Third Nat. Bank v. Owen

• Decision Date: 17 November 1890
• Citation: 14 S.W. 632,101 Mo. 558
• Court: Missouri Supreme Court
• Parties: THIRD NAT. BANK v. OWEN <I>et al.</I>

14 S.W. 632

101 Mo. 558

THIRD NAT. BANK v. OWEN et al.

Supreme Court of Missouri.

November 17, 1890.

ACTION ON BOND — PLEADING — LIABILITY OF SURETIES — REFERENCE.

1. In an action by a bank on a bond conditioned that the principal should faithfully account to the bank for all money that should come into his possession, as receiving teller, the sureties, by their answer, sought to avoid liability by alleging that the principal was permitted to perform the duties of other officers of the bank, and to discharge the duties of his office in an irregular manner, and to engage in business outside the bank, contrary to its by-laws. Held, that these allegations, failing to show that anything was done or left undone by the bank or its officers, which impaired the power of the teller to honestly account to the bank for money and effects that came into his hands, were properly stricken out.

2. The answer alleged that, when the sureties executed the bond, the principal was in the bank's employ, as receiving teller, and that the bank held him out to the sureties as a faithful officer when, in fact, he was then in default to the bank, which fact was known to the bank, but was fraudulently concealed from the sureties, in order to induce them to execute the bond. Held, that these allegations constituted a good defense, though the evidential facts set up in the answer were insufficient to show that the bank knew of such embezzlement.

3. Under Rev. St. Mo. 1879, § 3606, providing that the court may, on the application of either party, or of its own motion, direct a reference, "when the trial of an issue of fact shall require the examination of a long account on either side," a reference was properly directed on the application of the bank that a report be made of the amount and effects converted to his own use by the principal, as receiving teller.

4. There is no error in allowing a witness to refresh his memory with an examination of entries in books and an inspection of the stubs of checks, made in the usual course of the business, in which witness was engaged, and with the conduct of which he was familiar, by those having charge of the books, and having been examined by witness prior to testifying, and found correct, they being used simply to confirm in detail an amount to which he testified directly, and being calculated only to render definite that which witness had generally testified to.

Error to St. Louis circuit court; GEORGE W. LUBKE, Judge.

Hitchcock, Madill & Finkelnburg and Valle Reyburn, for appellants. John H. Overall, for respondent.

BRACE, J.

This is an action upon a bond executed on the 20th of May, 1875 by the defendant O. E. Owen, as principal, and by the defendants Edwin Harrison, W. H. Block, Charles Green, and Charles P. Chouteau, as sureties, in the sum of $30,000, payable to the plaintiff, upon the following condition: "That whereas, the above bound O. E. Owen has been, by the board of directors of the said Third National Bank of St. Louis, appointed receiving teller of said bank; and whereas, he, the said O. E. Owen, may, from time to time, by the board of directors of the said Third National Bank of St. Louis, be continued and reappointed receiving teller of said bank: Now, if the said O. E. Owen shall well, truly, and faithfully perform the duties of receiving teller of said bank, for and during all the time he shall hold such office as receiving teller of said bank, and for and during all the time that he may continue or act as such receiving teller of said bank, whether under the present appointment or under future reappointments, and shall and will well, truly, and faithfully account for and render over to said bank, all such moneys, goods, chattels, and other effects and things, as may come into his possession, or under his care and charge, while in the service of said bank, as such receiving teller, either under the present appointment or under a future reappointment, and shall, while he continues in such service, either under the present appointment or any future reappointment, faithfully, and to the best of his ability, perform all trusts reposed in him, and all duties devolved on him by the law of the land, or by any by-law, rule, order, or resolution of said board, now existing or hereafter made, enacted, or adopted, not inconsistent with the laws of the land, then this obligation shall be void, otherwise to remain in force." In the amended petition upon which the case was tried three breaches are assigned. The third was abandoned on the trial; the substantial averments of the other two counts are as follows: "First. That, on the 20th of May, 1875, and on divers other days between that day and the 2d day of April, 1881, the said Owen, as receiving teller of said bank, received, on account of the plaintiff, divers sums of money herein set forth aggregating $93,721.58, which moneys he fraudulently embezzled and converted to his own use, and failed to account to plaintiff therefor. Second That on the 20th day of May, 1875, and on divers other days between that day and the 2d day of April, 1881, there came into the possession of the said Owen, as receiving teller of said bank, a large amount of goods, chattels, effects, and things, the property of said bank, of the value of $19,690.17, which he fraudulently embezzled and converted to his own use, and failed to account to plaintiff therefor." The defendant Owen made default. The defendants Chouteau and Green filed a joint answer, and defendants Harrison and Block filed a joint answer. These answers are substantially the same, so far as they apply to the first and second counts of the petition. On motion of the plaintiff, all those parts of said defendant's answers purporting to set up affirmative defenses to plaintiff's cause of action were stricken out, leaving only so much thereof as put in issue the allegations of plaintiff's petition, by denial. The portion stricken out will appear from the answer of Chouteau and Green, which is as follows, all of which was stricken out except the denials in the first part thereof included within brackets:

