Fourth National Bank v. Blackwelder

BLAND, J. The home of plaintiff is Wichita, Kansas, of the defendant, St. Louis, Mo. The suit is on a promissory note dated June 22, 1895,. for $1,206.40, due January 1, 1896, payable to the order of plaintiff and signed by the defendant. The defense relied on is that plaintiff permitted certain promissory notes deposited with it by defendant as collateral security for the note sued on to become barred by statute of limitations while in plaintiff’s possession. The cause was tried by jury. At the close, of all the testimony the court gave the following instruction: “The court instructs the jury, under the evidence and pleadings in this case, the verdict must be for plaintiff for the amount sued for in the petition, which is $1,206.40, with ten (10) [431] per cent interest thereon from January 1, 1896.” The jury under this instruction returned a verdict in favor of plaintiff for $1,554.79. After an unavailing motion for new trial defendant appealed. The evidence on the part of plaintiff is, that in February, 1890, the plaintiff held defendant’s note for $2,000. To secure this indebtedness defendant delivered to plaintiff certain promissory notes aggregating $2,150.10, signed , by E. W. Stover and Ellen Stover, both residents of Wichita, Kansas. E. W. Stover paid plaintiff $1,050.10, and credit was given therefor to the defendant. After this payment one collateral note for $1,100 remained in the hands of plaintiff; this note was never paid, and on the trial plaintiff produced it in court and offered to deliver it to the defendant. Defendant testified that at the time he delivered this note to plaintiff he directed its officers to collect it and apply the proceeds to the payment of his note. The president of the bank testified that nothing was said about collecting the note, that the instructions were that when the parties paid anything, to apply it to defendant’s note. No suit was ever brought by the bank to collect the collateral note, and it became barred by the statute of limitations on October 3, 1898. Ellen Stover was the wife of E. W. Stover; the latter died Sept. 7, 1894, and was shown to be insolvent at the date of his death, but left an insurance policy in favor of his wife for $2,000. It appears that the collateral notes were secured by a second mortgage on 160 acres of land in Harper county, Kansas, given by Stover and wife. In January, 1896, suit was brought to foreclose the first mortgage and the plaintiff aud defendant herein were made parties defendant. Plaintiff mailed a copy of the summons to defendant, properly addressed. Plaintiff’s officers examined the land conveyed by the mortgages, and had its attorney at Wichita to look into the matter; the conclusion reached by the plaintiff’s officers and attorney was that the equity of the second mortgage was worthless. The testimony further shows that [432] the first mortgage was for $2,200, and that Stover was unable to pay either the principal or interest. The testimony further tended to show that Stover after making the collateral note had nothing and thereafter lived with his son until his death. On January 5^ 1894, the defendant wrote the plaintiff not to push or sue on the collateral note, but to give owner of the land (one Koelling), a chance to pay the mortgage, saying, “I don’t believe there is any quicker way nor as sure a way to get it as to keep Koelling feeling that he can save the farm by keeping up the interest and taxes.” In reply to plaintiff’s letter transmitting summons in the foreclosure suit, the defendant made no requests or suggestions about that suit, but promised to pay the note as soon as possible. Until 1892 or 1893, the defendant resided in Wichita. The contention of defendant is, that it was the duty of the plaintiff to have sued on the collateral note before it was barred by the statute of limitations, and having failed to do this the loss of the note should fall on it. Unquestionably it was the duty of plaintiff to exercise diligence to protect the note (Bank v. Thompson, 11 Fed. Rep. 113; Hanna v. Holton, 78 Pa. St. 334), and to have brought suit, if by a suit the security could have been collected; but it was not its duty to incur the expense of a suit, if the makers of the note were insolvent. The bank was only required to exercise, as to the security, such diligence for its protection as an. ordinary prudent business man would exercise with his own in like circumstances. The evidence shows that a suit would have been wholly unavailing on account of the insolvency of the makers of the note. The law does not require the doing of a useless thing, nor charge negligence to one for having omitted the doing of a useless thing. The burden was on the defendant to show affirmatively that the makers of the note were solvent, and that a suit against them would have protected the security. Mansur-Tebbetts v. Carey, 45 S. W. Rep. 120. No such showing was made; the [433] defense therefore failed for want of evidence in its support, and it was the duty of the court to instruct the jury to find for plaintiff. Hite v. Railway, 130 Mo. 141; Reichenbach v. Ellerbe, 96 Mo. 104; Hilz v. Railway, 101 Mo. 36. The judgment is affirmed. All concur.