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Green v. McCord

Supreme Court of Alabama
Jun 10, 1920
85 So. 752 (Ala. 1920)

Opinion

5 Div. 748.

June 10, 1920.

Appeal from Circuit Court, Coosa County; E. J. Garrison, Judge.

George A. Sorrell, of Alexander City, for appellant.

The debtor had notice of insolvency, or of the appointment of a receiver, and cannot set off the claims subsequently acquired. 176 Ala. 48, 57 So. 483. The liability was contingent, and not available as a set-off. 65 Ala. 436. There can be no set-off, where plaintiff has no cause of action. 124 Ala. 455, 27 So. 518. The claim is barred by failure to take the steps required by section 10, p. 63, Acts 1911. 83 Ala. 420, 3 So. 779; 111 Ala. 529, 20 So. 362.

James W. Strother, of Dadeville, and John A. Darden, of Goodwater, for appellee.

In the appeal in this case appellant is confined to the ruling superinducing the nonsuit. 167 Ala. 117, 52 So. 397. The claim was not barred under section 5858, Code 1907, nor was it barred by the statute of limitations. 83 Ala. 420, 3 So. 779; 88 Ala. 300, 7 So. 150; 124 Ala. 181, 27 So. 556; section 5863, Code 1907. The replication constituted a departure from the complaint and was demurrable. 165 Ala. 436, 51 So. 779. The replication failed to show a compliance by the superintendent of banks with the statute in reference to claim against insolvent banks. Acts 1911, pp. 62 and 63. The suit is in the individual capacity, and not in a representative capacity. 137 Ala. 492, 34 So. 562; 106 Ala. 458, 17 So. 629.


In the case of Oates v. Smith, 176 Ala. 39, 57 So. 438, it was held that a debtor of an insolvent state bank cannot set off against his debt a claim acquired by him subsequent to the initiation of the receivership. Whether that doctrine would be applicable to a case where, though the debtor's right of action on his cross-claim accrued after the receivership began, it was nevertheless founded upon a contractual obligation imposing a contingent liability, which antedated the receivership, we need not now determine.

So far as the present case is concerned, in the absence of appropriate allegation in the complaint showing that the Farmers' Merchants' Bank has been taken over by the superintendent of banks for the purpose of liquidation under the statute, and that this occurred prior to the accrual of defendant's demand in set-off as shown by his special pleas 2 and 3, there is nothing on the face of the pleadings to show that defendant's asserted claim is not available as a set-off against the note sued on. The demurrers to these pleas were therefore properly overruled.

In section 10 of the Banking Law of Alabama (Gen. Acts 1911, p. 63) it is provided that when a creditor's claim against a bank in liquidation has been filed with the superintendent of banks, and by him disallowed, and notice therof served upon the claimant, "an action upon a claim so rejected must be brought by petition to the court having jurisdiction of the affairs of the bank by the claimant within six months after such service, or the same shall be barred." This is a statute of limitation, which operates upon any independent action by the claimant. But, under section 5863 of the Code, such a claim is available as a set-off unless action thereon was barred when the plaintiff's cause of action accrued; and a replication setting up the statute is bad on demurrer when it appears from the complaint and plea that the bar was not thus complete. Jeffries v. Castleman, 75 Ala. 262; Riley v. Stallworth, 56 Ala. 481. On this principle the demurrer to replication No. 2 was properly sustained.

Without discussing in detail the effect of the transactions and conditions disclosed by the allegations of replication No. 3, it will suffice for present purposes to say that they do not show as a matter of law that defendant's claim, based upon his payment of the note to the Birmingham Bank upon which he was an indorser, was canceled and discharged by the mere fact that the Birmingham Bank held his own note for an equal amount, which was executed by him to the Farmers', etc., Bank, and by it transferred along with other notes, as collateral security for the note paid by defendant. The allegation that defendant became thereby the owner of his own note, and that his claim against the Farmers', etc., Bank was thereby settled and discharged, is a mere conclusion of the pleader, and is not supported by the facts shown. This replication was therefore subject to the demurrer.

Replication No. 4 is insufficient as an attempt to show an estoppel by the pleadings and judgment in another suit between these parties. The replication should set out all of the serial pleadings in that case in order that the issues therein may appear, and their relation to the present case be determined by the court. To set out merely the defendant's rejoinder "to the plaintiff's special replication No. 2, to plea A," is obviously not sufficient; the substance of the antecedent pleadings not being shown. Each of the replications being subject to demurrer, the assignment of error in this behalf, viz. that "the court erred in sustaining the defendant's demurrer to the plaintiff's replications," must be overruled.

We do not overlook plaintiff's contention, presented by demurrer to the pleas of set-off, that, under the provision in section 9 of the Banking Laws, which requires an action on a rejected claim to be brought "by petition to the court having jurisdiction of the affairs of the bank," the defendant cannot have a judgment over against the superintendent of banks in the action here prosecuted by him as a statutory receiver. That demurrer was, however, directed to the plea of set-off generally, whereas it should have been limited to its function as a cross-claim for a judgment over. The demurrer was therefore too broad, and was for that technical reason properly overruled. The question of defendant's right to a judgment over against the plaintiff, who sues in a representative capacity, is therefore not before us upon its merits, and need not be now determined.

A part of the subject-matter of this case is involved also in another case between the same parties. D. F. Green, as Superintendent, etc., v. Z. D. McCord (5 Div. 734) 85 So. 750. We refer to that case here merely for the purpose of saying that our rulings in the two cases are in perfect accord, having regard for differences in the pleadings.

Ante, p. 356.

Finding no error in the record, the judgment will be affirmed.

Affirmed.

ANDERSON, C. J., and McCLELLAN and THOMAS, JJ., concur.


Summaries of

Green v. McCord

Supreme Court of Alabama
Jun 10, 1920
85 So. 752 (Ala. 1920)
Case details for

Green v. McCord

Case Details

Full title:GREEN, Superintendent of Banks, v. McCORD

Court:Supreme Court of Alabama

Date published: Jun 10, 1920

Citations

85 So. 752 (Ala. 1920)
85 So. 752

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