Walters Nat. Bank v. Bantock

• Decision Date: 20 December 1913
• Parties: WALTERS NAT. BANK v. BANTOCK.
• Court: Oklahoma Supreme Court

137 P. 717

41 Okla. 153, 1913 OK 737

WALTERS NAT. BANK v. BANTOCK.

Supreme Court of Oklahoma

December 20, 1913

Syllabus by the Court.

A bank generally has the right to appropriate the funds of a depositor to the extent of the indebtedness due from him; but if the deposit, or any part thereof, is a trust fund, and the bank has notice of this fact, it will be liable to the true owner if it appropriates such fund to the discharge of an indebtedness due from the depositor.

Ordinarily the drawing of a check in the usual form by a depositor against his account in a bank does not operate as an equitable assignment, pro tanto, of the fund before such check has been accepted or certified.

Where the depositor of a trust fund in a bank enters into a contract with another person that such fund shall be deposited and held in escrow to insure the completion of a sale of land, and such parties go to the bank and fully disclose their intentions so to use the fund, and the bank advises both parties that a check for the amount of the fund will be paid, and to satisfy them thereof takes a check already executed for the full amount of the deposit, and writes into the face of the check "in escroe," and the check, in lieu of the money, is then placed with the contract in the hands of the bank's cashier to be held in escrow, pending the completion of the sale of the land, and which sale is later completed and the check is delivered over according to the escrow agreement, held, that the transaction operated as an equitable assignment of the fund that there was privity between the bank and the payee of the check, who, upon the bank's refusal to pay the same, had a right to sue and recover the amount of the fund.

A general finding by a jury in favor of a party includes a finding in his favor on all the material issues in the case.

Where the evidence in a case is conflicting, the verdict of a jury thereon will not be disturbed, where the evidence and the inferences legitimately to be drawn therefrom support the verdict.

A lawful agreement between parties will be enforced, even though it may be incidentally or indirectly connected with a contract that is illegal, where such lawful agreement is supported by an independent consideration, and can be proven without the aid of the illegal contract.

Commissioners' Opinion, Division No. 2. Error from District Court, Comanche County; J. T. Johnson, Judge.

Action by H. Bantock against the Walters National Bank, a corporation. Judgment for plaintiff, and defendant brings error. Affirmed.

R. J Ray and Chas. Mitschrich, both of Lawton, for plaintiff in error.

H. F Tripp and I. K. Revelle, both of Walters, and Gray & McVey of Oklahoma City, for defendant in error.

BREWER C.

The defendant in error, Bantock, as plaintiff below, sued the Walters National Bank for the sum of $1,000, and upon a trial before a jury was given a verdict for the sum claimed. The defendant bank has appealed on case-made to this court.

Bantock employed the W. E. Wilson Realty Company, a copartnership, composed of W. E. Wilson and W. W. Graves, to sell a farm belonging to his mother-in-law. The realty company found a purchaser who lived in Nebraska, who agreed to take the farm for $5,450, and sent to the realty company, a draft for the sum of $1,000 to be applied to the purchase. This draft arrived in Walters, Okl., October 28, 1907, simultaneously with what has been called the bankers' panic of that year. The farm proposed to be sold was a homestead entry, in the name of plaintiff's mother-in-law, and the final proof had not been completed; at least, title could not at the time be conveyed. As to the handling of the sale and the use of this $1,000 draft out of which this suit arose, the evidence is conflicting. Plaintiff's evidence shows: That, when this draft was received, Mr. Sultan, the cashier of defendant bank, was shown the same and was told about the land sale and the purpose of the draft, and insisted that, as the bank needed exchange badly, the draft be deposited in the bank, and it could be used in the land trade through a check against it. That it was so deposited on October 28, 1907. That next day, plaintiff and the members of the realty firm went into the bank and showed the cashier a contract that had been entered into providing for the sale of the farm, one of the provisions of which was that each party, Bantock upon the one hand, and the realty firm on the other, should deposit $1,000 each to insure faithful performance of the contract of sale. To accomplish this the realty company executed its check for $1,000, and Bantock executed his for a like amount, and these checks and the contract of sale were read and understood by the cashier of the bank. That one of the realty men and also Bantock asked the cashier if that check would be good for the money upon plaintiff's completing the sale, and that the cashier assured them it would, and stated he would fix it so it would be good, and, taking the check which had been already prepared, inserted in its face the words "in escroe." That the cashier then took the papers put them in an envelope, and held them for the parties. About April, 1908, Bantock had the farm conveyed, in everything fulfilling the contract so to do, and the contract and checks were delivered to him by the bank. The check for the $1,000 was presented, and the bank refused to pay it on the ground of "no funds." The bank explained the disappearance of the fund by saying that the $1,000 deposited by the W. E. Wilson Realty Company had been appropriated by the bank towards the liquidation of the individual notes of the partners in the realty firm.

