118 Neb. 495 | Neb. | 1929
The administrator with the will annexed of the estate of Ole P. Larsen brings this action for an allowance of his claim against the guaranty fund of the state of Nebraska. The present executor was appointed in September, 1924, upon the removal of one Kronberg, who had been appointed in July, 1923. Kronberg was the president and actual manager of the Farmers & Merchants Bank at Kennard, Nebraska, during the time he acted as executor of the estate of Larsen. On April 24, 1924, as executor, he deposited in his bank $8,000 which he had collected of the assets of said estate. At the time Kronberg was appointed executor, there were in the safety deposit box of the deceased in the bank three certificates of deposit issued by his bank; one for $5,000, one for $3,000, and one for $2,000, which items with the $8,000 deposit heretofore mentioned make up the total .of the claim of $18,000.
Prior to the time Kronberg became executor of the Larsen estate, he had made some improvident loans of the ■bank’s money, which loans he had been required to take out
As we view this case, the only question presented is whether the manipulations of the records of the bank by Kronberg were of such a nature as to terminate the deposit of the estate in said bank. In the consideration of this case it is difficult not to confuse in our mind the acts of Kronberg as president and manager of the bank and those of Kronberg as executor of the estate of Ole P. Larsen. It is necessary to a proper determination of this case that we keep these two relationships clearly and distinctly separated. It is only difficult because the two official positions were held by the same man. We think, if we remember that this was the money of the estate, held in trust and deposited in the ¡bank by Kronberg as executor, it will help us to avoid confusion. The appellee argues that, had Kronberg as executor brought this action instead of his successor in office, then there would be no doubt but that he as executor could not secure the allowance of this claim against the guaranty fund. If it could be conceived that he had been continued as executor by the probate court, and it was apparent that the estate was in fact a depositor of said bank, that said relationship had not been terminated, then a judgment might have ¡been entered allowing the claim as a deposit, for the benefit of the estate, in the name of Kronberg, as well as in the name of his successor as executor.
.If Kronberg as executor withdrew the money from the hank, then the relationship of banker and depositor was terminated and the guaranty fund cannot be charged with this claim. Upon this question the trial court found: “That the
Now the remainder of $5,000 of this account was used to pay a bogus certificate of deposit. Without going into the details of this transaction, suffice it to say that, in so far as' the bank is concerned, nothing in the record discloses that it was not the valid obligation of the (bank at the time. It follows then that this transaction inured to the benefit of the bank in that it removed from the books of the bank its liability to this depositor, without the payment of any money.
In State v. American State Bank, 108 Neb. 98, it is held: “False entries on the books of a bank, whereby one depositor is credited with the funds of another, do not change the relation of banker and depositor in regard to that particular item or relieve the bank from liability for a proper disbursement of the fund, if the bank is chargeable with knowledge of the facts.”
Where money is deposited in a bank by an executor of an estate, who is also president and manager of the bank, false entries which indicate that the money has been withdrawn from the bank, when in fact it was not so withdrawn, but was diverted to other accounts for the benefit of the bank, do not terminate the relationship of depositor and banker. The deposit in this case was diverted for the benefit of the bank, and the deposit was not terminated by the entries on the books of the bank, which were not in accord with the actual facts. The evidence forces the conclusion that this was a valuable business transaction for the bank.
The appellee relies upon the holding in the case of State v. Farmers & Merchants Bank of Walton, 112 Neb. 840, wherein it is stated: “Where money is deposited in a ¡bank to the credit of an administrator of an estate, the bank is charged with notice of the trust character of the fund, but is not required to see that the same is properly applied or
It' is not necessary to impute the knowledge of Kronberg as president and manager of said bank to it. The bank had actual knowledge of this whole transaction. The books of the bank disclose the whole transaction. The bank paid out nothing to cancel this deposit and the deposit was not withdrawn but remained a deposit of said bank. In State v. Farmers & Merchants Bank of Walton, supra, the writer of the opinion drew the distinction between that case and the case at bar, when he stated: “Where the fund is withdrawn upon checks of the trustee, signed in his official character, the responsibility of the bank with regard thereto is ended.” And again: “If he had attempted to apply the fund in payment of an overdraft at the bank or in any other way for the bank’s benefit, the bank would be charged.”
It is vigorously contended by the appellee that the act of marking the certificates of deposits as paid; that the act of placing an order for the payment of the checking account; and that the bookkeeping transactions incidental thereto, were the acts of Kronberg as executor. All of these things were done within the privacy and seclusion of the cage of the bank. When Kronberg, president and manager of the bank, falsified the records to indicate payment, the act was done by the bank and for the benefit of the bank. It was not done by Kronberg as executor, for as such he did not
Having reached the conclusion that there was no withdrawal of the funds of the estate from the bank by the executor and that the false entries on the books indicating a «withdrawal were the acts of the bank made with a full knowledge of the trust character of the funds, we find that at the time the bank ceased to be a going concern and was placed in the hands of the state the executor of the estate of Ole P. Larsen had a deposit of $18,000 therein which is a valid claim against the guaranty fund of the state of Nebraska. The trial court should enter judgment according to the views herein expressed.
Reversed.