Emporia National Bank v. Shotwell

The opinion of the court was delivered by Horton, C. J.: The issues formed by the pleadings in this case were submitted to the court, a jury being waived. At the commencement of the trial the National Bank of Emporia [370] requested that the court find the facts specifically, aud state its conclusions of law thereon. The bank did not consider the findings of fact first made by the court sufficient upon the questions of law involved in the trial, and therefore asked the court to make additional findings of fact. The court complied with this request. We therefore must consider all of the special findings of fact made by the court, and such findings of fact must be made to harmonize with each other, if possible, and are conclusive upon all disputed and doubtful questions. The actual name of the person who executed the notes and mortgages and indorsed the draft issued to him by the Exchange Bank of El Dorado is not disclosed in the findings of the trial court; yet, it appears therefrom that such person applied for the loan from Shotwell in the name of Daniel Guernsey; that in his letters he assumed the name of Daniel Guernsey; that he signed the notes and mortgages as Daniel Guernsey; that he indorsed the draft as Daniel Guernsey; that he stated to the cashier of the National Bank at Emporia his name was Daniel Guernsey; and that Harvey, who identified him at the bank, also stated to the cashier that the name of the holder of the draft was Daniel Guernsey. It also appears that Harvey, who inspected the Guernsey land upon the application for the loan and identified the payee of the draft at the bank, claimed to know Daniel Guernsey, and inquiries were made of him by Shotwell in reference to the party making the application previous to sending the draft. If we assume that the real name of the party who indorsed the draft and obtained payment thereof from the National Bank was Daniel Guernsey, although not the Daniel Guernsey who owned the real estate described in the mortgages, the case is very similar to Maloney v. Clark, 6 Kas. 82. If, however, it be conceded that the real name of the party who executed the notes and mortgages and indorsed the draft is not Daniel Guernsey, a somewhat different question is presented, but a like result follows; and therefore the judgment is erroneous, for the reason that it is not sustained by the findings of fact of the trial [371] court, and is contrary to the law which is applicable thereto. After Shotwell had obtained the draft from the Exchange Bank he delivered it to his agent, Lobdell, to be sent to the party executing the notes and mortgages, under the belief that such party was the Daniel Guernsey who owned the real estate described therein. This belief was induced by the letters written by the person obtaining the draft and the application he had made for the loan. Lobdell sent the draft to the address of Daniel Guernsey, at Florence, through the mail, and in sending the same he intended that the person who executed the notes and mortgages should receive it, then believing such person was the real Daniel Guernsey. Therefore it appears that Shotwell and Lobdell thought the person to whom they sent the draft was the Daniel Guernsey who owned the quarter-section of land upon which the loan was placed by them. The case of Robertson v. Coleman, N. E. Rep., (S. C. of Mass.,) vol. 4, No. 7, p. 619, is an authority directly in point. There, a thief had stolen a team of horses. He went to Boston, and registered his name at the Metropolitan Hotel as Charles Barney. There was living at Swanzey, Mass., a reliable and responsible man of that name. The thief turned the stolen team over to a firm of auctioneers to sell for him, giving his name as Charles Barney. The auctioneers sold the team, and after deducting their commission, gave the thief, calling himself Charles Barney, a check for the balance of the proceeds, the check being payable to the order of Charles Barney. The thief indorsed the check in blank with the name of Charles Barney, and disposed of it to the proprietor of the hotel where he was stopping. Subsequently the auctioneers learned that the team of horses had been stolen, that they had received them from the thief, and that his true name was not Charles Barney. Upon being notified by the auctioneers, the bank upon which the check was drawn refused to pay it. The holder brought suit, and recovered. Judge Field, in delivering the opinion in that case, said: “The defendants, for a valuable consideration, gave the check to a person who said his name was Charles Barney, and [372] whose name they believed to be Charles Barney, and they made it payable to the order of Charles Barney, intending thereby the person to whom they gave the check. The plaintiff received this check for a valuable consideration, in good faith, from the same person, whom he believed to be Charles Barney, and who indorsed the check by that name. It appears that the defendants thought the person to whom they gave the check was Charles Barney, of Swauzey, a person in existence. “ It is clear, from these facts, that although the defendants may have been mistaken in the sort of man, the person they dealt with was the person intended by them as the payee of the check designated by the name he was called in the transaction, and that his indorsement of it was the indorsement of the payee of the check by that name. The contract of the defendants was to pay the amount of the cheek to this person or his order, and he has ordered it paid to the plaintiff. If this person obtained the