The Home State Bank v. School District No. 17 In Wyandotte County

• Decision Date: 08 December 1917
• Docket Number: 21,129,21,128,21,130,21,128-21,130
• Citation: 169 P. 202,102 Kan. 98
• Parties: THE HOME STATE BANK, Appellee, v. SCHOOL DISTRICT NO. 17 IN WYANDOTTE COUNTY, Appellant. THE MINNESOTA AVENUE STATE BANK, Appellee, v. SCHOOL DISTRICT NO. 17 IN WYANDOTTE COUNTY, Appellant. THE COMMERCIAL NATIONAL BANK, Appellee, v. SCHOOL DISTRICT NO. 17 IN WYANDOTTE COUNTY, Appellant
• Court: Kansas Supreme Court

169 P. 202

102 Kan. 98

THE HOME STATE BANK, Appellee, v. SCHOOL DISTRICT NO. 17 IN WYANDOTTE COUNTY, Appellant.

THE MINNESOTA AVENUE STATE BANK, Appellee, v. SCHOOL DISTRICT NO. 17 IN WYANDOTTE COUNTY, Appellant.

THE COMMERCIAL NATIONAL BANK, Appellee, v. SCHOOL DISTRICT NO. 17 IN WYANDOTTE COUNTY, Appellant

Nos. 21,128-21,130, 21,128, 21,129, 21,130

Supreme Court of Kansas

December 8, 1917

Decided July, 1917.

Appeal from Wyandotte district court, division No. 2; FRANK D HUTCHINGS, judge.

Judgment affirmed.

SYLLABUS

SYLLABUS BY THE COURT.

1. REFERENCE--Findings of Referee Confirmed--Findings of Fact Conclusive. Where a defendant files a motion asking the court to approve and confirm the findings of fact made by a referee, and to set aside the referee's conclusions of law, and the court confirms and approves both the findings of fact and conclusions of law, the defendant cannot question the correctness of the findings of fact.

2. SCHOOL WARRANTS--Drawn on Empty Treasury--Warrants Became Floating Debt. The fact that at the time a school warrant is issued there are no funds in the hands of the treasurer with which to pay it, does not render the warrant illegal or void. When the warrant is presented for payment, it becomes the duty of the treasurer to indorse it "Not paid for want of funds," and it then becomes a floating debt of the district.

3. SAME--Action on Warrants--Pleadings--Departure. Where the answer of a school district to an action upon school warrants pleads that the warrants were unlawfully issued and are without consideration and void, a reply which alleges that the defendant received and used the property and services for which the warrants were issued, that the acts of its officers in issuing the warrants were ratified by the electors of the district, and that defendant is estopped to question the validity of the warrants, does not set up a new cause of action nor constitute a departure.

4. SAME--Assignment--Rights of Assignee. By the assignment of a school warrant the assignee becomes the owner of whatever claim the original holder had against the district for the indebtedness evidenced by the warrant.

5. SAME--Amount of Judgment. In an action on a school warrant which has been issued for a sum in excess of the amount due the creditor, but which is otherwise legally issued, the court may properly give judgment for the amount actually due on the indebtedness evidenced by the warrant.

Justus N. Baird, of Kansas City, for the appellant.

L. W. Keplinger, C. W. Trickett, E. A. Enright, E. S. McAnany, M. L. Alden, and Thomas M. Van Cleave, all of Kansas City, for the appellees, Samuel Maher, of Kansas City, of counsel.

OPINION

PORTER, J.:

These cases involve the same questions and were consolidated and submitted together. Each of the banks brought suit against the school district on school warrants and recovered judgment, from which the school district appeals.

The petitions alleged that the school district issued its warrants, setting out copies of the warrants, their assignment to the bank, and asked judgment for the amounts due. In addition to a general denial the answer alleged that at the time the warrants were signed, T. E. Moody was not a duly elected and qualified director and officer, and was not a bona fide resident of the school district; that James H. Ewing, at the time the warrants were signed, had no right to act as treasurer; that the warrants, which were drawn by Stephen Lockridge as clerk, were for sums in excess of the moneys in the hands of the alleged treasurer, or which had been apportioned to or raised by the district for the payment of warrants; that the warrants were without consideration, illegal, and void.

The reply contained a general denial and alleged that if any warrant sued on was invalid for any cause when issued, the property and service for which it was issued were received and used by the defendant, and thereby the defendant ratified and validated such warrant and became liable for its payment; that the acts of the officers and agents in issuing the warrants were ratified by the electors of the school district at subsequent regular school meetings; that the defendant appropriated the services and used the property received without objection; and that the electors of the district met in annual and special meetings each year with full knowledge that the warrants had been issued and of all the facts pertaining thereto.

The first complaint is the overruling of a motion to strike from the reply all averments tending to show that the district was liable because it had qualified or ratified the issuance of the warrants; the theory of the defendant being that these allegations of the reply constitute a departure, and further that plaintiff was thereby seeking to recover upon a quantum meruit, which was barred by the statute of limitations. There was no departure in the pleadings. The actions were brought upon school warrants; the answer challenged their validity; the reply merely sought to avoid this portion of defendant's answer by alleging that the school district received the benefit of the work and labor and the indebtedness represented by the warrants and was therefore estopped to plead the invalidity of the warrants. No new cause of action was pleaded by the reply. (Hunter v. Allen, 74 Kan. 679, 88 P. 252, and authorities cited in the opinion; Snyder v. Wheeler, 81 Kan. 508, 106 P. 462; Sturgeon v. Culver, 87 Kan. 404, 407, 124 P. 419.) The warrants are not negotiable instruments, and their assignment to the bank by the original payee transferred to the bank whatever claim the original owner had against the district for the indebtedness evidenced by them. (School District v. Dudley, 28 Kan. 160.)

The trial court sent the case to a referee, who filed an exhaustive report finding, among other things, that from January 1, 1908, to the 12th of January, 1911, James H. Ewing occupied the office of and acted as treasurer of the school district; T. E. Moody occupied the office of director, and Stephen Lockridge occupied the office of clerk of the defendant. These were the...