186 Iowa 1385 | Iowa | 1919
The petition shows the following alleged state of facts: Plaintiff is the minor daughter of John EL Tesene, who died in Cerro Gordo County, June 11, 1902. His life was insured for the sum of $5,000, payable as follows: $1,000 to his wife, Wilhelmina, $2,000 to his son Boy, and $2,000 to his infant daughter, Ima, the plaintiff in this action. At the time of and' prior to the decease of Tesene, the defendant Iowa State Bank was a corporation, doing a banking business at Mason City, of which bank I. W. Keerl was the cashier and active manager. Soon after the death of Tesene, Keerl, 'acting for and in the interest of the bank, and in order to secure the deposit of the insurance money in that bank, accompanied the adjuster of such insurance claim to the home of the widow, and informed her that the money so received for her children would be a trust fund, to be kept distinct from her own moneys, and that it would be necessary for her to be appointed guardian for the children and give bond as such; and that, if she would deposit the trust funds in the defendant bank, he would procure the bond for her, and see that the matter of her appointment was properly attended to and arranged.
Thereafter, and in pursuance of this understanding, Keerl caused to be prepared a petition for the appointment of the widow as guardian of her said children, and filed it in the office of the clerk of the district court, and stated and represented to her and to the agent of the insurance company that her appointment as guardian had been made; and thereupon, on June 17, 1902, said agent turned over to the widow a draft for the amount of said insurance, which sum or draft she, in turn, delivered to Keerl for deposit in the defendant bank. On this sum, $1,000 was by the bank credited as a deposit by Wilhelmina Tesene in her own right, and $4,000 to her credit in her capacity as guardian.
It is further alleged that, as a matter of fact, neither
The son, Boy Tesene, appears to have arrived at his majority, and is not, in his own right, a party to this action; but the plaintiff alone, who is still a minor, represented by her said brother as next friend and guardian, asks judgment against the bank and its trustees for the sum of $2,000, with accumulated interest.
The defendants admit the corporate capacity of the Iowa State Bank, that it was organized for the transaction of a general banking business, and that Keerl was its cashier; but aver that he was clothed with only power and authority such as is usually exercised by cashiers of banks under the laws of the state. They admit that the money mentioned in the petition was deposited in the bank, and that it was afterward withdrawn upon checks; but deny that such money was received as a trust fund; deny all knowledge and notice of its alleged trust character; deny that the hank assumed or was under any obligation to guard or protect said fund from misappropriation by the plaintiff’s mother; and deny that the bank received any part of the money withdrawn from said deposit, or any benefit therefrom. The answer further alleges that, if it be true that Keerl received or misappropriated any of said fund, he did not do so in his capacity as cashier or agent of the bank, and avers that, if he is chargeable with -any
On trial to the court, the evidence offered tended to show, without controversy, that, at the time of the transaction in question, Keerl was the cashier and the active managing officer of the bank in its daily routine of business; that he knew of the death of John H. Tesene, and that his widow and children were the beneficiaries of life insurance, and that of this sum $4,000 was payable to plaintiff and her brother, the infant children of the deceased; that he solicited the deposit of this money for the bank, and, as an inducement or aid thereto, he prepared the petitition for the appointment of the widow as guardian, and promised to procure the necessary bond; that, as a matter of fact, he did not furnish the bond, and the appointment was never made: but it is evident that both Wilhelmina Tesene and the insurance company relied upon his assurance that the matter had been properly attended to, and in such reliance the money was paid over and at once deposited in the bank in the form of a draft made payable to “Wilhelmina Tesene” and “Wilhelmina Tesene, guardian of the estates of Boy Tesene and Ima Tesene,” and endorsed by her in identical form; that, in recognition of the separate interest of the widow in her own right to the sum of $1,000, and of the right of her children in the remainder of $4,000, said sums were placed in separate deposits. One of these accounts was entered upon’the books of the bank in the name of “Wilhelmina Tesene,” and the other in the name of “Mrs. J. H. Tesene.”
At the same time, Keerl delivered to the widow a pass book, representing the deposit of $4,000 made out in the name “Wilhelmina Tesene, Guardian of Boy Tesene and
It further appears that, at some time after the $2,000 was used in the purchase of a house for Mrs. Tesene, she became embarrassed financially, and, on the advice of Keerl, she made to him a mortgage on said home property, to secure an alleged debt for $2,000, but, in fact, wholly without consideration, as a protection to her, “so no one could get anything against it.” This mortgage she supposed was still held in the bank, until after Keerl left the bank, when she learned, through its president, that the instrument had been sold to an eastern purchaser, who was demanding pay
Upon the subject of the authority of Keerl to represent the bank in its business, it is conceded by defendants that he had and exercised the usual and customary authority of bank cashiers in this state. It also appears by the testimony of witnesses, among whom were stockholders, officers, and employees in the bank, that he was the real, active head and manager of the bank’s business. One director testifies: “He had personal management of the business.” Another says: “As nearly as I could learn, he had been practically the managing officer.” The vice-president says:
“Keerl had active management of the bank, and looked after getting deposits and making loans. We tried to get our share of deposits, and pursued about the same course to get them as other banks do. When we knew of an account which might be gotten, we solicited the account — Keerl or I.”
