Tanner v. West

• Decision Date: 12 November 1936
• Parties: Frank Tanner, Administrator, Appellant, v. William E. West
• Court: Missouri Supreme Court

99 S.W.2d 7

339 Mo. 738

Frank Tanner, Administrator, Appellant, v. William E. West

Supreme Court of Missouri

November 12, 1936

Appeal from Clay Circuit Court; Hon. Ralph Hughes, Judge.

Affirmed.

S P. Reynolds, James S. Simrall and Walter J Gresham for appellant.

(1) The court erred in sustaining the motion for new trial. (a) The evidence made a case for the jury. It was shown that defendant threatened to call an officer unless plaintiff made good the bond shortage, that plaintiff was put in fear that he would be arrested and imprisoned, and that he was caused to execute the deed of trust to avoid that result. Miss Valley Trust Co. v. Begley, 298 Mo. 684, 252 S.W. 76; Miss. Valley Trust Co. v. Begley, 310 Mo. 294, 275 S.W. 540; Galusha v. Sherman, 105 Wis. 263; Lacks v. Bank, 204 Mo. 455, 102 S.W. 1007. (b) Defendant waived defenses pleaded by failing to ask instructions thereon. Unterlachner v. Wells, 317 Mo. 181, 296 S.W. 755; Jones v. Norman, 24 S.W.2d 191; Miller v. Chinn, 223 S.W. 767. (2) Instruction 1 is correct. The instruction requires a finding that plaintiff was put in fear by the threat of defendant for the purpose of getting him to execute the deed of trust, that such fear deprived him of his will power, and that he was thereby caused to execute the instrument. Smith v. Wells, 326 Mo. 525, 31 S.W.2d 1014; Beebe v. Kansas City, 223 Mo.App. 642, 17 S.W.2d 608; Mack v. Life Assn., 65 S.W.2d 1045; Baldwin v. Hutchison, 8 Ind.App. 454, 35 N.E. 711; State v. Patterson, 271 Mo. 99, 196 S.W. 3.

J. H. Hull, Lawson & Hale, Wm. B. Bostian, Charles W. German and R. R. Brewster for respondent.

(1) The evidence utterly fails to show that Woodward was acting under duress when he executed the $ 17,000 note and deed of trust. Even assuming that respondent threatened on March 9, 1922, to call an officer, the evidence fails to support appellant's contention that such threat deprived Woodward of his own free will and agency and caused and impelled him to execute the $ 17,000 papers on March 16, 1922, and that he would not have done so but for such threat. Miss. Valley Trust Co. v. Begley, 298 Mo. 684, 252 S.W. 76; Lacks v. Bank, 204 Mo. 455, 102 S.W. 1007; Bell v. Campbell, 123 Mo. 1, 25 S.W. 359; Wood v. Kansas City Home Tel. Co., 223 Mo. 537, 123 S.W. 6; Hensinger v. Dyer, 147 Mo. 219; Meredith v. Meredith, 79 Mo.App. 636; Gate City Natl. Bank v. Elliott, 181 S.W. 25; Western Paving Co. v. Sifers, 126 Kan. 460, 268 P. 803; Glascock v. Glascock, 217 Mo. 362, 117 S.W. 67. (2) The note and deed of trust for $ 17,000 were executed for the benefit of the Bank of Dearborn, Missouri. If executed under legal duress, plaintiff could have maintained an action to cancel the note and deed of trust or could have made the defense of duress if an attempt was made to collect the note or foreclose the deed of trust.

Ferguson, C. Hyde and Bradley, CC., concur.

OPINION

FERGUSON

In 1922, the defendant, West, was a State Bank Examiner and in that capacity made an examination of the Bank of Dearborn, at Dearborn, Missouri. He found a shortage in the accounts and assets of the bank. The bank was closed temporarily but later reorganized, reopened and continued in business under the same name. Henry C. Woodward, the original plaintiff, was a director and had been president of the bank for some four or five years consecutively prior to February, 1922, and thereafter continued as a director until the reorganization. That the bank might be reopened and to cover a certain shortage found by the defendant bank examiner, in March, 1922, Woodward and other directors executed their separate demand notes in proportional amounts which were placed in the assets of the bank. Woodward's note was in the amount of $ 17,000, of which $ 10,000 was on the shortage and $ 7000 to take up a note in that amount which he had previously made to the bank. Woodward secured the note, which was executed on March 16, 1922, by a deed of trust on approximately 160 acres of land in Platte County, Missouri. Later in May, 1922, Woodward paid and discharged this demand note and the deed of trust securing same by means of a loan in the amount of $ 12,000 from an insurance company payable five years after date and secured by a first deed of trust on the land mentioned, certain credits allowed and a note to the bank for the balance, in the amount of $ 3400, secured by a second deed of trust on the same land. These two last-mentioned deeds of trust were foreclosed in 1927. Thereafter and on April 19, 1927, this action was originally commenced by Woodward in the Circuit Court of Platte County. Upon a change of venue to the Circuit Court of Clay County, plaintiff took a nonsuit on March 21, 1928. The present action was filed in the Circuit Court of Platte County on July 31, 1928. The case again went to the Circuit Court of Clay County on change of venue.

