Welker v. Hayes

• Decision Date: 11 November 1929
• Docket Number: No. 16265.,16265.
• Citation: 22 S.W.2d 1052
• Parties: G.W. WELKER, RESPONDENT, v. BEN HAYES, JR., APPELLANT.
• Court: Missouri Court of Appeals

22 S.W.2d 1052

G.W. WELKER, RESPONDENT, v. BEN HAYES, JR., APPELLANT.

No. 16265.

Kansas City Court of Appeals. Missouri.

November 11, 1929.

Appeal from the Circuit Court of Randolph County. — Hon. A.W. Walker, Judge.

AFFIRMED.

Lamb & Lamb for respondent.

Hulen & Walden and Roy McKittrick for appellant.

BLAND, J.

This is an action in two counts, each upon a promissory note. The court sustained defendant's demurrer to the evidence as to count number two and plaintiff has not appealed so we need not consider further the note covered by this count. Count number one is upon a promissory note in the sum of $425, dated Salisbury, Mo., October 25, 1923, payable upon demand to The Peoples Bank of Salisbury, as payee, bearing seven per cent interest per annum and signed by the defendant, Ben Hayes, Jr. This note contains the following endorsement thereon —

"By order and consent of the Board of Directors, for value received, we assign the within note without recourse on us to G.W. Walker or order. (Signed) The Peoples Bank of Salisbury, by J.W. Grizzell, Pres."

The case was tried before the court without the aid of a jury, resulting in a judgment in favor of plaintiff in the sum of $552 and defendant has appealed.

The facts show that defendant executed a note in the sum of $425 to The Peoples Bank of Salisbury (hereinafter called the bank) on which he received the money from the bank; the note was thereafter sold and transferred to one Friend, but was not endorsed by the bank and was held by it through its president, Mr. Grizzell. The note was renewed on October 25, 1923, while it was still the property of Friend, the renewal note being the one sued upon by plaintiff. When Friend acquired the original note, he paid the bank for it by the bank's taking over another note held by Friend. On February 27, 1923, plaintiff deposited the sum of $10,500 in the bank, which went into an account in plaintiff's name at the bank designated "bond special account." The money in this account was left in the bank by plaintiff with which to buy bonds. Later plaintiff consented that the bank use the money for other purposes and the bank, through its president, Grizzell, on November 12, 1923, purchased for plaintiff five notes from Friend, aggregating the sum of $2500, of which the note in suit was one, for which Grizzell paid Friend the sum of $2500 out of plaintiff's bond special account. Grizzell then placed the notes procured from Friend in an envelope and put the same in a pigeon hole in the vault of the bank as the property of plaintiff. Plaintiff testified that he knew of the transaction and the placing of the notes in the envelope for him a short time afterwards. From the foregoing facts it appears that the bank, through Grizzell, was acting as plaintiff's agent in the purchase of the note from Friend.

Up to this time the bank had not at any time endorsed the note in suit and no endorsement was made on behalf of the bank until a short time after February 10, 1927. It appears that the board of directors of the bank on the last-named date directed that Grizzell, the president of the bank, assign to plaintiff the note in suit. Defendant attacks the regularity of the documents by which plaintiff at the trial showed this proceeding but in view of the conclusion at which we have arrived in reference to other issues in the case, it is not necessary for us to state the testimony in reference to defendant's contention in this regard.

It is insisted that the trial court should have sustained defendant's demurrer to the evidence because there was no competent legal evidence that plaintiff was vested with title to the note. In this connection it is insisted that under the statute, section 11762 Revised Statutes 1919, Grizzell, the president of the bank, "had no power or right to sell the note (in suit) without first a written record having been made by the board of directors authorizing him to endorse the note" and that the board of directors on February 10, 1927, had no power or right to authorize the endorsement of the note "and thereby ratify or authorize the delivery of the note to plaintiff in November, 1923."

It is not necessary to pass upon the question as to the right of the board of directors to ratify said act of its president for the reason that no authority of the board of directors was necessary in order to empower Grizzell to sell the note, if he did, in the first instance to Friend and to have endorsed the note in the name of the bank without recourse to plaintiff. [Stover Bank v. Welpman, decided by the Supreme Court but not yet reported.] In any event, the bank, through Grizzell was merely transferring title from Friend to plaintiff in the capacity of agent.

In the case of Stover Bank v. Welpman, 284 S.W. 177, this court held in effect that the amendment to the statute striking out the words "sell" and "selling" did not change it and that even now it is unlawful for an officer of a bank to sell notes, bonds and other obligations received by it for money loaned. It was recognized in that case that we were holding contrary to the decision of the St. Louis Court of Appeals in the case of Taylor v. Fugua, 203 Mo. App. 581, so the Stover Bank case was certified to the Supreme Court which disagreed with this court and the case of Stover v. Welpman, 284 S.W. 177, is overruled.

It is, therefore, our holding in this case that title to the...