Stookesberry v. Burgher
| Decision Date | 15 October 1935 |
| Docket Number | 42786. |
| Citation | 262 N.W. 820,220 Iowa 916 |
| Parties | STOOKESBERRY v. BURGHER. |
| Court | Iowa Supreme Court |
Appeal from District Court, Davis County; Elmer K. Daugherty, Judge.
An action to recover upon a promissory note. There was a directed verdict for the plaintiff at the close of all of the testimony. The defendant, John Burgher, appeals.
Affirmed.
Heinrich C. Taylor and T. A. Goodson, both of Bloomfield, for appellant.
Jo R. Jaques, of Ottumwa, and Buell McCash, of Bloomfield, for appellee.
This is an action seeking recovery upon a promissory note for $4,000. This is the second appeal. The opinion on the former appeal will be found in Mitchell v. Burgher, 216 Iowa, 869, 249 N.W. 357.
The action was originally brought in May, 1929, naming L. A. Burgher and John Burgher as defendants. Both of the defendants were nonresidents of the state of Iowa, and jurisdiction against one of them, John Burgher, was obtained through the process of attachment. Upon the first trial of the case in the district court the defendant John Burgher appeared and defended alleging, first, that the note in suit was paid, and, second, that by reason of certain facts pleaded the plaintiff was estopped from maintaining the suit upon the note. At that time the plaintiff, George T. Mitchell, was alive, but has since deceased, and the executor of his estate has been substituted as plaintiff. The case was first tried in the lower court and submitted to a jury resulting in a verdict for the defendant. On appeal to this court the case was reversed on account of numerous errors, inter alia, was failure to sustain a motion of the plaintiff for a directed verdict at the close of defendant's evidence. The case was remanded and upon a retrial in February, 1934, the trial court directed a verdict for the plaintiff for the amount due upon the promissory note in suit. Judgment was entered upon verdict so directed, and the defendant John Burgher prosecutes this appeal.
The note in suit, payable to George T. Mitchell and executed by L. A. Burgher and John Burgher, was dated March 17, 1920, and due, by its terms, on demand, and " if no demand is made, on March 17, 1921." Some two weeks prior to the execution of the note in suit, the defendant L. A. Burgher, and his father, A. Burgher, executed and delivered to George T. Mitchell another note for $5,000 dated March 3, 1920, and due, by its terms, on demand, and " if no demand is made, on March 3, 1921." Both of these notes were given for loans made by George T. Mitchell to L. A. Burgher.
On February 28, 1921, a day or two before the $5,000 note matured, Mitchell, the payee, asked L. A. Burgher for some money upon his indebtedness and received a check from L. A Burgher upon the Peoples State Bank of Coatsville, Mo., for the sum of $4,500. At the time of the giving of this check nothing was said as to the application of the proceeds thereof, although the $5,000 note was due or would become due in a few days. The check was deposited by Mr. Mitchell in the National Bank of Bloomfield, Iowa, and when it was presented to the Peoples State Bank, upon which it was drawn, was refused, and it was protested for want of sufficient funds. It may here be mentioned that L. A. Burgher was the president of the Peoples State Bank of Coatsville and John Burgher was the cashier, and that John Burgher is the uncle of L. A. Burgher. On the 7th day of March, the day the check was protested, L. A. Burgher went to the bank and told his uncle that the check which was protested was given to pay the $4,000 note upon which John Burgher was liable, but notwithstanding this statement, John Burgher refused to cash the check. L. A. Burgher then negotiated a loan from a third party (Crapson) for $3,600 upon a note signed by himself and his father, A. Burgher. This note was later secured by a mortgage upon real estate owned by the father, which real estate was later taken over by the party (Crapson) loaning the money in payment of the note. L. A. Burgher testifies that after the check was dishonored and he had to raise the money from other sources, he then changed his mind upon which obligation he expected to apply the proceeds of the $4,500 check, and he thought the application should be made upon the $5,000 note upon which his father was surety, and the payment later was so applied. After he secured the loan of approximately $3,600, as above indicated, he took the drafts so obtained and went to the bank of Coatsville to take up his protested check. He obtained from that bank through his uncle, John Burgher, drafts for $4,506.34, $4,500 of which was the amount of the check and $6.34 the protest fee. In order to do this he used the $3,600 he had borrowed from the third party, together with $727 of his own money taken from his checking account in the Coatsville Bank and $185 that he borrowed from his uncle, John Burgher, for which he gave his note. This occurred on March 8, 1921, the day following the protest of the note. It will be noticed here that without borrowing the $185 from his uncle, John Burgher, L. A. Burgher had $4,323.34 of his own money, which was more than enough to pay the $4,000 note with accrued interest. John Burgher, the defendant, testifies that the $185 he loaned to L. A. Burgher on March 8, 1921, was not loaned for the purpose of taking up the $4,000 note, but was loaned for the purpose of taking up the check. L. A. Burgher then went to the National Bank of Bloomfield and took up the protested check, which had been returned to it from the Coatsville Bank, paying to the National Bank the amount of the check with the protest fee of $6.34 added. L. A. Burgher testified that he never had any talk with his uncle, John Burgher, after he borrowed the money from Crapson, the third party, as to where he intended to apply the proceeds of the $4,500 check, and that when he borrowed the $185 from his uncle to make up the amount sufficient to take care of the protested check, nothing was said to his uncle or by his uncle about applying the payment, or a part of it, upon the $4,000 note. It is apparent that when L. A. Burgher told his uncle, John Burgher, on March 7, 1921, the day the check was protested, that the check was given to pay the $4,000 note, that it was for the purpose of inducing his uncle to honor the check, but failing in this L. A. Burgher later procured the necessary funds from other sources. Up to this time nothing was said to George T. Mitchell, the payee of the note, as to where the payment of $4,500 should be credited and there is no testimony indicating any promise or statement made by L. A. Burgher to John Burgher that in return for the loan of $185 the proceeds of the $4,500 check would be applied on the $4,000 note. It may be noted here that the $4,000 note was not yet due, and that the $5,000 note was due. It may also be noted here that in directing a verdict for the plaintiff upon the $4,000 note against John Burgher the trial court, with the consent of the plaintiff, credited thereon the sum of $185 with interest, representing the advancement made by John Burgher to make up funds sufficient to take up the $4,500 check. There is some evidence in the record that at a later time L. A. Burgher told George T. Mitchell that his uncle, John Burgher, would contend that the $4,500 check should apply upon the $4,000 note, but such conversation was long after the payment was made to Mitchell and the evidence is not of such a clear, convincing, and satisfactory...
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