This is a tort action for damages. Plaintiff's petition charges that he and his wife executed all the notes and deeds of trust in 1922, which we have mentioned, under duress and "restraint of fear" caused by threats on the part of the defendant bank examiner "that unless he (plaintiff) made good the shortage . . . he (defendant) would have plaintiff arrested immediately on that day . . . and would call an officer and have plaintiff arrested for theft" that "by reason thereof plaintiff and his wife were" so "disturbed, distracted, overcome by fear" and "powerless" that the "signatures on said deeds of trust and notes were not the real signatures of plaintiff and his wife but merely perfunctory and compulsory," and that by reason of the alleged wrongful acts of the defendant bank examiner, West, plaintiff was "damaged." The prayer asks damages both actual and punitive. Upon a trial in the Circuit Court of Clay County, in December, 1930, plaintiff had a verdict for actual damages in the amount of $ 9000. The plaintiff Woodward died on April 27, 1932, and the cause was thereafter revived on April 6, 1933, in the name of Frank Tanner, administrator of the estate of H. C. Woodward, deceased. On March 17, 1934, the trial court sustained defendant's pending motion for a new trial and ordered a new trial on the ground of error in Instruction No. 1, given at request of plaintiff; whereupon plaintiff appealed. We shall herein refer to Woodward as plaintiff. Here appellant contends that plaintiff's Instruction 1, is correct both in substance and form and seeks a reversal of the trial court's order granting a new trial. Defendant counters first with the contention that plaintiff did not make a submissible case, that his demurrer to the evidence at the close of all the evidence in the case should have been sustained, and that the order granting a new trial should be upheld on that ground, assigned in his motion for a new trial. We shall therefore first examine this contention which requires a review of the evidence.

In making the statement which follows we set out only the undisputed facts and the facts shown by plaintiff's evidence. In 1921 plaintiff was a director and president of the bank and had been continuously since some time in 1917. Ed C. Smith, W. P. Harrington, Lewis C. Gabbert and W. H. Gabbert were also directors. W. P. Harrington was vice president and was employed in the bank. W. H. Gabbert was cashier and in active management of the bank. Lewis C. Gabbert was attorney for the bank and resided at St. Joseph, Missouri. All the witnesses referred to W. H. Gabbert as "Boge" Gabbert and we shall do likewise in the course of this statement. In August, 1921, one Lowery, a State Bank Examiner, made an examination of the bank and found that the bank was carrying among its assets $ 28,640 in bonds of an "Iron Company" or "Iron Foundry." These bonds were deemed of small or doubtful value and the requirement was made that they be removed from the assets of the bank and other acceptable assets substituted in lieu thereof. To meet this requirement four of the directors, Lewis C. Gabbert, Boge Gabbert, Smith and plaintiff Woodward took over the bonds and each gave the bank his promissory note in the amount of $ 7160. It appears from plaintiff's testimony and other evidence adduced by plaintiff that by the following January (1922), the bank was in bad condition which was known to the directors and stockholders. Plaintiff speaks of a "shortage" existing "then," "bad loans," and "bad management" and stated that at that time "we agreed among ourselves" to make an assessment of fifty per cent on the stock. It does not appear however whether or not this was done.

Some $ 40,000, or more, in government bonds, owned by numerous customers of the banks, had been left with, and were held by the bank for safekeeping and the bank's receipts therefor issued. Plaintiff's witness, W. P. Harrington, vice president of the bank and employed in the bank, testified, that "in the summer or fall" of 1921, the cashier, Boge Gabbert took $ 5000 of the customers' bonds and sold them; that Boge Gabbert said he would use the proceeds from the sale of the bonds "for the purpose of restoring the legal reserve and that his brother Lewis Gabbert (director and attorney for the bank) had advised him to do that;" that when Boge Gabbert sold the $ 5000 in customers' bonds he entered up "fictitious accounts" on the bank's records; that "Mr. Woodward (president of the bank and plaintiff herein) came in in a few days and I called him off and told him that Gabbert had sold some of those bonds;" and that he "told Mr. Woodward all he had learned from Gabbert" about the sale of customers' bonds. Plaintiff admitted, that "in the fall or late in the summer," 1921, he learned that some of the customers' bonds had been "misappropriated;" that "Boge told me he had taken some of them and I...