McCarville v. Ream

• Decision Date: 18 October 1955
• Docket Number: No. 48761,48761
• Parties: Clifford McCARVILLE, d/b/a McCarville Motor Co., Appellant, v. Miller REAM (A. V. Hass, Executor, Substituted Defendant), Appellee.
• Court: Iowa Supreme Court

Page 476

72 N.W.2d 476

247 Iowa 1

Clifford McCARVILLE, d/b/a McCarville Motor Co., Appellant, v. Miller REAM (A. V. Hass, Executor, Substituted Defendant), Appellee.

No. 48761.

Supreme Court of Iowa.

Oct. 18, 1955.

Hoegh & Meyer and W. W. Bulman, Chariton, for appellant.

A. V. Hass, Chariton, for appellee.

THOMPSON, Justice.

A bunch of the boys were whooping it up in the Hotel Fort Des Moines. The date was the night of March 20-21, 1947, and the occasion was the annual convention of the Iowa Automobile Dealers' Association. The 'boys' were members of the Association and assorted friends, and this lawsuit grows out of what may be described as some of their extra-curricular activities which were probably not on the official agenda of the convention; in short, gambling games played with dice. As one witness described the scene: 'The dice game took place in one of the large rooms at Fort Des Moines Hotel. In fact, there was maybe four or five games going on. The place was full of them.'

The plaintiff was an automobile dealer at Carroll, and the original defendant, Miller Ream, operated an agency at Chariton. Both were present and there is substantial testimony both participated in the dice games. Miller Ream is now deceased and his executor has been substituted; but we shall continue to refer to him as the defendant.

The action here was commenced by the plaintiff, who brought suit upon a check dated August 12, 1947, signed by the defendant and payable to 'McCarville Motor' in the sum of $1,500. This was given as part of the purchase price of an automobile. The only defense offered to it is in the nature of a cross-petition claiming upon six different checks of the plaintiff, one payable directly to the defendant and the others having been endorsed to him. They totalled $2,250, and defendant prayed judgment against plaintiff in the amount of the difference between the check held by plaintiff--$1,500--and the six checks held by him, or $750. To this cross-petition the plaintiff by way of answer and reply alleged, in substance, that each of said checks was given, executed and delivered for money lost to the respective payees in a gambling game of chance played with dice at Des Moines, Iowa, of all of which the defendant had knowledge. Just before the opening of the trial, in 1954, the defendant's answer was also amended by including an allegation that after the commencement of this action the plaintiff and defendant made an oral agreement of settlement and compromise by which all claims and counter-claims would be settled by the payment by defendant to plaintiff of the sum of $100; and defendant offered to confess judgment for said sum.

The trial court instructed the jury that the defendant admitted liability on the $1,500 check, and this ruling is not questioned. The court submitted to the jury the issue raised by plaintiff's contention that the checks were void because given for money lost, laid, staked or bet in a gambling game, as to four of the checks, respectively Exhibits D-3, D-4, D-5, and D-6; but it refused to submit this issue as to Exhibits D-1 and D-2, and in effect directed a verdict for the defendant upon these checks, in the respective amounts of $1,050 and $200. It also submitted the issue as to defendant's claim of accord and satisfaction by the alleged compromise agreement. The jury found for the plaintiff on all issues submitted to it; that is, it determined that the four checks, Exhibits D-3 to D-6, inclusive, were void, and that there was no settlement agreement. Defendant has not appealed, so the only issue before us is the correctness of the court's determination that plaintiff did not engender a jury question as to whether the checks D-1 and D-2 were void because the consideration arose out of a gambling transaction.

I. The defendant does not question that the two checks in controversy would be void if given in connection with a gambling game under the provisions of Code section 537.4, which we set out:

'All promises, agreements, notes, bills, bonds, or other contracts, mortgages or other securities, when the whole or any part of the consideration thereof is for money or other valuable thing won or lost, laid, staked, or bet, at or upon any game of any kind or on any wager, are absolutely void and of no effect.'

Nor does he challenge plaintiff's contention that it is immaterial whether defendant was an innocent holder for value. In Plank v. Swift, 187 Iowa 293, 299, 174 N.W. 236, 238, 8 A.L.R. 309, we said:

'But an insuperable objection to plaintiff's right of recovery is found in the established fact that the checks were given for a gambling debt, and under our statute they are absolutely void even in the hands of a professed innocent holder.'

