Opinion
April 11, 1950. Rehearing Denied April 26, 1950.
Appeal from the Circuit Court for Dade County, George E. Holt, J.
O.B. Simmons, Jr., and Evans, Mershon, Sawyer, Johnston Simmons, Miami, for appellant.
Jack Moore, Miami, for appellee.
The appeal is brought by Riverside Bank, a defendant below, to review a decree of the Circuit Court of Dade County holding the bank liable for payment of certain moneys to the plaintiff.
As shown by the record, Ruth Rusciano, on October 16, 1947, purchased a cashier's check from Riverside Bank, Miami, Florida, in the sum of $3815, payable to the order of one Hazel Rutherford. On October 17, 1947, the payee endorsed the check in blank and cashed the same at the Miami Industrial Bank, Miami, Florida; the Bank paying the sum of $3800 for the check and thereby becoming the owner and holder of the instrument for value.
On October 20, 1947, Frank Maxa, Sr. instituted suit in the Circuit Court of Dade County, Florida, naming Hazel Rutherford, J. Rusciano and the Riverside Bank of Miami as parties defendant. The sworn bill of complaint filed by the plaintiff alleged that in August 1947 the defendant Hazel Rutherford had induced the plaintiff to purchase for $7500 a business in Miami known as Sunrise Bar and Restaurant; that in the consummation of the purchase she had fraudulently procured the transfer of the title to her; that thereafter she had fraudulently persuaded the plaintiff to enter into a marriage contract with her and that subsequent to the marriage ceremony she had sold the Sunrise Bar and Restaurant to one J. Rusciano who had paid a portion of the purchase price by means of the cashier's check purchased by Ruth Rusciano on October 16, 1947 from the defendant Riverside Bank of Miami; that the check had not been presented to the Riverside Bank for payment and that unless Hazel Rutherford Maxa was enjoined and restrained from cashing the check she would obtain the proceeds thereof and abscond.
The prayer of the bill sought to have a trust declared for the plaintiff in the Sunrise Bar and Restaurant or the proceeds from the sale thereof; an annulment of the marriage between the plaintiff and the defendant Hazel Rutherford Maxa; an injunction against the defendant, J. Rusciano, restraining further payment by him of any part of the purchase price for the Sunrise Bar and Restaurant; and an injunction that the defendant, Riverside Bank, be "enjoined and restrained from honoring or cashing the said cashier's check, payable to the order of Hazel Rutherford."
Based on the allegations of the bill of complaint one of the chancellors of the circuit court of Dade County, on October 20, 1947, entered a temporary restraining order without notice to any defendant and without requiring bond, enjoining the defendant, Hazel Rutherford Maxa, from cashing the cashier's check of the defendant Riverside Bank and enjoining the defendant, J. Rusciano, from paying to Hazel Ruthorford Maxa any further part of the purchase price of the Sunrise Bar and Restaurant, as prayed for by the plaintiff. As to the defendant, Riverside Bank, the chancellor did not follow the prayer of the bill that the Bank be "enjoined and restrained from honoring or cashing the said cashier's check, payable to the order of Hazel Rutherford", but entered a restraining order more limited in scope, which in express language enjoined the Bank "from paying to the said Hazel Rutherford Maxa, alias Hazel Rutherford, that certain cashier's check purchased from the said Bank by J. Rusciano and payable to the order of Hazel Rutherford."
The restraining order against the Riverside Bank was served on the morning of October 21, 1947. Subsequently, the cashier's check bearing the endorsement of the defendant, Hazel Rutherford, and the endorsement of Miami Industrial Bank showing that the check had been paid by the latter on October 17, 1947, was presented for payment in due course of business by Florida National Bank and Trust Company at Miami. Before paying the check to the holder for value, the Riverside Bank, out of an abundance of caution, inquired through its counsel of the chancellor who had entered the temporary restraining order, whether the order served on the bank was intended as an injunction against the payment of the cashier's check by whomever held, as prayed in the bill of complaint, or only as an injunction against the payment of the check to the payee, Hazel Rutherford, as expressly stated in the order. In response to this inquiry the chancellor informed counsel that the restraining order should be construed strictly in accordance with its terms and that it was the intent of the chancellor in framing the order as it read to enjoin the bank from paying the cashier's check to the defendant, Hazel Rutherford Maxa, and not from paying the check if the same should be presented by a third party.
Upon receiving this interpretation of the intended effect of the order from the chancellor who rendered the order, the Riverside Bank paid the check to Florida National Bank and Trust Company at Miami, and subsequently filed its answer in the cause showing payment of the check and the circumstances under which payment had been made to the holder for value.
