Pilcher v. Sioux City Safe Deposit & Trust Co.

80 N.W. 151, 12 S.D. 52, 1899 S.D. LEXIS 74
South Dakota Supreme Court·Decided September 2, 1899·Published·Cited by 1 cases

Opinion

Puller, J.

This is an appeal from a $1,500 judgment resulting from the trial of an action to recover for certain stenographic work performed by Ed. Granthum, respondent’s assignor, in the preparation of an appeal to this court; and the liability of appellant in the premises is the principal question presen led. It is undisputed that the services were performed, and of the value claimed, no part which has been paid by appellant. It appears that in 1892, through the agency of J. H. Swan, the senior member of an Iowa law firm, a §60,000 loan was negotiated by the Dakota Hot Springs Company, a corporation; andas a part of the transaction a trust deed covering the Evans Hotel, and other valuable property used in connection therewith, was then executed to appellant, as trustee, to secure 100 first mortgage, gold-bearing bonds, each of the de nomination of $1,000. This trust deed contains the usual recitáis, and provides, in case of default, that “at the request of the holders of a majority of said bonds the said trustee may enter into and take possession of, all and singular, the aforesaid premises and property hereby conveyed or hereafter con[54] veyed, and, as the attorney in fact or agent of said company, the trustees may, by themselves or their agents duly constituted, have, use, and employ the same, making from time to time all needful repairs, alterations and additions thereto, which in no case shall exceed the net income therefrom; or the said trustees may lease or let the said premises, property, or any part thereof, upon such rents or proportion of income as they may deem advisable, and after deducting the expenses ' of repairs, alterations, and additions, and other expenses in the management of the trust, apply the proceeds, rents, issues, and profits of said premises to the payment of the principal and interest of all such bonds due and remaining unpaid; or the trustee may,, in its discretion, and on the written request of the holders of a majority of the said bonds then unpaid, apply to the circuit court of the United States, of the district of South Dakota, or any other court having jurisdiction thereof, by a bill in chancery, for the appointment of a receiver, and fore closure of this deed of trust and sale of said premises, and such ‘ other and further relief as the court of chancery may, in its discretion, grant; or the said trustee may foreclose this deed of trust without first taking possession of said property. And the trustee shall, after deducting the expenses of operating said property and managing the trust, and, in case of sale, the ex - penses and costs attending the sale, apply the balance or residue arising from said property or sale to the payment of all bonds due and unpaid, and the remainder of the funds in their hands, if any, shall be paid over to the Dakota Hot Springs Company.” Subsequent to the execution of the foregoing instrument Mr. Swan, on appellant’s behalf, had occasion to frequently check up the books of the mortgagor, to ascertain the [55] actual earnings of the property, and the character of its management; and duiing the early part of the year 1896 he was furnished with a daily statement of receipts and disbursements, under an agreement that appellant should receive all profits arising from the business. This arrangement continued until November of that year, when he entered info actual possession and control for appellant under the terms of its trust deed, and continued to carry on the business and account to appellant until ousted by a receiver appointed by the circuit court in the case of Dudley et al. against the Dakota Hot Springs Company; being the case in which the stenographer’s work made the basis of this suit was thereafter performed, in preparing an appeal to this court. At this time Mr. Swan was prosecuting in the circuit court of the United States at Déadwood, S. D., an action to foreclose the trust deed above mentioned, but, relying upon his right to possession under the trust deed, had neglected to make application for the appointment of a receiver. As the agent and attorney of appellant, Mr. Swan bad all the authority that his principal possessed by reason of the provisions contained in the trust deed; and, from competent testimony introduced at the trial of this action, the jury was fully justified in finding, under proper instructions of the court, that the Dudley case was appealed to this court at his instance, and for the sole purpose of ousting the receiver of the state court and regaining possession for appellant, which was thereby _ accomplished. Although Mr. Swan was never retained as an attorney in the Dudley case, there was evidence to the effect that he consulted and employed counsel to take the appeal, and assisted in procuring a supersedeas bond, which was executed by the general manager of appellant, as a member of the local board of the [56] Fidelity and Deposit Company of Maryland, notwithstanding it was shown by his testimony that he had no knowledge of the fact, and never knew that any such proceedings were pending, The theory of the court below seems to be that, in view of the fact that Mr. Swan was fully authorized to take possession of the property in the first instance in the name of appellant, under the trust deed, he could, when ousted, properly resort to all lawful and reasonable means to regain such possession, in order to secure for appellant the right to “enter into and take possession of, all and singular, the aforesaid premises and property hereby conveyed or hereafter conveyed; and, as the attorney in fact or agent of said company, the trustees may, by themselves or their agents duly constituted, have, use, and employ the same.” In fact, Mr. Manley, who was the managing executive officer of appellant, testified that Mr Swan “had authority to take what action was necessary to forclose that mortgage, and to protect the Sioux City Safe-Deposit & Trust Company, — to protect their rights and their interests. ”

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Pilcher v. Sioux City Safe Deposit & Trust Co., 80 N.W. 151, 12 S.D. 52, 1899 S.D. LEXIS 74 (S.D. 1899).

80 N.W. 151 (Pilcher v. Sioux City Safe Deposit & Trust Co.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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