Union & Planters' Bank of Memphis v. Jefferson

Winslow, J. The circuit court rightly directed a verdict for the plaintiff. No defense to the action was proven. Oertainly, no fraud on the part of the bank officials was proven. They simply shared in the belief which prevailed in the minds of the business men of Memphis who knew the deceased, including his attorney and intimate friends, that his estate was worth from $50,000 to $100,000 above all his debts. ' All the evidence tends to show that, had the Memphis property been sold at that time, it would have brought far more than enough to pay all debts, but that it declined greatly in value after the panic of 1893, and finally declined so greatly as to make the estate insolvent. The defendant made his own investigations among real-estate men and all who had knowledge on the subject, as to the condition of the estate and value of its property, and did not rely on any information obtained from the officers of the bank. The claim of fraud is entirely without foundation. As to the alleged mistake of fact, it may perhaps be doubtful whether mere mistaken opinions as to the value of real estate can properly be called such mistake of fact as would justify rescission of a contract; but, however this may be, the evidence shows that the defendant is estopped from making this defense. The bank owed J. W. Jefferson [456] at the time of his death, upon deposit account, $791.06. By the law of Tennessee, it was entitled to offset this against the notes of J. W. Jefferson, and prove its claim against the estate for the balance. Shannon’s Code Tenn. 1896, § 4114. Instead of doing this, it transferred the deposit balance to the credit of the defendant, as administrator, and after Jefferson and Pearson had given their individual note of July 5, 1892, allowed the defendant, as administrator, to draw the entire sum from the bank. Thus, the bank has lost the benefit of this deposit, which it might have retained and applied; and it is clear that it allowed this balance to be withdrawn by the defendant because he and Pearson had given their own notes for the notes of J. W. Jefferson. Certainly, the defendant cannot now repudiate liability upon his note when the bank has thus so materially changed its position in reliance upon the note. It is practically an attempt to rescind a contract without returning what has been received by virtue of it. As to the defense of lack of. consideration, it is sufficient to say that the original note of J. W. Jefferson was canceled and surrendered by the bank when it received the note of the defendant and Pearson, and that this constituted a sufficient consideration. In addition to this, it seems clear that the same facts which estop the defendant from pleading-mutual mistake will also estop him from pleading want of consideration. As to the counterclaim for moneys paid upon the two notes of $1,400 and $1,500, under the mistaken supposition that the estate was solvent, it is perhaps sufficient to say that no such recovery can be had while the estate is still unsettled, a part of its real estate not sold, and before it is judicially determined whether there will be any deficiency of assets to meet liabilities. This conclusion is so apparent that a mere statement of it is sufficient. By the Court.— Judgment affirmed.