Court Opinion

ID: 7004616
Source: CourtListenerOpinion
Date Created: 2022-07-24 03:48:12.691046+00
Date Added: 2024-06-11T16:10:01.980685
License: Public Domain

Mr. Justice Baker delivered the opinion of the court. The only direction that Marr gave to the garnishees as to the disposition of the proceeds.of the sale of his cattle was, that they should remit the same to the Corwith bank. This left it to fhe garnishees to determine how, by what means, and through what agencies such proceeds should be remitted. It does not appear that they had been paid for Marr’s cattle when at 11:50 a. m. June 13, they deposited in the Live Stock Bank their check for $16,247.50, payable in effect to the bank, but only that this check “ covered moneys due and owing by Clay, Robinson & Co. (the garnishees) for the sales of cattle made June 13.” We will assume without expressly deciding the point, that the Continental Bank, from the mere fact that it was the Chicago correspondent of the Corwith bank, was authorized to receive money for the Corwith bank either for remittance or credit. But with such assumption can it be said that the delivery of this check with the accompanying directions and requests to the Live Stock Bank effected or amounted to a transfer of the proceeds of the sale of Marr’s cattle to the Corwith bank? Suppose that in place of employing the agency of the Live Stock Bank in effecting the remittance of the proceeds of Marr’s cattle to the Corwith bank, the garnishees had drawn a check for $2,180.46, the amount of such proceeds, on the Live Stock Bank, and sent their cashier or messenger to that bank with directions therewith to purchase a draft in favor of the Continental Bank for that sum and take such draft to the Continental Bank and have that bank place the amount thereof to the credit of the Corwith bank; could anyone doubt that up to the time of the delivery of the draft in favor of the Continental Bank to that bank the fund arising from the sale of Marr’s cattle would remain in the possession and under the control of the garnishees ? In the case under consideration, in place of the plan above supposed, the garnishees deposited with the Live Stock Bank their check for $16,247.87, for which they requested that bank to draw, and the bank did draw three drafts amounting in the aggregate to that sum, one of which for $5,187.45 was in favor of the Continental Bank, and this draft the garnishees requested the Live Stock Bank to send to the Continental Bank with a request in writing, signed Andrew Marr, by the garnishees as his agents, to the Continental Bank to place $2,180.46 of the proceeds of said draft to the credit of the Corwith bank. The deposit by the garnishees of their check for $16,247.87 payable “ to deposit ” in the Live Stock Bank did not transfer the funds arising from the sale of Marr’s cattle to the Live Stock Bank, for that check was used to buy drafts in favor of certain banks for the amount of the check, and the drafts so purchased took the place of the check. Nor did the mere drawing by the Live Stock Bank in favor of the Continental Bank of the draft for $5,187.45 transfer money or credits to that amount to the Continental Bank from the Live Stock Bank or from the garnishees through the Live Stock Bank. Such transfer was effected only when the draft in favor of the Continental Bank passed from the possession and control of the Live Stock Bank, and that did not occur until ten o’clock of the morning of June 15, when the messenger of the Live Stock Bank deliyered said draft with the accompanying requests to the Continental Bank. Up to that time the fund arising from the sale of Harr’s cattle remained due from or in the possession, or under the control of the garnishees, for the possession of the Live Stock Bank, the agent of the garnishees, was the possession of the garnishees. It is no doubt true that when at the time of the service of the writ upon a garnishee, the latter owes the debtor money or has property, effects, choses in action or credits of the debtor in his possession, and without fault or neglect on his part, the money is paid, or property delivered to the debtor by an agent of the garnishee, such payment or transfer is valid as against the garnishing plaintiff. But the. garnishee is bound to use reasonable diligence to prevent such payment by his agent and if he fails to do so, he will be held liable. In Farrell v. Pearson, 26 Ill. 463, Farrell was served with garnishee process in Chicago and it was claimed that he had in his possession at Tamaroa, in Perry county, property belonging to the debtors Clark and Study. This property Farrell claimed xvas delivered to the debtors by the clerk of Farrell before such clerk knew that Farrell had been served with process. The court gave this instruction for the plaintiffs: “If the jury believe from the evidence that at the time of the service of process of garnishment on Farrell in Chicago, he was in possession of property belonging to the defendants Clark and Study, that such property was then at Tamaroa, in Perry county, Illinois, and was subsequent to such service redelivered .to the defendants Clark and Study, by the agent of Farrell, but that such redelivery did not take place until the lapse of more than a reasonable time from the service of such garnishee in which notice thereof might have been communicated by Farrell to his agent at Tamaroa, then the jury should find for the plaintiffs,” etc. There was a verdict and judgment for the plaintiffs and the garnishee appealed. The judgment was affirmed and in the opinion Judge Breese said, “ The instructions given by the court were all proper.” To the same effect are Bates v. C., H. & St. P. R. R. Co., 60 Wis. 296; Spooner v. Rowland, 4 Allen, 485; Bank of Montreal v. Clark, 108 Ill. App. 163. In the latter case the payment could not have been prevented by notice sent by mail after the garnishee was served but might have been prevented by telegraph, and the court held that the garnishee did not use reasonable diligence and was therefore liable. The writ of attachment in this case was served upon the garnishees before twelve o’clock noon of June 14, more than two hours before the draft on the Continental Bank was drawn by the Live Stock Bank and more than twenty-two hours before that draft passed from the possession of the Live Stock Bank by its delivery by the messenger of that bank to the Continental Bank. The Live Stock Bank and the Stock Yards office of the garnishees ivere in the same building and it is stated in the stipulation of facts that the garnishees after the service of the writ “ made no effort to stop said money and proceeds from getting out of the possession of said National Live Stock Bank, and into possession and control of the defendant Marr.” No question as to rights of third persons to the funds is involved in this case for it is stipulated that the Continental Bank, on June 15, remitted said $2,180.46 to the Corwith bank and that the Corwith bank on June 16, placed the same to the credit of Marr. In our opinion the garnishees did not exercise reasonable diligence to prevent the transfer of said fund by their agent to the debtor, Ivlarr, after they were served with process, but were guilty of negligence in that behalf; and it was through and by reason of this negligence that the proceeds of the sale of Marr’s cat-tie which were in their possession, subject to garnishment when the writ was served upon them, were afterwards paid or transferred to the debtor; and therefore the finding and judgment of the Circuit Court should have been against and not in favor of the garnishees. The judgment will be reversed, but as the record contains no evidence upon which we can here enter a judgment against Marr, the cause must be remanded. Reverml and remanded.