.--2 Rev. Stats. 1879, p. 659, sects. 3867, 3868, 3871, ch. 64; Kent v. Rogers, 24 Mo. 233; Weiss v. Wahl, 5 Mo. App. 408; Waterman on Set-off and Counter-claim, sects. 103, 104, pp. 118-121 and cases there cited.

The draft in question is drawn generally and does not purport to be drawn on any particular fund whatever. In order to create an equitable assignment it is absolutely necessary that it should be drawn specifically on the fund equitably assigned.-- Watson v. Wellington, 1 Russ. & Myl. 602; Phillips v. Stagg, 2 Edw. Ch. 108; Luff v. Pope, 5 Hill (N. Y.), 413; Coperthwaite v. Sheffield, 3 N. Y. 243; Winter v. Drury, 5 N. Y. 525; Hopkins v. Beebe, 26 Pa. St. 85; Greenfield's Estate, 24 Pa. St. 232, 240; Clemenson v. Davidson, 5 Binn. 398; M. & F. Bank, v. Jauncy, 3 Sandf. (N. Y.) 257; Jones v. P. W. L. & T. Co., 13 Nev. 359; Bank v. Bogy, 44 Mo. 13; Wheeler v. Stone, 4 Gill, 38. The indorsement on the back of this promissory note is no part of the instrument itself, but is a simple memorandum made by Stewart for his own benefit, as he says, to inform his partners that cattle had been shipped.-- Roby v. Ollier, L. R. 7 Ch. App. 695; Brenner v. Johnson, L. R. 5 H. L. Cas. 157.NOBLE & ORRICK and C. N. STERRY, for the respondent: “A promise to pay out of a particular fund when received will be specifically enforced in equity, and thus operate as an assignment, especially when the circumstances are such that the promise was given as security for money loaned, and was relied upon as such by the lender.”-- Spain v. Hamilton, 1 Wall. 604; 3 Dill. 287; Hart v. Railroad Co., 13 Metc. 99-108; Walker v. Mauro, 18 Mo. 564; Taylor v. Lynch, 5 Gray, 49. “When a factor advances money to his principal upon goods shipped his principal to him to be sold on commission, the factor becomes a special owner of the property to the extent of the money advanced.”-- Valle v. Cerre, 36 Mo. 577; Story on Ag., sect. 111; Halliday v. Hamilton, 11 Wall. 560; Gray v. Foster, 67 Mo. 512.

LEWIS, P. J., delivered the opinion of the court.

The plaintiffs obtained an order of the circuit court, directing them to pay into court the sum of $11,811.27, less $500 for expenses, and further directing that the defendants, Phelps & Price, on the one hand, and the Emporia National Bank, on the other, interplead as several and adverse claimants of the fund. The terms of the order were obeyed and issues were joined accordingly. Upon a hearing of the testimony the court sustained the claim of the Emporia National Bank, and so gave judgment. Defendant Price appealed.

Phelps & Price were dealers in cattle at and near Emporia, Kansas. Hamer, Stewart & Burnside, partners, were cattle dealers and brokers near the stock yards in the vicinity of St. Louis. Phelps & Price purchased from one Martindale about two hundred and five head of cattle, and shipped them to Hamer, Stewart & Burnside for sale. This firm failed before the cattle reached St. Louis; and, by an arrangement between Burnside and other parties interested, the cattle were turned over to Irons & Cassiday, the plaintiffs, to be sold for account of whom it might concern. They sold the stock to one Burke for $15,211.27, and paid over $3,400, part thereof, to Phelps & Price. The residue of this sale money constitutes the fund in controversy. Phelps & Price maintain their claim on the ground that they were owners and consignors of the property for their own benefit, and that they never parted with either ownership or possession until sale was made for them by Irons & Cassiday. If this were the whole case, no equities intervening in favor of other parties, their legal claim would of course be unquestionable. They allege, moreover, that Hamer, Stewart & Burnside were indebted to them on other accounts to an amount exceeding the sum in controversy.

The bank's allegations in support of its claims are in effect as follows: Stewart, of the firm of Hamer, Stewart & Burnside, was at Emporia, Kansas, representing his firm and transacting its business. A tripartite agreement was made orally by and among the two cattle firms or their representatives and the bank, to the following effect: when Phelps & Price should buy a lot of cattle, under the arrangement, Stewart would draw a sight draft upon his firm for the necessary purchase-money, in favor of the Emporia National Bank. The cattle purchased would be shipped to Hamer, Stewart & Burnside for sale. The bank would then honor the check of Stewart, or of Phelps & Price, as might be necessary, to consummate the transaction in favor of the original vendor, for the amount of the draft less certain commissions or fees. The draft would be indorsed with a memorandum of the cattle shipped, and would be transmitted by the bank to its correspondent in East St. Louis, to be there paid by Hamer, Stewart & Burnside out of the proceeds of their sale of the cattle. It was understood that in each instance the draft should be considered as drawn against that particular shipment of cattle. The bank's interplea does not so summarize the features of the agreement. But the details given of a preliminary understanding between Stewart and the bank, with its recognition by Phelps & Price, and their active co-operation in whatever was necessary to carry out its provisions, result in a showing of the common compact whose effective terms were as above stated.

There had been a number of previous transactions in conformity with this compact, and the present one was in accordance therewith, up to the arrival of the cattle at the stock yards in East St. Louis.

If the case...