El Reno Mill & Elevator Co. v. Shull
| Decision Date | 06 March 1934 |
| Docket Number | Case Number: 23430 |
| Citation | 167 Okla. 444,1934 OK 138,30 P.2d 470 |
| Parties | EL RENO MILL & ELEVATOR CO. v. SHULL, State Bank Com'r, et al. |
| Court | Oklahoma Supreme Court |
¶0 1. Banks and Banking--Insolvency of Collecting Bank--Proceeds of Items Forwarded for Collection and Remittance Held Trust Fund Traceable in Hands of Bank Commissioner.
Where commercial paper is deposited and forwarded for collection and remittance, the collecting bank, upon receipt and acceptance thereof, becomes, and after collection remains, the agent of the owner of such paper, and if it sends its draft or cashier's check in remittance and becomes insolvent, and by reason thereof such draft or check is not paid, the proceeds of the collection constitute a trust fund, subject to be traced in the hands of the Bank Commissioner.
2. Same--Finding That Collecting Bank Became Owner of Funds Collected on Drafts and Debtor of Drawer not Sustained.
Record examined, and held, that the evidence does not support the finding and conclusion that the collecting bank became the owner of the funds collected on plaintiff's drafts and became plaintiff's debtor thereby.
Appeal from District Court, Jackson County; Frank Mathews, Judge.
Action by the El Reno Mill & Elevator Company against C. G. Shull, State Bank Commissioner, and another to establish a claim as preferred. Judgment for defendants, and plaintiff appeals. Reversed and remanded, with directions.
Miley, Hoffman, Williams, France & Johnson, for plaintiff in error.
M. B. Cope, W. C. Austin, and Robert B. Harbison, for defendants in error.
¶1 This is an appeal from the district court of Jackson county, Okla., wherein El Reno Mill & Elevator Company, a corporation, is plaintiff, and C. G. Shull, State Bank Commissioner, and J. R. Symcox, liquidating agent of Citizens State Bank, Altus, Okla., are defendants. The parties appear in this court as plaintiff and defendants, as they appeared in the trial court.
¶2 Plaintiff's suit was brought for the purpose of establishing a preferred claim to funds held by the defendants as assets of the defunct Citizens State Bank of Altus. The cause was tried to the court, resulting in a judgment denying plaintiff's claim for preference, but allowing the same as a general claim against the assets of the insolvent bank.
¶3 There is little, if any, conflict in the testimony, which may be briefly stated as follows: On January 24, 1930, plaintiff drew a draft upon the Altus Bakery for $ 624.75, and on the same date drew a draft upon the Oklahoma Grain & Fuel Company of Altus for $ 417. These drafts covered shipments of flour to the two firms upon which they were drawn, and to them were attached bills of lading and letters of instructions. The following indorsements appeared on the back of each of the drafts:
¶4 To the drafts was attached the following letter of instructions:
¶5 These drafts, with bills of lading and letters of instructions attached, were deposited on January 25, 1930, with the Citizens National Bank of El Reno, Okla., the same being included on a regular deposit slip prepared by plaintiff along with other items of deposit, including checks and currency. The managing agent of plaintiff testified that he had an arrangement with the El Reno bank to the effect that collection items deposited by plaintiff would be credited to plaintiff's account, and charged back if not paid, and that plaintiff would pay the bank interest on such items while they were outstanding, and this testimony is not controverted. Plaintiff received credit in its regular checking account with the El Reno bank at the time the two drafts were deposited, and was at liberty to check against the same.
¶6 Upon receipt of the two drafts the El Reno bank forwarded the same to the Citizens State Bank of Altus, Okla., with the bank's letter of transmittal. The Citizens State Bank of Altus received the drafts, accepting checks from the two customers in payment of same, delivered the bills of lading and received payments on the two checks on January 29th and 30th. The Citizens State Bank then forwarded direct to plaintiff its draft for the proceeds of the collection. This draft was made payable to the El Reno Mill & Elevator Company, the plaintiff herein. Upon receipt of this draft by plaintiff on February 3rd, it immediately delivered the same to its depository bank in El Reno, according to plaintiff's testimony, to complete the collection. Plaintiff did not indorse the draft which it received from the Citizens State Bank of Altus. Plaintiff's depository bank indorsed the draft and sent the same through the First National Bank & Trust Company of Oklahoma City for collection. Before the draft was paid by the Citizens State Bank of Altus, said last-named bank became insolvent and came into the hands of the State Bank Commissioner for the purpose of of liquidation, and the draft was therefore never paid. It is stipulated that the sum of $ 6,000 in cash came into the hands of the Bank Commissioner, and it was testified that approximately $ 4,300 in preferred claims had been filed, including that of plaintiff. The El Reno bank charged the drafts back to plaintiff's account on February 5th, and plaintiff paid the bank 5 1/2% interest on the amount from January 25, 1930, to February 5, 1930.
¶7 Plaintiff urges its first proposition as follows:
"The judgment is contrary to law, is contrary to the evidence, and the court erred in rendering judgment for defendants in error and in not rendering judgment for plaintiff in error"
¶8 --which embraces its assignments of error 3, 4, 5, 6, and 7. In this connection it appears that the question presented is whether title to the funds...
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Tibbals v. Graham
... ... is bound by the judgment in all capacities. Emerson v ... Elevator Company, (Wyo.) 297 P. 392; Corcoran v ... Chesepeake, 94 U.S. 741; ... 153 P. 1099; Prince v. Gosnell, 149 P. 1163; El ... Reno v. Cleveland, 107 P. 163. The doctrine of res ... judicata is that a ... ...
- El Reno Mill & Elevator Co. v. Shull