State ex rel. Park Natl. Bank v. Globe Indemnity

• Decision Date: 12 June 1933
• Docket Number: No. 30852.,30852.
• Citation: 61 S.W.2d 733
• Parties: STATE OF MISSOURI at the Relation and to the Use of PARK NATIONAL BANK, a Corporation, v. GLOBE INDEMNITY COMPANY, a Corporation, and RAYMOND L. COMSTOCK, Appellants.
• Court: Missouri Supreme Court

61 S.W.2d 733

STATE OF MISSOURI at the Relation and to the Use of PARK NATIONAL BANK, a Corporation, v. GLOBE INDEMNITY COMPANY, a Corporation, and RAYMOND L. COMSTOCK, Appellants.

No. 30852.

Supreme Court of Missouri, Division One.

June 12, 1933.^*

Appeal from Jackson Circuit Court. — Hon. J. Francis O'Sullivan, Special Judge.

REVERSED AND REMANDED (with directions).

Lathrop, Crane, Reynolds, Sawyer & Mersereau, Richard S. Righter and Henry W. Fox for appellants.

(1) The court erred in overruling appellants' (defendants') general and special demurrer to respondent's (plaintiff's) second amended petition, and erred in refusing to give appellants' (defendants') declaration of law, lettered B, in the nature of a demurrer to the evidence, because said petition shows on its face and the evidence showed that the cause of action sued on is not assignable, and that respondent (plaintiff) had no legal capacity to pursue the action at the relation of Park National Bank, the purported assignee. 5 C.J. 887; Mullinax v. Lowry, 140 Mo. App. 42; Harrison v. Craven, 188 Mo. 601; State ex rel. Kansas City Title & Trust Co. v. Otto, 276 S.W. 96; State ex rel. Mackey v. Thompson, 81 Mo. App. 549; Lowell v. Parker, 10 Met. 309, 49 L.R.A. (N.S.) 47 n; Sec. 9152, R.S. 1919; 46 C.J. 528; 5 C.J. 893; Mo. State Highway Comm. ex rel. and to Use of Licking State Bank v. Coopers Const. Service Co., 286 S.W. 736; Sec. 1041, R.S. 1919. (2) The court erred in refusing to give appellants' (defendants') declaration of law lettered B in the nature of a demurrer to the evidence, because the plaintiff's evidence showed that the act of Comstock was not the proximate cause of the loss alleged to have been sustained. State ex rel. Scruggs v. Packard, 199 Mo. App. 53, 201 S.W. 953; State to the use of Mathews v. Boughton, 58 Mo. App. 157; State to the use of Alexander v. Plass, 58 Mo. App. 151; Brown v. Rives, 184 Pac. 35; American Surety Co. v. First Nat. Bank, 82 So. 429; Brown v. Dolan, 27 N.W. 795; Governor of the State of Wisconsin ex rel. Mlekus v. Maryland Casualty Co., 51 A.L.R. 1478, 213 N.W. 1481; McAllister v. Clement, 75 Cal. 182, 16 Pac. 775. (3) The court erred in overruling defendants' (appellants' general demurrers to plaintiff's second amended petition, and erred in refusing to give defendants' (appellants') declaration of law lettered B in the nature of a demurrer to the evidence, offered at the close of all the evidence, because plaintiff's petition does not allege, and the evidence does not show, facts sufficient to constitute a cause of action. 38 Cyc. 351; Purcell v. Land Title Guarantee Co., 94 Mo. App. 13; Sec. 9152, R.S. 1919; 20 R.C.L. 336. (4) The court erred in refusing to give defendants' (appellants') declaration of law lettered B at the close of all the evidence because plaintiff failed to sustain the burden of proof resting upon it, and failed to show by the greater weight of the evidence that defendant, Comstock, was guilty of negligence as charged. The court erred in refusing to grant a new trial because the finding of the court, sitting as a jury, in favor of the plaintiff, was against the weight of the evidence. (5) The court erred in giving the finding number 8 requested by plaintiff because this finding is fundamentally wrong. (6) The court erred in refusing to give defendants' instruction lettered N at the close of all the evidence. State ex rel. Savings Trust Co. v. Hallen, 165 Mo. App. 422, 146 S.W. 1171; State ex rel. Mo. Abstract & Guaranty Co. v. Globe Indemnity Co., 9 S.W. (2d) 668; State ex rel. Mackey v. Thompson, 81 Mo. App. 556. (7) The court erred in making finding number 12 at the request of plaintiff.

John F. Cell and Donald W. Johnson for respondent; J.M. Johnson of counsel.

