The Ranchmen's State Bank v. Cooper

• Decision Date: 12 March 1927
• Docket Number: 26,836
• Parties: THE RANCHMEN'S STATE BANK, Appellee, v. C. E. COOPER et al., Appellants
• Court: Kansas Supreme Court

254 P. 364

123 Kan. 21

THE RANCHMEN'S STATE BANK, Appellee, v. C. E. COOPER et al., Appellants

No. 26,836

Supreme Court of Kansas

March 12, 1927

Decided January, 1927.

Appeal from Sedgwick district court, division No. 1; THOMAS E ELCOCK, judge.

Judgment reversed and cause remanded.

SYLLABUS

SYLLABUS BY THE COURT.

BILLS AND NOTES--Trade Acceptance--Waiver of Protest--Instructions. In an action by a bank to recover on a trade acceptance, the proceedings considered and an instruction set out in the opinion held to be erroneous.

John Madden and John Madden, Jr., both of Wichita, for the appellants.

Jean Madalene, of Wichita, for the appellee.

OPINION

HOPKINS, J.:

The action was one to recover from the indorsers of a trade acceptance. Plaintiff prevailed against the defendant Cooper, who appeals.

The instrument in question reads:

"TRADE ACCEPTANCE NO. 1917.

"$ 2,500.

WICHITA, KANSAS, Sept. 2, 1921.

Thirty days after date pay to the order of Ourselves the sum of $ 2,500 and 00 cts. For merchandise sold to drawee. The obligation of the acceptor of this bill arises out of the purchase of goods from the drawer.

To Red Ball Oil Company,

RED BALL REFINING COMPANY,

Wichita, Kansas.

By C. E. COOPER, Pres."

The acceptance was indorsed by the Red Ball Refining Company, by C. E. Cooper, Pres., also by C. E. Cooper, A. H. Stone, C. A. Morgan and C. C. Whittaker. It was accepted September 2, 1921, payable at the Ranchmen's State Bank, Wichita, by the Red Ball Oil Company, by C. E. Cooper, President. It was a renewal of one of like character. The petition alleged that the original instrument when due was surrendered in consideration of the delivery of the instrument sued on and that the renewal of the instrument in question was by the express request of the defendants Cooper, Stone and Morgan, and that the individual indorser, Cooper, personally promised to pay the obligation. Cooper himself denied that the acceptance was made for his accommodation and alleged that no presentment was made on him as indorser. Trial to a jury resulted in a general verdict for plaintiff and against Cooper. The jury also answered special questions to the effect that at the time they indorsed the instrument, the defendants promised personally to pay it; that it was a renewal of a former instrument of like character, and that at the time of the execution of the original instrument it was agreed that certain money derived from the sale of refined products of crude oil to be purchased with the cash obtained by cashing the trade acceptance should be deposited in plaintiff bank and applied to the payment of the trade acceptance; that the defendants knew of such agreement; that the money derived from such sale was thereafter deposited with the plaintiff and checked out by the Red Ball Refining Company for other purposes; that the defendant, Cooper, knew this was being done but that Morgan and Stone did not, and that the knowledge of and acquiescence in such conduct evinced a clear intention on the part of the defendant, Cooper, to assume a personal liability and to pay the instrument sued on and to waive notice of dishonor.

Error is alleged in the instructions, and chiefly in the following:

"You are further instructed that if you should find by a preponderance of the evidence that, prior to the due date of the instrument herein sued upon, it was agreed between the bank and any particular defendant (and this will also apply to any particular defendant who you so find had knowledge of such agreement, if any) that crude oil was to be purchased with the money obtained from the cashing of the trade acceptances, and that such crude oil was to be refined and delivered to the Red Ball Oil Company, and that the money obtained from the sale of the refined products by the Red Ball Oil Company was to...