88 Mo. 514 | Mo. | 1885
This is a suit in equity to compel the defendant to pay over to plaintiffs the sum of $3,757.67 in full, that being the amount of a fund received by the Mastin Bank in trust for plaintiffs before its failure, and not vesting in the defendant, as assignee, for general creditors.
'“Kansas City, Mo., August 1, 1878. »
“Exchange Bank of Denver, Colorado:
“Your account has credit $3,757.56, deposited by Stoller & Hill, for the use of P. P. Earnest.
“ Yery respectfully,
“ John J. Mastín, Cashier.
“Per J. A. Boakman, Teller.”
Stoller & Hill at once sent this memorandum to Mr* Earnest, and the Mastin Bank sent a popy of the same by mail to the Exchange Bank, at Denver. Before it. reached the Exchange Bank, the Mastin Bank had closed its doors and made an assignment to the defendant, for the benefit of its creditors. The Exchange Bank refused to charge the amount to the Mastin Bank, or to place it on its books to the use of Mr. Earnest. It refused to recognize Earnest as having any claim for such credit, or to pay him the amount thereof.
If the Mastin Bank had remained solvent, it is probable that the credit of that bank would have been allowed to take the place of the actual funds, and that the amount would have been entered to the use of the consignor. Mr. Earnest, the consignor, sued Stoller & Hill for the proceeds of his cattle, and recovered judgment, which has been paid. Stoller & Hill, having thus satisfied the claims of their principal, stand in his place, besides having rights of their own as dealers with the bank respect■ing the fund. Mr. Boarman, the teller of the Mastin Bank, is dead, and his version of the transaction is wanting. According to the books of the bank, the sum of $3,757.56 appears therein to the credit of the Exchange Bank of Denver, for the use of Earnest. It seems that Stoller & Hill proved up, before the assignee, their claim against the Mastin Bank in the name of the Exchange Bank of Denver, and received dividends thereon, which
I. It is contended by defendant that the fund claimed by plaintiffs was, with their consent, deposited in the Mastin Bank to the credit of the Exchange Bank of Denver, for the use of Earnest, and that the Mastin Bank thereafter became a debtor for the money so deposited, and that the plaintiffs retained no right to the. same except as creditors. Their right to a specific fund in trust is denied. I am not favorably impressed with this view of the transaction. If the credit attempted by the Mastin Bank had been perfected, I am inclined to think the position of defendant would be tenable. When Stoller & Hill drew their check for $3,757.56 on the Mas-tin Bank, and delivered the same to the bank, payable to the bank, or indorsed over tq it, they placed a specific fund in the hands of the bank. The bank was also advised sufficiently that Mr. Earnest was the ultimate owner or beneficiary of the fund. The bank agreed to transmit this fund to the Exchange Bank of Denver, to be received by said bank to the use of Earnest. The Mastin Bank, in good faith, believed that the same end could be accomplished by a system of credits between the two banks. Stoller & Hill’s agent evidently thought so too. The Mastin Bank attempted to accomplish the same end by substituting good credit for the fund.’ Now, it is apparent that the plan adopted required the consent of another party, and that it could not be effective without such consent. The plan could not be accomplished by the mere act of the Mastin Bank entering a credit on its books in favor of the Exchange Bank for the use of Earnest. The Exchange Bank could not be made a debtor to Mr. Earnest without its consent, or without receiving his money. The plan adopted required a corresponding entry in the books of the Exchange Bank
II. It is claimed by defendant that while the unaccepted credit to the Exchange Bank of Colorado remained on the books of the Mastín Bank, the money upon which it was based went into the general assets of the. bank, and was paid out on other liabilities of the bank. It must be apparent that the plaintiffs consented to the credit upon condition that the credit would be perfected by the consent of the Exchange Bank. Without such consent there could be no genuine credit. Having turned the fund into the general assets of the bank, without ■ furnishing the credit upon faith of which it was received, the bank, in doing so, effected an unlawful conversion of it. The defendant claims that the plaintiffs cannot follow the fund after it was thus mingled with the other assets of the bank, so as to be distinguishable from them. The authorities cited by defendant .would seem to support this position. But in the recent case of Harrison v.
III. The most serious embarrassment which the plaintiffs encounter in maintaining their suit, results from their previous voluntary proceedings before the assignee. It seems, from the evidence, that Mr. Earnest sued the plaintiffs in the Circuit Court of the United States In Colorado, for the proceeds of the cattle sold by them, and that while the suit was pending the parties to it entered into a written agreement, which recites the fact that the proceeds of the sale were deposited in the Mas-tin Bank by Stoller & Hill to the credit of the Exchange Bank of Colorado, to the use' of E. P. Earnest, and provides that the party who may be defeated in the action pending, may recover the indebtedness so as aforesaid deposited with the Mastín Bank, and that the claim be presented for allowance to the assignee of the bank in the name of F. P. Earnest and Stoller & Hill, and that the dividends received thereon be collected and finally paid over to the losing party. In pursuance of this agreement the claim was presented to the assignee by the parties thereto. I infer, from the pleadings and evidence, that it was presented and allowed against the general assets in favor of the Exchange Bank to the use of Earnest. Now, this allowance was in strict conformity with the credit on the books of the Mastín Bank. The plaintiffs, after being defeated in the Colorado suit, paid Earnest in full of his demand against them. By virtue of such payment and the agreement with him, they became entitled to the claim, which they had proved up to his use. As owners thereof, the plaintiffs have received
The present suit proceeds upon the theory that the debt arising from the credit was never affected by reason of the Exchange Bank’s refusal to accept it in place of money, and that consequently the fund was unlawfully converted to the use of the bank. After having resurrected the repudiated credit, and established it as a true demand .against the general assets of the bank, which has been realized by plaintiffs to the extent of the assets distributable thereon, they are clearly barred from prosecuting their present claim for the specific fund. The bank is certainly not liable on both claims. Yet such would be the result if the plaintiffs were allowed to maintain their present suit. They stand in a court of equity which will look at'the substance and truth of the previous proceedings before the assignee. ■ It cannot fail to notice that the Exchange Bank had nothing to do with them, and that they were conducted at the instance of plaintiffs, who" have received the proceeds thereof. They will not be permitted to occupy inconsistent and contradictory relations to the estate they are pursuing. Having received their pro rata share of the general assets of the bank, including the disputed deposit, upon their claim as a simple debt against the bank, they cannot be
Counsel for plaintiffs call attention to the case of Bank v. Coates, 3 McCrary, 9, in which it was held that the owner of a check, drawn by the Mastin Bank upon its correspondent in New York, might enforce it as the appropriation or assignment of the specific money called . for in the check, after having presented it to the assignee and received dividends upon its allowance as a debt . against the general assets. The learned judge, rendering . the decision, remarks that the two remedies are not inconsistent. The point is not discussed or considered in the opinion of the court. Without stopping to consider the correctness of the ruling in that case, I have only to say that I fail to find in the opinion any satisfactory guide for the determination of this case.
In accordance with these views the judgment of the circuit court ought to be reversed, and the plaintiffs’ bill dismissed.