129 Ky. 637 | Ky. Ct. App. | 1908
Affirming.
This is an action by the Commonwealth of Kentucky against the State National Bank, as one of the State depositories, to.recover of it the sum of $3,096 alleged to be due the Commonwealth for interest at the rate of 2% per cent, per annum upon the daily balances on deposit during the first six months of the year 1900. In the year 1897 the Treasurer of the State of Kentucky designated appellant bank as one of the State depositories, and entered into an agreement with it whereby the bank promised to pay 2y2 per cent, per annum on the daily balances on deposit. This agreement as to interest was inserted in the bond required by section 4693, Ky. St. 1903. On the 16th day of December, 1898, appellant renewed its bond, and continued thereafter to operate under the agreement to pay 2% per cent, per annum on the daily balance. The bank continued to act as a depository during the first six months of the year 1900. These facts appear in plaintiff’s petition. Appellant in its answer admits the execution of the two bonds referred to and the making of the contract in regard to interest. It also admits that up to January 1, 1900, it did pay to the Commonwealth of Kentucky interest at the agreed rate of 2]/> per cent, per annum upon the daily balances in its hands. It then alleges that on the--day of January, 1900, that Walter R. Day, who had been elected and qualified and was then the acting Treasurer of Kentucky, requested appellant to renew its bond and continue to’pay 2 y2 per cent, on the daily balance; That at the time of the request made by the said Day
Mr. Walter R. Day, the former Treasurer, testified that he acted as Treasurer from January 1, 1900, to February 26, 1900; that he’ called on Mr. Hoge to renew his bond to the State; that at the i#me he requested him to renew the bond Mr. Hoge inquired if the old bond he had with Mr. Long would not be good
Mr. George W. Long testified that he was Treasurer of the Commonwealth of Kentucky from 1896 to 1900. As Treasurer, he entered into a contract with the State National Bank to act as the State depository. He had no recollection of any notice having been served on him by the State National Bank that it did not longer want the deposit of the State. The bank did not refuse to accept any money that was offered for deposit. He did not remember having made out a bond for the State National Bank to send up to Mr. Hoge for execution after Mr. Day’s election as Treasurer. It was possible he may have done so.
O. W. Long testified that he was Assistant Treasurer of- the Commonwealth of Kentucky from 1898 to 1900. During that time neither the president, of the State National Bank, nor any other officer of that bank notified him that the contract entered into with his father (George W. Long) as State depository was terminated; nor had the bank notified him that it would no longer receive deposits. He did not remember taking a blank bond, at the request of the
S. W. Hager testified that he formerly held the office of State Treasurer. He assumed the duties on February 26, 1900. There tvere two depositories in the city of Frankfort — the State National Bank and the Farmers’ Bank. Had a conversation with Col. Hoge, cashier, and Gen. ITewitt, president, of the State National Bank. Some money had been paid into his hands as Treasurer, and he wanted to deposit it as the law provided it should be deposited. He went to the officers of the State National Bank, as well as the officers of other banks in the city, with a view of making an agreement or having an understanding with them that he as Treasurer might withdraw from the bank any amount of money that might be deposited by him as Treasurer, and this agreement they declined to enter into, for the reason, as stated,by them, that they were responsible to the State for any money that the bank as a depository might receive from any State officer, and that there was a controversy over the title to the office, and that they could not honor any cheek signed by him (Hager) as Treasurer. The conversation he had was in regard to money which he, as Treasurer, might-deposit in the bank, and not in regard to the money which had been deposited by his predecessors. In' the conversation had with the officers of the State National Bank not one of them indicated that the bank did not want to act as State depository any longer. The letter filed with Col. Hoge’s deposition (which will be hereafter set out) referred only to such deposits that he, as Treasurer, might make.
For appellant, Mr. Charles E. Hoge, cashier, testi
The provision of the Kentucky Statutes of 1903 with reference to depositories are as follows:
“Sec. 4692. The Treasurer shall designate in writing to the Governor to be entered on the Eexcutive*645 Journal, not less than three nor more than five solvent banks, each having a paid-up capital of not less than one hundred thousand dollars, as State depositories; and all public money of the State now in or hereafter received into the treasury shall be deposited in said depositories in amounts as nearly equal to the capital stock of the bank as convenience will permit; and the Governor or the Treasurer may from time to time, as may seem necessary, examine into the condition of the State’depositories and-the manner in which the State’s account is therein kept; and if it shall at any time appear that the capital of any depository has become impaired, the Treasurer shall have power to cause the State’s deposit to be withdrawn therefrom, and shall in like manner name another depository, which, when so named, shall, with its president and cashier, be subject to the provisions of this law. For services rendered by said depositories, there shall be no charges made of any character or description. The depositories selected shall each pay to the Commonwealth, in proportion to the. deposits received,- interest at such rate per annum as may be agreed upon between the Treasurer and the depositories upon the average daily deposits on hand at the close of banking hours, the same to be paid to the Treasurer at the end of each six months, commencing with the date of the deposit.
“Sec. 4693. Before gny bank shall be named as deposit.ory, or permitted to receive the public funds, said bank shall execute to the Commonwealth of Kentucky a bond, with good sureties, worth, severally or jointly, not less than one hundred thousand dollars, to be approved by the Treasurer, conditioned that said bank will pay over, (when demanded, all money deposited with it by the Treasurer, and otherwise*646 faithfully comply with the requirements of the law relating to it'as a depository. The bond shall be filed with and be recorded by the Secretary of State, and shall be renewed at least once in every two years, and oftener if required by the Treasurer. The execution of this bond, or the deposit of the public funds in banks named as depositories, shall not in any wise diminish the liability of the Treasurer or his sureties upon this bond, or impair or delay the right of the Commonwealth to recover thereon for any loss or misapplication of the public funds, or other delinquency in office, nor shall the execution of the bond by the bank impair or delay in any way the right of the Commonwealth to recover from any delinquent or defaulting bank, or the officers or stockholders thereof, in the same manner as other depositors.”
It will be observed that section 4692 prescribes how a State depository shall be designated. The statute, however, is absolutely silent upon the question of how long such depository shall continue to act as such. We therefore conclude that, in the absence of an agreement specifically fixing the time, the relation continues during the mutual will of the State Treasurer and the bank designated as depository. In order to discontinue the relation, it is necessary that it should be done by some certain, unequivocal act denoting a positive intention to do so. In case the Treasurer elects to withdraw the deposit, he should notify the bank to that effect. In the event the bank desires to be relieved of its responsibility as State depository, it. should notify the Treasurer accordingly, and at the same time turn over or tender the State deposit. Under this view of the case, did the State National Bank take the necessary steps to be relieved of its responsibility? The testimony
Some point is made of the fact that there were two claimants of the office of Treasurer, and that the bank did not know how to relieve itself of its obligation to pay interest otherwise than by refusing 'o
For the reason given, the judgment is affirmed.