Court Opinion

ID: 6659982
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:01:02.475246+00
Date Added: 2024-06-11T16:00:07.501741
License: Public Domain

Sedgwick, J.,
dissenting.
1. When Walker took this note, as between himself and the Bank of Ong, the note clearly belonged to Walker, and not to the Bank of Ong. He had been instructed by the directors to take McCann’s note for the balance he *230owed the bank. McCann owed the bank only $500. Contrary to those instructions, and without the knowledge or consent of the bank, Walker took McCann’s note for 15 times that amount, and gave McCann an additional credit for the full amount. This was in violation of the direct and positive, instructions of the bank. He never had authority to take a note from McCann for anything more than McCann owed the bank upon the books. His action in giving McCann credit for the amount of the note for his own purposes, and without the knowledge or consent of any of the directors, would not change the right of the thing as between him and the Bank of Ong. Walker was named as payee in the note in his personal, individual capacity, and not as cashier. As the payee in the note, his unrestrictéd indorsement was on the back. Therefore the form of the contract, as well as the conduct of Walker, would enable the Bank of Ong to insist that as between Walker and the bank, the note was the property of Walker, and not of the bank. His letter transmitting the note for sale declares himself to be the owner of the note, and would certainly estop him to deny that fact in any controversy between himself and the Bank of Ong. Certainly, if the controversy was between Walker and the Bank of Ong, the note belonged to Walker, and he cannot claim that it belonged to the Bank of Ong.
2. The question in this case, therefore, is whether the St. Joseph bank had notice of the real ownership of the note, or whether that bank had just grounds to believe, and did believe, that the note was the property of the Ong bank, and that when it was negotiating with Walker .it was negotiating with the Bank of Ong. Without doubt, the decision of this case depends upon that question. The reasons for saying that the St. Joseph bank understood that it was dealing with the Ong bank, and not with Walker personally, appear to be two: First, that the letter transferring the note was written upon the stationery of the bank; second, that the letter was signed “J, O. Walker, Cashier.” I think it will not be considered that *231the fact that the letter was written on the stationery of the hank is entitled to very much consideration. Walker undoubtedly did use the stationery of the bank in transacting his personal and individual business. Everybody would expect that. Is the fact that the letter was signed •‘J. O. Walker, Cashier” sufficient to justify the bank in concluding that it was drilling with the Ong bank, and in concluding. that the note was the property of the bank, and not the property of Walker? If we remember that the payee named in the note was J. O. Walker, and that it Avas indorsed “J. O. Walker,” and nothing on the note indicated that anyone else was interested in it, and then read the letter in which the note Avas transmitted to the St. Joseph bank, it Avould seem that there is no difficulty in determining avIiether the St. Joseph bank supposed that the note belonged to the Ong bank, or supposed that it belonged to Walker, and that they were dealing with Walker personally. The letter seems to me to be as plain and jiositive notification that the note did not belong to the bank, and Avas the property of Walker personally as our language could make it. The pivotal sentence in the letter is, “If you can handle this note for me (J. O. Walker), you can credit the Exchange Bank of Ong, Nebr., for my (J. O. Walker’s) use;” that is, if you buy this note of me, you can transmit me the proceeds by crediting it to the Exchange Bank of Ong, and I will take the money from the bank and use it. Note, also: “I think that my indorsement on same will make it secure.” Would the Bank of St. Joseph understand from that that the Bank of Ong was to be responsible for it, or Avas it the indorsement of J. O. Walker that they relied upon? The letter is a series of similar positive statements that the note belonged to him personally, and was not the property of the bank. If I sell a note to the bank, I instruct them how to send me the money. This Walker did. “If you (tan handle this note for me, you can credit the Exchange Bank of Ong, Nebr., for my use” He distinguishes between himself and the Bank of Ong, and *232tells them that they are handling the note for him and the money is his, the Bank of Ong'being merely the conduit for transferring his money to “my (Walker’s) use.” If the St. Joseph bank had not been satisfied to take the note from Walker, relying upon his indorsement and his representations as to his purchases of real estate and as to his personal responsibility, it should, and no doubt would, have required something to indicate that the Bank of Ong was interested in the transaction. If, as between Walker and the Bank of Ong, the note belonged to Walker and not to the bank, and the St. Joseph bank had notice of that fact, I do not see how they can now hold the Bank of Ong for the loss.
Eawcett, J., concurs in this dissent