Schrader v. Westport Avenue Bank

• Decision Date: 01 December 1941
• Docket Number: No. 19864.,19864.
• Citation: 156 S.W.2d 753
• Parties: MINNA SCHRADER, RESPONDENT, v. WESTPORT AVENUE BANK, A CORPORATION, APPELLANT.
• Court: Missouri Court of Appeals

156 S.W.2d 753

MINNA SCHRADER, RESPONDENT, v. WESTPORT AVENUE BANK, A CORPORATION, APPELLANT.

No. 19864.

Kansas City Court of Appeals, Missouri.

December 1, 1941.

Appeal from Jackson Circuit Court. — Hon. Albert A. Ridge, Judge.

REVERSED.

Beach, Gordon & Beach for appellant.

(1) The court should have entered judgment in favor of defendant under the law and the evidence because plaintiff is estopped to set up her title as against the defendant in that through plaintiff's voluntary act or through her carelessness, neglect or misplaced confidence she clothed the wrongdoer with indicia of ownership whereby defendant, an innocent party, accepted the bonds as collateral for a loan to the wrongdoer. 24 Ruling Case Law, page 378; The International Bank v. The German Bank, 71 Mo. 183; Neuhoff v. O'Reilly, 93 Mo. 164; Lawless et al. v. Guelbreth, 8 Mo. 139; DePew v. Robards, 17 Mo. 580; Lee v. Turner, 89 Mo. 489; 8 Am. Juris. 1030-1031; 19 Am. Juris. 698-699-700; Citizens Bank v. Mutual Trust & Dep. Co. (Ky.), 266 S.W. 875; Nat'l Safe Dep. Co. v. Hibbs, 229 U.S. 391; Austin v. Heyden, 171 Mich. 38; Johnson v. Bixby, 252 Fed. 103. (2) The court should not have assessed the damages at $3,440, the market value of the bonds as of the time when the defendant came into possssion. (a) Because plaintiff by the exercise of reasonable diligence at a trifling expense could have prevented any damages being sustained by either party. Sentney Wholesale Grocery Co. v. Thompson, 216 S.W. 780; 8 Ruling Case Law, page 442. (b) Because defendant was not guilty of conversion until notice of plaintiff's claim was first given on June 27, 1938, at which time the bonds were worth $640. Varney v. Curtis, 100 N.E. 650; Koch et al. v. Branch et al., 44 Mo. 542; Mohr v. Langan, 162 Mo. 474; Dusky v. Rudder, 80 Mo. 400; Hanson v. Jacob, 93 Mo. 331; Lafayette County Bank v. Metcalf, Moore & Co., 40 Mo. App. 494; Live Stock Commission Co. v. C., M. & St. P. Ry., 87 Mo. App. 330. (3) The original opinion of this court correctly declared the law that the burden of proving fraud, if any, was upon the plaintiff and not upon the defendant because fraud constituted no part of the grounds necessary to sustain the defense of equitable estoppel. DePew v. Robards, 17 Mo. 580-2-3; Lee v. Turner, 89 Mo. 489; Lawless v. Guelbreth, 8 Mo. 139; Neuhoff v. O'Reilly, 93 Mo. 164; International Bank v. The German Bank, 71 Mo. 183; 24 Ruling Case Law, 378-9; 8 Am. Juris. 1030-1; 19 Am. Juris. 698-9, 700; Citizens Bank v. Mutual Trust & Dep. Co. (Ky.), 266 S.W. 875; Nat'l Safe Dep. Co. v. Hibbs, 229 U.S. 391; Austin v. Heyden, 171 Mich. 38; Johnson v. Bixby, 252 Fed. 103. (a) Fraud, if any, being asserted or relied upon by the plaintiff — it was plaintiff's burden to plead and prove it. Shepard v. Traveler's Protec. Association, 124 S.W. (2d) 528; Greene v. Spitzer, 123 S.W. (2d) 57. (4) Plaintiff cannot now on this appeal raise the point that the trial court improperly transferred this cause to the equity docket and tried the cause as an equity case because: (a) Plaintiff took no appeal from the order and the court's action in trying this case as an equity case now complained of; (b) Plaintiff raised the question for the first time in her motion for rehearing; (c) Only errors preserved by the appellant are considered on appeal, in absence of cross-appeal. Reid v. Brotherhood of Railroad Trainmen, 232 S.W. 187; Shull v. Railway Co., 221 Mo. 140, 119 S.W. 1086; Thompson v. Lindsay, 242 Mo. 53, 145 S.W. 472; State ex rel. Carruthers v. Drainage District, 271 Mo. 429, 196 S.W. 1115; Turner v. Hine (Mo.), 248 S.W. 933; Schee v. Schee, 319 Mo. 542, 4 S.W. (2d) 760; Moore v. Hoffman, 327 Mo. 852, 39 S.W. (2d) 339. (d) The same rule applies to equity as well as law cases. In re Carlin's Estate, 226 Mo. App. 622, 47 S.W. (2d) 213. (5) The trial court erred in refusing to grant defendant the affirmative equitable relief prayed for in defendant's answer under the law and evidence, and in failing to declare an equitable lien on the bonds in favor of defendant and against the plaintiff. Equitable liens of this nature are recognized and enforced by courts of this State. Wallace v. Wilson, 30 Mo. 335; Callaway Bank v. Ellis, 215 Mo. App. 72, 238 S.W. 844; 33 Am. Juris. 430; Ricketts v. Finkelston (Mo. App.), 211 S.W. 391. (a) A court of equity, having taken jurisdiction, will grant complete relief and do complete justice as between the parties. Seestad v. Dickey, 318 Mo. 192, 300 S.W. 1088; Buckingham v. Williams, 9 S.W. (2d) 839; Woolum v. Tarpley, 196 S.W. 1127.

