Stotts City Bank v. Miller Lumber Co. ( 1903 )

REYBURN, J.

Plaintiff, a Missouri banking corporation, brought this action against defendant, a Missouri business corporation, on two checks, both dated Mt. Vernon, Missouri, January, 1901, one for $400, bearing date the eleventh and one for $325, bearing date the fourteenth of that month, both payable to plaintiff or order upon the Farmers -’ Bank of Mount Vernon, purporting to be executed by defendant, by C. W. O ’Kelley, and upon which instruments plaintiff averred it paid defendant the respective sums of money specified on the face of each, but on presentation and demand for payment to the Farmers’ Bank they were dishonored.

The answer was a general denial verified by oath of the president of defendant and, after trial before the court, a finding for defendant was orally announced, whereupon before entry of such finding and judgment, the plaintiff made parol request for a written finding of the facts, and the trial judge entered upon his docket, *lverdict and judgment - for defendant,” and subsequently on the same day filed a finding in writing as follows:

“The court finds that the defendant company was a corporation, buying and selling lumber at Aurora, Mt. Vernon and Miller, Missouri, and that C. W. O’Kelley was tlae agent at the yard at Mt. Vernon, and had been since the establishment of the yard there in 1891; that said O’Kelley had been issuing checks on the Mount Vernon bank, payable to the Stotts City Rank for a considerable length of time, and had been depositing the proceeds of said check to his individual credit in the Stotts City Bank; that said O’Kelley issued the cheeks in question; that the money so deposited in the Stotts City Bank had been checked out to the T. A. Miller Lumber Company and that said O’Kelley had no account with the Farmers ’ Bank; that defendant had no notice or knowledge of 0’Kelley’s transactions with the Stotts City Bank, and had no authority either expressed or implied to bind defendant. That under the law, and facts, plaintiff can not recover.”

'Which finding plaintiff assailed by exceptions unsuccessfully and its motion for new trial was also overruled.

The testimony disclosed that defendant was engaged in business in Lawrence county, with its places of business at various points therein, including a yard at Mount Vernon, where the Farmers’ Bank, upon which the checks in suit were drawn, was located and a,t which bank defendant had an account. 0 ’Kelley had been agent of defendant for ten years preceding January, 1901, and had transacted all business at the Farmers’ Bank, signing the defendant’s name to all checks thereon, with the knowledge of T. A. Miller, its manager and president, wlm frequently completed such check, which had been signed in blank in defendant’s name by 0’Kelley, and who received checks drawn thereon signed by 0 ’Kelley in defendant’s name for remittances of the business of defendant and deposited them in the bank at Aurora.

In October, 1900, O ’Kelley opened an account in his individual name with plaintiff at Stotts City, and the checks here involved were deposited by O’Kelley with plaintiff and their amount placed to his credit and they were forwarded by it to St. Louis in due course of collection in the same manner as numerous other checks drawn in the same form had been deposited,- credited, and collected on other occasions, and the funds of this individual account were drawn by 0 ’Kelley and transferred to the account in defendant’s name kept by him at Mount Vernon. The banking business conducted by defendant with the Farmers ’ Bank, during the year 1900 was $61,968.13, and the volume of such business transacted by O’Kelley between the plaintiff’s bank and the bank at Mount Vernon, by the transmission of funds from one account to the other by O’Kelley through checks drawn by him alternately in his own name and in the name of the defendant was extensive and substantial. The checks-drawn on plaintiff to defendant’s credit at the bank at Mt. Vernon during the year 1900, were 124 representing $45,970, and during January, 1901, the amount represented by checks drawn upon the bank in Mount Vernon in defendant’s name by O’Kelley in favor of plaintiff, appears to have been less than $500, while the amount drawn out of plaintiff, and deposited to the credit of defendant at the Farmers’ Bank at Mount Vernon by O ’Kelley aggregated $4,804.56.

