Warren v. First Nat. Bank of Columbus

• Decision Date: 26 October 1893
• Citation: 149 Ill. 9,38 N.E. 122
• Parties: WARREN et al. v. FIRST NAT. BANK OF COLUMBUS.
• Court: Illinois Supreme Court

149 Ill. 9

38 N.E. 122

WARREN et al.

v.FIRST NAT. BANK OF COLUMBUS.¹

Supreme Court of Illinois.

Oct. 26, 1893.²

Appeal from appellate court, first district.

Bill of interpleader by Pullman's Palace-Car Company against the Ohio & Western Coal & Iron Company, Walter P. Warren, the First National Bank of Columbus, and others. There was a decree directing the other defendants to be paid before the bank. This decree was reversed by the appellate court, the bank awarded priority, and the relative priorities of the other defendants changed. The other defendants appeal. Reversed.

Evans & Arnd, J. S. Cook, E. R. Jewett, Smith, Helmer & Moulton, Warren & Cox, and Flower, Smith & Musgrave, for appellants.

Norton, Burley & Howell, for appellee.

BAILEY, J.

On the 5th day of October, 1889, Pullman's Palace-Car Company, being a debtor of the Ohio & Western Coal & Iron Company, a corporation organized under the laws of the state of New York, in the sum of $31,695.63, filed its bill of interpleader in the circuit court of Cook county against the First National Bank of Columbus, Ohio, the trustees of the late firm of Glidden & Curtis, the Ohio & Western Coal & Iron Company, and James A. Hall, its assignee, and divers creditors of that corporation, who were seeking to reach the indebtedness in question by process of garnishment, praying to have these various claimants upon the fund in its hands brought into court, and required to interplead as to their respective interests and priorities. The defendants having appeared and answered, the cause was heard on pleadings and the master's report, and it was decreed that a proper case for an interpleader was presented; and, the complainant having paid into court the full amount of the indebtedness in question, the defendants were perpetually enjoined from proceeding further against it for the collection of the same, and it was ordered that the fund thus paid into court stands in lieu of the complainant's liability as garnishee or otherwise. The cause, as between the several defendants, being afterwards heard, it was adjudged and decreed that the claims of four of the attaching creditors, viz. those of Walter P. Warren, the Baltimore & Ohio Railroad Company, Evan T. Ellicott & Marcus A. Thompson, aggregating $22,771.97, were entitled to priority, and those claims, with interest thereon from the date of the decree, were ordered to be paid in full; and it was further decreed that the First National Bank of Columbus was entitled to the residue of the fund, after the payment in full of these four attaching creditors. From this decree the First National Bank of Columbus and the trustees of Glidden & Curtis appealed to the appellate court; and in that court the decree was reversed, and the cause was remanded to the circuit court, with directions to enter a decree giving priority to the claim of the bank, amounting to $16,676.79, and ordering that claim, with interest thereon from March, 1, 1889, to be first paid in full, and ordering payment of the residue of the fund to the trustees of Glidden & Curtis. From the judgment of the appellate court the four attachment creditors and the trustees of Glidden & Curtis have appealed to this court.

