State ex rel. Scruggs v. Packard
| Decision Date | 28 January 1918 |
| Citation | 201 S.W. 953,199 Mo.App. 53 |
| Parties | STATE ex rel. W. W. SCRUGGS, Appellant, v. M. E. PACKARD et al., Respondents |
| Court | Kansas Court of Appeals |
Appeal from Jackson Circuit Court.--Hon. Clarence A. Burney, Judge.
AFFIRMED.
Judgment affirmed.
McGilvray Woodbury & Woodbury and H. H. McCluer for appellant.
Morrison Nugent & Wylder and H. L. Hassler for respondents.
This is a suit on the defendant Packard's official bond as a notary public in and for Jackson county, Missouri. The charge is that through the notary's negligence in taking an acknowledgment to a chattel mortgage, the relator sustained a loss of $ 6250, which, he seeks to recover and for which he prays judgment. At the close of plaintiff's evidence the court, at defendant's request, instructed the jury to find for plaintiff but for nominal damages only and the jury returned a verdict assessing damages at one cent. Thereupon plaintiff appealed.
For many years before and up to the transaction involved in and forming the basis of this suit, the firm of McCoy & King had a good reputation and conducted at the stockyards in Kansas City an apparently successful business as a livestock commission firm, in the course of which they obtained for their patrons loans from various banks and individuals. These loans were secured by chattel mortgages on cattle located in the trade territory of Kansas City, and were obtained by the firm taking the secured paper payable to themselves and endorsing it over to the bank or individual making the loan. This method of procedure is common to livestock commission firms.
Relator was engaged at said stockyards in the livestock loan business, buying and lending on such notes secured by chattel mortgage on cattle. He had, up to a few months prior to the occurrences forming the basis of this suit, been associated in business with his father, but the latter had retired and the son had taken over the business for himself. In April, 1915, he purchased of McCoy & King a note for $ 6250 purporting to be signed by one, C. J. Gregory, and purporting to be secured by a chattel mortgage on 172 head of cattle in Barber county, Kansas. The chattel mortgage had an acknowledgment attached thereto taken by the defendant Packard, wherein she certified that on April 1, 1915, "before me personally appeared C. J. Gregory known to me to be the person described in, and whose name is subscribed to the foregoing instrument, and acknowledged to me that he executed the same as his free act and deed" etc.
The note not being paid at maturity, investigation was made and it was discovered that there was no such person as C. J. Gregory, nor was there any cattle of the kind or of any similar character on the location described, and no cattle in Barber county, Kansas, owned by anyone named C. J. Gregory.
When this discovery was made, it also came to light that McCoy & King, payees in the note and who had sold it to relator, had been engaged in a series of frauds through the use of spurious cattle paper. They were indicted, and, when called upon to testify in this suit, stood on their constitutional rights. It is not claimed, however, that the notary, Packard, in any way participated in or knew of the fraudulent acts of McCoy & King or that she was in any way guilty of fraud. The petition alleges, and it seems to be conceded on all sides, that a person pretending to be C. J. Gregory appeared before her, the said notary, with the note and chattel mortgage, and executed and acknowledged it and also swore to an affidavit of ownership of, and clear title to, the cattle. The notary was negligent in certifying in the acknowledgment that C. J. Gregory was known to her, and had appeared before her, since it seems that she did not know the man who acknowledged the mortgage, but accepted McCoy's introduction of him as C. J. Gregory.
The note in question was a renewal of a note given six months before, which was itself the renewal of a note given six months before that; all of them purporting to be secured by chattel mortgage on the same cattle. The first two notes, the original and the first renewal, had been obtained from McCoy & King for the National Bank of Providence, Rhode Island, by and through the loan company of relator's father with whom, as stated, relator was then associated. In this way, relator knew of said two notes and was well acquainted with the representations made by McCoy & King as to C. J. Gregory and with a written statement addressed to McCoy & King, dated February 12, 1913, purporting to be signed by C. J. Gregory and sworn to before said Packard as notary as to Gregory's financial condition, which McCoy & King had presented to and filed with said father's loan agency. When the Providence Bank's renewal note fell due, McCoy & King presented to relator the note and chattel mortgage, bearing the acknowledgment by Miss Packard as above stated, and relator took the loan himself by taking from McCoy & King an endorsement to him of said note and paying the bank the amount due it.
Of course, when McCoy & King's crookedness was discovered, it was also found that they were insolvent.
It appears from relator's own testimony that from the time McCoy & King got the loan on the first note, obtained by the Providence bank through the loan agency aforesaid, on down to the discovery of the fraud in connection with relator's note, no investigation was made by him or any one else to discover whether there were any cattle in existence as described in the chattel mortgages securing the various notes, or whether there was such an individual as C. J Gregory in Barber county, Kansas. In taking the note and chattel mortgage as security for his loan, relator relied partly upon what McCoy & King told him in reference to Gregory, partly upon the written statement as to Gregory's financial condition which McCoy & King had filed with the loan agency to obtain the first loan, and partly, and, as relator says, "quite strongly" upon the fact that other loans to Gregory had been paid. The payment of these other loans, however, is...
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