Another director testifies: “Keerl had the active management of the bank; think he practically had the sole management.” The bookkeeper says Keerl was the general manager, of the bank, and “dictated the policy of the bank practically, so far as the getting of deposits and the loaning of money is concerned.” •
Counsel for appellee argue that, as cashier, Keerl was without express or implied authority to promise or undertake to provide bonds for guardians, or to assume any responsibility of that character; and some of the directors testify that no such authority wais ever given. It may be conceded, we think, that there is no showing that the
“Well, you understand, I myself never looked after that, or got any of that business. In a general way, I knew what the practice was there. I think that was the common practice of banks here in town, more or less.”
On the same subject, another director says:
“We always furnished an administrator, guardian, or township or county officer bondsmen, as long as they put such funds in the bank.' I think that was generally done by the bánks here in Mlason City.”
No officer, director, or employee denies such practice.
It appears also to have been a part of the recognized duty or business of the bank or its cashier to negotiate loans for their customers and others desiring such aid.
Finally, in so far as it becomes important to inquire into the question of actual notice to the bank of the dealings between its cashier and Mrs. Tesene, as distinguished
“I heard of the death of Mr. Tesene. Don’t know whether Mr. Brier was a patron of the bank at that time or not. I saw Mrs. Tesene in the bank with Keerl. Can’t remember seeing Brier in there with them. Q. You knew of Tesene’s insurance money being deposited there in the bank, did you not? A. Well, I knew that there was some money deposited there. Keerl looked after that matter, and did all the business connected with that. All I knew that there was some money deposited there, and that Keerl and Mrs. Tesene were looking after the business in connection therewith. Don’t remember the amount. I learned that this money had been deposited there, and probably understood at the time that it was the proceeds of an insurance policy. Q. And you also knew from the papers, or from Keerl, that part of that belonged to the widow, and part to the children ? A. I heard them say something about that, I think. It appears the part that belonged to the widow was deposited to the credit of Mrs. J. Tesene, June 26th, 1902.”
The other directors, or most of them, deny having any actual knowledge of the business with Mrs. Tesene.
The foregoing is substantially all the pertinent evidence produced in the trial.
It should, perhaps, be added in this connection that, from a time prior to the commencement of this action, the Iowa State Bank has been in the course of voluntary liquidation, and that the trustees engaged in closing up the business are defendants herein.
“The acts of the cashier, I. W. Keerl, at the time in question, concerning the subject involved in these causes, are not within the general rule as to authority, notice, and knowledge of the agent being ordinarily imputed to the principal, but x’ather within the exception to the general rule, which exception is that, when the conduct of the agent is such as to raise a clear presumption that he would not communicate the facts in controversy, as when the communication of such a fact would necessarily prevent the consummation of a transaction not regular on its face, in the ways of carrying on the business of any well, regulated bank, and which irregular transaction the cashier in the instant cases was a party to, and one, apparently, in which he was personally interested, and not the defendant bank. It being made clear from the evidence in the cases that the cashier in the matter involved in these cases has placed himself in a position which conflicts entirely with the idea that, in so acting, ' he represented the interests of the defendant bank. Therefore, the defendant bank is not bound by either the knowledge or acts of the cashier, I. W. Keerl.”
We are strongly impressed with the conviction that the rule here stated is not properly applicable to the issues in this case, or to the well proved facts developed in the trial. The following are some of the reasons compelling this conclusion :
I. That Keerl was acting for the bank in soliciting the deposit of this trust fund, and that his act in that respect was within the scope of his authority and agency, there can be no reasonable doubt. His undertaking to assist the woman in procuring her appointment as guardian for her children, and to furnish the necessary bond, was in accordance jvith the established practice of the banks of that
We hold, therefore, that the defendant bank must be held to have had knowledge of the trust character of this deposit, and to have known that Wilhelmina Tesene was not the duly appointed or qualified guardian of Boy Tesene or Ima Tesene, and that she had no authority to demand or receive from said bank the said deposit of $4,000.
The L’Herbette case, supra, is quite in point upon one of the features of the present case. There, the cashier secured plaintiff’s money for deposit by ah unauthorized promise to pay interest, and to find investments in stocks and bonds. The cashier did not put the money in the bank, but embezzled it. The court held the bank liable, saying:
“The bank is bound because its cashier, assuming to act in its behalf, received the plaintiff’s money as deposited in the bank, and the fact of his making invalid agreements * * * does not have the effect to exonerate the bank from its liability to refund the money.”
Under very similar circumstances, the New Hampshire court, in Hanson v. Heard, supra, says:
“When the plaintiff’s money went into the cashier’s possession, it was in the bank’s possession. * * * If it was lost afterward, through carelessness, larceny, or other means, it was the bank’s loss.”
In the instant case, the money not only went into the cashier’s possession, but actual possession of the bank, as well, and was entered as' a deposit upon its books. At least $2,000 of it was taken or abstracted from that deposit by the cashier, on the unauthorized check of Mrs. Tesene, with the promise to invest it in a mortgage; and it
This holding is not inconsistent with the precedents cited by the appellee, to the effect that a bank receiving a deposit from a guardian or duly authorized trustee is not charged with the duty of supervising the expenditure of such deposit, and ordinarily may safely honor and pay the checks of the depositor. In this case, the mother of plaintiff doubtless acted innocently in receiving and depositing the money as she did, but her act was without authority of law, and of this the bank and Keerl were fully aware. The deposited money was received with knowledge that it belonged to the plaintiff and her brother, to whom alone, or to their duly appointed guardian, the bank was bound to account; and it is no defense to their demand for such accounting to plead or prove that the bank, which is chargeable with such knowledge, has paid the money over to the mother, or other person known to be without authority to receive it.
The costs will be taxed to the appellees. — Reversed and remcmded.