Roberts v. Washington Nat. Bank

• Citation: 40 P. 225,11 Wash. 550
• Parties: ROBERTS v. WASHINGTON NAT. BANK.
• Decision Date: 06 April 1895
• Court: United States State Supreme Court of Washington

40 P. 225

11 Wash. 550

ROBERTS v. WASHINGTON NAT. BANK.

Supreme Court of Washington

April 6, 1895

Appeal from superior court, Spokane county; Norman Buck, Judge.

Action by W. B. Roberts, receiver of the Washington Savings Bank of Spokane, against the Washington National Bank, for the recovery of certain property, or the value thereof. From a decree in plaintiff's favor defendant appeals. Reversed.

Blake & Post, for appellant.

Turner Graves & McKinstry, for respondent.

HOYT C.J.

This action was brought by the plaintiff, W. B. Roberts, as receiver of the Washington Savings Bank, against the Washington National Bank of Spokane Falls, to recover certain property, or the value thereof, which it was claimed had been fraudulently obtained by the defendant from the Washington Savings Bank, and to recover the money paid by the savings bank for certain notes transferred to it by the national bank in fraud of its rights. It was alleged that the transactions which led to the transfer of the property should be set aside, and held for naught, for two reasons First, because there was actual fraud intended and consummated by the officers of the defendant; and, secondly legal fraud, by reason of the relation of the officers of the two corporations through which the business was transacted. The business was done through one F. E. Goodall, who assumed to act for each of the corporations, and it was claimed that it was beyond his power, as such common agent, to do the business which culminated in the transfer of the property. Elaborate briefs have been filed upon the question of the powers and duties of agents, and of the want of power in an agent to act as such in behalf of two principals in relation to adverse transactions between them. These and kindred questions have been ably discussed in the briefs of counsel and in oral argument, but in our opinion the rights of the parties depend little, if at all, upon such questions. An inspection of the briefs of counsel will show that, notwithstanding the elaborate presentation of these and other questions of law, the propositions upon which the appellant and respondent radically differed were as to the facts established by the proofs. The authority of few, if any, of the cases cited upon either side is disputed by the other; and it is apparent that the application of the principles established by such cases would have led to little dispute if the discussion on either side had related to facts as to which the parties agreed. The trial court made findings of fact in substantial compliance with the claims of the plaintiff, as set out in the complaint; and, if these findings were warranted by the proofs, there would be little reason for questioning the correctness of its legal conclusions. The defendant excepted to all of these findings of fact, and requested the court to find substantially different upon nearly all the propositions involved; and if such exceptions had been sustained, and the facts found as requested, there could be little doubt but that the legal conclusions to be drawn therefrom would have resulted in a decree for the defendant. It follows that the substantial question which we are called upon to decide is as to whether the proofs in the record sustain the findings of the court, as made, or would better sustain those requested on the part of the defendant. If the former, the decree is substantially right, and should be affirmed; if the latter, it is wrong, and should be reversed, and the action dismissed.

Under the act of 1893, findings of fact in an equity case and in one at law are placed upon substantially the same basis; but thereunder it is made the duty of the appellate court, when exceptions are properly taken to such findings, to examine the proofs contained in the record de novo. This requirement, construed in the light of the practice of courts of equity in the determination of facts upon appeal by a trial de novo upon the record, compels us to hold that, at least in an equity case, the findings of fact do not stand upon the same footing as the verdict of a jury. On the contrary, the statute can only be given force by holding that it is the duty of the appellate court to determine the facts for itself, upon the proofs contained in the record. It does not follow that the finding of the lower court will have no weight in such determination, but it does follow that it cannot have any such weight as does the verdict of a jury in a law case. If it did, it would only be necessary for the appellate court to ascertain that there was evidence introduced upon which the fact could be found, in order that the finding should be affirmed. And it is clear that such an investigation would not be an examination of the proofs de novo in the appellate court, as required by the express terms of the statute. What we have said as to the effect of the findings of fact under the appeal act of 1893 is, to some extent, inconsistent with what was said by us in the case of Webster v. Thorndyke (decided March 9, 1895) 39 P. 677, and to that extent that case is overruled. The question, though involved in that case, was not necessary to its determination, for the reason that the findings of fact were warranted by the proofs. It affirmatively appeared from the proofs that the findings were right; hence it was unnecessary to the decision to say anything as to their effect, and what was said was by way of argument, and for that reason not as fully considered as it otherwise would have been. A more thorough examination of the question has satisfied us that this holding did violence to some of the provisions of the statute, and we now feel compelled to construe it differently. The rule before announced was the more convenient one, and we had hoped to be able to sustain it, but find ourselves unable to do so. In the case at bar, all of the findings of fact were excepted to, and the record contains all of the proofs offered upon the trial in the court below. Hence it becomes the duty of this court to find substantially, as a new question, the facts within the pleadings established by such proofs, and determine the rights of the parties upon the facts so found, even although the trial court, upon such proofs, had found them differently. In determining the facts established by the proofs, the findings of the trial court should receive consideration, but cannot be allowed to control when, in the opinion of this court, they are contradicted by a clear preponderance of the evidence.

Before proceeding to a discussion of the disputed facts, it will be proper to say that the undisputed proofs show that the Washington Savings Bank was in existence and doing business for some time prior to the organization of the Washington National Bank; that the scheme for the organization of said national bank originated with the...