Kuder v. Greene

• Decision Date: 15 October 1904
• Citation: 82 S.W. 836,72 Ark. 504
• Parties: KUDER v. GREENE
• Court: Arkansas Supreme Court

82 S.W. 836

72 Ark. 504

KUDER v. GREENE

Supreme Court of Arkansas

October 15, 1904

Appeal from Boone Circuit Court, ELBRIDGE G. MITCHELL, Judge.

Reversed.

STATEMENT BY THE COURT.

In June, 1901, C. M. Greene was the cashier of the Citizens' Bank of Harrison, Arkansas. In that month J. H. Kuder, while in Harrison, delivered to H. E. Cole two checks drawn by Kuder on a bank in Kansas. One of the checks for the sum of $ 150 was made payable to the order of H. E. Cole; the other check for the sum of $ 600 was made payable to the order of "C. M. Greene, Cashier." Cole took both of the checks to the Citizens' Bank, and had them deposited to his own credit for collection. The checks were paid by the bank in Kansas, and the proceeds were by the Citizens' bank placed to the credit of Cole, who afterwards drew it out of the bank on his own check. Before the money had been all paid over to Cole, Kuder notified the bank that Cole had no authority to collect the check, and the bank then asked him to find Cole and have the matter settled, but nothing seems to have been done, and afterwards, the bank refusing to pay Kuder for his draft, he brought this action against the bank to recover the sum of $ 600, which he claims that the bank owed him for the proceeds of the check. On the trial the plaintiff Kudger testified that he gave the check for $ 600 to Cole with the understanding that he should deposit it in the bank for collection for plaintiff Kuder, and that Cole had no authority to use the proceeds thereof. On the other hand, Cole testified that both checks were delivered to him by Kuder in payment of a debt that Kuder owed him for a lease which Kuder had purchased from him. Kuder, in explaining why he sent the check to bank by Cole, stated that he did so because Cole, who was a customer of the bank, told him that if he would let him (Cole) carry the check over to the bank the bank would not charge any commission for collecting. Before agreeing to credit Cole with the amount of the check the bank required him to indorse his name on the back of the check.

The case was submitted to the presiding judge, who made the following among other findings, to-wit:

"That defendants, R. T. Knight and C. M. Greene, are and were at all times mentioned in the proceedings in this case, partners and doing a general banking business at Harrison, Arkansas, under the firm name of Citizens' Bank, and that said defendant, C. M. Greene, is and was at all times cashier of said bank. That plaintiff on the 29th day of June, 1901, drew his draft on Northrup National Bank of Iola, Kansas, in favor of said Chas. M. Greene, cashier for $ 600; and on the same day caused said draft to be deposited in said Citizens' Bank for collection; and that said Citizens' Bank collected said draft on the 6th day of July, 1901. That said draft was delivered by plaintiff to H. E. Cole, and by him delivered to the bank, and that at the time of such delivery to Cole there was no express authority given him by plaintiff to collect or appropriate the proceeds of said draft. That plaintiff did not deliver said draft to Cole in payment of the purchase price of a lease; nor did he negotiate or sell the same to Cole. That the plaintiff constituted Cole as his agent to carry the $ 600 to the bank, and there to cash the same draft, and then for Cole to deposit the sum collected in plaintiff's name in the bank."

The court did not make any declaration of law, further than that the law of the case was in favor of the defendants, and he thereupon rendered judgment in favor of defendants, and plaintiff appealed.

Judgment reversed and case remanded.

B. B. Hudgins, Pace & Pace and J. W. Story, for appellant.

The court erred in refusing the first and second requests of appellant for instructions. 10 Wall. 650; 70 Tex. 643, S. C. 8 S.W. 507; Newmark, Dep. § 88; 23 N.Y. 289. It was likewise error to refuse appellant's third request. 44 Ark. 564; 50 N.Y. 410, S. C. 10 Am. R. 502. If appellees gave Cole credit for the draft or turned the proceeds of same over to him, they became liable to appellant. Story, Ag. (Benn. Ed.) § 126; 65 Ark. 385; 104 U.S. 54. If the money was ever actually paid to Cole, it was with full notice of appellant's right, and is no defense to this suit. 9 Gill & J. 297; 51 Cal. 64; 90 Ky. 431; 14 S.W. 411; 18 S.W. 115; 89 Tenn. 609; 148 Mass. 553.

G. J. Crump, for appellees.

The check having passed to Cole's credit, the fund was subject to his check, and the bank would have had to honor his check. 62 Pa.St. 88; 89 Ga. 108; 87 Ga. 45; 37 Ill.App. 425; 39 Mo.App. 540; 90 N.Y. 530; 57 N.Y. 499; 88 Ga. 333., S. C. 14 S.E. 554; 39 Ind. 109; 29 S.W. 926; 42 Ark. 26. When one of two innocent persons must suffer, he whose act made the wrong possible must bear the consequences. 74 Ala. 604; 6 Mackey, 428; 42 Ark. 22; 13 Ill.App. 236; 39 Mich. 584; 9 Pa. 52; 91 Pa.St. 290; 108 Pa.St. 529; 27 Tenn. 489.

OPINION

RIDDICK, J., (after stating the facts.)

This is an action by plaintiff Kuder against C. M. Greene and R T. Knight, partners doing business under the firm name of the Citizens' Bank, to recover the proceeds of a check which he claims to have deposited with the bank for collection. The check was made payable to the cashier of the bank, and was delivered to the bank by one Cole, to whom the proceeds of the check were paid. The defendants claim that Kuder authorized Cole to collect the check, and had him to present the check to the bank for the purpose of avoiding payment of exchange and collection charges. They say that the money was paid over to Cole in the usual course of business, and in accordance with...