Marvick v. Knight

• Decision Date: 01 April 1927
• Docket Number: 5900.
• Citation: 212 N.W. 866,51 S.D. 151
• Parties: MARVICK et al. v. KNIGHT.
• Court: South Dakota Supreme Court

212 N.W. 866

51 S.D. 151

MARVICK et al. v. KNIGHT.

No. 5900.

Supreme Court of South Dakota

April 1, 1927

Appeal from Circuit Court, Roberts County; J. J. Batterton, Judge.

Action by Andrew Marvick and others, as trustees for the creditors of the Citizens' National Bank of Sisseton, against H. M Knight, also known as Hal M. Knight. From an order overruling a demurrer to the complaint, defendant appeals. Reversed.

Babcock & Babcock, of Sisseton, for appellant.

Jorgenson & Anderberg, of Sisseton, for respondents.

MISER C.

This appeal is from an order overruling a demurrer to a complaint the grounds of demurrer being: First, that the plaintiffs have not legal capacity to sue; second, that there is a defect of parties plaintiff; third, that said complaint does not state facts sufficient to constitute a cause of action. The complaint is as follows:

"(1) That the plaintiffs herein, prior to the commencement of this action, were by the creditors of the Citizens' National Bank of Sisseton, S. D., appointed as the trustees of said creditors for the purpose, among other things, of collecting all accounts due said Citizens' National Bank on behalf of said creditors; that said plaintiffs have duly accepted said trusteeship and are now acting on behalf of the said creditors of said bank.

(2) That heretofore and on the 2d day of January, 1924, the defendant, for value received, made, executed, and delivered to the Citizens' National Bank of Sisseton, S. D., his certain promissory note, wherein and whereby he promised and agreed to pay to the said Citizens' National Bank of Sisseton, S. D., on the 2d day of April, 1924, the sum of $4,130, with interest thereon at the rate of 10 per cent from date until paid.

(3) That the defendant has failed, refused, and neglected to pay said note or any part thereof, although often requested so to do.

(4) That there is now due and owing on the said note from the said defendant, to the plaintiffs herein, as trustees, the sum of $4,130, with interest thereon at 10 per cent. per annum since the 2d day of January, 1924.

(5) That prior to the commencement of this action the said note was duly assigned and transferred to the plaintiff herein, as trustees of the creditors of said Citizens' National Bank of Sisseton, S. D."

Irrespective of whether or not there has been, in this complaint, a sufficient allegation by the plaintiffs of their representative character, the facts showing the trust relation, the circumstances of their appointment, and the powers with which they are vested, as the rules of pleading demand (39 Cyc. 458), the complaint was insufficient, and the demurrer should have been sustained, for the reason that there is not contained within the complaint any sufficient allegation of indorsement of a negotiable instrument or assignment of a nonnegotiable instrument by the payee named therein. Even though said complaint had sufficiently stated facts showing plaintiff's representative character and trust relation, by what words is the gap in the chain of title between the payee bank and the plaintiff trustees bridged? Throughout this complaint, plaintiffs have avoided saying that they are the present holders of said note, or that said note was indorsed by the payee in writing, or assigned by the payee in writing, or delivered by the payee, or that the plaintiffs are now in the possession of said note. In an action by one other than payee, it is necessary to allege facts showing plaintiff's title or right to sue.

"If there has been a transfer by indorsement, or the

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