Wahl v. Cunningham

• Decision Date: 18 May 1928
• Docket Number: 26004
• Citation: 6 S.W.2d 576,320 Mo. 57
• Parties: James S. Wahl, Appellant, v. F. J. Cunningham et al
• Court: Missouri Supreme Court

6 S.W.2d 576

320 Mo. 57

James S. Wahl, Appellant, v. F. J. Cunningham et al

No. 26004

Supreme Court of Missouri

May 18, 1928

Appeal from Pemiscot Circuit Court; Hon. Henry C. Riley Judge.

Reversed and remanded.

Ward & Reeves for appellant.

(1) The court erred in refusing to permit Arthur L. Oliver to testify. If an attorney represents both plaintiff and defendants in the matter of inquiry, then he is a competent witness, if all parties are present. Deuser v Hamilton, 52 Mo.App. 394; Hamil Co. v. England, 50 Mo.App. 341; Standard Oil Co. v. Drug Co., 84 Mo.App. 76; Deuser v. Walcup, 43 Mo.App. 625. (2) The court erred in refusing to permit James S. Wahl to testify. The court refused to permit the plaintiff to testify at all. Where there are two defendants and one of them is dead, the plaintiff may testify against the living defendant and that is true, notwithstanding the other defendant appears by administrator. Fulkerson v. Thornton, 68 Mo. 468; Ashbrook v. Letcher, 41 Mo.App. 380; Commercial Trust Co. v. Foulds, 273 S.W. (Mo. App.) 232; McConnon v. Kuhlmann, 278 S.W. (Mo. App.) 822; Wallace v. Jecko, 25 Mo.App. 313; Williams v. Perkins, 83 Mo. 385; Butts v. Phillips, 79 Mo. 304. (3) The court erred in sustaining the demurrer. (a) Without the testimony of Oliver or Wahl, there is enough evidence given by witness Tindle to take the case to the jury on the first count, because Tindle gives in detail the contract and says that on that contract Wahl put up $ 15,000. There is no pleading or proof that it was paid back. The burden of payment would be upon the defendants. Therefore, since there was a showing of the contract and the money paid by the plaintiff under that contract, and the defendants neither plead nor prove payment, this was sufficient to go to the jury, and the court erred in sustaining the demurrer to the first count, at least. (b) The defendant pleaded the Statute of Frauds, but the contract as pleaded and proven was not that the defendants would answer for the "debt, default or miscarriage of the Pemiscot County Bank."

Shepard & Hawkins and Moore & Fitch for respondents.

