132 Mo. App. 354 | Mo. Ct. App. | 1908
Plaintiff’s action is based on a negotiable promissory note for fifteen hundred dollars. He obtained judgment in the trial court, less $132, which was allowed by that- court as a credit, the circumstances of which we need not state since plaintiff is not complaining.
There was a private banking house in Clinton, Missouri, known under the name of Salmon & Salmon, which did a general banking business. The bank Avas practically under the exclusive management arid control of T. M. Casey, Avho Avas its cashier. • The plaintiff made a time deposit Avith the bank of $10,000 at five per cent interest and as evidence thereof received a certificate of deposit. He aftenvards concluded he could get a higher rate of interest by loaning the money to individual borroAvers and so expressed himself to Casey. The latter told him that the bank could not pay a higher rate, but that he Avould get him a note payable on demand for the amount and accrued interest, being $11,100, bearing seven per cent, signed by his father, G. M. Casey, himself and one of the Salmons, payable to Salmon & Salmon and by them endorsed to plaintiff, notice and protest waived. This was satisfactory to plaintiff.
Aftenvards G. M. Casey became knoAvn to be insolvent and failed in business, and plaintiff began to demand payment of his note from T. M. Casey, Avho, as already stated, Avas manager of the bank and who had also signed the note individually. The latter stated to plaintiff that if he Avould not press for payment he would turn over to him notes of the bank as collateral so as to make the note as good as it Avas before G. M. Casey’s failure. This was done and these collateral notes were endorsed by the bank, through T. M. Casey,
In January, 1905, defendant gave the note in suit to the bank, for $1,500. In April thereafter Casey gave to plaintiff this note (endorsed by him for the bank) as collateral to be substituted for some then received from plaintiff. Plaintiff took the note and placed it in his box. Afterwards, on June 10, 1905, after banking hours, defendant having a check on the bank for $1,000 and not knowing that his note had been transferred to plaintiff, went into the bank and said to the paying and receiving teller “I want to pay you $1,000 on that note of mine. Get the note.” The teller replied that it was locked up. Defendant then stated to him that he was going away and that “I want to leave this check with you to pay on that note.” The teller then made a memorandum to that effect. It was stated that Casey heard this conversation and we will assume that he did. A few days thereafter, on the 21st of June, 1905, the bank failed and its doors were closed.
Conceding this statement of the law, defendant makes two distinct claims in avoidance; The first is that the transfer of the note against defendant to the plaintiff by Casey as collateral,, though in the name of the bank, was merely an attempt to transfer the bank’s note as security for his private debt. The statement that the principal note Avas T. M. Casey’s is true, yet it is not the‘whole truth. The note was payable to the bank and it was signed by T. M. Casey’s father and one of the Salmons and by T. M. Casey himself. It was thus, on its face, a note belonging to the bank and the bank substituted it for the certificate of deposit it had given to plaintiff. In other words, the bank took up its certificate of deposit and gave in place thereof one of its notes; afterwards assigning other notes as collateral. While this was securing a note of which T. M. Casey was one of the makers, yet it was not done for him. It was done by the bank through him and for the bank. The transaction was that of the bank, and for the .bank, in order to take up the certificate of deposit issued and owing by the bank.
■ The well-settled rule of law in this State that a surety will be discharged if there is an extension of time without his consent, for a definite period, based on a consideration, is not opposed to what Ave have Avritten. That rule is founded upon equitable principles in favor of the surety and the reason for it does not apply as between the payee and the principal debtbr.'
It is furthermore true that section 1301 of that statute makes the provisions of the act applicable to private banks, such as this, “so far as the same are ■ applicable.” It is clear that in respect to the power of a cashier of a private bank, here considered, the statute is not applicable. The statute can only apply to such banks as have a board of 'directors. The terms -of the statute, by direct implication, preclude its application to a private bank not so organized.
10. We have not overlooked that it appeared that plaintiff held the subordinate position of clerk in the bank. But we do not see how that fact can affect -any of the questions we have discussed. The judgment will be affirmed.