check from the defendants by fraudulent representations, the plaintiff took it in good faith and for value.” [373] PTng"nothe?f" indorsement of ñaabi¿tyistakü; [372] So, in this case, Shotwell, for the notes and mortgages received by him, sent the draft to a person who said his name was Daniel Guernsey, and whose name Shotwell believed to be Daniel Guernsey, and Shotwell made the draft payable to the order of Daniel Guernsey, intending thereby the person to whom he sent the draft. The National Bank of Emporia received this draft for a valuable consideration in good faith from the same person whom the bank believed to be Daniel Guernsey, and who indorsed the draft by that name. When the holder of the draft presented it to the National Bank for the purpose of having it cashed, he stated 'that he was the Daniel Guernsey who was named in the draft as the payee thereof, and that the draft had been sent him for the notes and mortgages which he had delivered to Shotwell. Harvey, who identified the holder of the draft at the bank, stated to the cashier that he knew that such holder was Daniel Guernsey “from having knowledge of the fact that this man had executed certain notes and mortgages and delivered them to Shotwell for a loan.” This is not like a case where a draft falls into the hands of the person by theft, for which the party sending is not responsible. It appears that Shotwell thought [373] the person to whom the draft was sent was the real Daniel Guernsey who owned the land in Butler county, and the false Daniel Guernsey did not obtain the letter sent him containing the draft by theft from the mail. Shotwell and Lobdell dealt with the false Daniel Guernsey as though he were the real Daniel Guernsey. Such person, it is true, obtained the draft from Shotwell by fraudulent letters and representations, but the National Bank is not responsible for the letters and representations of the false Daniel Guernsey, and as it took the draft in good faith and for value, it cannot be holden for the conversion of it, nor is it liable for the return of the money which it paid to the holder thereof upon his indorsement. The National Bank of Emporia paid the draft to the person to whom it was sent by Shotwell, and such person received the money from the bauk theyeon. Counsel for Shotwell claims that the National Bank did not use sufficient care and diligence in having the payee of the draft identified. This is not important, under the circumstances presented. The vital point in this case is, that Shotwell intended the draft to be sent to the party executing the notes and mortgages, and intended it to be paid to the person to whom he sent it and whom he designated by the name of Daniel Guernsey, because that was the name which he assumed in executing the notes and mortgages; and therefore the National Bank is protected'in paying the draft to the •very person whom Shotwell intended to designate by the name of Daniel Guernsey. Counsel also comments upon the fact that he refused to send currency to Florence, as requested, but sent, instead, the draft, payable to the order of Daniel Guernsey. If it were not for the other facts, this finding might tend to show caution and prudence on the part of Shot-well, but as all of the findings must be considered together, it may be that Shotwell “preferred to send the money in the way of a draft” as a matter of convenience only. Counsel for Shotwell claims that Dodge v. Bank, 30 Ohio St. 111, is decisive in favor of his client. The court in that [374] case recognized, the exact ruling and principle decided in this, but refused to apply it to that case, because the facts did not seem to warrant its application. The court said in that case that the bank paying the check upon the forged indorsement “had the right to show, if it could, that the person to whom the check was delivered was in fact the person whom the drawer intended to designate by the name of Frederick B. Dodge.” In that case the drawer of the check refused to recognize the person presenting the voucher for which the check was given as the owner, without proof of identity, and for that reason made the check payable to the order of Dodge, the owner of the voucher. In this case the draft was sent to a false Daniel Guernsey, under the belief that he was the real Daniel Guernsey, and it was the intention of Shotwell and his agent, Lobdell, that the person who had executed the notes and mortgages should receive the draft sent by them. It was said in argument that the trial court decided this case upon the authority of Kohn v. Watkins, 26 Kas. 691. That case is no authority for the decision. There, the draft was sent by Watkins to his correspondent, McLain, to be delivered to the.payee thereof, Michael A. Becker. McLain forged the name of Becker upon the draft, then indorsed his own name thereon and negotiated the same. The draft was never delivered as Watkins had given instructions. He never intended it to be paid to McLain, to whom it was sent. McLain, the correspondent, was solely responsible for the fictitious application and the forgery. It is true that there is-some resemblance between the case at bar and the cases of Dodge v. Bank and Kohn v. Watkins, yet an examination of these cases shows a fine distinction in each, and such a distinction that neither of the latter cases controls the decision of the former. Upon the findings of fact of the trial court, the judgment must be reversed, and the cause will be remanded with the direction for the court below to render judgment in favor of the plaintiff in error. All the Justices concurring.