The circumstances of the deposit of the $1,000 are best told by W. E. Wilson of the realty firm, who, after stating that he received the draft from the purchaser of the farm in Nebraska, made payable to W. E. Wilson Realty Company, and told the cashier of the matter, says: "A. Well, I told Mr. Sultan I had a draft there. I had been out to see Mr. Bantock, and he was to come in next day, and I told Mr. Sultan. * * * A. I told Mr. Sultan I had a $1,000 draft for Bantock, and Mr. Sultan asked me to deposit the draft. I says, 'I don't feel like depositing the draft until he comes in and fixes the deal up,' but he says: 'You go ahead and deposit that draft, I want this draft in exchange.' * * * A. Well, I went and talked to Mr. Graves (his partner), and we deposited the draft in our name, but we had it understood with Mr. Sultan it was Mr. Bantock's money, and he told us we could check on this thousand dollars and close the deal next day," etc. This deposit was the only one ever made by the realty company. The cashier of the bank in a way denies this evidence. The next day after making the deposit, the plaintiff, Bantock, also both Wilson and Graves, of the realty firm, testify that they went into the bank and met the cashier, Sultan, and explained the nature of the contract for the sale of the farm; showed him the contract, which he read; and Mr. Wilson states what was done as follows: "A. When I and Mr. Bantock and Mr. Graves went to see Mr. Sultan about this deal, I says to Mr. Sultan, I says, 'Was our check good for a thousand dollars to Mr. Bantock?' and Mr. Sultan says, 'Most assuredly it is,' and Mr. Bantock asked him then if it is good, and he says, 'Give me the check and I will make it good,' and he takes it and wrote that word in there taking it to the desk, and took his pen and wrote that on the check, and Mr. Bantock accepted the check." The words referred to as having been written in the check by the cashier are "in escroe." That this was written by the cashier to satisfy Bantock that the check would get the money upon the completing of the contract is positively stated by the three witnesses mentioned. Mr. Sultan denied writing the words in the check; in fact, he set up an alibi and disclaimed any knowledge, at the time, of the escrow agreement. For the purpose of comparison of handwriting, the cashier introduced a number of papers he had written in which the word escrow appears. The court and jury evidently had the benefit of a comparison of these writings with the one in dispute; but we have not the same opportunity, as nothing but typewritten copies are before us. Six of these exhibits have the word escrow on them spelled "escroe," as it was on the check in suit.

We do not understand this to be the usual way of spelling the word, and this circumstance that defendant had spelled the word in this peculiar manner in the exhibits may have had weight with the jury. At all events, we take it the jury found against defendant on this point, as well as on the point that the cashier understood the nature and purposes of the draft deposited, who it came from, and how it was to be used, and that it was not the property of the real estate firm, for the reason that a general finding in favor of a party by a jury includes a finding in his favor on all the material issues in the case.

The assignments of error go to: (1) The refusal of the court to direct a verdict for defendant. (2) The admission of incompetent evidence. (3) The refusal to give certain instructions. (4) The giving of certain instructions. The greater part of the brief is devoted to the first of these assignments.

Notwithstanding the vast amount of industry and ingenuity employed by appellant to convince this court otherwise, from a study of the facts of this case, it does not seem to us that many words are required to show that the bank can assert no justification in law or equity for withholding this deposit and appropriating it as has been done. Assuming that plaintiff's evidence is true, as evidently believed by the jury, the bank in receiving this deposit full well knew that...