37 Colo. 399 | Colo. | 1906
delivered the opinion of the court:
The receiver of The Denver Savings Bank filed his report with the district court of the city and county of Denver, showing, among other liabilities of the defunct bank, the following:
Saving Deposits ............$1,380,225.86
Commercial Deposits........ 25,004.90
Certificates of Deposits....... 96,512.92
Cashier’s Checks............ 448.55
Certified Checks ............. 165.66
Several petitions in behalf of D. "W. Mul-lin,-M. E. Lothrop, Sarah A. Taylor, William T. Land and all others similarly situated, were filed in the district court praying that the petitioners, who held time certificates of deposits of said bank, be permitted to participate in the distribution of the assets to be made by the receiver. N. M. Tabor and Frank N, Pierce, as executors of the will of Augusta L. Tabor, deceased, and Joseph C. Freund, appearing on behalf of themselves and all other depositors of the bank similarly situated, filed their petitions of intervention resisting the application of Mullin and others, and prayed that they be declared to be preferred creditors of the bank. A demurrer to- the petition of intervention was sustained; the court rendered judgment in favor of the petitioners; and from this judgment the intervenors have appealed.
Section 528 of Mills ’ Ann. Stats., is as follows:
“In case of the insolvency of any bank or association formed under the provisions of this act, the savings depositors thereof shall be entitled to preference in payment over all other creditors of said bank or association.”
This, for the purposes of this case, is a sufficient description of the manner in which the books of the concern were kept. The controversy is between those holding time certificates of deposit and the depositors holding pass-books. The depositors holding
We have no doubt that the intention of the legislature was to prefer the savings depositors in all institutions where such deposits were made, and to make a distinction between savings and commercial depositors in savings banks. Daniel, in his work on Negotiable Instruments, has this to say concerning certificates of deposit: “Now, when a depositor desires to have his funds ready to check on at any moment, he-takes no certificate of deposit, but uses his own check as the mode of transfer. But when he wishes his funds to be running at interest, and to remain for any extended period in bank, he usually takes a certificate of deposit, which is the bank’s receipt payable at a future day, or on demand, or upon ten days ’ notice, as the case may be. The very nature of the instrument and the ordinary modes of business show that a certificate of deposit, like a deposit credit in a pass-book, is intended to represent moneys actually left with the bank for safe keeping,
One of the certificates of deposit of the bank set forth in the abstract, is as follows:
“$75.00 . Denver Savings Bank.
Certificate' of Deposit, $75.00.
Denver, Colo., Jul. 12, ’05.
M. E. Lothrop has deposited in this Bank seventy-five dollars, payable to the order of self on return of this certificate properly endorsed six months after date, with three per cent, interest per annum. No interest after maturity.
C. Wood,’ Cashier.
Not subj ect to check. ’ ’
The other certificates are in the same form. Authorities are cited holding that such certificates are negotiable, and are'the equivalent of promissory notes, and because of this, and for other reasons, the appellants insist that the holders of these certificates are not “savings depositors” within the meaning of our statute, and are not entitled to preference. Although the transactions between the appellees and the bank were evidenced by certificates of deposit which were negotiable1 and were the equivalent of promissory notes, still they deposited their money with the bank for safe keeping, and are entitled to be • regarded as depositors. Those holding pass-. books containing entries of deposits and those holding certificates are creditors of the bank. It is not denied that the bank accepted the money from the holders of certificates as deposits, and not as loans.
Counsel cite in support of their position that the holders of certificates of deposit are not depositors, the case Lansing v. Wood, 57 Mich. 201, and
One of the questions before the court was whether public funds can be transferred by a public treasurer to his successor by giving certificates of deposit; and in passing upon that phase of the case the justice used the language quoted. Mr. Justice Cooley, in the same case, said: “The reasons assigned for still holding Wood and his sureties responsible for this fund are': First, that payment by him could lawfully be made in nothing but money; and second, that by the city charter moneys are to be transferred from the city treasurer to the treasurer of the board of education on the order of that board. The first reason has, to my mind, no application to this case; for the transaction with the treasurer of the board was such as to amount to a deposit by himself of the amount he receipted to Wood. If Wood had first drawn the money from the bank, and Edmunds had taken and immediately deposited it, the latter, unquestionably, if he had a right to the moneys, would have taken upon himself all risks. What difference it can make that the parties did not count out the money and then, count it in again, I do not perceive. It is manifest that all parties at that time understood that the fund had been transferred to Edmunds, and it is certain that he had all the evidences of right, and the complete and absolute control. ’ ’
Judge Cooley, it will be observed, was of the opinion that the transaction between the incoming and retiring treasurers was a transfer of deposits;
We have therefore concluded that the holders of time certificates of deposit and the holders of the savings account pass-books are entitled to preference in payment over, the other depositors and creditors. of the bank. It is worthy of mention that the only class who could not withdraw any of their funds just prior to the appointment of the receiver were those who held time certificates of deposit, and it is stated in the record that the rule permitting the withdrawal of ten per cent, only was enforced against many of the savings pass-book depositors. It is ■ also stated that if the savings account depositors are preferred, all the funds of the bank will be exhausted in the payment of their accounts. To meet just such conditions, and to protect those who left their funds at interest, the legislature, as we believe, wisely designed to make no> discrimination in the distribution
Chief Justice Gabbeet and Mr. Justice Campbell concur.