113 Neb. 93 | Neb. | 1925
Applications of various persons holders of certificates of deposit issued by the Home State Bank of Dunning for allowance of the same against the state guaranty fund.
Applicants show that they became the owners of the certificates in good faith and for value before due, and claim that they are entitled to the protection of the law as applied to good faith purchasers of negotiable instruments, and a good proportion of their brief is devoted to-a discussion of that question. But, while there is no doubt that certificates of deposit are negotiable instruments entitled to the protection of the law governing the same as between private parties dealing therewith, since the filing of the briefs in this case we have decided in State v. Farmers State Bank, 111 Neb. 117, that, where the question is of the allowance of such claim against the guaranty fund, the law of merchants or the negotiable instruments law have no application. As was said in that case by Day, J.: “The circumstances under which the guaranty fund may be liable are entirely apart from the law pertaining to negotiable paper. A holder of a certificate of deposit in a bank who seeks to hold the guaranty fund liable for its payment must suow that the transaction leading up to the issuance of the certificate was such that the law holds the guaranty fund liable for its payment.” See, also, Fourth Nat. Bank
From the date of its organization up until about April 24, 1920, C. C. Cooper was president of the Dunning bank, and about said date sold all of his stock to six other stockholders of the bank, to wit, Wilson, McGinn, Wegner, Rankin, Hankins, and Ocher, who, in payment for said stock, gave their joint note to Cooper for $20,000 due October 1, 1920. On that date Cooper demanded payment, but the makers were unable to make it. Cooper refused to renew the note, but suggested that if the makers could procure certificates of deposit of the Dunning bank for the amount, ■due in 12 months, he could handle such certificates in California, where he was then living, but could not handle individual notes. As the makers were not permitted by law to borrow the money from the Dunning bank, being stockholders therein, upon the suggestion of Cooper that they procure the money on their notes from some other bank, one C. E. Wilson, cashier of the Dunning bank, caused to be prepared and signed by the six purchasers, above named, a note for $20,000 payable to the Citizens State BanK of University Place, Nebraska, and on or about October 7, 1920, took the same to the Citizens State Bank, and explained the situation to its president, Mr. Bair, and requested a loan of $20,000 upon the note as security. Being informed by Bair that the bank did not have that much money to loan, Wilson suggested that the money need not leave the ba^k, but should remain there to the credit of the Dunning bank. Bair replied that that put a different aspect upon the matter, and it was finally arranged that credit should be given upon the books of the Citizens bank, which was accomplished in the following manner:- Bair
On May 20, 1921, new notes were executed by Rankin and Hankins, and July 8, 1921, by Ocher, Wilson, and Wegner, each for $3,333.33, and indorsed, respectively, by. the other five stockholders and deposited with the Citizens bank, and thereupon the credit of the Dunning bank was reinstated in the sum of $16,666.66, and was later drawn out upon drafts of the Dunning bank upon the advice of. the state bank examiner. These notes were not indorsed by the Dunning bank, but were secured by second mortgages on real estate of the signers. The Citizens State. Bank continues to hold the five notes and that of McGinn, or renewals thereof, aggregating $20,000.
The question then recurs whether upon the above facts the claimants have shown such a deposit in- the Dunning: State Bank as is entitled to the protection of the state guaranty fund. A number of facts have been referred to occuring after the issuance of the certificates in question, but the legal status of the certificates of deposit, must be determined as of their date, the subsequent occurences being of material consideration only as they may tend to characterize the original transaction. The subsequent deposit of notes secured by real estate mortgages: and withdrawal of the funds thereby secured, while it might
We find no error in the record, and the judgment of. the district court is
Affirmed.
Note—See Banks and Banking, 7 C. J. sec. 15.