State ex rel. Banister v. Cantley

• Decision Date: 15 June 1932
• Parties: The State ex rel. E. W. Banister, Receiver of Skinker-Northwood Investment Company, a Corporation, and Fred Schmitt Contracting Company, a Corporation, Relators, v. S. L. Cantley, Commissioner of Finance of the State of Missouri; Hans Wulff, Special Deputy Commissioner of Finance in Charge of the Fidelity Bank & Trust Company; Moses Hartmann and Albert D. Nortoni, Judges of the Circuit Court of the City of St. Louis
• Court: Missouri Supreme Court

52 S.W.2d 397

330 Mo. 943

The State ex rel. E. W. Banister, Receiver of Skinker-Northwood Investment Company, a Corporation, and Fred Schmitt Contracting Company, a Corporation, Relators, v. S. L. Cantley, Commissioner of Finance of the State of Missouri; Hans Wulff, Special Deputy Commissioner of Finance in Charge of the Fidelity Bank & Trust Company; Moses Hartmann and Albert D. Nortoni, Judges of the Circuit Court of the City of St. Louis

Supreme Court of Missouri

June 15, 1932

Preliminary rule made absolute.

R H. McRoberts and Earl Seesman for relators.

(1) The officers of the Department of Finance of the State of Missouri have only the rights, duties, obligations, powers and privileges conferred by the statutes creating the offices which they hold, and said statutory officers have no implied powers other than those necessary for the effective exercise and discharge of the powers and duties expressly conferred and imposed. Lamar Township v. Lamar. 261 Mo. 189 169 S.W. 12; State ex rel. Bradshaw v. Hackman, 276 Mo. 607, 208 S.W. 445; 46 C. J. sec. 287, pp. 1031-32. (2) The powers and duties of the Department of Finance of the State of Missouri are conferred and limited by the statutes of Missouri. R. S. 1929, secs. 5316, 5319, 5322, 5324, 5327, 5330, 5332-33, 5340. (a) The primary rule for the interpretation of statutes is that the legislative intention is to be ascertained by means of the words it has used. Grier v. Railway Co., 286 Mo. 534, 228 S.W. 454; Clark v. Railroad Co., 219 Mo. 534, 118 S.W. 40; Betz v. Ry. Co., 314 Mo. 390, 284 S.W. 455; Hannibal Trust Co. v. Elzea, 315 Mo. 500, 286 S.W. 371; State ex rel. Cobb v. Thompson, State Auditor, 319 Mo. 496, 5 S.W.2d 57; 36 Cyc. pp. 1106-7. Statutes should not be construed as to pervert their very object. Missouri Granitoid Co. v. George, 150 Mo.App. 650, 131 S.W. 170. (b) Words in common use are to be construed in their natural, plain and ordinary signification. Hannibal Trust Co. v. Elzea, 315 Mo. 485, 286 S.W. 371; State ex rel. Williams v. Purl, 228 Mo. 1, 128 S.W. 196; Elsberry Drainage Dist. v. Winkelmeyer, 278 Mo. 268, 212 S.W. 893; State v. Plotner, 283 Mo. 83, 222 S.W. 767; Lauch v. Reis, 310 Mo. 184, 274 S.W. 827; State ex rel. Gray v. Wilder, 206 Mo. 541, 105 S.W. 272. The word "liquidation" has a well defined and clearly understood meaning. Ballentine's Law Dictionary (1930), p. 763; In re Union Bank of Brooklyn, 96 Misc. (N. Y.) 299, 161 N.Y.S. 42. (3) There are no statutory provisions, either express or implied, granting the Commissioner of Finance or his Special Deputy Finance Commissioner the power to succeed to the execution of the duties and powers of a trustee in a deed of trust. (a) The Commissioner of Finance and his Special Deputy Finance Commissioner hold possession in the instant case only for the purpose of liquidation, and not for the purpose of continuing as trustee in the deed of trust executed by the Skinker-Northwood Investment Company wherein the Fidelity Bank and Trust Company was named as trustee. R. S. 1929, sec. 5316, et seq., supra; Sullivan v. Kuolt, Commissioner of Banking, 156 Wis. 72, 145 N.W. 210; Mitchell, Chief State Bank Examiner v. Shuford, 156 S.E. 513; Brackett v. Middlesex Banking Co., 89 Conn. 645, 95 A. 12. (b) The Missouri statutes heretofore set forth were apparently copied from the Wisconsin Statute interpreted in Sullivan v. Kuolt, Commissioner of Banking et al., supra, and it is assumed that the Legislature in adopting the procedure for the liquidation of banking and trust institutions hereinabove described, also adopted the construction placed upon it by the highest court of the State of its original enactment. Schott v. Continental Auto. Ins. Underwriters, 326 Mo. 92, 31 S.W.2d 7; Ball v. Mercantile Trust Co. et al., 220 Mo.App. 1165, 297 S.W. 415; Joplin Supply Co. v. Smith, 182 Mo.App. 212, 167 S.W. 649; State ex rel. Guion v. Miles et al., 210 Mo. 127, 109 S.W. 595; State ex rel. Kemper v. Carter et al., 257 Mo. 52, 165 S.W. 773; St. Louis National Bank v. Hoffman, 74 Mo.App. 203; State ex rel. Crow v. Carothers, 204 Mo.App. 209, 222 S.W. 1043; Jegglin v. Randolph, 222 Mo.App. 738, 7 S.W.2d 441; Laws of Mo., 1915, secs. 29-55, pp. 116-127; Laws of Mo., 1921, secs. 1-10, pp. 393-97; R. S. 1929, sec. 5316, et seq., supra; Statutes of Wis., 913, sec. 2022. (c) It is well settled that a deed of trust in the nature of a mortgage invests the trustee with legal title. Hurst Automatic Switch & Signal Co. v. Trust Co., 216 S.W. 954; McNutt v. Mut. Benefit Ins. Co., 181 Mo. 94, 79 S.W. 703. The Commissioner of Finance of the State of Missouri takes no titles to the assets of a closed bank. Bank of Oak Ridge v. Duncan, 40 S.W.2d 656. (4) The power to sell under a deed of trust is a matter of convention and contract between the parties, and they are authorized to select their own trustee. Kelsay v. Farmers' & Traders' Bank, 166 Mo. 157, 65 S.W. 1007; Bales v. Perry et al., 51 Mo. 449; Graham et al. v. King et al., 50 Mo. 22; Swabey v. Boyers, 274 Mo. 332, 203 S.W. 204; Polliham v. Reveley et al., 181 Mo. 635, 81 S.W. 182; St. Louis v. Priest, 88 Mo. 612; Markel v. Peck, 144 Mo.App. 706, 129 S.W. 243; Perry on Trusts (3 Ed.) sec. 602.

