Woodbridge v. First National Bank of Saratoga Springs

61 N.Y.S. 258 | N.Y. App. Div. | 1899

Merwin, J.:

The main contention of the appellant is that a case was made entitling the plaintiff to an interlocutory judgment requiring the defendant to account for all moneys belonging to the estate of Samuel Freeman, deceased, at any time received by the defendant.

There was no contract relation' between the defendant and the estate such as would make it the duty of the defendant to account to the plaintiff. The cases, therefore, that are cited with reference to the duty to account where the relation of the parties is based on contract do not apply. The contract dealings here were between the defendant on the one part and Helen F. Woodbridge or John Woodbridge on the other. The relation was that of debtor and creditor. The duty of the defendant was to pay to the party depositing or to his or her order. It did so. John Woodbridge had authority to act for his wife.

A bank, in the absence of' notice of an adverse claim, has the right to assume that the person who makes deposits to his own credit has the right to draw them out.

A court of equity may order an accounting when a fiduciary relation exists between the parties and a duty rests on the defendant to render an account (3 Pom. Eq. Juris. § 1421); and this rule may be applicable in case of a constructive trust. (1 Story Eq. § 512.) The existence of such trust or the facts upon which it may arise1 by operation of law must be definitely shown before the right to recover, or to require an account, is established.

John Woodbridge was> as the defendant knew, or is chargeable with knowing, the agent of the trustee.in the collection of the moneys of the estate. The plaintiff concedes that Woodbridge had the right to collect, but claims that he had no right to deposit his collections in the bank to his own credit. Assume this position to be correct, it would be incumbent on the plaintiff to show either that, all the deposits were estate moneys, or to show what deposits were such. It is not shown that all were moneys of the estate. On the contrary, it is shown that other moneys were deposited, and .the amount thereof that belonged to the estate is not shown. Because Woodbridge was, to defendant’s knowledge, agent of the trustee, and made some deposits, that consisted of trust moneys, it does not follow that the burden is on the defendant of showing what of the deposits belonged to the estate, or of showing, that the whole went for the benefit of the estate. It will hardly do to put upon a bank the burden of showing where its customer gets his deposits. The plaintiff, with the access to papers and records which she is supposed to have, should, in the first instance, show what deposits were estate moneys.

This is done as to certain dividends or bank stock held by the estate in the defendant bank and in a Schenectady bank. Those dividends were a part of the annual income of the trust fund, and were less than the annuity payable to Mrs. Woodbridge. The defendant had a right to believe that such dividends were rightfully received by Mrs. Woodbridge or her husband, as her agent, to apply on her annuity, and, therefore, no misappropriation or negligence can be charged to the bank on that account.

No other specific deposits are shown as coming from the trust estate. It is alleged that the individual debts of Hr. Woodbridge were paid from the estate funds. The evidence, to say the least, leaves that in doubt, but if there were such payments, the amount does not appear. • There is nothing in the evidence from which the trial court could properly say that the defendant must pay or account for any particular sum, or any particular item of property

This is not the case of the management of an estate by a party having no right- to do so, or the case of the use of property, the profits from which may be reached, and for which a right to an accounting may exist. The question is whether the defendant has improperly allowed the moneys of the trust estate, known to be such, to be withdrawn from the bank, or has itself improperly received, to its own benefit, such moneys. The claim is, in its nature, tortious, and should be shown with reasonable pertainty.

The deposits seem to have been made and paid out in the ordinary course of business, fr.om 1872 to 1891, without any adverse .claim until the commencement of this suit. It is not shown to what extent during this period the principal of the estate has been diminished. So far as the case shows, the defendant had the right to believe that the estate, though practically in the hands of John Woodbridge, was managed to the satisfaction of all parties up to the time of the resignation of the trustee in 1891.. It had a right to believe that whatever deposits of estate moneys were made by Woodbridge to the credit of his wife or himself, were so made with the assent of the trustee, and without any design on the part of either the trustee or of Woodbridge to misappropriate the same. ,

We are not persuaded that, upon the case presented, the plaintiff was entitled to an interlocutory judgment for an accounting. The trial court, in effect, found that no conversion or misappropriation by the defendant had been shown, or any negligence or improper conduct on its part in regard to any withdrawal of trust funds by Woodbridge from the bank. We find no good reason for disturbing this conclusion or the conclusion that a cause of action was not established.

Upon the appeal from the order granting an extra allowance of costs, it is claimed by the plaintiff that there is no basis in the case for granting an allowance. The allowance must be based “ upon the sum recovered or claimed, or the value of the subject-matter involved.” (Code Giv. Proc. § 3253.) The plaintiff, in her complaint, asked judgment that the defendant he required to account and pay to the plaintiff all moneys of said estate found due upon such accounting, and for such other or further relief as might be proper. The argument is, that the subject-matter of the action is the right to an accounting, and that no money value can be placed upon that, and, therefore, there is no basis for an allowance.

The subject-matter of the action was the deposits of trust moneys during, the period in controversy. Under the allegations of the complaint a recovery was possible to the full amount alle'ged. The amount or value of such deposits, however, was not proved except to1 the extent of about $30,000, being the dividends of certain banks. That sum, therefore, is to be deemed the value of the subject-matter involved. The order granted an extra allowance of $2,000. • This was larger than the facts of the case, as appearing from the papers on which the order was granted, warranted. It should be reduced to the sum of $1,000, and the order as so modified should be affirmed.

All concurred, excépt Putnam, J., not sitting.

Judgment affirmed, with costs.

Order modified, by reducing the amount of the extra allowance to the sum of $1,000, and as so modified affirmed', without costs.