*1
REPORTER
268 SOUTHWESTERN
reguest
I)
©=>248(
banking
—Guardian
of 4. Banks and
overruled
in the
Case
Weems
and ward
not liable for
©=>53—Ward
for leave
case
plaintiff in
in that
error
unlawfully purchased
ments on bank stock
petition,
held:
amend
by guardian,
may
assessments
recover
statute,
Watson
paid.
the old
Gertrude
“Under
n would
proceedings
above
been
have
pur-
Where
stock
been
error,
it was
party
of
the writ
defendant to
by guardian
money,
chased
National
under
with ward’s
er-
of
required
writ
for
that the
not
ror
Banking
(Rev.
S. §
Act
U.
St.
give
defendants
of
should
names
Gomp.
9690]),
[U.
§
St.
not
ward is
liable
bond was
It was sufficient
therein.
made
of
stock,
for assessments
recover assessments
such
duty
them,
payable
it was
for
paid by guardian.
upon filing
to obtain
bond
clerk
—
papers in the
necessary
banking ©=>248(2)
from
5. Banks and
Certificate
information
impaired]
There-
citations.
of
which to issue the
that bank stock
from
cause
practice
proper
percentage
the old statute the
stated
of that
under
held conclusive
fact.
fore
Ap-
Civil
of
the Court
been for
have
would
Currency
Certificate of
proceedings
merely
peals
stricken
to have
had been
prematurely
having been
their docket
from
filed,
ice
and
is conclusive of
stockholder’s ac-
fact
perfect
plaintiffs
leaving
serv-
error
enjoin
tion to
sale of stock to
assessment.
Watson,
upon Gertrude
court below
banking
6. Banks and
of stock
bring up
©=>241—Sale
record.”
then
necessary
for restoration of
authorized:,, though
held
to dis-
motion
hold
We therefore
stockholder not
liable for assessment
ex-
time, that
filed'in
error
the writ
miss
cess of 100
cent.
appearance
not waived
same
(Rev.
Banking
Under National
Act
St. U.
.who.,
in error
filing
of defendants
briefs
§
Act June
amended
briefs
their
filed
have
rules must
under the
9767]),
[U. S.
sale of bank stock
protection.
for
to
paired capital
nor
been made to
to restore im-
dismissed,
is therefore
of error
The writ
enjoined,
cannot be
losses
the docket.
stricken
the cause
deposit
contingent
fact
does
that a
guarantee
such restoration af-
though
liability,
fect stockholder’s
stockholder
for
liable
is
per
assessments
excess of 100
required
cent.,-nor
to take care of losses
NAT. BANK.*
al. v. MIDLAND
BROWN et
in addition to losses of entire
1665.)
(No.
Appeal
Court,
Appeals
El
Paso.
District
(Court
Texas.
Coun-
of Civil
Rehearing
Denied
ty;
Gibbs, Judge.
Dec.
Chas.
1925.)
Jan.
by Z.
Actions
Brown and Annie
T.
Klapproth
Bank,
the Midland National
anti
Guardian
ward
I.
©=>53—Investment
money
together.
held unlawful
ward’s
diversion,
in bank stock
consolidated and
From
tried
giving
right
to immediate
rise
Judgment
plaintiffs
appeal.
rendered,
in wardl
recover.
action
part,
Affirmed in
and reversed
remanded
money in
ward’s
investment of
Guardian’s
part.
unlawful diversion
mis-
bank
appropriation thereof,
Paso,
Howard,
John B.
El
and Chas. L.
which,
done
when
Midland,
appellants.
Klapproth, of
knowledge
gives
officers,
rise
imme-
of bank
Fannin, Midland,
Wag-
O. W.
J. M.
in ward to recover.
diate
action
staff, Abilene,
appellee.
—
©=>174(2)
Limitation of
Z.
actions
.Minor
diverted]
action to
ward’s
guardian
recover
HIGGINS,
by running
Klapproth,
held:
barred
J.
stat-
against guardian.
ute
13 shares of the
stock of
owner
incorporat-
Rule,
that when
of action
trustee Midland
which is
holding legal
right
apply
by limitation,
title becomes barred
under
laws of
United States with a
ed
que
barred,
of cestui
trust is also
does not
$75,000, brought
suit
in favor of
action
bank to restrain the sale
money wrongfully
ward to recover
diverted and
sale
been
which had
bank
advertised
misappropriated by guardian’s purchase of
a 100
because
assessment
her failure
stock,
to which
ward has both cent,
her
ordered
legal
equitable
title.
purpose
bank for
3.Guardian and ward
18—Minor ward not
©=>l
restoring its
had
.which
required
majority
suing
wait
to.
until
before
theretofore
losses
money wrongfully
by guardian.
diverted
.for
Brown,
T.
the estate of the
A
whose
has diverted and minor, Joseph
brought a
suit
also
wrongfully appropriated
by investing
against said Midland
same court
Na-
required
them bank
until
is not
to wait
petition being in two counts.
tional
majority
suing,
attains
Ms
un-
alleged
guard-
first count it
In the
St. art.
der Rev.
recover
n ian,
substance,
15, 1907,
October
that on
so diverted.