(1) The cause of action which inured to the Kansas City Title & Trust Co., being grounded on an injury to that company in its property rights, was assignable, and the assignment being supported by a sufficient consideration, the relator has the legal capacity to pursue this action as substituted plaintiff. Snyder v. Railroad, 86 Mo. 616; Remmers v. Remmers, 217 Mo. 541; Kissick v. Kissick, 279 S.W. 764; Spiller v. Railway Co., 40 S.C. 473; Deatsch v. Fairfield, 38 A.L.R. 651, 233 Pac. 887; Commonwealth v. Market Warehouse Co., 250 Mass. 452; Secs. 97, 9152, 1354, 7285, R.S. 1919; Licking State Bank v. Coopers Const. Service Co., 286 S.W. 736; United States to use of Bank v. Rundle, 100 Fed. 403; Title Guaranty & Trust Co. v. Puget Sound Engine Works, 163 Fed. 179; Title Guaranty & Trust Co. v. Crane Co., 31 S.C. 142, 219 U.S. 24. (2) The act of notary defendant in taking a fictitious acknowledgment to the deed of trust was the proximate cause of the loss sustained by the Kansas City Title & Trust Co. under its title policy. State ex rel. Scruggs v. Packard, 199 Mo. App. 53, 201 S.W. 953; State ex rel. Mathew v. Boughton, 58 Mo. App. 155; State ex rel. Alexander v. Plass, 58 Mo. App. 148; Brown v. Rives, 184 Pac. 32; Joost v. Craig, 131 Cal. 504, 63 Pac. 840; Governor of the State of Wisconsin ex rel. Mlekus v. Maryland Casualty Co., 51 A.L.R. 1478, 213 N.W. 281; State ex rel. Joseph Matter v. John Ogden and Am. Surety Co., 187 Mo. App. 39; State ex rel. Kansas City Title & Trust Co. v. Otto, 276 S.W. 96. (3) The court properly overruled the peremptory instruction asked by the defendants. The petition discloses a cause of action in favor of the Kansas City Title & Trust Co. While it is true that the title policy issued to the McGonigle Company, the purchaser of the bogus note, being a contract of insurance, was in the nature of an indemnity, the act of Comstock in taking the spurious acknowledgment invested the McGonigle Company with a cause of action, since that act was the proximate cause of the loss sustained by the purchasing company. The policy ran to the company, or its assigns, and when the Title Company paid the loss, it became subrogated under the policy to the rights of the holder of the policy. (4) There is no merit in the fourth point made by appellants, since the greater weight of the evidence discloses that the proximate cause of the loss was the act of the defendant Comstock in taking an acknowledgment without complying with the statutory requirements. Authorities, supra. (5) There was no error in the court's finding No. 8, requested by plaintiff. Under all the facts and circumstances in proof, the false certificate to the acknowledgment of the deed of trust was the proximate cause of the loss, since it was the last wrongful act in the chain of causation which induced McGonigle to part with his money. Authorities, supra. (6) No error was committed in overruling defendants' Instruction lettered N. Under the ruling of this court in State ex rel. Park National Bank v. Globe Indemnity Co., 2 S.W. (2d) 815, l.c. 819 (3), the defendants were not entitled to the credit claimed in that instruction, (7) And no error was committed in finding No. 12 made by the trial court at the request of plaintiff.

HYDE, C.

This is a suit upon a notary public's bond. Plaintiff obtained judgment for substantial damages (the amount paid for the mortgage note hereinafter described), from which defendants appealed to the Kansas City Court of Appeals. The Court of Appeals reversed the judgment and remanded the cause with directions to enter a judgment for nominal damages only. [State ex rel. Park National Bank v. Globe Indemnity Co., 29 S.W. (2d) 743.] The Court of Appeals, however, deemed its opinion in conflict with the decision of the Springfield Court of Appeals in the case of Missouri State Highway Commission v. Coopers Construction Service Co., 220 Mo. App. 401, 286 S.W. 736, and certified the cause here under the provisions of Section 6 of the Amendment of 1884 of the Constitution.

Plaintiff's contention was that the loss sued for was occasioned by the notary's action in certifying the acknowledgment of a deed of trust, which was never, in fact, made by the person who purported to sign it, and that no such person even existed. The action was, however, based on the notary's negligence and did not charge him with fraud. The case was heard by the trial court without a jury and special findings of fact were made. These are supported by substantial evidence and are binding here. [Huttig v. Brennan, 328 Mo. 741, 41 S.W. (2d) 1054, and cases cited.] The substance of these findings of fact are stated in the opinion of the Kansas City Court of Appeals as follows:

"The court found that R.L. Comstock was a notary public and that Globe Indemnity Company was the surety upon the notary's bond; that on the 11th day of June, 1924, the notary certified that he took the acknowledgment of one W.T. Doerr to a deed of trust, purporting to convey all of lot four in Greenview, an addition in Kansas City, Missouri, to one Carl E. Kimpton in trust for one James J. Reamer, to secure a real estate mortgage bond dated June 28, 1924, in the principal sum of $3,000, payable three years after date to the said Reamer; that the notary negligently and carelessly omitted to faithfully perform his duties as notary public; that W.T. Doerr did not appear before the notary nor execute or acknowledge the deed of trust, and that Doerr was not personally known to the notary. The court further found that John A. Cattanach became the owner of the real estate described in the deed of trust in 1919, and had been the owner of such property ever since; that neither the said John A. Cattanach nor his wife subscribed their names to a warranty deed which had been introduced in evidence and which purported to convey said real estate to W.T. Doerr, but that said deed and the acknowledgment thereof was a forgery.

"The court found that the name of W.T. Doerr was a fictitious name used by some person unknown to the notary; that the Kansas City Title and Trust Company (assignor of relator) relied in part upon the notarial certificate of acknowledgment to the deed of...