Plymouth County Bank v. Gilman
| Decision Date | 17 October 1896 |
| Citation | 68 N.W. 735,9 S.D. 278 |
| Parties | PLYMOUTH COUNTY BANK, Plaintiff and respondent, v. GILMAN, Defendant and appellant. |
| Court | South Dakota Supreme Court |
GILMAN, Defendant and appellant. South Dakota Supreme Court Appeal from Circuit Court, Minnehaha County, SD Hon. J. W. Jones, Judge Affirmed C. S. Palmer Attorneys for appellant. A. B. Kittredge, Sioux Falls, SD Attorneys for respondent. Opinion filed Oct. 17,1896
The defendant, for a complete defense and counterclaim to this action, upon his overdue promissory note for $412, executed and delivered to plaintiff on the 18th day of January, 1875, alleged in his answer, and introduced evidence for the purpose of proving, damages sustained largely in excess of plaintiff’s claim, on account of the negligence of plaintiff in failing and neglecting to enforce the collection of certain secured notes owned by the defendant, and indorsed over to, and left with, plaintiff for collection and collateral security. This appeal is by the defendant from a judgment entered upon a verdict in favor of plaintiff for the full amount remaining unpaid upon the principal note, according to its terms, and from an order overruling a motion for a new trial.
The question not being raised in the additional abstract, respondent’s motion to strike out appellant’s bill of exceptions and all the evidence contained in his abstract, because the particular errors relied upon are not specified in said bill of exceptions, cannot be considered, for the reasons stated in Peart v. Chicago, M. & St. P. R7. Co., on appeal from the taxation of costs, decided at this term, and reported in 8 SD 634,(1896). Concerning these collateral notes, aggregating $1,150, left with respondent when the note in suit was executed appellant testified, in effect, that it was agreed between himself and respondent’s cashier that in consideration of a collection fee agreed upon, the bank would proceed at once to collect said collateral notes, one of which was at the time past due, and apply the proceeds, so far as necessary, to the satisfaction of the $412 note, and pay the balance over to appellant. Respondent’s cashier, with whom the business was transacted, testified that the notes in question were merely transferred to the bank to secure the payment of appellant’s $412 note, and that nothing was said about their collection, and no agreement was ever-made concerning a collection fee. Under the court’s charge, the jury, by its general verdict, found, upon this conflicting testimony, that the secured notes in question were deposited merely as collateral security, without any express agreement' as to their collection; and in this respect the case is materially different from that disclosed by the record of the same case on a former appeal to the territorial court, where it was clearly shown, by the undisputed evidence, that an express contract was entered into between the parties to the action, by which the bank agreed to collect the notes for 10 per cent., and turn the proceeds over to defendant, Gilman, after deducting said collection fee and the amount due upon the $412 note, including interest, according to its terms. Furthermore, we find from an examination of the abstract used on that appeal, that there was testimony introduced tending to establish the utmost good faith and prudence on the part of the bank’s officers in the selection of suitable and competent attorneys to enforce the collection, which, of necessity must be intrusted by plaintiff, a nonresident corporation, to some one residing in this state where the mortgaged premises were situated. The case, as-then made, involved the question of the liability of one who has, for a valuable consideration, undertaken by an express contract to collect collateral notes, and turn the proceeds over to the owner, after deducting the amount secured thereby, together with a stipulated fee for collection; and, although the notes were placed in the hands of reputable attorneys for collection, the court held that in view of the existence of an express agreement to collect, and evidence tending to show a loss of the security by the negligence of attorneys, it was error to direct a verdict in favor of plaintiff. Bank v. Gilman, 6 Dak. 304, 50 N.W. 194. From the evidence introduced by appellant; and the admissions of respondent in its reply, it appears that a proceeding to foreclose the mortgage by which the collateral notes were at the time amply secured was instituted at the instance of respondent, in the month of August, 1875; and that, owing to the carelessness or inability of the attorney to whom the business was intrusted, it became necessary to obtain an order vacating and setting aside, as invalid, the decree of foreclosure obtained in that action; and that no sale of the property, under a valid foreclosure, was had until the 17th day of October, 1881, when the...
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