State ex rel. Mechanics-American National Bank v. Sturgis , 276 Mo. 559 ( 1919 )

FARIS, J.

This is an original proceeding by certiorari, whereby relator seeks to quash the record of the Springfield Court of Appeals in the case of Mechanics-American National Bank, Appellant, against M. Helmbacher, Respondent, for that, as it is averred, the opinion filed therein by the Court of Appeals is in certain behalves in conflict with the last previous rulings of this court.

The facts in the above case (which for brevity we shall call the Helmbacher case), as these facts were found by the learned Court of Appeals, are thus set fourth in the opinion of that court:

“This is a suit on a promissory note for $1,500, dated May 28, 1915, payable on or before January 1, 1916, interest at eight per cent. This note is as follows:

“ ‘$1,500. Oran, Co., May 28, 1915. “ ‘On or before Jan. 1st, 1916 after date, we promise to pay to the order of C. D. West, trustee, fifteen hundred 00/100 dollars, for value received, negotiable and payable without defalcation or discount, and with interest from date at the rate of eight per cent per annum, and if the interest be not paid annually to become as principal and bear the same rate of interest until paid. (Signed) Peter Dirnberger. M. Helmbaeher.

“ ‘Bk. of “ ‘t Oran, Mo.

“ ‘Due Jan. 1st, 1916.’

“Indorsed on back: ‘C. D. West, Trustee.’

“Upon trial, before the court and a jury, judgment below was for the defendant, and plaintiff appealed.

“The payee of the note as originally written was C. D. West. Plaintiff claims to be the holder in due course, for value, and without notice of any infirmities. The defense is that since the signing and delivery of said note it has been materially altered, mutilated, and changed in this manner: (1) That the relation of the parties to the instrument has been materially changed by inserting after the name of the payee, 0. D. West, the word ‘trustee’ without the knowledge or consent of the defendant; (2) that the end of the note has been cut off, thereby cutting off “Payable a’ in said note, and inserting ‘Bk of’ over ‘Oran, Mo.,’ and it is claimed this changed the place of payment; (3) and that some ■ memorandum or writing has been cut off the end of said note, which memorandum or writing rendered said note non-negotiable; (4) that the note was executed on condition that certain merchandise and other property, including some real estate, assigned by Dirnberger to C. D. West as trustee for the benefit of creditors, would be returned to Dirnberger, and that this property was not returned, and that there was therefore no consideration for the note.

“It seems that Dirnberger, who had been conducting a grocery store, had not prospered, and was being pressed by creditors. In this situation be made an assignment, and C. D. West, adjuster for tbe Credit Men’s Association of St. Louis, was made tbe assignee. Tbe defendant signed the note with Dirnberger as accommodation maker. Tbe note was filled out by defendant at bis residence on a blank form taken from bis blank note book at which time it was signed by Dirnberger and defendant, and was delivered to Dirnberger. ' A blank from defendant’s note book was introduced at tbe trial, and by comparison tbe portion cut off clearly appears from tbe photographic copies in tbe record. Shortly thereafter Dirnberger delivered tbe note to H. E. Robocker, credit manager of Adam Roth Grocery Company. Robocker soon thereafter delivered tbe note to West, who on June 5, 1915, discounted the same at plaintiff bank, and tbe proceeds were deposited to bis credit as trustee for Dirnberger, and paid out to the creditors of Dirnberger. Robocker testified that when be received. tbe note from Dirnberger it was in tbe same condition as at tbe trial, except tbe £Bk. of’ was not on it, and it did not then, of course, bear tbe endorsement of C. D. West, trustee. C. L. Allen, assistant cashier of plaintiff bank, testified that when be discounted the note for bis bank it was in tbe same condition as at tbe trial. West testified that be did not think tbe ‘Bk of’ was written on tbe note when be received it from Robocker, but that tbe word ‘trustee’ was in tbe note when be received it. It is conceded that tbe word ‘trustee’ was written, and that tbe end of tbe note was cut off and ‘Bk. of’ inserted, after defendant signed the note, and all this without his knowledge or consent. Two questions arise upon this record: (1) Is plaintiff a holder in due course? (2) Did the addition of ‘trustee’ and ‘Bk of’ and cutting off ‘Payable a’ under tbe circumstances so change the relation of tbe parties and tbe place of payment as to amount to a material alteration?”

