Jefferson Cty. Bank v. Hansen Lbr. Co.
| Decision Date | 09 December 1932 |
| Citation | 246 Ky. 384 |
| Parties | Jefferson County Bank v. Hansen Lumber Co. |
| Court | United States State Supreme Court — District of Kentucky |
Notwithstanding precautionary directions given to buyer of lumber, buyer made payments to bank before receipt of bill of lading and invoice, under assumption that lumber purchased had been shipped. The draft forwarded was not to be paid until the bill of lading for the lumber was received. The bank credited the payments to the account of the seller, and the seller in due course of business withdrew the payments from its account. Some nine months after the payments in question, the buyer had not received the lumber nor the bill of lading, and thereupon made inquiries. In the meantime, the seller had become bankrupt, and the bank had become insolvent and was in charge of the state banking commissioner.
4. Payment. — Fact that bank, as agent for seller of lumber, had advanced money on basis of draft, held not to preclude estoppel against buyer which negligently paid draft to recover payment under mistake of fact, where bank was prejudiced.
Appeal from Jefferson Circuit Court
J.S. LUSCHER for appellant.
LAWRENCE S. GRAUMAN for appellee.
Reversing.
This case comes before us upon a motion for an appeal by the Jefferson County Bank from a judgment recovered against it in the common pleas branch of the Jefferson circuit court, by the appellee Hansen Lumber Company, for the sum of $448.55, for which it sued upon assumpsit to recover as for money paid it by mistake.
Upon the trial, the facts appeared to be as follows: The plaintiff (appellee), the Hansen Lumber Company, is an Iowa corporation, engaged in the lumber business at Davenport, Iowa. The Continental Lumber and Manufacturing Company is a Kentucky corporation, engaged as wholesalers in the manufacture and sale of lumber and having its main office in Jefferson County Ky., and which will hereinafter, for convenience, be referred to as the selling company. The Jefferson County Bank, defendant below (appellant here), is also a Kentucky corporation, engaged in the banking business at Jeffersontown, Jefferson county, Ky.
On July 15, 1929, the Hansen Lumber Company sent its order to the Continental Lumber & Manufacturing Company, or selling company, at Louisville, Ky. for a certain amount of lumber, of the wholesale value of $632.70, payable on usual wholesale terms, the freight to be deducted from invoice.
On July 17, 1929, the selling company acknowledged its receipt and acceptance of said order. Later thereafter, on September 7, 1929, it advised the plaintiff that said lumber was being shipped it in certain initialed car No. 57819, over the Louisville & Nashville and Chicago, Burlington & Quincy Railroads, and that through its president it had transferred and assigned its invoice and delivered bill of lading for this purchased lumber to the Jefferson County Bank of Jeffersontown, Ky., and that it was drawing sight draft on it, payable to the order of said bank, for $408.31, and that bill of lading for said car No. 57819 would be attached to said draft and delivered to purchaser upon its payment.
On September 10, selling company drew draft on the Hansen Lumber Company for $408.31, as per terms of prior invoice, payable to the order of the Jefferson County Bank, said draft being in its form as follows:
This draft was returned unpaid by direction of the drawee, upon the grounds that it did not conform with the terms of contract.
However, a few days after, notwithstanding its return of draft, the plaintiff Hansen Lumber Company sent its check in the sum of $410, payable to the Jefferson County Bank, as an advance on said lumber, and on October 29 sent its further check to the Jeffer-County Bank for $38.55, as an additional advance payment thereon, making a total of $448.55 paid the appellant bank therefor.
These, its checks, received by the bank were at once credited upon the account of the selling company then carried with it.
It further appears that the selling company, when making its draft upon the purchaser for $408.31 for the lumber sold it, arranged with the appellant bank to advance it some $150 upon the security of the draft, which it assigned the bank, making it payable to its order and which, when collected, was then by it credited upon the selling company's account.
It is further admitted that this car of lumber was never shipped to nor received by the Hansen Lumber Company, nor was any bill of lading ever sent it therefor by the seller, as represented by its invoice of sale sent it, nor was any bill of lading by it ever delivered to the appellant bank to forward with draft made on the purchaser, Hansen Lumber Company, nor, in fact, was any bill of lading ever received by purchaser from anyone.
On the other hand, the evidence, without conflict, is that the appellee made payments upon this lumber upon its assumption, based on the representations of selling company's invoice sent it, that the lumber had been shipped it, even though purchaser had been expressly instructed, both by the invoice and by the terms of the draft alike, that the bill of lading and invoice would each be attached to the draft when presented for payment to it, and that drawee should pay the amount of the draft "after its receipt of bill of lading and invoice" and to "hold draft for arrival of bill of lading and invoice," and further, as stated in the invoice, that the appellant bank was to make collection of this draft "after Hansen Lumber Co. has received bill of lading and invoice." which it advised was that day mailed to it.
Notwithstanding these precautionary directions given the purchasing company, admonishing it against the payment of the draft until bill of lading and invoice had been received by it, it none the less paid this $448.55 upon this car of lumber which it assumed had been shipped it, in violation of its instructions that the draft forwarded by appellant company was not to be paid before bill of lading for the lumber was received.
Some nine months after the purchasing company had thus made these payments to the bank, during which time it had never received the lumber nor bill of lading therefor, it wrote the appellant bank on June 3, 1930, inquiring of it as to the miscarriage of its lumber purchase made the prior July from the Continental Lumber & Manufacturing Company and demanding that it send them the delayed bill of lading therefor, or, failing in this that it refund purchaser this $448.55 paid it by mistake and without consideration therefor.
Appellant refused to make refund of the money paid it, upon the grounds that when this money was received by it from the purchasing company it had been at once entered and credited by it upon the selling company's bank account carried with it, and that it had been entirely used by selling company, and, even further, that the said Continental Lumber & Manufacturing Company had, during this nine-month period, become and was then bankrupt, and that the appellant bank had also become insolvent and was then in charge of the state banking commissioner.
Suit was thereupon filed in the Jefferson circuit court by the Hansen Lumber Company against the Jefferson County Bank, wherein the facts as above detailed were in substance alleged and issues joined thereon by appropriate pleadings.
On trial of the case, at the conclusion of all the evidence, the court, upon plaintiff's motion, peremptorily instructed the jury to find for plaintiff, the Hansen Lumber Company, and upon its verdict returned, judgment was entered.
Appellant's motion for a new trial being overruled, it has filed the record of these proceedings in this court and moves for an appeal, seeking a reversal of the judgment, assigning several grounds of alleged error therefor. We will here consider, however, only those which are in its brief insisted upon, which are as follows: (1) That the court erred in overruling defendant's exceptions filed to plaintiff's depositions taken upon interrogatories at the home office of the company in Davenport, Iowa, without notice of their having been given appellant; (2) that the court erred in not awarding the defendant a peremptory instruction to find for it and in having awarded a peremptory instruction to find in favor of plaintiff; and (3) that the court decided the case on its own motion, when it should have been submitted to the jury.
We do not consider it as here needful or requisite to discuss or pass upon appellant's first contention, insisting that its exceptions, filed to appellee's depositions, should have been sustained, for the reason that they could not be taken on interrogatories without notice being given appellant that they were to be filed. We pass without discussion or decision of this contention urged by appellant, inasmuch as our conclusion...
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