On January 15, 1901, Miller first learned that O’Kelley was checking against the account kept in defendant’s name at Mount Vernon and transferring funds therefrom to his private account with plaintiff, and an investigation ensued resulting in the discharge of O ’Kelley from defendant’s employ the following day. Miller and plaintiff’s cashier differ regarding the conversations between them by telephone and face to face, concerning O’Kelley’s account with plaintiff, Miller’s' version being to the effect that at first, believing that $40 would be sufficient to honor an unpaid check, he consented to have that amount charged against him or defendant for such purpose, while plaintiff’s cashier insists that Miller agreed to make good also the checks in suit. Be that fact as it may, Miller obtained 0’Kelley’s pass book of the account with plaintiff, and had it balanced and received the cancelled checks accompanying it.

Respondent urges that appellant’s request for special findings, under the provisions of section 695 of the Revised Statutes, was too late, being addressed to the court after the latter had announced its finding for defendant, but as in response bo this application of plaintiff, the court made and filed on the same day its written finding, the latter, in legal contemplation, was at the rendition of the judgment and in compliance with the purposes of the statute. Loewen v. Forsee, 137 Mo. l. c. 38. And answering appellant’s criticism of the court’s finding above quoted, it was sufficient under the statute, as on each material issue on which it appears to be silent, it may be regarded as a finding against the party holding the affirmative or burden of proof. Cochran v. Thomas, 131 Mo. l. c. 278. The rule is recognized that where a special finding has been made by the trial court, pursuant to the above statutory provision, the appellate court will not review the finding of the lower court on questions- of fact in actions of law, and where there is evidence in the record tending to support such findings, they are incontrovertible on appeal. K. C., M. & B. R. R. v. Railway Co., 151 Mo. l. c. 389; Lumber Co. v. Mining Co., 78 Mo. App. l. c. 681. Under such conditions the questions open for review are errors apparent upon the face of the record and the conclusions of law. Freeman v. Moffitt, 119 Mo. l. c. 294; Sutter v. Raeder, 149 Mo. l. c. 307. The special finding herein amounted to no more and was in .effect a general declaration that, under the pleadings and evidence, the plaintiff was not entitled to recover.

Thebestimony presented no disputed issue of fact, except as already narrated, respecting the scope of the assurances to make good outstanding checks uttered by defendant’s president. The' latter conceded .that O’Kelley was vested with full authority to draw checks against the account maintained by O’Kelley in the name of defendant, with the Farmers’ Bank at Mount Vernon, but denied his right to apply the money of defendant to his own use. As defendant hád constituted O’Kelley its agent and empowered him to execute checks in its name, no responsibility was imposed by law upon those dealing with O’Kelley in the usual course of business and in good faith for the proper application of funds belonging to his principal. If such duty had been created, or existed, it would have received full satisfaction by the transfer to defendant’s eredit of the proceeds of the checks in suit to defendant’s account at Mount Vernon. There is no. proof produced tending to show that any of the money deposited by O’Kelley in his own name with plaintiff was ever diverted or otherwise appropriated than for the benefit .of defendant, indeed it appears that all the funds of this individual account, including the credits of the checks in dispute, were from time to time transferred to the account of defendant.

Defendant is precluded from affirming and ratifying O’Kelley’s actions in drawing all other checks against the .account at Mount Vernon, and excepting and repudiating the checks held by plaintiff, payment of which is sought to be herein enforced. The defendant, after full knowledge of all the circumstances, retained the fruits of the transactions herein sought to be evaded as unauthorized, and it can not be heard to exclude from the plenary power it conferred upon O’Kelley, his conduct in executing these unpaid checks in the hands of an innocent holder for full value. First National Bank v. Badger Lumber Co., 54 Mo. App. 327, also reported again in 60 Mo. App. 255.

The defendant’s testimony failed to reveal any' legal justification for non-payment of the obligations created by the checks held by plaintiff, and the cause is reversed and remanded.

Bland, P. J., and Goode, J., concur.