Gnarini v. Banca Svizzera Americana

STURTEVANT, J.,

pro

tem.

This is an appeal by defendant from a judgment in favor of plaintiff on the second trial of this action. On the first appeal a judgment in favor of defendant was reversed by the supreme court on rehearing, after disagreement in this court. Upon the second trial the court below rendered judgment in favor of plaintiff, and this appeal is from such judgment.

Briefly stated, the facts involved are as follows: On February 2, 1903, the firm of Cain, Boyd, and Corriea executed to the defendant bank a note in the sum of two thousand dol

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lars, upon which the sum of one hundred dollars was subsequently paid. The payment of this note was secured by a mortgage given by Cain, a member of the firm, to the defendant bank. This mortgage also secured an individual note of Cain’s. The mortgage contained a clause that it ivas given as security for the repayment of all other and further advances that might be made to the firm of Cain, Boyd, and Corriea. The bank made the two thousand dollar loan to the firm upon the faith in this clause in the mortgage. On December 11, 1903, a corporation by the name “Cain, Boyd and Corriea” was formed, of which corporation Cain was president. On June 4, 1904, a new note was executed to the bank for the sum of one thousand nine hundred dollars, balance. This note was signed and delivered by Cain to the bank, but there is nothing on its face to indicate that it was a corporate note, the signature being identical with the original note. On the fifteenth day of June a petition was filed for an adjudication that the corporation was bankrupt, and on July 1,. 1904, it was so declared.

Six days after the execution of this note, and five days before the filing of the bankruptcy petition, the corporation had on deposit with defendant bank the sum of $1,843.60, and at this time the bank purported to apply this deposit on account of the note. The note was stamped “paid” and returned to Cain, Boyd, and Corriea. The original note of February 2, 1903, was also stamped “paid” by the bank and returned to the makers.

Upon the former appeal the supreme court adopted the opinion of Mr. Justice Kerrigan, holding that the mortgage secured the indebtedness and not the