Muth v. St. Louis Trust Co.

• Citation: 94 Mo. App. 94,67 S.W. 978
• Parties: MUTH v. ST. LOUIS TRUST CO.
• Decision Date: 15 April 1902
• Court: Court of Appeal of Missouri (US)

67 S.W. 978

94 Mo. A. 94

MUTH v. ST. LOUIS TRUST CO.

Court of Appeals of St. Louis, Missouri.

April 15, 1902.

BANKS — TELLER — IMPLIED AUTHORITY — CERTIFICATION OF CHECKS — FRAUD — EVIDENCE — IMPEACHING WITNESS — HARMLESS ERROR — PAROL EVIDENCE — VARYING WRITTEN CONTRACT.

1. The teller of a banking institution has no implied authority to certify checks, though authority may be implied from his conduct in certifying checks, and the subsequent payment of them by the institution.

2. In an action against a bank by the payee of a certified check, the defense was fraud. It appeared that plaintiff and his brother, as a firm, had on deposit with defendant a little over $2,000, when a check of the firm, payable to plaintiff, was certified at plaintiff's request; that the same was retained 10 months before presentation, during which the account was drawn down to $96, and plaintiff borrowed several thousand dollars, falsely stating to the notary before whom a mortgage was acknowledged that he was unmarried. His explanation as to the delay in presentment was that he had given the check to his wife to deposit, and supposed she had done so until he found it just before presentment. His marriage certificate showed he was not married when he claimed to have given his wife the check, but he testified that he had in fact been married prior to that time, but that the ceremony evidenced by the certificate had been performed to please his mother. It was shown that plaintiff knew the bank's teller was not in the habit of charging up certified checks until drawn. Held, that the evidence was sufficient to send the question of fraud to the jury.

3. Where, in an action against a bank by the payee of a certified check held by him for 10 months before presentment, the defense was fraud, and plaintiff denied that he told a certain person that when giving a mortgage for a loan, during the time he had the check, he had falsely stated himself unmarried, it was error to permit such person to testify that plaintiff did make such statement to him, since the impeachment was on a collateral matter.

4. The impeachment of a party on a collateral matter by testimony that he had stated he told a falsehood when acknowledging a deed of trust was harmless error; the party, when testifying, having admitted the falsehood.

5. Where a certified check given by a firm to one of its members was retained by the payee 10 months, during which the account was drawn out, and, in an action on the check, the defense was fraud, it was proper to admit evidence of a conversation between plaintiff and the teller at the time of certification tending to show that it was understood that the check should be presented in a few days; such evidence not tending to vary the written contract, but being a material fact on the issue of fraud.

Appeal from circuit court, St. Louis county; John W. McElhinney, Judge.

Action by William E. Muth against the St. Louis Trust Company. From a judgment for defendant, plaintiff appeals. Affirmed.

The suit is on a certified check drawn by E. G. Muth & Co. on the St. Louis Trust Company in favor of W. E. Muth, plaintiff, for $1,950, dated January 14, 1897. Across the face of the check are written these words: "Good. St. Louis Trust Company, by F. P. Jones, Tell." The answer was, first, a general denial for want of authority in Jones, as teller, to certify the check, and the following paragraph, to wit: "And for further answer to the plaintiff's amended petition, the defendant states that the drawer of the said check was E. G. Muth & Co., a copartnership firm composed of E. G. Muth and the plaintiff, who were brothers, and engaged in the shoe business in the city of St. Louis; that the said E. G. Muth and the plaintiff, W. E. Muth, conspired together for the purpose of defrauding the defendant in the amount of $1,950, the face value of the said check, and that the plaintiff is not, in equity and good conscience, entitled to recover anything thereon; that the said E. G. Muth and W. E. Muth, having obtained from defendant's employé an apparent certification or statement that the said check was good, at a time when the same was in fact good, proceeded wrongfully and fraudulently to draw out from the deposit account of E. G. Muth & Co. all of the money due thereon, and thereby to deprive the defendant of the means to make payment of the said check, with the fraudulent intent of calling upon the defendant to make payment of the said $1,950 called for by the said check thereafter, and to compel payment thereof; that through the making and negotiation of checks of later date, which were presented to the defendant for payment, and allowed to reach the defendant through ordinary business channels, such as indicated no fraud or wrongful intention, there was obtained from the defendant all of the money on deposit to the credit of E. G. Muth & Co., except the sum of $96; and the defendant charges and states that the said later checks were drawn by E. G. Muth & Co. for the purpose and with the actual intent to get the amount of money which was then on deposit, and to thereafter insist on the payment of the check for $1,950, in this way cheating and defrauding the defendant out of the amount thereof. And the defendant states that, by reason of said fraudulent conspiracy and intent, the plaintiff is not entitled to recover on the claim herein," — and several other special defenses, not necessary to note, as they were not submitted to the jury.