Digests
Key-Numbered
topic
Indexed
in all
KEY-NUMBER
see same
cases
©^»For
of error
*Writ
refused March
*2
Tex.)
BROWN MIDLAND
v.
NAT. BANK
227
(268 S.W.)
appointed guardian
Klapproth
he was
paying
of the estate of
$455 to cover such assess-
minor, Joseph Brown,
the
that he
the
and
ment. At
going
that
time the bank
awas
qualified
guardian
acting
concern;
and
of the
voluntary
the assessment was
being
part
of
adminis-
said minor which
still
was
the
of
paid
the stockholders and was
probate
tered in
ty ;
of Midland coun-
the
court
purpose
into
restoring
the bank for the
of
its
15, 1913',
April
pur- impaired capital.
that on or about
he
February 14, 1923,
the
Bank 16
chased
Midland National
going
the
bank
was still a
concern and
capital
par
shares of its
of
value
the
authorities,
banking
said date the national
each,
$100
of
of stock there-
making
and certificate
examination,
an
found that its
him,
paying
capital
to
he
therefor the
was issued
impaired,
stock was
and it had sus-
$2,400
paid
sum
for with the
which was
-heavy
of
Whereupon,
tained
losses.
on said
money;
stock was issued
date,
the
and
the
of
advice
the bank exam-
minor;
guardian
that such
to him as
sale
of said
iner,
bank,
its directors closed the
it re-
and
guardian
without author-
that
was
to
charge
mained closed in
of the examiner un-
law, illegal
ity
void;
officers
and
the
intervening
During
til March
the
that the stock
at the time knew
the bank
time the bank officers and the examiner made
belonging
paid
the
to
was
for with
an effort to
amount of its
the
determine
minor,
illegal
knew it
to invest
and
was
losses,
making
an
the stockholders were
stock, where-
in such
of minor
the funds
fore he
reopen
effort to
the bank. The bank officers
tendered back said shares
charge
and the examiner in
estimated the
the
recovery
judgment
of said
and asked
$2,400 paid
$150,000
at
bank’s losses
notified
bank was
interest,
therefor,
the
with
that,
the
the
purchase
he here
“for which amount
date of
and
efit,
arrangements
reopened,
bank
be
store its
could
behalf,
use and ben-
now sues
the
losses,
to take care of
made
its
ward,
Brown.”
Joe
petition
in sub-
The
second count
meantime,
In the
shareholders of
the
Klapp-
as that Annie Mae
stance the same
negotiations
bank had entered into
with one
throughout
guardian’s
Scattered
the
roth.
petition
July, 1922,
Henry
James and others to furnish
allegations
that in
effect
are
reopen
take care of
losses
the
the
paid
bank
of the
$560
he
the
Thereupon Henry
and his
James
associates
satisfaction of a 35
funds
per
the
placed in
Bank the
the
cent,
voluntary
theretofore
$150,000,
special
account,
sum of
escrow
the
to re-
made
the'
bank,
the
secure
losses of the
to enable
capital
To
thereof.
store
part
reopen.
it to
Each of the stockholders were
cent,
wherein
of the
for said
per
to be assessed 100
their stock
interest,
$2,400,
sum
sued
restoring
bank,
to assist
and,
the losses of the
interposed
special exception
defendant
paid,
when
thus received was
petition upon
to
disclosed that
effect that the
its face
applied
liquidation
payment
to be
2
it was barred
4
$75,000
of the escrow account.
account
escrow
year
limitation.
statutes of
capital,
was
be used
restore
Upon
trial
cases were consolidated. and
the balance
restore the additional
special exception
The
referred to was sus-
deposit
losses.- The escrow
was
made
Upon
hearing
other is-
tained.
purpose
guaranteeing
restoration
judgment in
court rendered
favor
sues the
bank,
$75,-
of the
and the additional
defendant,
plaintiffs appeal.