After setting out tbe facts of tbe case thus, tbe Court of Appeals proceeded to apply to these facts tbe provisions of tbe Negotiable Instrument Law, [Laws 1905, pp. 243, et seq.] Having so applied its construction of divers sections (Secs. 10030, 10094, .10095, and 10022, E. S. 1909) thereof to what it found to be the facts of the Helmbacher case, it held: (a) that plaintiff bank was. not a “holder in due course,” and (b) that (1) the addition of the word “trustee” following the name of the payee, (2) the addition of the words “Bk of,” designating the place of payment, in conjunction with (3) the cutting off of some inch or more from one end of the note, which destroyed the words “payable at,” changed the place of payment and constituted such “material alterations” thereof as to prevent plaintiff’s recovery as against an accommodation maker.

In reaching the conclusion first supra, the Court of Appeals felt constrained to construe Section 10022, Eevised Statutes 1909, in respect of what constitutes a' “holder in due course;” and it based its opinion that the changes of the note in the modes stated constituted “material alterations,” upon its construction of Section 10094 and 10095, Eevised Statutes 1909.

af^Note™ I. Eelator calls our attention to a number of cases ruled by us, which it ably and strenously urges are in conflict with the rulings of the Court of Appeals upon the points supra. Touching all of these cases except one (American National Bank v. Bangs, 42 Mo. 450), general reference will be made hereinafter, since in the view we are constrained to take of the case all these cases, with the exception noted, may be discussed and harmonized, or distinguished together. The facts in the Bangs case, supra, were briefly these: Bangs and another, one Deady,.seemingly partners, made a note to “Fritsch & Simonton, New York,” for one thousand dollars, dated October 10, 1866, and due three months after date.The payee assigned and endorsed this note before maturity to the plaintiff therein, which being compelled to sue thereon, lost below and brought the case here by writ of error, Dehors the body of said note, and pccupying in that behalf a position in all respects similar to that of the words “payable at” upon the note in the Helmbaeher case, there was printed the word “Due,” followed by a blank, or blank space. In this blank, after the making and delivery of the note, there was written the words “at Goodyear, Bros. & Durand’s, New York, Jan. 10-13,” thus making this line to read “Due at Goodyear, Bros. & Durand’s, New York, Jan. 10-13.” Upon this state of facts it was successfully urged nisi ■ and contended here, that the note was void as against the makers. This court upon that point said:

“The question, then, is, whether these words attached to the foot of the instrument are to be taken as a part of it or only a private' memorandum, which can in no way affect the liability of the makers. It will be found upon an examination of the authorities upon this question that where such words are not incorporated in the body of the contract itself, nor in any manner annexed to the instrument by the maker for the purpose of fixing a place of payment, they are to be taken as a mere memorandom, and therefore immaterial. . . . The memorandum in this case does not increase or vary in any respect the liability of the defendants, and therefore presents no obstacle to the recovery of the plaintiff. It is admitted that in cases where there was a contest between the holder and indorser, such an addition or memorandum, without the knowledge and consent of the latter, has been held sufficient to discharge him. But as to the makers themselves, the question is altogether different. This opinion has proceeded upon the idea that the words in question were simply a memorandum made at the bottom of the note after its execution, and not intended to be a part of the contract itself. Such appears to be the fact, so far as the case is presented here by the record, but we will not assume it to be so for the purpose of entering up judgment in this court.”

In other words, this court ruled that if such a memorandum was only intended to be a mere notation for the convenience of the holder in collecting the note, and not intended to be a part of the contract itself, the addition of the memorandum did not constitute a material alteration as between the indorsee and the maker. It was intimated that this question of intention could be cleared up by testimony upon another trial; for the court expressly refused to foreclose it by a judgment here, but sent the case back to be retried.