Earlier Iowa cases are cited in support of the quoted holding.

The trial court was of the opinion that there was insufficient evidence to permit submission to the jury of the question whether Exhibits D-1 and D-2 were given in consideration of gambling losses. Exhibit D-1 is a check for $1,050, dated March 20, 1947, drawn on the Carroll County State Bank, payable to the order of Ream Motor Company, and signed McCarville Motor Co. by Cliff McCarville. In the lower left hand corner is the notation '1941 Chev. Coach, John Willy, Chicago Form 158.' On the back are the endorsements 'Ream Motor Co., Miller Ream, Homer Ritch, Miller Ream.' Exhibit D-2 is a check for $200, dated March 21, 1947, drawn on the Carroll County State Bank, payable to Holmer Ritch, and signed 'McCarville Motors, by Clifford McCarville.' On the back is the endorsement 'Holmer Ritch.' On the lower left hand corner is the notation 'Cash.'

It was the notations in the lower left hand corners of these checks which apparently caused the trial court to differentiate them from the other four in ruling upon the question of submission to the jury. It was the thought of the court that each check showed on its face that it was given for a definite consideration--a 1941 Chevrolet coach as to the first check, and cash as to the second; and there was no substantial evidence to contradict these statements. We think there was competent evidence in the record that both checks were given in consideration of gambling losses, and that there was evidence improperly excluded as to Exhibit D-1 which tended strongly to constradict the claim it was given in payment for an automobile.

The defendant being deceased at the time of trial, the plaintiff was precluded from testifying to any transactions with him. However, there was substantial testimony given by one Mike J. Maystadt, who was in 1947 an employe of the plaintiff and had attended the convention with him. He said that he was present at the dice games, and further: 'I have seen Exhibit D-1 before. * * * He didn't buy any car then. I saw Clifford McCarville write that check. * * * I saw Mr. McCarville write that check. It was given during the gambling game I referred to. * * * I saw the check D-2 before. I saw it given. Yes, it was given during the gambling game--was put on the table. * * * I saw Clifford McCarville sign that check and put it on the table in the gambling game. * * * I was in this hotel when Clifford McCarville quit gambling and went home. He had bet Exhibits D-1, D-2, D-3, D-4, D-5, and D-6 in that gambling game.'

On cross-examination the same witness testified: 'Q. That is the one (Exhibit D-1) you said he didn't get--didn't get any Chevrolet from Ream,--that was lost in the crap game? A. Yes. Q. You say that was bet in the crap game? A. Why, yes.' Again he said: 'I know these are the same checks for that is the time the crap game was in Des Moines, after the banquet. I know these are the ones because he lost the money. There wasn't any given for some other transaction. I know there wasn't any other transaction because I was with Mr. McCarville. * * * I think I saw him sign all these checks.'

Here is a definite statement that the witness saw the origin of the checks, and saw them lost in the dice game. Whether the notations which seemed of governing importance to the trial court were placed there for the purpose of making the consideration seem something whihc it was not, became a jury question in the light of the above testimony. The defendant urges that at best the evidence was in equipoise as to whether the checks were involved in the dice game; and so that the plaintiff failed to carry the burden of proof resting upon him to establish his defense to the checks. We suggest it was for the jury to weigh the evidence and determine whether it was in fact evenly balanced. By taking the issue from the jury the court usurped its functions. Maystadt's testimony cannot be disregarded; it is substantial evidence and engendered a jury question.

II. Plainitff also assigns error upon the exclusion of certain offered evidence tending to show there was no sale or transfer of an automobile from Miller Ream to Clifford McCarville in 1947. The county treasurer of Lucas County, where the defendant lived and operated his business, testified the law required that if a resident of Lucas County sold a car to someone in another county a record be made of the transfer in the treasurer's office; and he found no such record in 1947. The offered testimony of the county treasurer of Carroll County--the residence and place of business of the plaintiff--who produced the records of her office as to transfers of automobiles for the year 1947, was rejected by the court. She was asked whether the records showed a transfer of a 1941 Chevrolet car from the defendant to the plaintiff, and the records were offered in evidence. Error cannot be predicated upon this ruling, because there is no showing as to whether the answers would or would not have shown such a transfer. But we think upon another trial the evidence of the records will be competent.

Both plaintiff and defendant were retail dealers in automobiles. Section 422.50 of the Code...