Million v. Commercial Bank of Boonville.

• Decision Date: 04 December 1911
• Citation: 141 S.W. 453,159 Mo. App. 601
• Parties: MILLION v. COMMERCIAL BANK OF BOONVILLE.
• Court: Missouri Court of Appeals

141 S.W. 453

159 Mo. App. 601

MILLION v. COMMERCIAL BANK OF BOONVILLE.

Kansas City Court of Appeals. Missouri.

December 4, 1911.

1. HUSBAND AND WIFE (§ 129)—ESTATE OF WIFE — CHARGES — RIGHTS OF HUSBAND'S CREDITORS.

Where a husband, with the consent of his wife, used her personal property as his own, on the credit of which he contracted debts, the wife was estopped, when the husband became insolvent, to set up her ownership of the property against his creditors.

2. BANKS AND BANKING (§ 116)—NOTICE TO CASHIER.

Where a cashier of a bank, in dealing with a patron, discovered that he was insolvent, such knowledge of the cashier was notice to the bank of his insolvency.

Appeal from Circuit Court, Cooper County; Wm. H. Martin, Judge.

Action by William R. Million, trustee in bankruptcy of the estate of Joseph B. Varnum, bankrupt, against the Commercial Bank of Boonville. From a judgment for plaintiff, defendant appeals. Affirmed.

John Cosgrove, for appellant. Roy D. Williams, for respondent.

BROADDUS, P. J.

This is a suit by a trustee in bankruptcy.

The defendant held a note of $1,700, signed by the bankrupt, Joseph B. Varnum, and his wife. This note was a renewal of two former notes given to defendant by Varnum and wife, or by Varnum alone (there is a dispute as to that matter), one for $1,200, and the other for $500. There were four or five months rent due the defendant for a storeroom occupied by Varnum, which belonged to defendant. The interest on the $1,700 note and the back rent amounted to $1,942.60. Varnum had been engaged in the hardware business at Boonville, when he met with reverses, and filed a petition in the bankrupt court. Before coming to Boonville, he had been living at Rocheport, where he had also been engaged in the hardware business, and it seems that the stock of goods carried at Rocheport was purchased with funds he procured of his wife. This stock of goods was taken to Boonville. The business at Boonville was conducted solely by Varnum. The sign over the front door bore his name, and he had exclusive management of the business. The stationery and bill-heads were printed in his name; and his wife did not claim to own any interest in the business, and did not make any suggestions how it was to be conducted. And it appears that Varnum held himself out to the world as the owner of the goods. When he moved to Boonville, he rented a building, in which he conducted his business, from defendant, and deposited his funds, which at that time amounted to about $2,000, in his own name with defendant bank. Soon after going into business at Boonville, he began to borrow money of defendant. First, he borrowed $500, and afterwards $1,200, as has been stated. Afterwards they were renewed, and the amount incorporated in the one note for $1,700. All the money so borrowed was deposited in defendant bank to the credit of Varnum. It appeared that Varunm was unable to pay what he owed defendant, but also defaulted in the payment of interest and in the payment of rent for several months. Dauwalter, defendant's cashier, loaned him $600 with which to pay interest due and past rent, and a deed of trust was given to secure it on Mrs. Varnum's home.

There is no doubt but what Varnum gradually and constantly became financially embarrassed, and the defendant's cashier had knowledge that such was the case, which knowledge he obtained through transactions he had with him as such cashier. The cashier was told by Varnum that the stock of goods was all the property he had, and that he owed about $1,000 to other creditors. Varnum was advised by the cashier that the best thing he could do would be...