Kenneth I. Fligg and Warren E. Slagle for respondent.

Lombardi, Robertson, Fligg & McLean of counsel.

(1) Respondent was not estopped to assert title to her bonds because the court found as a fact that she did not clothe any wrongdoer with indicia of ownership. This court should defer to the findings of fact made by the trial court and under said findings the rule of estoppel relied on by appellant has no application. American Employers Insurance Company of Boston, Massachusetts, v. Manufacturers and Mechanics Bank of Kansas City et al., 229 Mo. App. 994, 85 S.W. (2d) 174; State v. Gould, 329 Mo. 828, 46 S.W. (2d) 886; State v. Cochran, 336 Mo. 649, 80 S.W. (2d) 182; Gate City National Bank v. Bunton, 316 Mo. 1338, 296 S.W. 375; J.R. Watkins Company v. Thompson et al., 230 Mo. App. 482, 93 S.W. (2d) 1100; Curzweil et al. v. Enyart (Mo. App.), 54 S.W. (2d) 464; Phillips v. Alford et al. (Mo. App.), 90 S.W. (2d) 1060; Gorman v. Mercantile Commerce Bank & Trust Company et al., 345 Mo. 1059, 137 S.W. (2d) 571. (2) The court applied the proper measure of damages which was the market value of the bonds at the time the appellant acquired them as pledgee. Kansas City Cas. Co. v. Westport Avenue Bank, 191 Mo. App. 287, 177 S.W. 1092; 2 Cooley on Torts (4 Ed.), page 502; People's Savings Bank & Trust Co. v. Huttig Manufacturing Co., 1 Ala. App. 394, 55 So. 929; 49 Corpus Juris 953, sec. 119; 65 Corpus Juris 136, sec. 252; 1 Restatement of the Law on Torts, secs. 223 and 229; Iavazzo, Admx., v. Rhode Island Hospital Trust Co., 51 R.I. 459, 155 Atl. 407; The Merchants National Bank of Memphis v. Trenholm & Son, 59 Tenn. (12 Heisk.), 520; Hotchkiss et al. v. Hunt et al., 49 Me. 213; Skinner & Company v. Dodge & Cobb, Prosser & Moncure, and William Marshall et al., 4 Hening & Mumford's Reports (Virginia), 432; Thrall v. Lathrop, 30 Vermont (Shaw, Volume 1) 307; Hendricks v. Evans, 46 Mo. App. 313; Traders National Bank v. Huttig Manufacturing Co., 1 Ala. App. 452, 55 So. 928; Patton v. Joliff, 44 W. Va. 89; Litz v. First Huntington National Bank et al. (Supreme Court of Appeals of West Virginia), 197 S.E. 746; James v. Klar & Winterman (Texas Court of Civil Appeals), 118 S.W. (2d) 625; Silverman v. Bush et al., 16 Ill. App. 437; Charles Moe Co. v. J.H. Logue Co., 108 Ill. App. 128; William Frantz & Co. v. J.S. Winehill & Co. et al., 124 La. 680, 50 So. 650; Newton et al. v. Cardwell Blue Print & Supply Co., 41 Colo. 492, 92 Pac. 914; Varney v. Curtis, 213 Mass. 309, 100 N. E. 650; Koch et al. v. Branch et al., 44 Mo. 542; Mohr v. Langan, 162 Mo. 474, 63 S.W. 409; Dusky v. Rudder, 80 Mo. 400; Nanson v. Jacob, 93 Mo. 331, 6 S.W. 246; Lafayette County Bank v. Metcalf, Moore & Co., 40 Mo. App. 494; Livestock Commission Co. v. Chicago, Milwaukee & St. Paul Ry. Co., 87 Mo. App. 330; In re Chicago & N.W. Ry. Co. (District Court Northern District Illinois), 35 F. Supp. 230; National Match Co. v. Empire Storage & Ice Co. (Mo. App.), 19 S.W. (2d) 565; Roll v. Fidelity National Bank & Trust Co. of Kansas City, Mo. (Mo. App.), 115 S.W. (2d) 148. (3) The rule in regard to minimizing damages is inapplicable under the facts of this case. Sentney Wholesale Grocery Co. v. Thompson (Mo. App.), 216 S.W. 780; Kansas City Casualty Co. v. Westport Avenue Bank, 191 Mo. App. 287, 177 S.W. 1092. (4) No demand was necessary in order to render the appellant liable for the conversion of respondent's bonds. Iavazzo, Admx., v. Rhode Island Hospital Trust Co., 51 R.I. 459, 155 Atl. 407; The Merchants National Bank of Memphis v. Trenholm & Son, 59 Tenn. (12 Heisk.), 520; Hotchkiss et al. v. Hunt et al., 49 Me. 213; Thrall v. Lathrop, 30 Vermont (Shaw, Volume 1) 307; People's Savings Bank & Trust Co. v. Huttig Manufacturing Co., 1 Ala. App. 394, 55 So. 929; Lafayette County Bank v. Metcalf, Moore & Co., 40 Mo. App. 494; Citizens Bank of Sikeston v. Scott County Milling Co., 210 Mo. App. 603, 243 S.W. 433.

BLAND, J.

This is an action for the conversion of certain non-negotiable debentures issued by the Community Telephone Company. Plaintiff recovered a judgment in the sum of $3440, and defendant has appealed. Defendant pleaded defenses, equitable in nature, and moved that the suit be transferred to the equity docket. This was done, and the case was tried, without objection, as one in equity.

The facts show that plaintiff, for a number of years prior to the month of December, 1936, owned eight one thousand dollar bonds of the Trinity Lutheran Hospital Association; that for sometime prior to the month of December, 1936, she had been acquainted with one, Wilson E. Tucker, who had purchased for her some Gary Telephone stock in the years of 1932 and 1933; that he also managed three or four farms for her; that her relations with him were such that she had confidence in his ability and integrity; that in December, 1936, Tucker was engaged in the brokerage business, and was associated in that business with Prugh, Combest and Land, security brokers, in Kansas City; that Tucker advised plaintiff to sell her Trinity Lutheran Hospital Association bonds and to purchase Community Telephone Company debentures and, with her authority, Tucker sold her bonds and purchased nine Community Telephone Company debentures of the par value of $8000. These latter bonds are the ones involved in this proceeding. Prugh, Combest and Land caused the Commerce Trust Company, the transfer...