102 Va. 373 | Va. | 1904
delivered the opinion of the court.
In January, 1897, John W. Holland conveyed a large estate to Berryman Green, trustee, to secure numerous creditors. In March of the same year, the trustee filed a hill asking the direction of the court in administering his trust. In this assignment, Charles L. Holland, doing a banking business under the name and style of Johnston and Cheek, was given priority over all other creditors for a debt of $20,000.00, which seems not to have been questioned by any one.
It appears that the trustee kept his bank account with the banking house of Johnston and Cheek from the time the suit was instituted until the final settlement of his accounts. On June 4, 1900, the trustee collected and deposited to his credit with Johnston and Cheek $16,393.52, under a decree which directed him to deduct therefrom his commissions, a reasonable fee to be paid his attorneys, the unpaid costs of thd suit, and to distribute the balance to the creditors, according to their rights and priorities, as ascertained by the report of the commissioner then filed in the cause and confirmed. Checks were drawn by the trustee against this account, and other deposits added thereto, but the larger part of the deposit of June 4, 1900, remained in the bank until January 13, 1902, when Green, trustee and receiver of the court, gave to Victor and Patterson, substituted trustees, his check for $14,193.62, the balance then standing to his credit in the bank, and on the same day the substituted trustees paid this sum to Johnston and Cheek on account of their preferred debt of $20,000.00.
The contention of the general creditors is that, inasmuch as the deposit in question was made in the bank of Johnston and
We are of opinion that the lower court erred in sustaining this contention. The record shows that the account kept by Green, trustee and receiver, at the bank of Johnston and Cheek was an active and varying one, and was subject to no special agreement, but was received and treated as the accounts of all other customers of the bank, whose deposits were at all times subject to check. The decree relied on as dedicating the deposit of June 4, 1900, to the payment of the debt due to Johnston and Cheek cannot be so construed. The decree does not direct any certain sum to be paid to the creditors. Indeed, the fund was not in the hands of the trustee. He was directed to collect certain moneys due to the fund, and to deduct his commissions, pay reasonable attorneys’ fees, pay the unpaid costs of suit, and, lastly, to distribute the balance to the creditors, according to their rights and priorities. The several payments to be made by the trustee were not ascertained by the decree, were uncertain in amount, and some of them left to the discretion of the trustee by the direction to him to pay reasonable attorneys’ fees. This item of attorneys’ fees has since been the subject of litigation, and is now undetermined and pending on appeal in another case
The case last cited is very much in point. That was a suit to liquidate the affairs of a firm, among whose creditors was the Ilion Bank. In the regular course of.the liquidation, a dividend which should have been paid to the bank, amounting to nearly $50,000.00, was delayed for a year or more, and during this period the receiver, of the court kept on deposit at the Ilion Bank a part of the trust funds largely in excess of the dividend; and it was there contended that because the bank had the use of the funds it was not entitled to interest on the dividend, but the court held that the arrangement between the bank and the receiver was one of mutual benefit and convenience, and whether one received more benefit than the other could not be enquired into; that it was in the nature of a contract between the parties with which the court had no right to interfere.
For these reasons the decree appealed from must be reversed, and the cause be remanded for further proceedings in accordance with the views expressed in this opinion.
Reversed.