Nye v. Lincoln County Bank

Mr. Justice Bean delivered the opinion of the court. 1-3. The case depends largely upon questions of fact. The evidence is conflicting. The main facts are testified to upon one side by Frank Nye, plaintiff, and upon the other by Mr. Scarth, the former cashier of the defendant bank. Under such conditions the findings of the decision of the trial judge who heard the witnesses and observed their demeanor upon the stand are entitled to great weight: Scott v. Hubbard, 67 Or. 498 (136 Pac. 653); Hurlburt v. Morris, 68 Or. 259 (135 Pac. 536). A reading of the evidence convinces [47] us that the conclusions of the trial court are correct. The proof meets the requirement contended for by defendant’s counsel that, to justify a cancellation of the note and mortgage, the evidence should be clear and convincing: 3 Jones, Evidence, § 447; United States v. Maxwell Land Grant Co., 121 U. S. 325 (30 L. Ed. 956, 959, 7 Sup. Ct. Rep. 1015). The substance of Mr. Searth’s evidence is to the same effect as shown upon the face of the note and mortgage and the certificate of stock, and goes but little further. He states, in effect, that he does not remember in regard to the details as testified to by the plaintiff. The condition of the bank at the time the mortgage was executed was admittedly as asserted by the plaintiff. Nye is corroborated as to some circumstances by J. C. Altree. If Mr.- Oliver Altree, the president of the Yaquina Bay Lumber Company, obtained the mortgage from the plaintiff as security for the lumber company, he did not appear as a witness to such a fact. Neither is any reason given for defendant not producing such witness. It appears that the plaintiff was led to believe that he was executing the note and mortgage as an accommodation to the defendant bank. The claim of the defendant that shares of stock in the Yaquina Bay Lumber Company were sold to the plaintiff, and that the note and mortgage were given on account thereof, is not sustained by the proof. The plaintiff, a laborer in the mill in which the defendant bank was largely interested, at least to the extent of a loan of $25,000, was induced by the importunities of the officer of the bank aided by the officer of the mill company to execute the note and mortgage with a promise that it would be returned to him by the bank. In equity and honest dealing the note and mortgage should be canceled and returned to the plaintiff: 1 Story, Equity Juris. (13 ed.), § 188. [48] The decree of the Circuit Court provided that the stock of the Yaquina Bay Lumber Company claimed to be held by defendant as additional security for the $2,000 loan be returned to the secretary of the Yaquina Bay Lumber Company freed from any claim of the defendant. The defendant should be allowed, if it desires, to retain the certificate of stock as security for any sum due it from the lumber company. The decree of the lower court will be changed in this respect, without modification as to costs. The decree canceling the note and mortgage is affirmed. Affirmed. Rehearing Denied. Mr. Chief Justice Moore, Mr. Justice McBride and Mr. Justice Benson concur.