Mineral Belt Bank v. Elking Lead & Zinc Co.

• Citation: 158 S.W. 1066
• Parties: MINERAL BELT BANK v. ELKING LEAD & ZINC CO.
• Decision Date: 18 July 1913
• Court: Court of Appeal of Missouri (US)

158 S.W. 1066

MINERAL BELT BANK v. ELKING LEAD & ZINC CO.

Springfield Court of Appeals. Missouri.

July 18, 1913.

On Motion to Modify Opinion, August 5, 1913.

1. BILLS AND NOTES (§ 475)—ACTION—ANSWER —FAILURE TO VERIFY—EFFECT.

Under Rev. St. 1909, § 1985, providing that, when a pleading is founded on an instrument charged to have been executed by the other party, its execution shall be deemed confessed, unless the party charged to have executed it deny, by verified pleading, its execution, the unverified answer, in an action against E. on a note signed "K., by S.," merely confesses the note was executed and signed as the note itself shows, and does not confess the conclusion of the petition that it was executed by E., by its president, K.; the purpose of the statute being merely to do away with the proof, required at common law, of signing and execution, unless its execution is denied under oath.

2. APPEAL AND ERROR (§ 171)—REVIEW— THEORY OF CASE BELOW.

The contention that the unverified answer, in an action against E. on a note signed "K., by S.," made it unnecessary to prove that the note was in fact defendant's note is unavailable on appeal; the case having been tried on the theory that it was necessary for plaintiff to show the connection between K. and defendant.

3. BILLS AND NOTES (§ 121)—LIABILITY AS MAKER—PERSONS NOT SIGNING.

Under Rev. St. 1909, § 9989, providing no one whose signature does not appear thereon is liable on a negotiable instrument, one whose name in no way appears on the face of a note cannot be held liable as principal; the note not being signed in such a way as to make it ambiguous.

On Motion to Modify Opinion.

4. APPEAL AND ERROR (§ 665)—RECORD.

The court is bound by the abstract of record showing that plaintiff voluntarily dismissed the second count; this not being challenged by an additional abstract, as permitted by court rule 12 (122 S. W. vi).

5. APPEAL AND ERROR (§ 1175)—REVERSAL— REMAND.

The court, on reversal of the judgment for plaintiff because the petition states no cause of action, will not remand where an amendment would change the cause of action.

6. PLEADING (§ 248)—AMENDMENT—CHANGING CAUSE OF ACTION.

A petition, counting solely on execution and failure to pay a promissory note, may not be amended to count solely on money had and received, or money paid for the use and benefit of defendant, as this would change the cause of action.

7. JUDGMENT (§ 581)—BAR—REVERSAL.

Reversing the judgment for plaintiff, on a count on a promissory note, without remanding the cause is not a bar to another action for money had and received; a count for which the record shows plaintiff voluntarily dismissed, in effect, taking a nonsuit.

Appeal from Circuit Court, Jasper County; David E. Blair, Judge.

Action by the Mineral Belt Bank against the Elking Lead & Zinc Company. Judgment for plaintiff. Defendant appeals. Reversed.

Frank L. Forlow, of Webb City, for appellant. Thomas & Hackney, of Carthage, for respondent.

FARRINGTON, J.

Suit on note and attachment in aid thereof. Judgment for plaintiff sustaining attachment, and judgment for plaintiff on the merits.

Plaintiff, a banking corporation of Webb City, filed its petition on May 28, 1909, in two counts, the second count being voluntarily dismissed, and the cause was tried on the first count. The following excerpt from the petition is sufficient to show plaintiff's charge and prayer: "Plaintiff further states that on February 11, 1908, the defendant company borrowed from the plaintiff the sum of $3,000, for which the defendant, by its president thereunto duly authorized, made, executed, and delivered to the plaintiff its certain promissory note, bearing said date, by which it promised to pay to the plaintiff or order 90 days after date the said sum of $3,000, for value received, with interest at the rate of 8 per cent. per annum from maturity until paid, and if not paid annually to become principal and bear the same rate of interest, which said promissory note is herewith filed and made a part of this petition. Plaintiff further states that the defendant has made payments on said note as follows: May 23, 1908, cash $500; August 13, 1908, by A. M. W., $500; August 20, 1908, $775; November 23, 1908, cash $125; May 6, 1909, cash by Elking, $375. That the balance of said promissory note is long since past due, has been demanded and payment refused. Wherefore plaintiff prays judgment against the defendant for the sum of $725, together with interest thereon at the rate of 8 per cent. per annum."