The facts in relation to the claim of the First National Bank of Columbus, Ohio, as shown by the evidence, are substantially these: On February 8, 1889, and prior to that time, the trustees of the Ohio & Western Coal & Iron Company resided in Massachusetts, Maine, New York and Pennsylvania, and one of their number, James A. Hall, who was also vice president of the company, resided at Columbus, Ohio. John M. Glidden, the president, and George R. Chapman, the treasurer, resided and had their office at Boston, Mass., and Chester Griswold, the secretary, resided and had his office in the city of New York. The company had an office in New York City, where its corporate meetings were held, and it also had an office in Boston, where its principal financial business was transacted, and also one at Columbus, where its principal operative business was carried on, its mines and furnaces being all situated in Ohio. Books of account of the transactions in Ohio were kept at the Columbus office, and books of account were also kept at Boston. The representatives of the company residing at Columbus were Hall, the vice president, and H. C. Stanwood, whose office or agency, as he was known and held out to the world, was that of assistanttreasurer; and he had, ever since the must be confessed that the testimony of the about six years, been performing the duties appropriate to that position, and had been recognized by the company in many ways as holding that office. It is now claimed, however, that no such office as assistant treasurer was provided for by the by-laws of the company, and that there is no record upon the books of the company of Stanwood's appointment to that office; but the evidence clearly warrants the conclusion that, from the first organization of the company down to the time of the transactions in question in this suit, he had actual charge of the financial affairs of the company at Columbus, and was, de facto, its treasurer at that place. In transacting its financial business in Ohio, the company, from the first, kept its bank account with the First National Bank of Columbus; the business with the bank being all transacted, on the part of the company, by Stanwood. All deposits were made by him, and all checks bore his signature, although a part of the checks seem to have been also countersigned by Hall, the vice president, while others were signed by Stanwood alone. Among other financial transactions between the bank and the company, Stanwood drew, through the bank, a large number of drafts in favor of the company on Glidden & Curtis, of Boston, which were honored. In January, 1889, the company was indebted to the bank in the sum of $20,000 for money previously borrowed, and in renewal of which indebtedness it gave its two promissory notes for $10,000 each, one dated January 10, and the other January 12, 1889, and each payable, 30 days after date, to the order of Glidden & Curtis, and indorsed by them. This loan was made at the earnest solicitation of Stanwood, and the business with the bank in relation to it was transacted by him. The loan seems to have been made principally upon the financial standing and credit of Glidden & Curtis, who were then reputed to be wealthy and responsible, the bank having declined to make the loan on the credit of the coal and iron company alone. On the night of February 8, 1889, the officers of the bank having learned that Glidden & Curtis had failed, and had made an assignment for the benefit of their creditors, and being alarmed about their security upon the notes, sent for Stanwood, who was the only officer of the company then in Ohio, and demanded further security from the company. No security was given that night, but, at about 9 o'clock the following morning, Stanwood executed and delivered to the bank the following instrument: ‘Columbus, Ohio, February 8, 1889. To the Pullman Palace-Car Company, Pullman, Ill.: Please pay to the First National Bank of Columbus, Ohio, or order, the sum of twenty thousand dollars of the money owing by you, and to become due to us on or about the 15th day of February and the 15th day of March, 1889, value received by us, and charge the same to our account. The Ohio & Western Coal & Iron Co., by H. C. Stanwood, Asst. Treasurer.’ Notice of the execution of this instrument was at once given to the Pullman Company by telegraph, and on February 11th it was presented to that company, and protested for nonacceptance; and on the 15th day of February, and again on the 15th day of March, it was presented, and protested for nonpayment. On February 9th, Thompson began his suit by attachment, in the circuit court of Cook county, against the coal and iron company, and caused the Pullman Company to be summoned as garnishee. This attachment was followed at different dates by those of the other attaching creditors, and on February 11th the coal and iron company made an assignment to James A. Hall, assignee; the deed of assignment being delivered to Hall, and filed for record in the probate court of Franklin county, Ohio.

The first proposition affecting the claim of the bank to priority, raised by counsel for the appellants, is that Stanwood had no authority to execute to the bank the instrument above set forth, and that such instrument therefore was ineffectual as an assignment to the bank of any portion of the fund in the hands of Pullman's Palace-Car Company. The question thus raised is one of fact to be determined from all the evidence, and it must be confessed that the testimony of the various witnesses, applicable to that question, is far from being harmonious. It is to be noticed, however, that both the circuit and the appellate court, after considering the evidence, have reached the conclusion that Stanwood was vested by the coal and iron company with competent authority to execute the order on its behalf. While, in cases in chancery, where, as in the present case, the evidence has not been taken orally in open court, in the presence of the chancellor, we are not concluded by the decision of the court below, but may examine and pass upon the evidence de novo, still some degree of weight is properly due to the concurring decisions of the two courts to whose judicial investigation the evidence in the case has already been subjected. We have nevertheless given the evidence an earnest and careful consideration, and, while it must be said that the question is not altogether free from doubt, we are inclined to concur with the conclusion reached by the courts below. The evidence in the case is very voluminous, the abstract of the record constituting a volume of over 540 printed pages. It is manifest, therefore, that any attempt on our part to give such an analysis of the evidence as...