State v. Niehaus, 39407.

Citation209 Iowa 533,228 N.W. 308
Decision Date13 December 1929
Docket NumberNo. 39407.,39407.
PartiesSTATE v. NIEHAUS.
CourtUnited States State Supreme Court of Iowa

OPINION TEXT STARTS HERE

Appeal from District Court, Clayton County; Carl W. Reed, Judge.

Defendant was indicted for fraudulent banking under section 9279, Code 1927, and on the trial, after the state had rested, a verdict was directed in favor of the defendant, and the State appeals. Affirmed.John Fletcher, Atty. Gen., Neill Garrett, Asst. Atty. Gen., Elmer F. Pieper, Co. Atty., of Waukon, and Alex Holmes, of Strawberry Point, for the State.

Wm. S. Hart and G. B. Richter, both of Waukon, and W. W. Davidson, of Elkador, for appellee.

ALBERT, C. J.

The defendant was president of the Citizens' State Bank of Waukon, Iowa, which bank was incorporated under the laws of this state. This bank closed its doors on January 26, 1925, and a receiver was shortly thereafter appointed. One Clarence Evans was the owner and holder of a certificate of deposit issued by said bank in the sum of $800, dated January 12, 1924, and due in twelve months, at 4 per cent. interest. When this certificate became due, or shortly thereafter, Evans went to the bank and stated that he wished to leave the money there, as he was going to buy some cattle. He was then paid the interest on the certificate, amounting to $32. He later purchased some cattle from one Arnold, who was in some way connected with the bank. Evans went to the bank to pay Arnold, and this was done by the cancellation of the certificate of deposit for $800, the price of the cattle was credited to Arnold's account, and a new certificate of deposit issued to Evans, bearing date January 11, 1925, in the sum of $414.25, which certificate was a duplicate in form of the first certificate above described, except as to date and amount. The transaction in the bank was had with the defendant, Niehaus. At this point it might be well to note that the first ground of the motion directing a verdict, which the court sustained, raised the question of whether this latter certificate was a renewal of the first within the provisions of the statute.

Section 9279, Code 1924, reads as follows: “No bank, banking house * * * or person engaged in the banking * * * business, shall, when insolvent, * * * renew any certificate of deposit.”

Section 9280 makes such conduct a felony. The question is whether or not the facts recited––conceding them to have occurred––come within the provisions of the statute.

[1] It is to be remembered that criminal statutes are to be strictly construed. The state relies for its contention on the case of State v. Kiefer, 183 Iowa, 319, 163 N. W. 698. In that case the facts show that the first certificate was for $1,761.85, with interest, and the second, issued to replace the first, was for $1,858.75. The latter certificate covered the first, plus the interest therein provided for. This case holds that under such circumstances the statute we are discussing applied; in other words, that the second certificate was a renewal of the first within the meaning of the statute.

[2] In the case at bar, however, we do not have this situation. The original certificate was for $800, plus the interest, and the interest was paid. Therefore the amount due on the original certificate at the time in question was $800. Out of this amount was deducted the purchase price of the cattle, and a new certificate was issued for $414.75. This makes a wholly different situation from that existing in the Kiefer Case. It is quite apparent on the face that the second certificate was not a renewal of the first.

In Kedey v. Petty, 153 Ind. 179, 54 N. E. 798, 800, it is said: ‘Renewed’ or ‘renewal,’ as applied to promissory notes, in commercial and legal parlance means something more than the substitution of another obligation for the old one. It means to re–establish a particular contract for another period of time. It means ‘to restore to its former conditions an obligation on which the time of payment has been extended’ * * * ‘imparting continued or new force and effect.’

In Lowry National Bank v. Fickett, 122 Ga. 489, 50 S. E. 396, 397, the Georgia court said: “As applied to promissory notes, the term ‘renewal’ has been held to mean ‘the re–establishment of the particular contract for another period of time.’

In Carter v. Brooklyn Life Ins. Co., 110 N. Y. 15, 17 N. E. 396, 399, the New York court said:

“To renew, in its popular sense, is to refresh, revive, or rehabilitate an expiring or declining subject; but is not appropriate to describe the making of a new contract, or the creation of a new existence.”

The word “renewed,” as indorsed on a note, may be considered as meaning received the interest for a renewal, and may be properly regarded as an agreement to consider the note to be the same as if made in the same terms anew from that date. Lime Rock Bank v. Mallett, 34 Me. 549, 56 Am. Dec. 673.

In Holloway v. Schmidt et al., 33 Misc. Rep. 747, 67 N. Y. S. 169, the court said in substance that a clause in a lease giving the lessee the “first privilege of a renewal” gives the prior right to a lease upon terms the same as in the first lease, providing the property is relet at the expiration of the first lease.

In Leavitt v. Maykel, 203 Mass. 506, 89 N. E. 1056, 1057, 133 Am. St. Rep. 323, the Massachusetts court said that the word “renew” in a lease providing that the lessee shall have the right to renew the lease “imports a giving of a new lease like the old one, with the same terms, stipulations and covenants.”

Webster's New International Dictionary defines “renew”: “To make new again; to restore to freshness; also to restore to fullness or sufficiency; to grant or obtain an extension of; to continue in force for a fresh period.”

It is apparent that in the Kiefer Case, supra, the situation came within any one or all of the foregoing definitions, and therefore that case was rightly decided. It is also quite apparent that the fact situation we have before us does not come within any one of these definitions, and it necessarily follows that the ruling of the court on this ground of the motion to direct a verdict was right.

[3] The next ground of the motion to direct was that the evidence was wholly lacking to show that the bank was duly incorporated. A copy of the articles of incorporation, under the certificate of the secretary of state which was introduced in evidence, was sufficient. Sections 11296 to 11304, inclusive, of the Code of 1927.

The third ground of the motion was that the state failed to show that the defendant was an officer of the corporation; and, fourth, that there is not sufficient evidence of insolvency; fifth, that there was...

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