Board of Levee Com'rs v. Love

113 So. 335 | Miss. | 1927

^* Corpus Juris-Cyc References: Banks and Banking, 7CJ, p. 485, n. 82 New; Depositories, 18CJ, p. 588, n. 15 New. This is an appeal from a judgment adverse to the board of levee commissioners, who filed suit to compel the superintendent of banks to issue guaranty certificates for the balance of the levee board's deposit in the Delta Bank Trust Company, of Clarksdale, Miss., which bank closed for liquidation on March 16, 1921. At the time it closed, it had on deposit for the levee board, a total of one hundred ninety-one thousand eight hundred fifty-three dollars and eleven cents. This indebtedness had been reduced by the sale of bonds and other securities, and by impressing the assets of the bank as a trust fund until the amount was reduced to approximately seventy-three thousand dollars. The levee board's priority as to the assets of the bank had been recognized prior to the suit, and the realization from said assets had been applied to the payment of the public deposit claims of the levee board, the city of Clarksdale, and the state of Mississippi. The assets of the bank had been exhausted, and the levee board, in this proceeding, is demanding that the state bank depositors' guaranty fund satisfy the balance.

It appears that the Delta Bank Trust Company was selected as the depository by the board of levee commissioners, and that, practically, one hundred thousand dollars worth of bonds, debentures, and other permissible securities were deposited with the board of levee commissioners by the bank to guarantee the levee board's deposit. In addition to this, a bond was executed by the Delta Bank Trust Company personally secured by certain directors of the bank, making it a personal bond for the bank. It was intended by this arrangement to secure, at least, two hundred thousand dollars of the funds of the levee board as a deposit in the bank, or that same should come into its possession for and on behalf of the levee board. This bank was also selected as the fiscal agent for the levee board, and, in the course of its dealings, it would draw funds from other depositories, and place them in the Delta Bank Trust Company, and draw checks on that bank in disbursing funds in the course of administration of its business. There is a dispute in the record as to whether this bond was signed by three sureties or by four sureties, as required by the statute, and the chancellor refused to decide this issue of fact presented by the record, holding that it was unnecessary as the banking department was not liable for the balance due to the levee board on account so made.

We think the deposit was otherwise secured in the present case by the personal bond, and that the levee commissioners had a right of action against this bond for the balance of their claim, under the authority of Perkins v. State ex rel., 130 Miss. 512, 94 So. 460. The levee commissioners accepted the bond as having four sureties, and the bank and the signers of the bond received the benefit of the contract, all parties treating the bond as being legally sufficient. There is no doubt but what the levee commissioners could resort to and recover on this bond, and they certainly had available securities to the extent of one hundred thousand dollars in addition to this personal bond.

It seems to be the theory of appellant that, if the securities taken fail to pay the amount of the levee board's deposit, the banking department, under the Guaranty Banking Act, would be liable for the remainder of money on deposit not realized from the securities, bonds, and assets of the bank, under the trust fund statute. We do not think the act can be given this construction. If the deposit had been less than one hundred thousand dollars, it certainly would have been fully secured. The levee board was not depositing on the faith of the bank's solvency and credit, but it exacted, and took, securities, and it can proceed against these securities for the collection of its demand. It seems to be settled by the case of Love, Superintendent of Banks, v. Citizens' Bank TrustCo. of Marks, 140 Miss. 585, 105 So. 484.

We therefore hold that the court below committed no error, and the judgment is affirmed.

Affirmed.