41 Ind. App. 474 | Ind. Ct. App. | 1908
Appellant sued appellees to recover $500 in money alleged to have been left with appellee bank as a special deposit. The facts are undisputed and in substance are as follows: In September, 1903, appellant contracted with the American Shredder & Husker Company for one of their machines. He was to give $500 and a McCormick Husker for the same, provided said machine fulfilled the guaranty after ten days’ trial. The machine company directed that he should leave the money at a bank
"Elkhart, Indiana, October 5, 1903.
Horace Shopert has deposited in this bank $480 payable to the order of the American Shutter & S. Co., in current funds on return of this certificate properly indorsed. Provided husker fills guaranty after ten days’ trial. This deposit is not subject to check.
W. L. Collins, cashier.
Hold until notified to remit by H. Shopert. ’ ’
This certificate was placed in an envelope and retained by the bank, the banker saying: "Now, it’s all right.” Appellant received no deposit slip, certificate of deposit, or other writing for the money so deposited. Subsequently the shredder company sent the bill of lading for the machine to said bank, with instructions to turn the same over to appellant when he had deposited $500 subject to the order of said company, upon the successful operation of the husker
The machine did not fill the guaranty, and it was after-wards returned and the contract rescinded. Meanwhile, and before appellant made demand for the return of the money, a receiver was appointed for the bank. There was cash on hand in said bank, at the time the receiver took charge, to the amount of $3,293.75. There was no separate package of $500 in said bank at said time.
The court made a general finding and rendered judgment for appellant for the sum of $500, to be paid pro rata as other creditors. Appellant moved to modify the judgment by ordering that said judgment be a preferential claim over the general creditors, and that the receiver be ordered to pay the same in full out of the funds in his hands. -This motion was overruled and exception taken. Motion for a new trial was then filed by appellant, which was also overruled.
The only substantial question in this case is whether the facts just stated constitute a special deposit, and said amount of money should be paid to appellant in full as a preferential claim.
Deposits in banks are either general or special. McLain v. Wallace (1885), 103 Ind. 562.
By the agreements and instructions aforesaid the bank was made the trustee of the fund with certain duties to perform with reference thereto: one was to preserve it intact, the other to deliver it at the proper time to the proper person. Under these conditions the bank had no right of property in it, and could not invest itself with such right by any act of its own without the knowledge of the party or parties who had such interest.
In the case of Woodhouse v. Crandall, supra, Woodhouse leased a building to Furlong. The conditions of the lease were that Furlong was to deposit $1;500 with Meadowcroft Bros., bankers, to be held as security that Furlong would comply with the terms of his lease. Within six months of
In the case of Anderson v. Pacific Bank, supra, money was deposited by Anderson with the bank to secure sureties procured by the bank on certain bonds. A certificate of deposit, in the usual form, was given to Anderson, which, in addition to the usual words, stipulated: “Payable only on release of bonds. ’ ’ The money, without the knowledge of Anderson, was placed in the general funds. The bank became insolvent, the bonds released, and Anderson demanded the return of his money as a specific deposit. The court held it a special deposit, saying: ‘ ‘ The money was delivered in a manner strictly in accord with a contract of pledge, but quite inconsistent with the notion of an ordinary banking deposit. The so-called certificate of deposit issued by the bank is not a certificate of deposit, but a mere receipt, expressing, though briefly, the contract of pledge. Every contract by which possession of personal property is transferred as security only is to be deemed a pledge. * * * Under such a contract the fact that the bank afterward wrongfully commingled and used the funds, if it did do so, cannot be urged by it in defense as effecting any change in the contractual relations and rights of the parties. -It would be but allowing it to plead its own wrongdoing to its own advantage. ’ ’
Other authorities to the same effect are Windstanley v. Second Nat. Bank, supra; Massey v. Fisher, supra; Kim
Cause reversed, with instructions to the lower court to modify said judgment, as asked in said motion.