So far as counsel upon either side have pointed out and so far as we have been able to find, the Bangs case is the last previous ruling upon the materiality of a memorandum such as was made in that case and in the Helmbacher case. The rule announced in the Bangs ease seems so consonant with reason and good sense, that we ought not to go back fifty years to abrogate it; a fortiori at a time when in ■ effect it is urged, that the high cost of paper has driven those dealing in negotiable instruments to the custom of making such memoranda— as place or person of convenient collection, and the computation of interest — upon the very faces of the instruments themselves. But reading the whole opinion of the Court of Appeals in the Helmbacher case, we do not get the view that the learned court held that such a pencil memorandum as “Bk. of” which was put on as a mere notation of the name of a convenient collecting agent, was of itself alone sufficient to constitute a “material alteration” of the note. Rather do we incline to the view that what was meant was that the shearing off of the words “payable at,” taken in connection with the addition of the words “Bk. of,” together constituted a material alteration within the eaning of Section 10095, Revised Statutes 1909. There are, it is true, some expressions in the learned opinion which considered alone and without the whole context might on first blush incline us to a different view. But in summing up toward the close of the opinion the Court of Appeals says: “It appears that Dirnberger added the word “Trustee” after defendant had signed the note, and without defendant’s knowledge and consent, as the word trustee is in Dirnberger’s handwriting. . By elimination it would appear that Dirnberger cut off the end of the note and thereby destroyed or removed the place of payment.” (Italics ours.) For the latter reason alone, we think this contention of relator should be disallowed.

„ statute. II. Relator urges upon our attention a number of other cases which it contends are in conflict with other views held in the Helmbacher case. But the difficulty we meet in agreeing with the latter contention of relator arises from the fact, foreshadowed above, that the Court of Appeals ruled the points alleged to conflict with our prior decisions pursuant wholly to its construction of certain sections of the Negotiable Instrument Law. This law was not enacted till 1905 (Laws 1905, pp. 243, et seq); all of the cases called to our attention were ruled long prior to the latter date. Neither the exhaustive research of learned counsel for relator, nor our own somewhat careful examination of the authorities, has found for us any case wherein wre have construed the particular sections- of the Negotiable Instrument Law upon which the questions turned, which were held in judgment in the Helmbacher case. . It is persuasive that the learned Court of Appeals, as it frankly confesses, was likewise unable to find any case wherein any appellate court in this State had theretofore construed said Sections 10094 and 10095, Revised Statutes 1909. [Mechanic’s American National Bank v. Helmbacher, 199 Mo. App. l. c. 178.] Since then, the points raised upon the record before the Court of Appeals in the Helmbacher case turned upon new and theretofore unconstrued statutes, they were matters of first impression in this State and no conflict with any prior decision of ours was possible. The Court of Appeals had the right to construe the above sections of the Negotiable Instrument Law in such wise as it saw fit and to say authoritatively (till after we shall have ruled the precise point, or principle) what those sections mean, and to what state of facts they are applicable, Indeed, as we have heretofore had occasion to suggest, they even had the right to construe these sections erroneously; which right to decide wrong is inherent in all courts, as a casual glance at any table of overruled cases will make manifest. Our own prior decisions, urged upon us as conflicting with the Helmbaeher case, followed the Law Merchant and not the subsequently enacted Negotiable Instrument Law. Eegardless, therefore, of whether there is or is not a conflict, and whether the Court of Appeals is or is not right (touching which ■$-e do not rule), statutes have intervened and we have no authority to interfere. For these reasons we are compelled to disallow this contention of relator.

Facts.ded III. It is urged, however, by relator that the statement in the opinion of the Court of Appeals that “it is conceded that the word ‘trustee’ was written and that the end of the note was cut off and ‘Bk. of’ inserted, after defendant signed the note and all this without his knowledge or consent,” is in conflict with the rule announced in Gannon v. Gas Light Co., 145 Mo. l. c. 516-517, where it was said by this court:

“The plaintiff was entitled to have the jury determine the credibility of the testimony offered, even though she offered nothing to contradict that offered in behalf of defendant, and it is not to bé assumed by the court as a matter of law that evidence is true, satisfactory or convincing to 'the body called ■ upon to hear it, from the mere fact that no one by words contradicts what has been uttered.”

