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Regan v. First National Bank of Arizona

Supreme Court of Arizona

April 15, 1940

E. D. REGAN, Appellant,
FIRST NATIONAL BANK OF ARIZONA, a National Banking Association, Appellee

APPEAL from a judgment of the Superior Court of the County of Maricopa. E. G. Frazier, Judge. Judgment affirmed.

Mr. Robert D. Dewolf, of Phoenix, Arizona, and Mr. Lee Combs, Jr., of Los Angeles, California, for Appellant.

Messrs. Armstrong, Kramer, Morrison, Roche & Duffy, for Appellee.


Page 215

[55 Ariz. 321] LOCKWOOD, J.

This is an appeal by E. D. Regan, hereinafter called plaintiff, from a judgment in favor of First National Bank of Arizona, a national banking association, hereinafter called defendant. The facts [55 Ariz. 322] shown by the record and necessary to a determination of the appeal may be stated as follows:

In 1934, plaintiff brought an action in the superior court of Maricopa County against Cary O'Steen and other parties, and on July 14th caused a writ of garnishment to be served on defendant herein, requiring it to show any indebtedness to Cary O'Steen, Mary O'Steen, his wife, American Mutual Benefit Society, a California corporation, or American Mutual Benefit Society, an Arizona corporation. Defendant answered that at the time the writ was issued Cary O'Steen was the renter of a certain safe deposit box owned by it and numbered 460, but that the garnishee knew nothing of the contents of the box; that it was not indebted to either of the O'Steens or the California company, nor did it have any effects of theirs in its possession, but that it was indebted to the Arizona company in the sum of $411.48. This answer of the garnishee was never controverted, as permitted by the statute. On Octover 27th another writ was issued in the same action against defendant herein, requiring it to answer concerning the defendants named in the first writ, and also as to Raymond O'Steen, Western Benefit Society, an Arizona

Page 216

corporation, and Burbank Mutual Life and Benefit Association, a California corporation. The garnishee answered that it was indebted to Western Benefit Society in the sum of $15.70, but was not indebted to any of the others, not did it know where they had any effects. This answer also was never controverted. On January 21, 1935, judgment was rendered by default, in the principal suit, in favor of plaintiff against Cary and Mary O'Steen, and American Mutual Benefit Association, Western Benefit Society and Burbank Mutual Life, and Benefit Association, California corporations, and on November 27, 1937, judgment was rendered after trial in the same [55 Ariz. 323] case against Western Benefit Society and American Mutual Benefit Society, Artizona Corporations, for something over $5,000. Thereafter, and on December 20, 1937, a writ after judgment was served on defendant herein, and it answered that it was indebted to American Mutual Benefit Society and Western Benefit Society, Arizona corporations, in the sums of $411.48 and $23.60, respectively, and that it knew of no persons who had any effects of any of said defendants in their possession. Plaintiff controverted this answer of the garnishee and tendered an issue in garnishment, wherein it set up as follows:

"That garnishee herein has failed to disclose in its answer on file herein whether or not it is now indebted to any person, partnership, corporation or other legal entity not named as a defendant herein, but in which one or more of the defendants herein have the power, by power of attorney, agent, president or otherwise to exercise control over said funds or indebtedness.

"That plaintiff alleges that the garnishee is indebted to or have effects belonging to C. Collins, or to some other individual, person or corporation or legal entity unknown to plaintiff, but that Cary O'Steen or some other defendant herein, is empowered by arrangement with garnishee herein, as agent, treasurer or attorney in fact for said C. Collins or other person, to exercise full control over said effects, indebtedness or other property held by garnishee.

"That said powers of attorney, corporate entities and arrangements are all fictitiously formed for the purpose of evading effective enforcement of the process herein, and that all funds and property held by the garnishee herein by persons or identities or corporations not parties to this action, but which are under the control of the parties hereto, is in fact the property of said defendants herein.

"That said garnishee should be required to disclose in its answer what if any such relationship exists between the parties to this action and said garnishee, and what if anything it is holding on behalf of some [55 Ariz. 324] person or corporation not a party hereto, but which is under the control of said defendants herein.

"That plaintiff is informed and believes that defendants herein and garnishee have transacted business heretofore in a similar manner, and that the sum of $2992.26 was paid to Cary O'Steen as agent for the Western Benefit Society, after a levy of a writ of garnishment against said Cary O'Steen, but prior to the time that said Western Benefit Society was made a party defendant herein, and that a ...

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