In Re Assignment of Thomas ( 1926 )

Albert, J.

I. At the times involved herein, G. G. Thomas was the owner of and conducting a private bank in the city of Des Moines, known as the Capitol Hill Bank. He was also president of a corporation apparently run in connection therewith, known as the Capitol Securities Company. On the 29th day of April, 1919^ claimant, James F. Moran, sold to Thomas three pieces of property in the city of Des Moines, which will be designated by the numbers, respectively, 1, 2, and 3. On the same date he conveyed the same to Thomas for a total consideration of $4,500, which was paid by Thomas by delivering to him ten instruments, identical in form except as to due dates, the following being one of said instruments:

“United States of America

■ “State of Iowa

“No. 1037 $450.00

“The Capitol Hill Bank of Des Moines, Iowa, for value received, hereby promises to pay - James F. Moran, of Des Moines, Iowa, or to the registered holder hereof, the principal sum -of Four Hundred Fifty Dollars on-the first day of May, 1925, and to pay interest on the said principal sum at the rate of four per centum per annum until paid, payable semi-annually on the first days of May and November in each year. Both principal and interest shall be payable in United States gold coin of the present standard of value at the banking house of the Capitol Hill Bank.

’ “Inasmuch as the proceeds received' from the sale of this and like bonds are invested in first mortgages or other authorized securities which usually aire made out for a long period of time, it is agreed that the maturity date of this bond is the essence of this contract. ' .....

“This bond is not negotiable, and is transferable on the books of the Capitol Hill Bank by the holder hereof in person or by attorney upon surrender ‘of this bond properly endorsed.

“In witness whereof, the Capitol Hill Bank, by its cashier, signed and delivered this bond and has caused its seal to be .hereunto affixed in the city of Des Moines, Iowa, this 29th day. of April, 1919. ■

“[Signed] G. G. Thomas, Cashier.”

. Five of these instruments have been paid, and. the claim,of appellant is bottomed on the remaining five.- • ■ :■ -

. On May 26, 1924, Thomas made an assignment for the benefit, of creditors, naming A. B. Elliott as assignee therein, and. Moran filed in. the assignment proceedings a petition -of intervention and amendment-thereto, setting up the-foregoing facts and .asking that a vendor’s lien be.established, and that his claim be allowed by said assignee as a preferred claim. Later, he amended his claim by including certain allegations of false and fraudulent representations made by -Thomas- to -induce him to accept the aforesaid written instrument on which his claim is based. The case was sent.to.the referee; and- the-finding of the referee approved by the lower court. In the finding of the referee .it is stated‘

“This claimant originally filed.his claim on the doctrine of a vendor’s lien, which position has been tacitly withdrawn and the 'claim based upon the alleged fraud of :G.. G. Thomas..’ f ■

- ’Notwithstanding this finding by the referee,, the claimant insists upon-and argues the. question of vendor’s lien.

Property.No. l-.was sold by Thomas to..one,.McQuiston, and. contract was put up with, one .Blanchard, as trustee. Later.,- this contract, was sold to the. Capitol. Securities. Company,..and.deed made therefor.. It is apparent, therefore, from. the.record that the assignee herein is. correct in his statement-when, he testifies-that he received.nothing from the McQuiston property.

. Property No. 2 was sold to one Blanchard, and the deed therefor put up with one Emerson, as trustee. This transaction seems to be something, of the following -nature: The Capitol Hill Bank had issued to Emerson certain bonds or certificates in the ■ sum of $14,000, which were and-are still unpaid. . To. secure this indebtedness, the .Capitol Hill Bank placed in .the hands of one Harder, as trustee, .certain .-real estate- contracts ;and deeds-(among which was the.contract with Blanchard)and after liis appointment as assignee, Elliott, under order of the court,- settled this claim with . Emerson by turning over all the property covered by the. agreement with .Emerson- and the trustee to. Emerson, and the property thus conveyed or thus transferred . was insufficient to satisfy. Emerson's; .claim, by the amount of $2,281.79, which amount was ordered by the court to be allowed - as a general -creditor's claim -in favor of-the said Emerson -It is apparent, therefore, that, as the assignee, testified, he received nothing out of the .proceeds of this'particular piece of. property.

As.to Property No. 3, when Thomas acquired the title to this .piece-of property, he .placed a mortgage thereon for $1,000. He then sold the property to one Lanfield, and at the time the assignee took possession of the property,There was $944 still,due-on this contract. The Lanfield contract is not set out in- the record, nor are -the details thereof-referred to. The holder- of-the $1,000 mortgage was urging dts payment,, and, by arrange-., ment, the $944 still due .was applied in satisfaction- of the said; $1,000 mortgage,- thus releasing Thomas's liability on the, mortgage. It is quite apparent that this - property was not very valuable, and, if Thomas, in.fact contracted to convey, this property to Lanfield with a clear title, he would have To pay the $1,000. mortgage. : We. see:-no Barm in. .the method-, by. which .the mortgage was. disposed of. ....

. All of these transactions seem to have been, in good faith,, and there, is nothing in the record to show- that there, was any . sacrifice of this property. None of the purchasers of these three pieces of property are parties to this litigation. The whole record shows, and confirms the assignee in his statement, that he received nothing whatever from any of these three pieces of property. Whether or not the claimant would have a vendor's lien, as against these purchasers, iS not before us for consideration, a~id could not be; because, as stated, none of the purchasers are-in court. So long as, under the record, none of the proceeds of these pieces of property canie into the hands of the assignee, we are not cOncerned ~vith the question of vendor's lien. There is no claim that the assigñec herein breached his duty as an officer of the court in sacrificing any property that came into his hands, nor is he charged with any dereiiction of duty in hi~sbandin~ the assets of the estate.

II. It is insisted on the part of claimant that he was induced to accept these instruments by reason of certain false and fraudulent repre~entation~, and therefore that he is entitled to have his claim established against said bank as a preferred claim

In the• first place, claimaut had. no dealing or transaction whatever with the bank in question. His tramsact~on was wholly with Thrnnas, as a private individual, aiid he was paid for his property with teii Instruments, a copy of which is hereinbefore set Out. Upon a revie'~ of this instrument, it is our epinien that the same is, in effect, the promissory note of the banlc to pay the amount therein specified. It is not a certificate of deposit. There is nothing in the instrument itself dr in the transaction, as related i~i the evidence, in any form or manner that would tend to lead one to the conclusion that, when claimant became poss~ssed of these instruments, he was a depositor in said bank. If we pass the question as to whether the statutory provisions as to preference have to do with private banks, but assmne that they hav~, the statutes uader which claimant seeks to have his claim allowed he~ein, èreating preferences, only apply to perSons Who are depositors in a bank, and not to genei~al creditors. As a matter of fact, claimant herein deposited nothing in said bank, and therefore we can see no reason why he should be classed as a depositor. The• referee found, and the district court appro~ved the finding of the referee, that Moran's claim, as filed in the assignment, should' be allowed, and given status as that of a general creditor.

In closing, attention is called to the fact that.Section 9239, Code- of 1924, and the other sections correlated thereto, as to how the proceeds of a-bank shall be restricted, "giving-prefeirence in payment to depositors, ’ ’ have • nothing whatever-to do with private hanks, as, in such an institution, there seems, to be no preference among creditors, except in cases of trust funds or prior incumbrance ór; lien.

With this finding we agree, and therefore find no error in the ruling of the district court. — Affirmed. ' • ■ ■ •

De Grape, C. J., and Evans.and Morling, JJ., concur.