While we do not find that plaintiff, or its learned counsel, did make the concession stated, but gather on the contrary from other parts of the opinion that the fact whether such alleged alterations were made before or after the instrument was signed by Helmbacher, was denied throughout; it is yet apparent from other parts of the opinion that the use of the word “conceded” was a mere slip of the pen. For elsewhere in the course of the opinion it is said: “The note sued on by the most casual inspection shows that the words ‘trustee’ and ‘Bk. of’ were written in this note in a different handwriting and in different ink to that in which the balance of the note was written [‘Bk. of’ was in pencil] and the evidence shows conclusively that these additions were made at a different time to that when the balance of the note was written.” Again it is said in the opinion: “It appears that Dirnberger added the word ‘trustee’ after defendant had signed the note and without the defendant’s knowledge or consent, as the word ‘trustee’ in the face of the note is in Dirnberger’s handwriting.”

We do not think that the finding and statement of the Court of Appeals that the evidence showed “conclusively,” or that it was “conceded” that the changes alleged to have been made in the note were so made after Helmbacher signed it, are in conflict with the rule quoted above from the Gannon-Gas Light case. In the Gannon case it was strenously contended here that the trial court erred in not taking the case from the jury for that the evidence offered by defendant explained conclusively when and how the electrically charged wire fell, and that this explanation irrefutably negatived defendant’s liability.' This court held that such refusal to sustain the demurrer offered to the evidence upon the whole case was not error, because the plaintiff had the right to take the jury’s finding upon the credibility of the evidence offered by the defendant in explanation of how and when the wire fell. In the Helmbaeher case the defendant testified that the note was not cut off nor was the word “trustee” written therein when he signed it. No one, it seems, categorically denied this testimony upon the trial. Relator correctly insists that under the rule in the Gannon case the plaintiff had the right to have the jury pass upon the credibility of defendant’s testimony. Unquestionably, the Gannon case holds this. But the learned Court of Appeals was dealing with a condition and not a theory. The jury had passed upon the credibility of Helmbacher’s testimony; had seen fit to believe it, and the trial court had in overruling the motion for a new trial set the seal of his approval upon the finding of the' jury upon that point. In considering whether it was, or was not, a fact that the note was unchanged when Helmbacher signed it, the Court of Appeals had the right to impute absolute verity to the jury’s finding upon this question and to say that it was conclusively proven that the changes were made in the note after Helmbacher signed it. For all of the purposes of review in the appellate court, the finding of a jury in a case at law, wherein such finding is bottomed on substantial evidence, is “conclusive” and is just as binding upon the appellate court as any “conceded” fact would be. [In re Lankford’s Estate, 272 Mo. 1.] The Gannon case dealt with a theory advanced by the appellant therein; the Helmbacher dealt with a condition brought about by the finding of the jury, and the approval of that finding by the trial court. We think this contention of conflict is therefore untenable.

Decisions. IV. In conclusion, we may add that it is, so far as concerns relator, wholly beside the question to urge text-book law and the decisions of sister states in a case brought up to us from a Court of Appeals by certiorari for quashal. Unless we have prior the filing of the opinion by a Court of Ap-

peals ruled in conflict with the opinion of which quashal is sought, we have no constitutional power to interfere with the decisions of the Courts of Appeals, moving within their constitutional orbits of jurisdiction, whether such decisions be right or wrong. Until we have ruled upon the question, or until another Court of Appeals has upon a given point held a different view and the case has been certified up to us, the errors of any judge of a Court of Appeals, however grievous are so far as this court is concerned, political questions solely. [Majestic Mfg. Co. v. Reynolds, 186 S. W. 1072.] Of course, as has often happened, if there is in fact a conflict and the Court of Appeals is right upon the point and we are wrong, text-book law and rulings from other jurisrictions, called to our attention by the respondent, may be of value in aiding us to correct our own errors.

We conclude that our writ herein was improvidently issued and ought to be quashed. Let it be so ordered.

All of the judges concur; Bond, G. J., in result.