Lebrecht v. New State Bank, Woodard, Oklahoma
| Decision Date | 10 June 1918 |
| Citation | 205 S.W. 273,199 Mo.App. 642 |
| Parties | L. G. LEBRECHT, Appellant, v. NEW STATE BANK, WOODARD, OKLAHOMA, Respondent |
| Court | Kansas Court of Appeals |
Appeal from Jackson Circuit Court.--Hon. Willaim O. Thomas, Judge.
REVERSED AND REMANDED.
Judgment reversed and cause remanded.
Hal R Lebrecht and M. Schwind for appellant.
McCune Caldwell & Downing for respondent.
This action is to recover $ 2300 claimed as the balance due on a deposit of $ 10,000 made by plaintiff with the defendant bank. The petition alleges that on the 8th of October, 1916 said bank received from plaintiff as its depositor the sum of $ 10,000 which was credited to plaintiff's account; that on December 5, 1916, plaintiff drew his check thereon for $ 10,000, payment of which was refused, and defendant doth still refuse to pay same, or any part thereof, except the sum of $ 7700, leaving $ 2300 due with interest thereon at the legal rate from said December 5; for which, judgment is asked.
The answer, after a general denial, set up that on September 25, 1916, plaintiff was the owner of 91 out of a total of 150 shares of the capital stock of said bank; that the bank was then in the hands of the Oklahoma Bank Commission because of the wrongful conduct of Murphy, the cashier, in making unsafe and fictitious loans and in misappropriating its funds, and the Bank Commissioner was threatening to liquidate the bank and wind up its affairs as he was empowered under the law to do.
That on said date plaintiff entered into a contract with said Bank Commissioner whereby the former agreed to deliver to the latter $ 10,000 to be used in reimbursing and securing said bank against any losses caused to defendant by the wrongful acts of said Murphy as cashier "and to be applied pro tanto in reimbursement for any misappropriations or wrongful withdrawals of funds from defendant by said Murphy, and to be returned to plaintiff, subject to any deductions for such purposes, only with the approval of said Bank Commissioner, in consideration of which said Lankford, as such Bank Commissioner, acting under the laws of the State of Oklahoma, agreed to permit and did permit the defendant to be reopened and continue in business, without being dissolved and liquidated, and its affairs wound up, as said Lankford might have insisted upon being done.
The answer further alleged that pursuant to said contract plaintiff delivered said $ 10,000 to the Bank Commissioner and he deposited same with defendant subject to the commissioner's orders and thereupon permitted the bank to be reopened and continue in business to plaintiff's great benefit, enabling the latter to afterwards sell all of his stock in the bank as an active and going concern; that thereafter it was discovered that Murphy, the cashier, had wrongfully issued a negotiable cashier's check of defendant in the sum of $ 2300 which was negotiated to a holder in due course who was entitled to enforce payment of same against defendant.
The answer then alleged that "thereafter, plaintiff made demand upon said Lankford for the return of the said $ 10,000 and the said Lankford agreed to return $ 7700 thereof immediately and the balance upon plaintiff's securing the cancellation and surrender of said $ 2300 cashier's check without payment by defendant, which plaintiff then and there agreed to do, for the benefit of this defendant, and thereafter said Lankford returned to plaintiff said $ 7700."
"That nevertheless plaintiff failed to secure the cancellation and surrender of said cashier's check and this defendant was obligated to pay same and did pay same with the consent of said Lankford to its damage in the sum of $ 2300;" that said commissioner has refused and still continues to refuse to permit the balance of said fund, to-wit, the sum of $ 2300, to be returned to plaintiff.
The reply was a general denial.
A trial was had, the jury returned a verdict for defendant and plaintiff has appealed.
Plaintiff was in business in Kansas City, and some time prior to the making of the contract between him and Lankford the Oklahoma Bank Commissioner, Murphy, the cashier, borrowed of a bank in Kansas City the sum of $ 8000 on plaintiff's endorsement. Murphy also put up ninety-one shares of stock owned by him in the defendant bank, as collateral. The borrowed money was placed to the credit of defendant bank and was drawn out by its assistant cashier. Afterwards, plaintiff paid off the $ 8000 note on which he was security and obtained the stock put up as collateral and some time later became the owner of said stock.
Shortly thereafter Murphy summoned plaintiff to come to Woodward. Arriving there, he found the bank in charge of Deputy Bank Commissioner, McBride. The bank was closed on Saturday and that night plaintiff and his attorney went to Oklahoma City to see the Bank Commissioner, and there a written contract was entered into by which plaintiff was permitted to put up $ 10,000 so as to guard against the insolvency of the bank and so that the Bank Commissioner would allow the bank to be reopened. At the time the contract was made it was not definitely known just what was the exact condition of the bank, but an audit was to be made to ascertain the exact state of affairs.
Shortly after, the plaintiff deposited said $ 10,000 in the defendant bank, the same being placed to plaintiff's account; but it was, of course, made pursuant and subject to said contract. A Mr. Hastings, of Woodward, was agreed upon as the one to hold the stock as specified in the contract and he was installed as the Banking Department's representative and the bank reopened with the Deputy Bank Commission, McBride, present and in supervising control. It is clear that on the reopening of the bank there were several matters to be adjusted and settled, namely, (1) about $ 6100 of paper that McBride considered uncollectible had to be charged off as assets of the bank, (2) a $ 4000 Cozarth Grain Company acceptance, which was apparently an accommodation note of Murphy's, had to be taken out of the bank and value substituted therefor, (3) a $ 6120 discrepancy in the account of a correspondent bank had to be made good, and (4) paper of the Murphy family, amounting to $ 1475 (possibly $ 1600 with interest)), had to be taken up and cash put in its place.
While the bank was thus open and running under the permission given by virtue of the deposit contract, McBride instructed Murphy not to withdraw any money from his personal account but to leave same there to take care of any paper which the examination might disclose he had wrongfully issued. The Deputy left town for one day, however, and while he was away Murphy issued a cashier's check for $ 2300 to a fictitious person and for accommodation, and the amount was charged against the funds in his account. The moment McBride discovered this, he ordered that the check should not be paid when presented and told plaintiff that he would stop payment on it.
Thereafter, plaintiff began negotiations with two acquaintances, Lobaugh and Zacharias, to sell them his stock and they finally reached a point where the purchase was likely to be made and the Deputy Bank Commissioner McBride was sent for to sanction the transfer.
It should be here stated that it turned out that the notes though uncollectible, were good, and the bank did not lose a penny on them; nor did it lose anything by reason of the $ 6120 discrepancy, as Murphy met it in some way. The evidence is that he took it up with money obtained on the loan he got through plaintiff's endorsement as stated hereinbefore set forth. So that at the time of the proposed sale of plaintiff's stock to Lobaugh and Zacharias, there remained to be adjusted only the $ 4000 Cozarth acceptance matter and the $ 1475 worth of Murphy family paper. In addition to this, the cashier's check for $ 2300, which had come into existence after the making of the contract, the putting up of the deposit and the reopening of the bank under the contract, was outstanding and unpaid, having been, by the Commissioner's direction, withdrawn as a charge against Murphy's account,...
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