143 P. 736 | Cal. | 1914
This was an action against the superintendent of banks to recover the value of two checks and a draft received by the Kern Valley Bank just before it was closed by his order. The amount of one of the checks, two hundred dollars, was paid by the defendant before the trial of the action. The court held that three hundred dollars, the money represented by the other check, and one hundred and forty dollars, the proceeds of a certain draft, were held by the defendant in trust for the plaintiff. From this judgment defendant appeals.
Plaintiff was on May 11, 1911, and for a long time theretofore had been a depositor with the Kern Valley Bank. On the afternoon of that day he deposited with said bank a check for three hundred dollars drawn in his favor and bearing his indorsement in blank. Before the close of business on that day the books of the bank were posted and balanced and the amount of the check was placed to the credit of the plaintiff, D.J. Gonyer. On May 12th before the opening of the bank at 10 o'clock A.M. one of defendant's deputies entered the premises. Under his instructions the doors were opened as usual for business but all deposits made during that morning were segregated and kept separate from the other funds of the bank. Shortly before noon the bank closed its doors and subsequently all deposits made on May 12th were returned to the depositors. Before the doors were closed on the morning of May 12, 1911, the Bank of Bakersfield on which the check for three hundred dollars was drawn balanced its accounts with the Kern Valley Bank with the result that the sum of about one thousand three hundred dollars was found to be due by the latter to the former.
While it is alleged by plaintiff and admitted by defendant that the Kern Valley Bank was in fact insolvent when plaintiff's check was deposited, there is neither allegation nor finding *454
that such insolvency was known at that time to the officers of the bank. There is therefore no question in this case with reference to the fraudulent receipt by an insolvent institution of an amount tendered for deposit. Respondent's theory, which was accepted by the trial court, was that the function of the depositary was to collect from the Bank of Bakersfield the amount of the check and place it to the account of the depositor and that until such a transaction was consummated by the balancing of the account of the two banks, Mr. Gonyer did not become a general creditor of the Kern Valley Bank; and that, as the Kern Valley Bank was under the supervision of the state's superintendent of banks when the balance between the two institutions was sought to be figured, it was incapable of transacting business and therefore no general deposit of the three hundred dollars was completed. We cannot agree with this theory of the transaction. The deposit of the indorsed check by Mr. Gonyer with the Kern Valley Bank, in the ordinary course of business, transferred the title to the instrument from him to the bank. The transaction was not one which created the relation of principal and agent but rather that of creditor and debtor. The matter of depositing checks and the ensuing rights and obligations was considered by this department in the case of Plumas County Bank v. Rideout,Smith Co.,
The plaintiff sued also on an assigned claim for one hundred and forty dollars. The history of the transaction out of which that claim arose is as follows: In the early part of May, 1911, the Kern Valley Bank received for collection from the Clauss-Shear Company of Fremont, Ohio, a draft on A. Weill for one hundred and forty dollars. This was presented and duly paid by the said A. Weill on May 11, 1911. The Kern Valley Bank, after deducting the usual charge for collection, prepared a draft upon its New York correspondent for the balance of the one hundred and forty dollars and sent said draft to the Clauss-Shear Company. Before the last *455 named corporation could present the draft for collection the Kern Valley Bank suspended business; the New York correspondent, therefore, refused to honor the draft and it has never been paid. It was stipulated by the parties that the course pursued by the Kern Valley Bank was that usually followed by banking institutions in collecting drafts and remitting the proceeds.
The money was not a special trust fund but the general assets of the bank were subject to the payment of the draft on the failure of its correspondent in New York to honor its paper. The owners of the money collected from Weill were, therefore general creditors and the court erred in finding that a part of the assets of the bank which passed into the hands of the superintendent of banks constituted a trust fund for the payment of the balance due from the bank as the proceeds of the collection. Nothing in Henderson v. O'Conor,
It follows that the judgment must be and accordingly it is reversed.
Henshaw, J., and Lorigan, J., concurred.