Taylor v. Canaday
| Decision Date | 06 June 1900 |
| Docket Number | 18,704 |
| Parties | Taylor et al. v. Canaday, Receiver |
| Court | Indiana Supreme Court |
Rehearing Denied Jan. 2, 1901, Reported at: 155 Ind. 671 at 678.
From the Randolph Circuit Court.
Affirmed.
Theo. Shockney, John Shockney, J. S. Engle, J. J. Cheney, J. W Macy, J. P. Goodrich, W. G. Parry and E. L. Watson, for appellants.
W. A Thompson, for appellee.
Hadley, J. Monks, J., did not participate in this decision.
This action is to enjoin the collection of certain promissory notes assigned by the Citizens Bank of Union City, to appellant Taylor, treasurer of Union City, in alleged violation of § 2934 Burns 1894. Trial, finding and judgment for the plaintiff. Separate assignments of error call in question the sufficiency of the complaint, the correctness of the conclusions of law, and the action of the court in overruling appellant's several motions for venire de novo and for a new trial.
The special finding discloses the following facts: The Citizens Bank of Union City was legally organized March 27, 1893, under the provisions of an act of the General Assembly approved February 7, 1873 (Acts 1873, p. 21), as a bank of discount and deposit, and did business as a bank of discount and deposit from the date of its organization to the 6th day of May, 1896, when its doors were closed, and the appellee was thereafter duly appointed and qualified as receiver and took charge of its assets for administration. On January 2, 1895, appellant Taylor was by the city council appointed treasurer of Union City to succeed Rosser, resigned, and, in settlement with Rosser, Taylor accepted a check drawn upon the Citizens Bank of Union City for the full amount due the city from the retiring treasurer. This check Taylor deposited with the Citizens Bank and opened with the bank a general account in the name of P. A. Taylor, treasurer, and, from time to time up to and including May 1, 1896, deposited with the bank and had placed to his said account all the money that came to his hands as treasurer of the city, amounting in all to $ 41,610.57, and against which deposits he from time to time during all of said period drew checks in discharge of the liabilities of the city, and which were paid upon presentation, amounting in all to $ 32,184.95. The officers and directors of the bank were sureties upon Taylor's official bond, and had knowledge that the money Taylor so deposited with the bank was not his individual money, but money belonging to the city of Union City. All the money so deposited by Taylor was intended by him and received by the bank as general deposits subject to check, and was mingled by the bank with its own funds and with the moneys of other general depositors and used by the bank as its own money. Taylor at no time loaned any part of the moneys so deposited by him to the bank, or other party. On May 2, 1896, there was owing Taylor from the bank a balance of $ 8,416.36, which he was entitled to draw, and on that day Taylor drew and presented his check on the bank for the full amount of the city's balance; the bank paid no money on the check, but, in lieu thereof, Cadwallader, as president, and on behalf of the bank, turned over and assigned to Taylor promissory notes and bills receivable, after the same had been indorsed on behalf of the bank by Edger, cashier, amounting in the aggregate to $ 8,426.18, which notes were assigned by the bank and accepted by Taylor in full settlement of said balance due himself and the city, and to secure and make Taylor and the city safe on account of said deposits and on account of the indebtedness of the bank to Taylor as a depositor.
Taylor submitted said notes to one McMahan, who was at the time a member of the city council and chairman of the finance committee, and also a director of the bank, for examination, and afterwards, on May 4th, Taylor returned all of the notes to the bank but one, and received from the bank other notes of the bank indorsed as in the first instance in lieu thereof sufficient to cover said balance less $ 1,000 cash then paid on account of said balance. At the time of this last transaction it was agreed between the bank by Cadwallader, president, and Taylor that Taylor should continue to draw his checks upon the bank for the current liabilities of the city and that such checks should be paid, and as fast as the checks thus paid should equal a note or notes so assigned Taylor should return such note or notes to the bank. The indorsement and transfer of said notes and bills by said bank to Taylor was accepted by Taylor and made by the bank for the purpose of giving Taylor, as treasurer of Union City, a preference over the other creditors of the bank. Before any of said notes had been assigned to Taylor said Citizens Bank was insolvent and had committed acts of insolvency, which insolvency and acts of insolvency were well known to the officers of said bank before the transfer of said notes, and before said transfer Taylor had good reason to believe and did believe said bank was insolvent.
It is insisted that the complaint does not sufficiently exhibit authority in the receiver to bring this suit. It is alleged in the complaint that appellee was duly and legally appointed by the Randolph Circuit Court receiver of the Citizens Bank, in an action within the court's jurisdiction, and in the order of his appointment said receiver was commanded to reduce to his possession all the property, rights, credits, and choses in action of every description, and as such receiver "to bring, maintain, and prosecute, in his own individual name any and all actions necessary in the discharge of his duties as such receiver, whenever in the judgment of said receiver it might be necessary to bring and prosecute any such suit, in the proper discharge of his duties." This action is also brought by the receiver in the court of his appointment.
While it is essential to the sufficiency of the complaint that it appear by clear and express averment that the receiver was authorized by the court to bring the action, we think the averments before us are sufficient. Hatfield v. Cummings, 152 Ind. 280, 50 N.E. 817; Davis v. Talbut, 128 Ind. 222, 27 N.E. 494; High on Receivers, § 201.
It is not necessary that the complaint shall show that the receiver had specific authority from the court to bring this particular action; it is good if it is shown that in the order of appointment authority to sue was sufficiently broad to authorize the receiver to institute and prosecute such suits as become necessary and proper for the collection of the assets and for obtaining possession of the property over which he has charge. The complaint in this respect is sufficient. Beach on Receivers, § 651.
It is also urged that the complaint is insufficient to state a cause of action against either of the...
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