Staples v. City Bank & Trust Co.

70 So. 115, 194 Ala. 687, 1915 Ala. LEXIS 302

• Court: Supreme Court of Alabama
• Decided: November 11, 1915
• Status: Published

Opinion

SOMERVILLE, J. —

(1) This case is ruled by the principles declared by this court in the recent case of Lawkin v. Lowell, 176 Ala. 334, 339, 58 South. 258. In that case it was settled, upon a very full consideration of the subject, that when a wife borrows money from her husband’s creditor, and hands it back to him in payment of her husband’s debt, although she becomes nominally the principal debtor upon a new obligation, she is nevertheless, within the true meaning of the statute (Code, § 4497), a surety for her husband’s debt, and not bound by her obligation to pay it.

A fundamental distinction is made between a loan secured from the husband’s creditor and one secured from á third person who is not interested in the disposition of the fund, and who malíes the loan to the wife as an independent business transaction, to do with as she pleases. If the debt sought to be enforced against the wife, or any part of it, was infected with this vice in its inception, the infection remains, regardless of renewals or changes of form. And so, with respect to the method by which the proceeds of the loan are returned to the hands of the lender, it is of no consequence whether the payment of the husband’s debt is open and direct, or whether the money passes to the creditor through intermediates chosen for the purpose.

The law looks to the intention and the result, and not to the means employed. In the present case, therefore, the mere fact that the proceeds of a nominally independent loan made by plaintiff to defendant were first deposited to’ the account of defendant in the plaintiff bank, and by her checked out to> the husband debtor, is of no significance, if pursuant to previous understanding between plaintiff and husband, the fund was ultimately appropriated to the payment of the husband’s then existing debt. The prime questions were the contemporaneous debtorship of defendant’s husband (which is not disputed) and the accomplished intention of paying his debt with the obligation of defendant, his wife (which was the disputed issue). On this issue, which was necessarily a broad one, the trial judge unduly contracted the inquiries of defendant’s counsel, and excluded evidence which, though purely circumstantial in character, was, we think, quite clearly relevant and admissible.

(2) It w|as competent for defendant to' ask the witness Buck, who was president of the plaintiff bank, and who conducted the transactions in question with defendant’s husband, if the check drawn by her to him did not withdraw the full amount of the $2,000 deposit made to her credit on the same day it was made. The check for $2,100 drawn by defendant in favor of her husband on November 21, 1911, was not indorsed by him, but carried a pencil memorandum on its back, “Credit account of N. A. Staples.” It' was competent for defendant to ask the witness Buck in whose handwriting the memorandum was, as tending to show contingently that the money was appropriated by the bank to the debts of N. A. Staples. And, as throwing some light on. the relationship and purpose of the whole series of transactions, we think the cashier’s check for $2,500 drawn payable to defendant for the discount of the first $2,500 note was admissible in evidence; and for the same reason the written statement prepared by plaintiff from its books, entitled “Credit Limit — N. A. Staples,” and including items of the various notes held by plaintiff against N. A. Staples and defendant, his wife, was also admissible. In short, all transactions relating to the series of dealings between plaintiff and defendant, including notes, discounts, checks, and deposits, are, in our view of the case, proper for consideration by the jury in determining whether $2,000 of the proceeds of the note sued on was procured and used by plaintiff for the satisfaction of her husband’s indebtedness to plaintiff in that sum.

(3) This was a question that should have been submitted to the jury.

(4) With respect to the remainder of the note, $500, we find nothing in the evidence which can justify any inference that it was intended or used for the payment of any debt owed to plaintiff by defendant’s husband, and to that extent the general affirmative charge for plaintiff was proper.

(5) There was no prejudicial error in the rulings on the pleadings, since, as the case was submitted to the jury, the defendant had the benefit of all meritorious defenses, and this will suffice for another trial.

The written charge refused to defendant, as shown in the reporter’s statement, was in accordance with the law as above declared, and should have been given.

Let the judgment be reversed, and the cause remanded.

Reversed and remanded.