"[Now come the defendants Charles P. Chouteau and Charles Green, and for answer to plaintiff's amended petition, filed by leave of court, deny all liability to plaintiff on the supposed bond mentioned therein. Defendants deny that the allegations in said petition, touching moneys, goods, chattels, effects, or things of plaintiff's received by said Owen, as receiving teller, and not accounted for or fraudulently converted to his own use, are true. Defendants deny that Oby Owen, as receiving teller of plaintiff, on or after the 20th day of May, 1875 converted to his own use, or embezzled the moneys, goods, chattels, effects, and things in plaintiff's petition enumerated, or any portion thereof, for which, or any portion of which, these defendants are liable. These defendants are informed and believe, and so aver, that, since the execution and delivery of said supposed bond, said Owen, while in the employment of plaintiff as receiving teller, has misused and embezzled moneys of plaintiff in the amount of from two to three thousand dollars; and they deny that said Owen, as receiving teller, has misused or embezzled any greater amount since May 20, 1875; and they aver that any sums for which these defendants would thus become liable were repaid to plaintiff by said Owen after the date of the expiration of said bond. And, for further defense to plaintiff's cause of action, these defendants deny that said Owen, since the execution and delivery of said supposed bond, has misused or embezzled any moneys, funds, or effects of plaintiff, for which these defendants are liable, by virtue of said supposed bond.]

"These defendants state that, at the date of said supposed bond, there were, among other officers of the plaintiff, a cashier, a paying teller, and a receiving teller; that, by the by-laws of plaintiff, it was then provided, among other things, that the cashier shall sign checks and bills of exchange, and countersign certificates of stock issued by the bank. He shall keep a regular record of the proceedings of the bank, furnish official extracts therefrom, and give all such information, as may be required by the board, or by any committee. He shall correspond, as the organ of the board, with all corporations or persons doing business with the bank on subjects connected with his department. He shall lay before every board of directors, on their entering into office, a list of the officers and persons in the employment of the bank, with their respective salaries, the names of their securities, and the amounts for which they are bound. He shall carefully observe the conduct of all persons employed under him, and report to the board such instances of neglect, incapacity, or bad conduct as he may discover in any of them. He shall daily examine the statement of the cash accounts of the bank, and take charge of its assets, except the funds intrusted to the tellers for the daily business of the institution, and such bills receivable as may be in the custody of the note-clerk. He shall superintend the general and individual accounts of the bank, lay before the directors, on each board day, a general statement of the condition of the institution, promptly report to the president and directors material disagreement of the amount of cash actually on hand, with the balances called for by the books, and generally perform such other services as may be required by the board. These defendants say that, at the time of the execution and delivery of said supposed bond, it was the duty of said receiving teller to receive the plaintiff's money and funds, but not to retain in his possession more thereof than was needed for transacting the daily business of his said office. These defendants are informed and believe and thereupon aver that such daily business of such receiving teller of plaintiff never required that he...