Moneypenny v. Third Nat. Bank
| Decision Date | 17 December 1937 |
| Citation | 111 S.W.2d 375,172 Tenn. 237 |
| Parties | MONEYPENNY et al. v. THIRD NAT. BANK. |
| Court | Tennessee Supreme Court |
Certiorari to Court of Appeals, on Appeal from Chancery Court, Davidson County; Joseph C. Higgins, Special Chancellor.
Action by H. Moneypenny and others against the Third National Bank. The chancellor dismissed the bill, but on appeal the Court of Appeals modified the decree, and defendant brings certiorari.
Decree of Court of Appeals affirmed in part, and in part reversed and rendered.
E. J Walsh, of Nashville, for appellant Third National Bank.
E. L McNeilly and Harry G. Nichol, both of Nashville, for appellee Moneypenny.
Complainants Moneypenny, Jones, and Bryant, members of the Order of Railroad Telegraphers, an unincorporated association with headquarters at St. Louis, and of division No. 58 of this Order, brought this suit on their individual behalf and for the benefit of the Order, seeking to recover from the defendant bank, located at Nashville, the amount of five certain checks. Division 58 carried an account in defendant bank designated as "Order of Railroad Telegraphers, Div'n No. 58, H. Moneypenny G. S. & T." A. W. Davis was general chairman of this division, with broad powers. It was charged that Davis had misappropriated the proceeds of the checks; that although so drawn as to carry notice on the face that they represented funds of the Order, the bank passed the proceeds to the individual account of Davis and permitted him to withdraw the funds for his own use.
The issues of fact were submitted to a jury. At the conclusion of the testimony the chancellor took the case as to one of the checks, for $975, from the jury and dismissed the bill as to this check; the jury found the issues as to the other four checks in favor of the bank, and the chancellor on this finding dismissed as to these also. The jury found: (1) That Davis had authority and consent of the Order to demand and receive the proceeds of the two checks sued on for $500 dated November 21, 1932, and $375, dated July 24, 1932, respectively; (2) that the Order approved and ratified his action after knowledge of the facts; (3) that the Order failed to act with reasonable promptness in repudiating his action and giving notice to the bank of disapproval; (4) that Davis had authority to indorse and collect the check for $1140, dated October 5, 1933; (5) that the Order failed to repudiate this transaction with reasonable promptness, but ratified it; (6) that Davis had authority to indorse or sign the name of H. Moneypenny to the check for $904.04, dated December 14, 1933, and collect and take possession of the proceeds; (7) and, finally, that the bank did not knowingly co-operate with Davis in appropriating to his own use any of the funds of No. 58 of the Order.
Complainants appealed, and the Court of Appeals sustained the decree of the chancellor as to the three checks for $500, $375, and $1140, on the ground that the evidence showed ratification and settlement as to the proceeds thereof, but held that there was (1) no material evidence to support the finding of the jury as to the check for $904.04, and (2) the chancellor erred in withdrawing the case as to the check for $975 from the jury, and, modifying the decree of the chancellor, sustained the bill as to these two items and rendered judgment accordingly. Petition of the bank has been granted and the cause argued. It is therefore necessary for this court to consider the case only as it relates to these two checks for $904.04 and $975.
It appears that the check for $904.04 was in the following words and figures:
"The Order of Railroad Telegraphers
St. Louis, Dec. 14, 1933. No. 27612.
Grand Secretary and Treasurer.
The indorsements, including the name of Moneypenny, were made by Davis, and the proceeds passed to his personal account.
While as before stated, Davis had broad powers as general chairman of Division 58 in the handling of its affairs, we are constrained to agree with the Court of Appeals that he had neither actual nor apparent authority to indorse the name of Moneypenny on a check thus made payable. There is no proof that Moneypenny had authorized this, but directly to the contrary. Nor is there any evidence that this had ever been done before. This check not only carried quite evident notice that the funds were association funds, but that it was to be paid to Moneypenny as treasurer only. It was quite apparently not a collection from outside sources, which it does appear Davis, in his capacity of general chairman, sometimes made with apparent...
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...fraudulent purpose, or a want of authority on the part of the payee, or participates in the misappropriation." Likewise, in Moneypenny v. Third National Bank, supra, decided on same day, the court, while recognizing the rule of liability as applied to trustees, guardians, executors, and adm......
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