73 Minn. 409 | Minn. | 1898
This case is another illustration of the system of frauds practiced by the firm of A. F. & L. E. Kelley, former loan agents at Minneapolis.
During all the times hereinafter mentioned, plaintiff was, and still is, the owner of a certain city lot in Minneapolis. On January 3, 1893, he procured a loan of $1,100 from defendant, and executed to her therefor his promissory note, due in three years, with interest at the rate of 7 per cent, per annum, payable semiannually according to the terms of six coupon notes attached to the principal note, and signed by him. He also executed to her a mortgage on said lot to secure the payment of the note. Defendant has always lived at Montpelier, Vermont, and the Kelleys acted as her agent in making the loan. After the mortgage was recorded, the papers were sent to her in Vermont, and she always retained them until about the time the loan was due, except that she sent each coupon note to the Kelleys for collection about the time it came due, and they collected the amount, and remitted it to her.
About 15 days before the principal of the loan came due, the Kelleys notified plaintiff that defendant wanted it paid at maturity;
Prior to the time the note and mortgage to Dean was executed, he placed in the hands of the Kelleys $2,000 of his money, to be loaned by them as his agent; and they had deposited it in their own name in the bank, in an account in which they had to their credit in the bank at said time the sum of $30,000. On the execution of the note and mortgage to Dean, they charged him on their books with $1,100, and credited this sum to defendant; but they never remitted this money to defendant, and never remitted to her the amount of the last coupon note paid to them in cash by plaintiff.
Some time after the Kelleys received the note, mortgage and satisfaction from defendant, they made an assignment for the benefit of their creditors. Thereafter defendant commenced proceedings to foreclose her mortgage under the power of sale therein contained, and plaintiff brought this action to have the foreclosure enjoined, and to have the mortgage declared paid and satisfied. On the trial the court found for plaintiff, and, from an order denying a new trial, defendant appeals.
1. We are of the opinion that the Kelleys did have such authority. There was a long course of dealing between them and defendant. For some years prior to 1888 her father’s estate was administered by one Mason, and he, as such administrator, loaned the money of the estate through the Kelleys as his agents. Commencing in the latter part of 1888, he at different times distributed the estate in instalments between defendant, her sister and her mother, who continued thereafter to loan their money through the Kelleys as their agents. On December 29, 1890, the Kelleys wrote to defendant complaining thát Mason, who was then dead, had in his lifetime turned over to her and her mother certain notes and mortgages without making any written assignment of the mortgages, so that satisfactions of the mortgages, which the mortgagees would accept, could hot be obtained. The letter stated that they (the Kelleys) had received payment of these mortgages, and given their receipts for the money, and surrendered the note and mortgage in each case. A way was suggested by which acceptable satisfactions might be obtained.
In September, 1893, defendant appointed one Lowe, her brother-in-law, as her agent to look after and manage these loans for her. Lowe resided at Montpelier also, and had considerable correspondence with the Kelleys in regard to these loans. On October 13, 1894, the Kelleys wrote Lowe:
“Enclosed ñnd New York draft $527.40, in payment of Olson note and interest, due Ella M. Bailey; also release for her to execute.”
On January 9, 1896, they wrote Lowe:
“Herewith we hand you check for $521, in payment of the $500 instalment of the Forman B. Smith mortgage, in favor of Ella M. Bailey, which matured on May 31st last, together with interest on same to date. Also N. Y. draft $324.50, $300 of which is on account of the $700 instalment still due on above mortgage, with interest to Jan. 1,1896, $24.50.”
The trial court was warranted in finding from the correspondence between the parties that defendant had notice of all these facts. The principal received on all or nearly all of the loans which came due prior to the latter part of 1893 was retained by the Kelleys, and reinvested by them for defendant. They collected all her loans which were paid before they made the assignment, and whenever a loan came due, and the borrower was ready to pay, they made out a form of release and sent it to her to execute, which she always did. The correspondence tends to prove that they did about as they saw fit in all these matters, and made such loans as they saw fit, except that she wanted her money loaned on city property, and that she had implicit confidence in them. The long course of dealing between the parties tends to prove that the Kelleys had implied authority from defendant to receive from plaintiff the money in question. See 1 Am. & Eng. Enc. (2d Ed.) 1002.
But there was also evidence tending to prove express authority. Kelley further testified that in 1893 Lowe came to Minneapolis, and informed him that defendant would want the loans paid as they matured. Lowe testified that he had told Kelley that he did not believe defendant would consent to renew or reloan any money. The trial court had a right to believe either of these statements. The Kelleys, writing to Lowe on December 3,1895, after speaking of another mortgage, say:
“Your other past-due mortgages, we will make every effort possible to have them completed and in proper shape by January 1st.”
On the same date (December 3d), Lowe, writing to the Kelleys, says :
“What about loans past due, and with you for collection? Have you succeeded in collecting any, and what are the prospects?”
True, the loan to plaintiff was not then due. It fell due a month later, January 8, 1896. But, taking their correspondence in connection with the other testimony, the trial court was warranted in finding that the Kelleys had express general authority from Lowe to collect all of these loans as fast as they would fall due, regardless of whether the Kelleys had in their hands releases to he delivered on payment, and that their authority was not, as appellant contends, limited by the condition that they should have in their possession the papers, including a release of the mortgage. Then, we are of the opinion that the evidence tends to prove that the Kelleys had actual authority, partly express and partly implied, to collect this loan on January 3, 1896, even though they did not then have the papers or a release of the mortgage in their possession.
2. Appellant further contends that by the transaction above recited, by which the Kelleys merely made a transfer of a credit on their books from Dean to defendant, they did not receive any money as defendant’s agents, and plaintiff did not pay them any as such agents; that no money actually passed; and it cannot be held that this mere matter of bookkeeping paid defendant’s mortgage. The evidence will warrant a finding that defendant knew that the Kelleys made a practice of depositing her funds in their own name in their account in the bank, because the correspondence shows that they had often paid her with checks drawn on such an account in their bank. And, in our opinion, the case is the same as if the Kelleys had drawn $1,100 out of the deposit to their credit in the bank, and had said to plaintiff, “This is the money which Dean has lent to you, and with which we will pay Miss Bailey,” and had then redeposited it in the bank just as it had been deposited before it was drawn out. But this idle ceremony of drawing the money out of their account, and redepositing it in the same account, could add nothing to the binding character of the transaction. In our opinion the transaction amounted to a payment of the money to defendant.
The order appealed from is affirmed.