(1) Plaintiff's petition wholly failed to state a cause of action against either of the defendants in either the first or the second count thereof. (a) The first count is fatally defective. Under the allegations therein, the demand or cause of action sought to be enforced, as appears on the face of the petition, had not matured when suit was brought; therefore, no cause of action then existed in favor of plaintiff against either defendant. Heard v. Ritchey, 112 Mo. 516; Parker-Washington Co. v. Dodd, 305 Mo. 171; Clothing Co. v. Steideman, 120 Mo.App. 527; Van Dyke v. Maddicks, 23 Mo.App. 192; 1 Page on Contracts, sec. 537, p. 893; 1 C. J. 1151, sec. 396, par. 4, and note 70; Fisher v. Steirns, 143 Mo. 181. (b) It clearly appears from the allegations of the first count that Pemiscot County Bank was the beneficiary of the moneys raised and to be raised; that the bank was the primary debtor; it was to repay the moneys raised for its benefit. The obligation to repay was its direct debt. The agreement of defendants was to hold plaintiff harmless and to indemnify him by reason of the moneys raised for the benefit of the bank; it was a collateral contract from defendants to plaintiff; it was, as alleged, only an indemnifying contract; such facts are stated in the first count of petition; they are also supported by testimony of Tindle, witness for plaintiff. That contract was, therefore, in direct contravention of the Statute of Frauds, because made orally and not in writing. Sec. 2169, R. S. 1919; Hurt v. Ford, 142 Mo. 300; Gansey v. Orr, 173 Mo. 532, 546; Mathews v. Martin, 177 Mo.App. 379; Rottman v. Pohlmann, 28 Mo.App. 404; Price v. Ry. Co., 40 Mo.App. 194; Harroun R. E. Co. v. Davis, 152 Mo.App. 491; Waggoner v. Davidson, 189 Mo.App. 349; Mueller v. Woodson, 198 S.W. 1135; 29 Eng. & Am. Ency. Law (2 Ed.) 921-b, 923-c; 27 C. J. 142, notes 65, 66, 67, and pp. 134-5, notes 16 and 17. (c) The first count also alleges the oral contract made May , 1913; that it was renewed from time to time. The petition does not allege the renewal to be for a consideration or to be in writing; it is fatally defective for these reasons: The testimony of Tindle, plaintiff's witness, shows only oral agreements were made in 1913, before the bank failed. Plaintiff is barred by the Statute of Limitations. R. S. 1919, secs. 1317, 1338 (extended only by writing); Steinbruegge v. Ins. Co., 196 Mo.App. 203; Petty v. Tucker, 166 Mo.App. 105. In order to prevent the bar of the statutes from running against the alleged oral contract which plaintiff says defendants made in 1913, the petition must allege there was a written agreement extending the contract. Sec. 1338, R. S. 1919; Goodyear to use v. Delaney, 181 Mo. 564; 6 Page on Contracts, sec. 3523, p. 6099. Upon plaintiff's failure to allege a renewal or extension of his alleged contract a demurrer lies to his petition. Petty v. Tucker, 166 Mo.App. 105; Steinbruegge v. Ins. Co., 196 Mo.App. 203; Sec. 1338, R. S. 1919; 6 Page on Contracts, secs. 3522, 3523; Burrus v. Cook, 215 Mo. 496; Garth v. Motter, 248 Mo. 477. (d) The petition fails to show a consideration passed from plaintiff to defendants for the alleged extension or renewal of the contract sued on by plaintiff; for this failure the petition is fatally defective; it cannot support a judgment. George v. Railroad Co., 214 Mo. 551; Hicks v. Hamilton, 144 Mo. 495; 1 Page on Contracts, sec. 537, p. 891. (e) The relation between a bank and its depositor is that of debtor and creditor. 1 Morse on Banks and Banking (5 Ed.) sec. 289; Bank v. Massey, 192 U.S. 145; Utley v. Hill, 155 Mo. 259. (f) The contract of a surety who acts without compensation will be strictly construed in his favor. Schuster v. Weiss, 114 Mo. 166. (2) The second count of plaintiff's petition was wholly defective and wholly failed to state a cause of action against either defendant. The allegations of the second count are very similar to the allegations of the first count. The legal propositions are substantially the same. The only differences between said counts is that in the second count plaintiff states he executed his note for $ 10,000 payable to F. J. Cunningham, one of the defendants, to raise money for the benefit of Pemiscot County Bank. (a) The note executed by plaintiff for $ 10,000, dated June 19, 1913, was payable to F. J. Cunningham, who secured $ 10,000 thereon for use of Pemiscot County Bank. Plaintiff paid said note August 12, 1919; defendants agreed to hold plaintiff harmless on said note and repay to plaintiff "whatever portion thereof was not paid by Pemiscot County Bank when the affairs of said bank were finally settled up and the exact amount determined." (b) All questions of law under Point 1 apply with equal force here so far as the rights of John A. Cunningham or his estate are involved. (c) All propositions of law under Point 1 apply under the second count in behalf of F. J. Cunningham, unless subdivision c, concerning the Statute of Limitations, would not apply. The petition is not clear as to whether the $ 10,000 note was held by F. J. Cunningham when it was paid or not. If the note was renewed from time to time and payable to some other party than the defendant F. J. Cunningham, the Statute of Limitations would apply. The petition is silent on this question. (3) Under the petition, and excepting the statement of the plaintiff's witness Tindle concerning said contracts alleged by plaintiff, it appears that under no theory of law could a judgment be given for plaintiff. It was mandatory under the law that judgment must be for defendants, and that judgment, being for the right party, must be affirmed on appeal. Secs. 1276, 1513, R. S. 1919; Holmes v. Railway, 245 Mo. 644; Cass v. Ins. Co., 188 Mo. 17; Kansas City v. Block, 175 Mo. 443. (4) The Statute of Frauds may be raised by plea in the answer or by general denial and objection to evidence. Steele v. Steele, 272 S.W. 85.

Seddon, C. Lindsay and Ellison, CC., concur.

OPINION

SEDDON

This is an action, commenced on October 20, 1923, to recover damages for breach of certain contracts or agreements, alleged to have been made by and between plaintiff and the two original defendants, F. J. Cunningham and John A. Cunningham. The petition is cast in two counts. The first count alleges, in substance, that for a long period prior to June 5, 1913, the Pemiscot County Bank was an organized banking corporation doing business in Caruthersville, Missouri, and its affairs were taken over by the State Bank Commissioner on June 5, 1913, and later the bank was placed in the hands of the Citizens Trust Company as receiver, which Trust Company (at the time of the commencement of the suit) had the affairs of said Pemiscot County Bank in court and the receivership had not then been terminated; that the two original defendants, John A. Cunningham and F. J. Cunningham, at the time and long prior to the failure of said bank, were, respectively, the president and vice-president of said bank, and, together with other named parties, were the directors of said bank; that, in the year 1913, plaintiff was elected as a member of the board of directors of said bank; that, shortly after his selection as a member of the board of directors and before plaintiff had attended a board meeting as such director, it was ascertained by the said defendants, John A. and F. J. Cunningham, that the bank was in financial distress, and later that it was in a failing condition and insolvent, because of the mismanagement, embezzlement, misuse and misappropriation of its funds by an officer of said bank during the year 1912, and prior to the time plaintiff qualified as a member of the...