On the 29th of April, 1893, the plaintiff in this action and respondent on this appeal delivered to the defendant James H. Carpenter a debenture bond, stated to be of the value of §1,030, with instructions to Carpenter to collect the money on such bond. Carpenter, through his agent, Bridges, received said bond, and agreed to collect the same. On the 12th of May the bond was collected and converted into cash, and the proceeds sent to the First National Bank of New York City for collection on May 13th, where they remained on deposit to the credit of the defendant Carpenter until after the 15th of May, on which day Carpenter made a general assignment for the benefit of his creditors to the defendant Bridges. In addition to the amount realized on the bond, Bridges, as assignee, drew from the bank $800.90, and there was also transferred to him by the assignment the sum of §5,787.85, cash on hand. The case discloses that during a period of about 10 years prior to the time of the delivery of the bond in question the plaintiff and the firm of Neher & Carpenter, and Carpenter as the successor in business of such firm, had business dealings with the plaintiff, and that firm had collected securities for the plaintiff, and the proceeds of some of such collections had been -deposited with Carpenter’s firm, which was carrying on the business of individual bankers. And the defendant Bridges swears that during that time the character of the business which plaintiff did with Carpenter’s firm was depositing checks, cash, securities, bonds, etc., and keeping a regular bank account. In speaking of the transaction in controversy in this action, the witness used this language:
-Shortly after the 1st of May, Mr. Lafort came in with a debenture of the Minneapolis Debenture Loan Co., due May 1, 1893, $1,000, and interest, $30.00,—$1,030. I asked him, ‘Do you want to reinvest the debenture?’ He said, ‘No, I am going to use the money for something else.’ I said, ‘Very well, we will send it over to Boston with other bonds.’ ”
The plaintiff, in his testimony, characterizes that transaction as follows:
“I brought this bond to Bridges, who is the cashier of this house, and asked him to collect that bond for me. He told me it would take some days *170to collect the money. He had to send to Boston for collection. Then Bridges asked me this question: If I wanted to buy other bonds of the Minneapolis firm for that money? which, as I understood, he would have sold me then and there. I told him I did not want to buy a bond. Then Mr. Bridges asked me some question to the effect whát I would do with the money. I told him I did not know; that I wanted the money, and would tell him when I got the money; that is, in a few days, if I could. That was all that took place.”
This is the substance of the evidence bearing upon the question as to what the real character of the transaction between Carpenter and the plaintiff was at the time of the receipt of this bond. On the part of the plaintiff it is insisted that this transaction created only an agency on the part of Carpenter for the plaintiff for the collection of this bond. On the part of the defendant it is insisted that this transaction, taken in connection with other previous transactions between the plaintiff and Carpenter’s firm, showed a deposit of this bond, or its proceeds, with Carpenter, in his capacity as a banker, and that the fund arising from the collection of this bond could be properly credited to the plaintiff on account, and that the proceeds thereof became a part of the assets of Carpenter, and passed as such to his assignee on. his general assignment for the benefit of creditors. It is manifest that the transaction alone which occurred at the time of the delivery of this bond to Bridges, as cashier of Carpenter, was simply a deposit of the bond for collection only, and that that transaction, disassociated from any other transaction between the plaintiff and Carpenter, could not be treated as a deposit of this fund to the credit of the plaintiff. Nor does the evidence show that there was such a uniform custom on the part of the defendant Carpenter in receiving of the plaintiff bonds for collecting and depositing their proceeds to the credit of the plaintiff on the bank account as would change the character of this transaction, and make it a deposit of this bond or its proceeds, and relieve the defendant from the manifest agency that he assumed when he received this bond for collection. The title to the fund, therefore, which was realized on this bond, never passed to the defendant, and the fund was, therefore, only in his hands as the agent of the plaintiff, and not as owner, and was a trust fund, to which the assignee acquired no title, and in which the creditors of Carpenter had no legal or equitable interest.
The referee found that on or about the 29th day of April, 1893, the plaintiff delivered said bond to the defendant W. B. Bridges, and instructed him to collect the sum of money mentioned therein of the makers thereof, and also at the same time informed him, the said Bridges, that he desired the money when the same was collected." The referee also found:
“That at the time of the delivery of said bond to the defendant Bridges as aforesaid, he, the said Bridges, was the agent of the defendant James H. Carpenter, and as such agent said Bridges received and accepted said bond from the plaintiff at the time of its delivery to him, and on behalf of said Carpenter promised and agreed to collect the amount thereof, and to pay to this plaintiff, on his making demand therefor, the proceeds of such collection.”