After the filing of the answer, numerous proceedings were had in the main suit between Frank Maxa, Sr., and Hazel Rutherford Maxa, which are not material to this appeal and hence need not be stated. Subsequently, on February 26, 1949, the special master appointed in the cause to take testimony and to report his findings and recommendations thereon, filed a report in the court, in which he found the equities of the cause to be in favor of the plaintiff and against the defendant, Hazel Rutherford Maxa; that by reason of the payment of the cashier's check to Hazel Rutherford on October 17, 1947, the Miami Industrial Bank became and was a holder in due course of the instrument prior to the institution of suit; and that because of the fact that Riverside Bank had paid the check to the holder in due course, or its order, after the service of the restraining order upon the Bank, a decree should be entered "ordering and directing that the Riverside Bank of Miami be decreed to pay to the plaintiff * * * the said sum of $3815.00 evidenced by their cashier's check No. 21372, dated October 16, 1947 and payable to the order of Hazel Rutherford, which said check they were heretofore enjoined from paying to the defendant Hazel Rutherford."
Exceptions were filed to the master's report by the Riverside Bank on the ground, in substance, that in paying the check to the Miami Industrial Bank, or its order, the Riverside Bank had acted in good faith and not in violation of the restraining order. The exceptions were heard and overruled by a chancellor other than the one who entered the temporary restraining order, and a final decree was entered against Riverside Bank in accordance with the recommendations of the master. Thereafter the Bank appealed for the purpose of testing the validity of that portion of the decree which held the Bank liable to the plaintiff.
We can find no valid basis in the record for that portion of the final decree which found the Riverside Bank liable to the plaintiff. As is shown by the record in the cause, and as was expressly found by the special master, Miami Industrial Bank (which was never a party to the suit) became and was a holder in due course of the cashier's check executed by Riverside Bank before the suit between Maxa and his wife was instituted and before any restraining order was entered against the Riverside Bank. Because of the position occupied by Miami Industrial Bank as a holder in due course of the check, it held the check freed from all personal defenses or prior equities subsisting between the original parties to the instrument.
Unless, therefore, the restraining order which was served on Riverside Bank was broad enough in scope to enjoin the payment of check to a holder other than the payee Hazel Rutherford — of which more later — the Riverside Bank became liable to the Miami Industrial Bank for the payment of the check upon its presentation, with no way of ultimately avoiding such liability, the check being a primary obligation of Riverside Bank with no right of countermand. See Causey v. Eiland, 175 Ark. 929, 1 S.W.2d 1008, 56 A.L.R. 529; Polotsky v. Artisons Savings Bank, 7 W.W. Harr., Del., 151, 188 A. 63, 107 A.L.R. 1458; Bank of Bay Biscayne v. Ball, 99 Fla. 745, 128 So. 491; also annotations 56 A.L.R. 532; 107 A.L.R. 1463. Riverside Bank, moreover, became confronted with the real possibility of being charged with protest fees and interest if it refused to pay the check upon due presentment by the holder. See Bank of Clarksdale v. Planters' Nat. Bk., 156 Miss. 269, 125 So. 837.
Faced with the consequences of liability to a holder in due course for refusal to pay the check for which it was primarily liable, on the one hand, and the possible consequence of violating an injunction order which, though it did not say so, might have been intended by the chancellor to have been broad enough in scope to enjoin such payment, on the other, the Bank sought an interpretation from the chancellor who had first entertained the proceedings as to his intentions with respect to the order, which though definite, clear, unambiguous and certain enough in its terms was nevertheless bottomed on the prayer of a bill which sought much greater relief than was accorded in the order. In pursuing such course the Bank doubtless acted in accordance with the principle enunciated in Seaboard Air Line Ry. Co. v. Tampa Southern R. Co., 101 Fla. 468, 134 So. 529, 533, wherein it is said: "Neither will a strict or narrow construction be placed on the terms of an injunction for the purpose of permitting a defense by one charged with violating it when it is plain that he must have known when he did so that it was the intention of the court to restrain the acts done, whether such acts were as definitely described in the injunction as they should have been, or not. In cases of doubt in such matters, it is the duty of the defendant to apply to the court for such modification of the language of the injunctive order as will remove from it any ambiguity in its meaning or indefiniteness in it as to description of the property intended to be protected."
It was only after the chancellor entering the order had advised counsel that the order meant exactly what it said, that is to say, that the payment of the check to Hazel Rutherford, and only to her, was to be enjoined, that the Bank acted by paying the check to the holder in due course, who was the owner of the instrument.
Throughout the entire transaction the Riverside Bank acted with the utmost good faith in cashing the check in the hands of the holder in due course — at least there is not one scintilla of evidence in the record to suggest anything to the contrary. We think, therefore, that under the circumstances the Riverside Bank acted within its rights in paying the check to the holder in due course; for certainly the restraining order did not by its terms purport to enjoin such a transaction nor did the chancellor who entered the order intend that the order should be given a construction broader than that warranted by the use of the language employed. Accordingly, that portion of the decree entered in the cause by a chancellor other than the chancellor who entered the temporary restraining order, whereby the Riverside Bank is decreed to pay the amount of the cashier's check to the plaintiff should be reversed with directions that the Riverside Bank be absolved from liability to the plaintiff.
It is so ordered.
CHAPMAN, Acting C.J., and HOBSON and ROBERTS, JJ., concur.