State Banking Board v. Goose Creek State Bank

The appellants' propositions in effect present the point that the special circumstances of the present case do not constitute "a deposit" within the purview of the Bank Deposit Guaranty Act, and on that account the claim of the appellee bank is not entitled to the protection of the act. The facts found by the court can be summed up In order to give effect to the real dealing between the two banks. The appellee bank, through its cashier, upon the solicitation of the cashier of the Shepherd State Bank, consented to place on interest in the latter bank $5,000 of its surplus. Thereupon the cashier of the Shepherd State Bank, acting upon his own volition, and without prearrangement to that effect, as must be inferred from the record, made out a sight draft in favor of the Shepherd State Bank on the appellee bank for $5,000 as an undertaking by that bank of the transmission of such funds for the advantages arising to it from the probable temporary use of the money or interest. Instead of forwarding the draft directly to the appellee bank, the cashier of the Shepherd State Bank on his own initiative, as seemingly shown, forwarded it through the Houston National Exchange Bank for collection. And the appellee bank, on presentation of the draft, paid the money over to the Houston National Exchange Bank. After receiving the remittance, the Houston National Exchange Bank did not credit the amount on its books, or remit it to the Shepherd State Bank, but, without previous authorization, "applied and credited this $5,000 on the note of Ed Cochran and the directors of the State Bank of Shepherd, previously executed," and "the Shepherd State Bank accepted and ratified the action of the Houston bank in so applying such $5,000." Thereupon "the Shepherd State Bank entered and carried this transaction on its books as a deposit with such bank by the Goose Creek State Bank, and the same was duly entered upon its ledger; and the Shepherd State Bank paid interest on such deposit to the Goose Creek State Bank up to and including April, 1920, but thereafter no interest was paid; and the Shepherd State Bank by due course of mail regularly sent statements to the Goose Creek State Bank, showing that the $5,000 was on deposit to the credit of the Goose Creek State Bank." It is believed that the appellants' contention should be sustained that the transaction did not constitute a "deposit" within the purview of the act, and hence the claim was not entitled to payment out of the state guaranty fund. It has more of the characteristics of an intended loan than an actual "deposit"; and it failed to be effective as an actual "deposit" in fact.

In order to create a "deposit" within the meaning of the act, it is essential that (1) "the money is placed in the bank in reality for the benefit of the depositor," or that (2) "there are delivered to or left with the bank checks or drafts, the commercial equivalent of money, subject to his order, and by virtue of which action the title to the money passes to the bank." Kidder v. Hall, 113 Tex. 49, 251 S.W. 497; Chapman v. Bank (Tex.Civ.App.) 276 S.W. 731; Bank v. Bank (Tex.Com.App.)272 S.W. 775; Banking Board v. Pilcher (Tex.Com.App.) 270 S.W. 1004. The facts do not bring the case at all within the test laid down. There is no pretense in the evidence that the "money" ever reached or was actually placed in the Shepherd State Bank by the appellee bank. The account carried by that bank was in fact a matter of mere bookkeeping, treating the transaction as a cash deposit. And it fully appears that the appellee bank did not "leave or deposit a check or draft subject to its order" with the Shepherd State Bank, importing the relation of principal and agent in the collection. On the contrary, the Shepherd State Bank on its own initiative drew a draft on the appellee as an undertaking by that bank *Page 313 itself of the transmission of the funds for the advantages arising to it from the probable temporary use of the money by paying interest thereon. Hence the time the appellee bank could predicate a right respecting the transmission of the funds even though "a deposit" was intended by it, relates entirely to the time of payment of the draft. And although the effect of the payment of the draft was to work a delivery, having origin at the time, of the funds to the Houston National Exchange Bank in the capacity of agent of the Shepherd State Bank for collection, yet a "deposit" of the funds in the latter bank was never accomplished and made effective, in the purview of the act. Payment by appellee bank of the funds over to the Shepherd State Bank, acting through its agent, and the subsequent entry by the latter bank of a credit on its books treating the dealing as a cash deposit, has probably the effect of estoppel of the latter bank to deny a "deposit" as between the two banks as such. A general obligation would arise in favor of appellee bank against the Shepherd State Bank as such. But what might be an estoppel against said bank may not be an estoppel against the guaranty fund. The bank and its officers could do nothing to impose a liability upon the guaranty fund, except as the liability is imposed by statute. The banks, as such, have nothing to do with the guaranty fund.

The judgment is reversed, and judgment is here entered in favor of appellants, with all costs of the trial court and of this appeal.