000
losses
ease all of the stockholders
A condensed statement of
facts found
did not
their assessment and the ad-
the court
as follows:
The
per
ditional
deposit
100
cent. This escrow
legally qualified
minor,
acting guardian
the
the
16 shares of stock
separate
kept
bank,
was
to
who
and 100
and was not
Joe
and is the owner of
be otherwise used.
Those shareholders
cent,
of Midland
paid
per
in 100
of the assessment
par
cent,
each,
$100
value of
per
stock were
Brown, guardian,
issued to
.was
on- given temporary certificates to that effect.
April
arrangement
The said
has been
approved by
The
Comp-
the owner of
said stock since
date of its
'Currency
troller of the
the examiner
issuance,
paid
and it
for out of
the funds charge
arrangement
of the bank. This
hav-
$2,400 being
of his
sum'
paid
ing
been made on March
the bank
t¿erefor.
Klapproth
Annie
reopened
is the
permis-
owner was
for business with the
of 13 shares of the
which she has owned for a
bank,
years
stock of
Comptroller,
29, .1923,
sion of the
on March
and,
number
purpose
carrying
for out
preceding
filing
July,
the
capital
agreement
of this suit.
per-
under which
1922, the
reopen,
Midland National mitted to
issued his
impaired,
Bank had become
the stock-
certificate
had been
effect that its
per
holders ordered an
assessment of
per cent.,
35
and noti-
cent,
to restore the
the bank
order
fied
an assessment of 100
capital,
cent,
stockholders,
-was
shareholders,
go
or else
into
guardian paying $593.60,
liquidation.
$150,000
and Annie Mae
at that
time had
(Tex,
REPORTER
268 SOUTHWESTERN
no
barred
que
wherein
tent to
in a cestui
lee invokes the
Carty,
is vested
statute of
disability
App.
in tbe minor.
money
tbe
was an unlawful
tbe
a
Civ.
Tex.
S.
ing tbe
invested
in
petition
It is this sale
Klapproth,
tion of tbe
red
avoid a
dated
ment,
first count
tbe
ruling
ment, except
meeting
to tbe
resolution
tors
of tbe
Thereafter,
mining
been
antee
tbe
the stockholders’
seek to
be
all tbe
ed
whom surrendered
would be
[2] In
party,
[1] We
W.
application
restored
paid,
made.
tbe
suit,
32 W.S.
allegations
trust is also
ward. Smoot v.
appeal which
App.)
equitable
McAdams
812;
146,
placed
April
604,
tbe same
board,
suit
that tbe
sue,
back
limitation,
tbe
guardian of this
whether or
special
stockholders,
enjoin.
it
sale.
was
support
and a
and one
Tex.
with
by
will first
27 W.
limitation,
Bank
tbe
adopted
65 L. A.
Notice
limitation
having
of tbe
stock of tbe bank.
by
que trust who
and
all stockholders
17,
tbe
immediately
tbe
and
S.
called for
held that whenever a trustee
minority.
its face
title
when tbe
which tbe
an assessment of
S. W.
Article 3235.
Tbe
right
exception
ruling
1923, meeting
eause
Midland
tbe
was
bis
guardian
R.
was
second count
diversion and
v.
plaintiffs in
barred.
for tbe
McAdams,
tbe
an
meeting
and bis action
failed to
Fambrough,
not tbe assessment
3 W.
legal
other cases of like
to tbe
complains of tbe court’s
bis
plaintiffs
967;
tbe court’s
Claxton,
dispose
aforesaid was
cause of action
money,
duly
of action
301;
this
plaintiff
a
held,
additional
and on
petition,
Richards,
made Collins v.
does
cent,
motion a
820,
shows
stock to
tbe
tbe
legal
action
money
title
purpose
plaintiff
to
right
Bank
advertised
meeting
arose in
But this
Bank
money
and tbe
labors under
was
104 Am.
purpose of deter- in
'
10 Tex. Civ.
paid
escrow
97 Tex.
Tbe investment
petition
in this consoli-
April
April
to recover tbe
title
misappropria
tbe
action,
which,
tbe
set
v. Hill
by
stockholder’s
100
run
Am. St.
held,
tbe
v.
bis
effect.
this
in sustain
Annie
consolidat-
tbe
was
Tex.
certificate
submitted tbe
tbe
tbe
up in the
Jones,
tbe direc-
case
phase
rule
latter
favor of
restoring
15,
28,
by
becomes vides:
St.
petition,
for sale.
bank to
569,
compe
nature
is
vested erty belonging
assess- unlawfully
should
appel-
and
cestui
under
would
them.
given
guar- him, though
1913,
App.
legal
1923,
Rep.
Rep.