Leahy, Saunders & Walther for respondents.

(1) Mere insolvency does not disqualify a trustee. 1 Perry on Trusts (7 Ed.) 1929, sec. 279; Shryoch v. Waggoner, 28 Pa. St. 430; Moorman v. Crockett, 17 S.E. 875. (2) The Finance Commission is given powers broad enough to continue all functions of a bank in liquidation. R. S. 1929, secs. 5330-5332; 3 Michie on Banks and Banking, p. 153; Tomasella v. Murphy, 129 So. 328; Power v. Amos, 114 So. 364. (3) A bank liquidator has powers and functions of a receiver. 7 C. J., pp. 725-738, sec. 507; Mothersead v. Harris, 298 P. 602; Baggett v. Mobley, 155 S.E. 334. (4) Construction given a statute by those charged with duty of executing it will be given consideration. Ross v. Kansas City, 111 Mo. 18; State v. Cupples, 223 S.W. 75; Huntsville v. Noel, 12 S.W.2d 751; State ex rel. Barrett v. First Nat. Bank, 297 Mo. 397, 249 S.W. 619. (5) The law abhors a multiplicity of suits. (6) Public policy of State to allow a state official to function where interests of numerous persons are involved. State ex rel. v. Hyde, 286 S.W. 365; Equitable Life v. Brown, 213 U.S. 25; Koch v. Missouri-Lincoln Trust Co., 181 S.W. 44.

OPINION

White, J.

The Fidelity Bank & Trust Company, a Missouri Corporation, October 2, 1931, by resolution of its Board of Directors was placed in the hands of the Finance Commissioner of Missouri.

The Commissioner, S. L. Cantley, who took charge October 23, 1931, placed Special Deputy Commissioner, Hans Wulff, in charge and Wulff was in charge at the time of filing the petition for prohibition here.

May 1, 1929, relator Skinker-Northwood Investment Company executed a first deed of trust conveying to the Fidelity Bank & Trust Company, as trustee, certain real estate described in the relator's petition to secure an issue of six per cent gold bonds amounting to $ 670,000 and that deed of trust was in force at the time the said Fidelity Company was placed in charge of the Finance Commissioner. Relator, Fred Schmitt Contracting Company, was the owner and holder of one of the first mortgage bonds secured by said deed of trust. The deed of trust provides:

"In the event of the death, resignation, disqualification or any other inability or incapacity of said Fidelity Bank & Trust Company, when and while its services shall be required under any provisions hereof, J. U. Menteer of the City of St. Louis, State of Missouri, shall be and is hereby appointed its successor in trust created hereby, and in the event of the death, resignation, sickness, refusal, disqualification or any other inability or incapacity of said J. U. Menteer, his successor in trust, when and while his services shall be required under any provision hereof, Wm. Brace, of the City of University City, State of Missouri, shall be and hereby is appointed second successor in the trust created hereby. Said J. U. Menteer or Wm. Brace, or either or both of them as such successors in trust, shall have identically the same title to said premises and the same rights, powers and duties as are hereby vested in or imposed upon said Fidelity Bank & Trust Company."

The deed of trust further provides:

"In case at any time said trustee or any successors in trust hereunder shall fail or refuse to act, resign, or be removed or otherwise become incapable of action, a successor may be appointed by the holder of the majority in amount of the bonds then outstanding, and an instrument signed by such bondholders and recorded in the office of said Recorder of Deeds, but in case no such appointment shall be made by the bondholders within ten (10) days after the occasion for such appointment has arisen, a new trustee may at any time thereafter be selected and appointed by any court of competent jurisdiction in the premises upon the application of the grantor or of the holders of any of the bonds hereby secured upon such notice as said court shall direct. Such new trustee if appointed by order of court, shall in all cases be a trust company with a capital and surplus aggregating at least one million dollars ($ 1,000,000)."

February 24th and again February 26, 1932, Special Deputy Commissioner Hans Wulff filed in the Circuit Court of the City of St Louis in the case entitled "In re Liquidation of the Fidelity Bank & Trust Company" five applications for orders to continue to act as trustee in various deeds of trust in substantially the same form as that in which the Fidelity Bank & Trust Company was made trustee, and in each of said cases the said circuit court entered the order prayed for and, it is alleged, proposes...