Quaker City National Bank v. Hepworth

Opinion by Mb. Justice Gbeen, There is no question that when Boulter confessed the judgment for $15,500 to Datz as trustee it was done to secure Datz for only $1,400, which Boulter owed him, and for $14,100, which Boulter owed the bank. Datz was therefore trustee for-the bank under this judgment to the extent of $14,100, and that [319] fact was perfectly well known and understood by tbe bank. Clark, the casMer9 being examined as a witness, testified as follows: “ Q. What was the indebtedness of Boulter to the bank ? A. Fourteen thousand, one hundred dollars. Q. That was the indebtedness in 1897, was it ? A. Yes, sir. Q. That included all that he was indebted to the bank both on made and indorsed notes, did it not? A. Yes, sir. Q. It included this note amongst others of $1,200, dated March 29, 1897, made by Hepworth & Company to the order of Boulter, payable three months after date and indorsed by George H. Boulter ? A. That is right. Q. When did you first hear that a judgment was confessed to William P. Datz, trustee, for $15,500, which included $14,100, being all the indebtedness of Boulter to the bank ? A. I understood that Mr. Boulter had confessed judgment to Mr. Datz as trustee for the amount that the bank was owing, and for Ms own indebtedness sometime about the time that note was given. Q. Did you know of the levy under that judgment? A. No, sir. Q„ You know nothing at all about the sale of property under that judgment? A. Nothing about it. Q. You knew nothing of what was done with that property ? A. All I knew was Mr. Datz had bought it in and was operating it since. That is all. Q. Acting as trustee for the bank. You know that? A. Certainly. Q. He has acted therefor srnce, having bought the property in under that judgment, and for the benefit of that judgment, with the full knowledge and approval of the bank? A. Certainly.” ' The witness havmg stated the items which constituted the indebtedness of Boulter to the bank, and which included the $1,200 note in suit, was asked as to what efforts the bank made to get their money out of the business which Datz as trustee, with Boulter as manager, carried on subsequently to the sheriff’s sale of Boulter’s goods to Datz as trustee, and said, M reply to a question: “ A. The only inquiry that we made was that Mr. Datz had a judgment, and we tried to get the amount out of it. Q. What attempt did you make to get it ? A. We knew that Mr. Datz was running the plant, and they have paid us some $900. ... Q. Do you mean to say that you did not call upon the trustee to account for the large amount of property sold at that sale ? A. No account except that there was about $900 [320] paid off on account. Q. How was the business run? A. By Mr. Datz, trustee, as I understood. Q. Who manipulates the business? A. Boulter, as the manager, I believe. . . . Q. You knew he was trustee of the bank? A. Yes. Q. You knew he had bought the property in at sheriff’s sale ? A. Yes. Q. You knew he was running the business in the name of Datz, trustee? A. Yes. Q. You knew Datz was trustee for the bank of upwards of $14,000 ? A. Yes, sir. . . . Q. Did you know George Boulter was acting as manager of the business ? A. Y es, certainly.” William P. Datz, who was the trustee named in the judgment, was asked: “Q. Did you have any conversation with him (Clark) on the subject of the sheriff’s sale before the sale took place? A. Yes, sir. Mr. Clark and the president of the bank both knew that Mr. Boulter had confessed judgment to me for the bank’s claim. Q. Did you attend the sheriff’s sale ? A. Y es, sir. Q. You bought in the property as trustee? A. My counsel did. Q. For you as trustee? A. Yes, sir. . . . Q. Having bought that as trustee for the bank what did you do in the way of carrying out your trust with the property ? A. I have been running the plant since under my name as trustee. Q. Did you attend there, or did Mr. Boulter run it for you ? A. Mr. Boulter has run it as manager.” Under the foregoing testimony, without considering the personal testimony of the defendant, it is not easy to see how the conclusion can be resisted that Datz, the plaintiff in the judgment, took the judgment, held it and bought in all the stock of goods, as trustee for the bank, with the full knowledge and consent of the bank, and also carried on the business as such trustee for more than a year. As it seems to us now the jury might well find that the bank, having control of the property, through their trustee, carried on the business, and were properly responsible for the manner in which it was conducted and for its results. It seems to us a fair question for the jury was raised under the testimony, to inquire into the operations of the trust, and we think that the defendant should be at liberty to show what the stock of goods was worth, what it sold for, what was done with the proceeds, and if he could establish facts which entitled him to claim that the bank had received, or ought to have received, satisfaction for the note in suit out of the sub [321] sequent management and disposition of the goods by the trustee, he should have the opportunity to do so. But all inquiry of this kind was shut off by the binding direction of the learned court below to the jury to find a verdict for the plaintiff for the full amount of the claim. We think, in the peculiar circumstances of this case, this was error aftd that the case should have been submitted to the jury on all its facts. For obvious reasons we cannot here discuss the facts nor decide the merits of the respective contentions. We sustain the first, second, third, sixth and seventh assignments, the others are dismissed. Judgment reversed and new venire granted.