Civ.
bar
was
Tbe
Mc
tbe
tbe
18
80
conditions obtain which
from
be
follows from
tion
no other
can act
protection of bis estate.
should
where the
be can do so
majority
of a minor with a
bis
all
suits
viz.: Must tbe minor
There,
ute
rents,
Tbe
misappropriation
this suit
ever be
fected
which was vested
to sue
action thus vested
clearly,
to
guardian
version or
was
thorities
and
within the
authorities
ture of tbe
It
in tbe cases
would be
3 S. W.
vested in
tbe bank
S. W.
trustee. Weiss
W.
“The
In
[3]
Tbe
right
It
obligations-in
prosecuted by
recover it
178;W.
bis
majority
is an
1000;
possession
legal
of limitation has
guardian,
acting guardian
others,
perhaps
vested
against
legal
tbe
This
be assert
is
suing.
money
is no
or claims due such
ruling
name,
required
or
of action vested
true,
that a
case
before be can assert and
is
*3
730,
last
to
title to tbe
applicable.
is.
proper person through
tbe
tbe failure of tbe
Smith v. Price
action to recover back
and
guardian
asserted
tbe enforcement
brings
sound
to
guardian’s
anything
in
supra,
bis
Collins
recover
tbe same.
Belt
diverted and
prescribed period. We think
in
third
That
where some other
article
and if
back is not barred
of tbe minor which
2
as contended
because
recover back
the
cited,
relied
equitable
next friend.
right
it and
Am.
v.
right
to wait until be reaches
of bis
tbe
legally appointed, qualified,
v.
reason
in
him.’’
minor without a
minor, and,
us
is
bis
persons, except
be can
Goodhue,
management
case of
favor,
tbe
Cetti,
ward,
the minor. Under
tbe
upon tbe
St.
applicable
of bis
guardian
of that
But that
of action
to tbe
have run
McCarty,
wait
him,
suit
of action is not
right
it was issued to
prevent
adversely interested,
money,
stock,
protect
why
Rep.
guardian
prosecuted
right
title to
to collect
assert
R.
100 Tex.
affected bis
in
Weiss v.
became
money
until
misappropriated.
by
him,
by
bring
But,
guardian
estate,
98 Tex.
a minor should
next
tbe
S.,
kind,
or for
under
diversion
is entitled
Civ.
is
of bis estate
rights
tbe
and
here because
tbe
of all
action must
immediately
tbe
bis
exceptional
this
even
in tbe ease
not tbe na-
and which
to enforce
and defend
first count.
the minor
tbe title
was
whom be
prosecute
bad
guardian
not,
guardian
App.)
Tex.
vested
question,
in cases
tbe stat-
tbe rule
there
Goodhue
appellee,
right
appellee
reaches
rights?
274, 83
money
to
debts,
prop-
if
those
suing
right
93 S.
pro-
how
con-
and
sue
bis
ac-
tbe
bis
au-
tbe
af-
is
to
in
may
the minor’s
unlawful
bank stock which has been
state.
us to determine whether
and unlawful diversion of a
presented.
a
the
ed
or'
money
arise out
very
of an unlawful
This
we
Bank
therefore
tion was
through
Appellee
Joe
longing
whom
Brown.
use
estate
case cited it
ed
and is
Ogilvie, 111
recover back the
To
is the
guardian
out
the
er
(U.
Tes.)
personally subject
istrators, guardians,
hands shall
ward,
would
hold the
holders;
misappropriation
Also,
“Persons
[4]
July, 1922, may
person
this no
otherwise. The
by
do
the assessment
so hold would be
the stock from their
question
S.
minor has the
a
exception
Brown” to recover
he made the
same extent as the
Now,
different
be used to
way
of action.
the minor
is
or
legally appointed, qualified, and
remedy
be,
in the stock.
next
not sound.
Such
upon the
the remainder of
his
benefit of his ward
not
person
Bank
The minor has a
relies
but
sues
investment and
think
think
question
the suit
stock of the Midland National
holding
our
That case
be liable
question
and he based
bring
appears that
is:' Can a
living’
estate to
investment
Ky. 181,
authorized
prosecute
the estate of the
until he
answered
herein
minor which
question
Act,
opinion,
interested in
it
by inheritance, bequest, gift
his
investment of the
present
Kentucky
If
9690),
estates and funds in their
basis
it. Of
investment
be recovered back.
stock
In what
made in
Bor
or
section
not,
'It
both absurd
relates to
money paid
first
“in
limitation,
may
any liabilities
presented
brought?
Brown v. Midland Nat. Bank
268 S.W. 226
Tex. App.1924Check TreatmentAI-generated responses must be verified and are not legal advice.