People's Sav. Bank of Des Moines v. Gifford

• Decision Date: 10 May 1899
• Parties: PEOPLE'S SAV. BANK OF DES MOINES v. GIFFORD ET AL.
• Court: Iowa Supreme Court

108 Iowa 277

79 N.W. 63

PEOPLE'S SAV. BANK OF DES MOINES

v.GIFFORD ET AL.

Supreme Court of Iowa.

May 10, 1899.

Appeal from district court, Story county; S. M. Weaver, Judge.

Action at law to recover an amount alleged to be due on a promissory note. There was a trial by the court without a jury, and a judgment in favor of the defendants for costs. The plaintiff appeals. Affirmed.Bailey & Ballreich and McCarthy & Lee, for appellant.

G. A. Underwood, for appellees.

ROBINSON, C. J.

The note in suit was made by E. W. Gifford and H. M. Funson for the sum of $425, was made payable to J. T. James or order, and is indorsed in blank. A payment thereon of $290 has been made. The defendants are the makers of the note. They allege that it was given in settlement of an alleged indebtedness which grew out of gambling transactions had by Gifford with the firm of J. T. James & Co., and that it is for that reason void. The court was authorized to find that the material facts involved in the making of the note were substantially as follows: In the year 1896, the firm of J. T. James & Co., of which J. T. James and J. B. Henshaw were the members, were engaged in operating an office in the city of Des Moines known as a “bucket shop,” and dealt in options on grain and stock. Actual delivery of the property in which the firm pretended to deal was not made nor contemplated, and its business was prohibited by chapter 93 of the Acts of the Twentieth General Assembly. The defendant Gifford had dealings with the firm in its line of business, and in May, 1896, there was a settlement, at which it was agreed that Gifford owed the firm $415 on account of his dealings with it in options. Thereupon Gifford drew his check, payable to himself or bearer, on a bank of Nevada, Iowa, for the amount stated, indorsed it in blank, and delivered it to Henshaw. He took it to the plaintiff, and received from it the amount of the check, and paid it to James. The bank on which the check was drawn refused payment, the check was protested, and returned to Gifford, and the note in suit was then given in lieu of it and for protest fees.

1. It was well settled, prior to the enactment of chapter 93 of the Acts of the Twentieth General Assembly, that an executory contract for the sale of property is void where delivery of the property was neither made nor contemplated, and where settlement was to be made by the payment of the difference between the contract price and the market price of the property at the time fixed for settlement. First Nat. Bank of Lyons v. Oskaloosa Packing Co., 66 Iowa, 41, 23 N. W. 255, and cases therein cited. See, also, Counselman v. Reichart, 103 Iowa, 430, 72 N. W. 490. Transactions of that kind are mere gambling contracts. Bank v. Carroll, 80 Iowa, 11, 45 N. W. 304. See, also, Shipley v. Reasoner, 80 Iowa, 548, 45 N. W. 1077;Osgood v. Bander, 75 Iowa,...