Daniel v. St. Louis National Bank

Hughes, J. The St. Louis National Bank sued Daniel, the appellant, upon the following note, to-wit: “$1,000. Mammoth Springs, Ark., April 28, 1897. Ninety days after date, I promise to pay to the order of the Bank of Mammoth Springs one thousand dollars, at the Bank of Mammoth Springs, Arkansas, for value received, with ten per cent, interest from maturity until paid. E. M. Daniel. Indorsements: “Bank of Mammoth Springs. H. G. King, President. “Received on the within note $400.00, this July 31, 1897. J. W. Meeks, attorney for R. G. Dun & Co.” And on the back of the note appears this indorsement: “Pay Bank of Mammoth Springs, or order. St. Louis National Bank.” The appellant pleaded payment. Judgment was rendered for appellee against appellant for four hundred dollars, and he appealed. The appellee admitted that four hundred dollars had been paid to it on the 31st of July, the amount being credited on the note; but contends no other payment was ever made to it, or to any one for it, who was authorized to receive it. The evidence on the part of appellant tends to show that on the 20th of July, 1897, the appellant sent through the mail to the Bank of Mammoth Springs for collection the note, the payment of which is in controversy, and that it was received by the Bank of Mammoth Springs about 11 o’clock on the morning of the 21st of July. King, the casher of the Bank of Mammoth Springs, testified that “on or about July 21st Mr. Daniel came into the bank, and paid $600 on account of this note. This amount was credited to the account of the St. Louis National Bank. * * * * The $600 paid by Mr. Daniel was paid a few days before the maturity of the note. * * * I don’t think I credited the note with this payment. The note was in the collection case at the time. He did not pay the note in full. The note was in my hands for collection. The custom of banks dealing with each other is, when we make collections we credit them, and when we send collections they credit them to us. This $600 was paid and receipted as a credit to this note, and we gave a receipt to that effect. This $600 was paid in three different installments, $200 each. One was on the 21st, while this note was in our collection case for collection. They were all close together. The $600 was credited to the account of the St. Louis National Bank. This account would sometimes show a credit and sometimes a debit. The St.Louis Bank is holding considerable quantity of our securities, and I consider that any claim they have against the Bank of Mammoth Springs will be amply covered by these collaterals.” F. M. Daniel, the appellant, testified1 “I am defendant in this suit. I executed this note to the Bank of Mammoth Springs. I had no notice of the St. Louis National Bank holding this note prior to .the bank closing. This note was given to the Bank of Mammoth Springs, and payable there. I paid there $600 on this note, and got a receipt for it, which is as follows: ‘July 21st, 1897. Received of F. M. Daniel $600, as part pajonent of his note of $1,000 payable to the Bank of Mammoth Spring, and due July 30, 1897. Bank of Mammoth Spring, by H. G-. King, President.’ I paid this $600 at different times; $200 on July 21st, and the remainder a short time before. I had money in the bank, and wrote checks on the bank, and told them to put it on this note, and the whole $600 was charged to me, I suppose. Mr. King told me that these checks were all charged up to me on July 21st. I had no notice of the sale of this note to the St. Louis National Bank until the day after the bank failed. When I asked Mr. Reed or some of them where my note was, they said that the St. Louis National Bank had it. I then asked about the $600 I had paid, and they said that was all right. I had no thought beforehand of the bank failing. I afterwards paid the remaining four hundred dollars to Mr. Meeks, and told him that I had paid the $600. The bank is closed, and I have not got my checks jret.” On the cross-examination of King, the cashier of the Bank of Mammoth Spring, he testified that he had the $600 paid him by Daniel and tbe note for collection at the same time on the 21st. It is contended by the appellee that there was no such testimony, and that this is improperly in the record. But it appears regularly in the bill of exceptions certified by the judge, and no effort has been made to correct the record in this behalf, and we must take it as correct. We cannot go outside upon assertion merely to the contrary. The evidence shows that the Bank of Mammoth Spring failed on the 22d of July, and that it returned the note to the St. Louis National Bank, without credit of this $600, and that the same was not paid to the St. Louis National Bank. The defendant (appellant) asked the following instructions, to-wit: “The court instructs the jury that if you find from the evidence that the Bank of Mammoth Spring, and the plaintiff, the St. Louis National Bank, were correspondents, and on the 21st of July, 1897, the defendant had in the hands of the Bank of Mammoth Spring six hundred dollars, with instructions for that amount to be paid on the note against him held by the plaintiff, and that you further find that at the same time the Bank of Mammoth Spring had received the defendant’s note for collection, and that the Bank of Mammoth Spring, on the 21st of July, 1897, charged up the six hundred dollars to the defendant, and entered to the credit of the St. Louis National Bank, the plaintiff, the said six hundred dollars in their usual course of banking business as correspondents of said St. Louis National Bank, then you would be authorized to find for the defendant;” which was refused by the court, to which the defendant excepted. A majority of the court is of the opinion that the court committed error in refusing to grant this instruction. Until the note was sent to the Bank of Mammoth Spring for collection, it was not the agent to receive payment for the St. Louis bank, but it was its agent for collection after the receipt of the note on the 21st of July, 1897, and if, after its receipt for collection by the Bank of Mammoth Spring on the said 21st of July, 1897, the Bank of Mammoth Spring had six hundred dollars of Daniel’s money, which he had directed to be paid on this note, and at the same time had the note on the 21st, and charged up to Daniel the amount, and credited the National Bank of St. Louis with said six hundred dollars in the usual course of business between the two banks as correspondents, we are of the opinion that this constituted payment by Daniel to the St. Louis National Bank. We think there was testimony in the ease which called for the submission of these questions to the jury. For the error indicated, the judgment is reversed, and the cause is remanded for a new trial.