The defendant filed an unverified answer to the merits admitting its incorporation, denying that it made and executed the note described, and charging that no person had power or authority to execute said note and bind the defendant, alleging, also, that the note was made without consideration, and that the proceeds were advanced, if any consideration was given by plaintiff, to L. Kreilsheimer for his personal use, and that plaintiff knew at the time such money was advanced, if it did part with any money, that it was for the benefit of said Kreilsheimer and not for the benefit of the defendant.

An attachment was issued in aid of the suit setting up six of the statutory grounds for attachment, namely, the second, seventh, eighth, ninth, tenth, and fourteenth grounds as contained in section 2294, R. S. 1909. A plea in the nature of a plea in abatement was filed denying under oath the allegations contained in the affidavit. The writ issued, and the sheriff seized certain leasehold interests and certain mining and milling machinery on the leasehold owned by the defendant. A redelivery bond was given by the defendant, and the case went to trial on the plea in abatement and then on the merits. In our opinion the judgment on the merits must be reversed, and it will therefore be unnecessary to consider the alleged errors pertaining to the attachment proceeding.

The evidence disclosed that the defendant was a Missouri corporation engaged quite extensively in the mining business; that on its organization L. Kreilsheimer subscribed for and owned practically all the stock. It also shows that L. Kreilsheimer was the president, treasurer, and general manager of the company; that he had an office in Webb City, where he directed the affairs of the company, and that this was the defendant's office; that one Jessie Schooler was the stenographer and private secretary of Kreilsheimer and also performed the duties of secretary of the corporation; that defendant, Elking Lead & Zinc Company, owed $5,000 to the Webb City Bank; that, when the Mineral Belt Bank was organized, Kreilsheimer took some stock and lent some of his influence to it; that he did not want the Webb City Bank, to which was owed the $5,000, to know that any business was being done with the Mineral Belt Bank. Having seen the cashier of the plaintiff bank with reference to a loan of $3,000, he left Webb City and went to Chicago, instructing Jessie Schooler, his secretary, that as soon as the bank opened for business she was to go and get the $3,000, and according to her testimony, if she could not get it in the company's name, to get it in his name. She accordingly went to the bank and signed the note sued on in this action, "L. Kreilsheimer, by Jessie Schooler," taking two certified checks for $1,000 each, which she mailed to Chicago to Kreilsheimer, and leaving the balance in the plaintiff bank deposited to the personal account of L. Kreilsheimer. The evidence shows that this money was sent to Kreilsheimer in order for him to return it to his secretary to be applied on the debt of the defendant at the Webb City Bank evidenced by its note (for $5,000). In the course of a few days, $1,500 of the $2,000 sent to him was returned to her, and under his instructions she applied the $1,500 to the indebtedness of the defendant company at the Webb City Bank. At least $600 of the money left in the Mineral Belt Bank to the credit of L. Kreilsheimer she drew out and applied on the bills of the defendant company.

There is no contention in this case by either party but that the $1,500 which was paid to the Webb City Bank was money received by the defendant company. In other words, $1,500 of the money derived on the Kreilsheimer note immediately went to pay a part of the defendant's note, and the evidence is convincing that at least $600 of the balance of the money borrowed on the Kreilsheimer note went to pay the powder and other bills owed by the defendant company. The defendant admitted that it received the benefit of the $1,500 and afterward repaid it to the Mineral Belt Bank, as shown by the credits of May 23, 1908, August 13, 1908, November 23, 1908, and May 6, 1909. There is one other credit on the note, August 20, 1908, for $775, which it is admitted, was money applied by the plaintiff on the note, which money belonged to L. Kreilsheimer personally. When Kreilsheimer returned from Chicago, the plaintiff asked that he make a note for the $3,000 signed by the Elking Lead & Zinc Company, which he refused to do, stating that he had used part of this money for his personal affairs, but offered to make a note for $1,500, the amount which had been paid on the Webb City Bank's note. Plaintiff's cashier refused to carry out this proposal.

Defendant objected to the introduction of any testimony, when plaintiff prepared to open its case on the merits, on the ground that it was not indebted to plaintiff in any sum, and that plaintiff never held the note of the defendant. This objection was overruled, and plaintiff was permitted to prove that the note sued on (which was lost after it was filed with the petition in the circuit court) was signed "L. Kreilsheimer, by Jessie Schooler." The evidence of the plaintiff discloses without question that the note nowhere on its face bore the name of the Elking Lead & Zinc Company, and that there was nothing that could be discerned from the four corners of the...