Lowe v. Wells Fargo & Co.

The opinion of the court was delivered by Smith, J.: The facts being agreed upon and in writing, this court is in the same position to weigh and interpret them as was the court below. Whether the money was paid under a mistake of fact is practically conceded to be the controlling question. To entitle the plaintiff to recover, we shall assume, [110] in accordance with the contention of the defendant, that the mistake must have been at the time of the payment mutual, and the alleged mistaken fact material. What, then, was the situation at the time of the payment? The money had been lost. Diligent efforts were made by both parties to discover what became of it, which resulted in tracing it to the hands of'the plaintiff’s son. He could not account for it, and no further trace of it could be found. Before reaching Emporia, where an investigation was made by defendant’s representative and another man who accompanied him, the plaintiff was informed “that it was evident that one of two men had the money.” After making the investigation they informed the plaintiff and his son “that they were unable to find out anything concerning the loss” and demanded payment of the amount lost from the plaintiff’s son. Then the plaintiff, according to the agreed statement of facts, “believing the fact to be that, after said' W. H. Lowe had received the package at Emporia, he had dropped the same before reaching the defendant’s office at the depot in Emporia, and further believing that some one had picked the same up and carried it away,” paid the amount of the loss to the defendant. When the defendant’s agent under these circumstances demanded payment of the loss from the plaintiff’s son and received the payment from the plaintiff we think the defendant should not be heard to say that it did not believe that the plaintiff’s son had lost or appropriated the money. Both parties, then, believed a material fact to exist which did not exist, and which alone led to the payment of the money. That another stole. the money after the plaintiff’s son had “safely conveyed it to defendant’s office at the. depot in Emporia, Kan., 'and there placed it with other packages,” is not material except to show the mistake by reason of which the plaintiff paid the money. There is no recital in the statement of facts, and there is no presumption, that the failure of W. H. Lowe to take a [111] receipt for the package induced Davis to steal the package. It is true the rule of the company required W. H. Lowe to take a receipt for each article of express which came into his possession as agent of the defendant when he parted with such possession. His failure to do so was negligence, and for such negligence he was responsible to the company for such damages as could be reasonably anticipated to flow therefrom. We can not. say, however, that when he safely deposited the package in the defendant’s office with other packages, presumably of like character, it was reasonably to be anticipated that some other employee of. the company would steal the package. If not, .there was no consideration for the payment. The theft was the proximate and independent cause of the loss; the negligence was not'. The payment was made and received under the belief that W. H. Lowe, and not another, had lost or appropriated the package. The defendant bases its defense practically upon the proposition “that the money was lost, and lost by reason of the carelessness and neglect of duty on the part of W. H. Lowe.” We do not think this conclusion follows from the facts. There is much discussion and citation of authorities in the briefs as to what must be the nature of the mistake of fact to entitle a party to recover. A succinct definition, which-we think correct, is given in volume 27 of the Cyclopedia of Law and Procedure, at page 809: “A mistake which takes place when some fact which really exists is unknown, or some fact is supposed to exist which really does not exist; one not caused by the neglect of a legal duty on the part of the person making the mistake; an unconscious ignorance or forgetfulness of a fact past or present material to the contract ; a mistake not caused by the neglect of a legal duty on the part of the person making the mistake and consisting in an unconscious ignorance or forgetfulness of a fact past or present material to the contract or belief in the present existence of a thing material to the con [112] tract which does not exist or in the past existence of a thing which has not existed.” It is a general rule that money paid under a mistake of fact, where the party seeking to recover was not intentionally ignorant nor grossly negligent in failing to discover the facts, can be recovered. Money paid by an express company on a claim for the loss of goods, under the mistaken belief that it had received them for shipment, may be recovered. (J. S. Hulse Hardware Co. v. American Express Co., 65 Ill. App. 596.) Plaintiff’s recovery of a bank-book could not be defeated on the principle of voluntary payment where, her son having accidentally set fire to defendant’s property, she transferred the book to the defendant, not willingly, but because of some supposed legal liability on account of the son’s act, defendant having no right or pretense of right, but merely having asked plaintiff if she could not make him some recompense for the loss, and having asked her to sign a writing transferring the book. (Bishop v. Corning, 37 N. Y. Supr. Ct., App. Div., 345, 57 N. Y. Supp. 697.) “Money paid under a mistake of fact may be recovered. The fact that the person making the payment has the means of knowledge at hand and overlooks the same by an inadvertence is immaterial if the party receiving the same is not entitled to it.” (Girard Trust Co. v. Harrington, Appellant, 23 Pa. Super. Ct. 615, syllabus.) (See, also, City of Covington v. Powell, 59 Ky. 266; City of Louisville v. Henning & Speed, 64 Ky. 381; Pearson v. Lord, 6 Mass. *82; Lazell v. Miller, 15 Mass. 207; Guild v. Baldridge, 32 Tenn. 295; Scott v. Ford, 45 Ore. 531, 78 Pac. 742, 80 Pac. 899, 68 L. R. A. 469.) It is contended that the payment in question was a voluntary one and can not be recovered, and among other authorities cited to support this proposition are the following: Phillips v. Jefferson Co., 5 Kan. 412, Wabaunsee Co. v. Walker, 8 Kan. 431, Irwin v. Thomas, 12 Kan. 93, K. P. Rly. Co. v. Comm’rs of [113] Wyandotte Co., 16 Kan. 587, Sapp v. Comm’rs of Brown Co., 20 Kan. 243, and Thimes v. Stumpff, 33 Kan. 53, 5 Pac. 431. We have examined all these cases and find that they are really authorities against the proposition contended for. The decisions in each case are based upon the proposition that the plaintiff with full knowledge of the facts voluntarily made the payment. In the case at bar the plaintiff made every reasonable effort to ascertain what became of the lost package of money, without success. The facts which came to his knowledge from investigation evidently led him to believe, and he paid the money believing, that his son had lost the package by dropping it. This was not true. It was lost by being stolen by another employee from a place in the defendant’s office where the plaintiff’s son had safely deposited it. This we think is a clear mistake of fact. A fact was believed to exist which did not exist, and a fact existed which was not known; otherwise the money would not have been paid, it is safe to infer. Under the real facts neither the plaintiff nor his son were under a duty to pay the loss, and the defendant had no right to retain the money after it was paid. The company was indemnified against loss from the misfeasance of Davis as well as of young Lowe. It is contended that the language incorporated with the receipt which the defendant executed and delivered to the plaintiff became a contract when accepted, and determined the conditions only upon the occurrence of which the defendant was bound to return the money or any part thereof. Some courts hold that equity refuses to enforce contracts made under a mistake of fact against one injured thereby, where no wrong is done to the other party. The repayment of the money puts the defendant in the same position that it was in before payment. The judgment is reversed and the case is remanded, with instructions to render judgment for the plaintiff.