*171We think the finding of the referee is fully sustained by the evidence. We are referred by the learned counsel for the appellants to People v. Merchants’ & Mechanics’ Bank of Troy, 78 N. Y. 269, as an authority that this bond, and its proceeds, became, on the receipt of the bond by Carpenter, the assets of Carpenter’s estate, and that the plaintiff from that time sustained the relation of creditor of the Carpenter firm for that amount. The case to which we are referred is not an authority for that contention. In that case the C. N. Bank, having received from a customer of the M. & M. Bank a check-upon that bank, sent it to the drawee for payment. The M. & M. Bank charged the check to the drawer, whose account was then good for the amount, and returned the check to the drawer as paid. It sent to the 0. N. Bank a draft on a New York bank for the amount of the check. Two days after, the M. & M. Bank closed its doors, and a receiver of its assets was appointed, and the draft was not paid. On application by the C. N. Bank for an order requiring the receiver to pay the amount of the check on the ground that the assets came to the hands of the receiver impressed with a trust in favor of the C. N. Bank, it was held that the order was properly denied. It will be seen that the facts of the last-cited case are quite unlike those of the case at bar. The delivery of the bond by the plaintiff to the defendant under the circumstances of this case would not have authorized the plaintiff to-draw on Carpenter against the proceeds of the bond, and his draft, if drawn under such circumstances, would not furnish a cause of action in favor of his drawee against Carpenter. The bond and the fund realized on the same in the hands of Carpenter, or of his agent or assignee, was clearly impressed with a trust which arises between the agent charged with the duty of collecting funds and his-principal in relation to funds so collected. The agent received and held the bonds, or the proceeds thereof, in a fiduciary capacity, and not as owner.
In Bank v. Peters, 123 N. Y. 278, 25 N. E. 319, it was held that where money held by a person in a fiduciary capacity has been deposited by him in his general account at a bank, the party for whom the money is held can follow it, and has a charge on the balance in the bank’s hands, and O’Brien, J., in discussing that question, uses this language:
“When money held by a person in a fiduciary capacity has been paid or deposited by him in his general account at a bank, the party for whom the money is held can follow it, and has a charge on the balance in the bank’s hands; and if a person holding the money in a. fiduciary capacity pays it to his account at his bank, and mixes it with his own money, and afterwards draws out some by checks generally, and in the ordinary manner, the drawer of the check must be taken to have drawn out his own in preference to the-trust funds.”
See, also, Baker v. Bank, 100 N. Y. 34, 2 N. E. 452.
Applying the rule in the cases cited to the case at bar, it will be found that at the time of the assignment of Carpenter to Bridges there was standing to the credit of Carpenter & Co. in the First National Bank of New York, $1,830.90, which must, under the rules-*172referred to, have represented the $1,030 which were the proceeds of the sale of the plaintiff’s debenture bond. The defendant Bridges, the assignee of Carpenter, took this money impressed with the trust under which it was held, and cannot be treated as a bona fide holder of this money for value, as against the claim of the cestui que trust and owner of the same. “The character of the trust fund was . not lost by mingling it with other moneys.” People v. City Bank of Rochester, 96 N. Y. 32.
In Dows v. Kidder, 84 N. Y. 121, it was held:
“If' any property, in its original state and form, is covered with a trust in favor of the principal, no change of that state and form can divest it of such trust, or give the agent or trustee converting it, or those who represent him in right, * * * any more valid claim in respect to it than they respectively had before such change. * * * The plaintiff may follow the property, however it may change form, or in whosesoever hands it may be found, until his' rights be divested by his own act or authority.”
In Baker v. Bank, 100 N. Y. 31, 2 N. E. 452, the court say:
.“The relation between an agent for the sale of goods and his principal is fiduciary. The proceeds of goods sold, whether in form of money or notes or other security, belong to the principal. The relation is not that of debtor and creditor; and in case of the insolvency of the agent the proceeds would not go to the assignee, but would be subject to the paramount claim of the principal.”
And in People v. Bank of Dansville, 39 Hun, 187, it was held that:
“If the identical money collected by the bank did not pass into the hands of the receiver, it makes no difference, for in some shape or form they went to swell the assets which came into his hands.”
We think the well-settled rules established in the above cases, and in other cases to which reference might be had, make it clear, it seems to us, that the defendant Carpenter, before the assignment, and his assignee subsequently thereto, became chargeable with the proceeds of this bond in their fiduciary capacity as agents of the plaintiff, and that the referee was right in holding that the plaintiff might recover; and that the judgment recovered in this action was properly declared to be a first lien upon the funds in the hands of the defendant Carpenter, and that the judgment must be affirmed.
Judgment affirmed, with costs.
PUTNAM, J., concurs. HEBBICK, J., concurs in result.