The undisputed facts are that F. P. Jones was the paying teller of the defendant, and that on January 14, 1897, the partnership of E. G. Muth & Co., composed of E. G. Muth and plaintiff, had to its credit on their deposit account with defendant over $2,000; that E. G. Muth was the acting member of the firm of E. G. Muth & Co., and had for a considerable period of time prior to January 14, 1897, deposited the moneys of the firm with the defendant from time to time, and drawn the checks of the firm against these deposits; that the check in question was drawn by E. G. Muth & Co., and presented to F. P. Jones, as paying teller, at the counter of defendant, by plaintiff, in the presence of E. G. Muth, with the request from plaintiff for exchange on New York; that in discussing the matter, and after plaintiff found that exchange on New York would cost him something, at the suggestion of Jones, plaintiff concluded to retain the check, with Jones' certification, and that Jones did then and there write the indorsement found on the face of the check, and certified that it was good; that plaintiff kept his individual deposit account with the Union Trust Company; that the check in suit was retained by plaintiff for over 10 months without being presented for payment, and without being put in circulation; that, after keeping the check about 10 months, plaintiff deposited it with the Union Trust Company to the credit of his individual account; that, when the check reached the defendant, it refused to honor it, and plaintiff was induced by the Union Trust Company to take it up; that, after repossessing himself of the check, this suit was brought. The deposit account of E. G. Muth & Co. was not charged by Jones with the check when he certified it, nor was any entry made in any account book of defendant charging up the check, nor was any memorandum made by Jones of the fact that he had certified it. On the date the check was presented and certified, the balance to the credit of E. G. Muth & Co. on the books of defendant was $2,105 and some cents. On the 9th of April following, the balance was $2,086.58. On the 3d of August following, it had been reduced to $1,434.13 by checks drawn by E. G. Muth & Co. On August 16th, a check for $600 was presented and paid, and on the 20th day of October another for $525 was presented and paid. These two checks, and one for $509.75, presented and paid on June 3, 1897, were drawn payable to the First National Bank of Flora, Ill., where the plaintiff then resided. When the check in suit was presented to the defendant, the deposit account of E. G. Muth & Co. had been drawn down to $96. In respect to the authority of Jones, as teller, to certify checks, the evidence was that he and his successor had been in the habit of certifying checks for divers business firms in the city of St. Louis, and that the defendant had honored and paid them; that the firm of E. G. Muth & Co., more than a year previous to the certification of the check in suit, got a check certified by Jones, which it used in its business, and which was duly honored and paid by the defendant. Plaintiff testified that he was a dentist; that he and his brother prior to January 14, 1897, were engaged in several business enterprises in the city of St. Louis; that he furnished most of the money, and that the management of the enterprises was intrusted entirely to his brother, E. G. Muth, he (plaintiff) being engaged in the practice of his profession; that these enterprises were all closed up prior to January 14, 1897, and that the check in question was given to liquidate, in part, the indebtedness of E. G. Muth to him for money loaned to E. G. Muth during their joint operations in business; that he resided at Flora, Ill., when the check was given to him and certified, and that he continued to reside there until some time after the check was presented for payment; that he did not know that his brother was drawing money from the defendant after the certification of the check; and that he received no part of the said fund, nor any benefit therefrom. E. G. Muth did not testify. On the part of the defendant it was shown that there was no express authority conferred by by-law or resolution of the board of directors of the defendant on its teller to certify checks. Jones testified that he was paying and note teller; that the defendant had no cashier, and that he was under the secretary and president of the company; that, as paying teller, he...