Padgett v. Bank of Mountain View

COX, J.

As to the question of conversion of the notes upon which plaintiff sought to go to the jury under the fourth count of its petition, it is sufficient to say that in that count of his petition he does not allege a. conversion, but charges fraud, and having done so, must be held to stand upon that proposition, and the court did not err in submitting the issues under that count of the petition upon the question of fraud. There is, however, an allegation in this count that the defendant bank received from Yaughn, after the death of Padgett, $50 and that the bank credited this money upon a note which they then held against Padgett. As to this particular item, there seems to have been no instruction asked and none given. As to this item, as will appear later, the plaintiff was entitled to recover, and the credit by the bank, upon the note they held against Padgett, of this money was unauthorized. We hold, however, that as to the issue of fraud alleged in the fourth count of the petition, that issue was properly submitted to the jury, and as far as thát part of the judgment is concerned, it will be affirmed.

As to the one item of $50 in the fourth count, and *380as to all the items in the first three counts of the petition, the case seems to have been tried on the theory that Padgett was a depositor of the bank (though this fact was not pleaded), and, therefore, the bank had the right, upon receipt of money coming to Padgett, or to his estate, to credit it upon obligations they held against Padgett, and could not be required to pay it to the administratrix. In this, we think the trial court was wrong. It is true that ordinarily the relation existing between a bank and its depositors is that of debtor and creditor, and the bank holding a matured obligation of a depositor may use the money on deposit to pay this obligation, but in this case it will be noted that the money claimed in the second and third counts of this petition was money paid into the bank after the death of Padgett, or if it were on deposit in the bank prior to his death, it did not become payable to him until after his death. This being true, the money was never received by Padgett, but was an asset accruing to the administratrix after the death of Padgett, and the defendant could not use this money to pay an obligation which it held against the estate, but should, have turned it over to the administratrix, probated its claims against the estate, and taken its chances with the other creditors upon their payment. [Woodward v. McGaugh, 8 Mo. 122; R. S. 1899, sec. 4489.]

During the life of Padgett, the bank had the right to offset one claim against the other, but Padgett’s death closed the accounts between them and while the bank could strike the balance as of the date of Pad-gett’s death, and could credit any money then on deposit on any obligation which it then held against Pad-gett, it could not take into consideration any items accruing to the estate after Padgett’s death. [Knecht v. U. S. Savings Institution, 2 Mo. App. 563; Union Bank of Quincy v. G. D. Tutt, 5 Mo. App. 342, l. c. 346; R. S. 1899, sec. 195.]

The dealings between the bank and the estate after *381Padgett’s death must of necessity have been with the administratrix. The funds coming into the bank, after the death of Padgett, could not be treated by it as a deposit made by Padgett in his lifetime, but as to this money the bank was a trustee only, and it was its duty to pay it over to the administratrix and it was her duty to hold it for the benefit of all the creditors of Padgett. She could not use this money to pay an obligation of Padgett’s to the bank without an order of the probate court directing her to do so, and the bank could not do for her what she could not do for herself.

It will avail defendant nothing to say that Padgett had in his lifetime directed that part of this money, when collected, should be credited on his note to the bank. This, if true, was not a contract, but a mere direction as to the appropriation of the money, and to permit the bank to so appropriate this money after the death of Padgett would be to give to this direction of Padgett’s as to the disposition of this money, the force and effect of a will which cannot be done.

The court, at the request of defendant, instructed the jury, in effect, that the burden was upon the plaintiff to prove that the defendant had received the money, and in addition thereto, that it converted the money to its own use or applied it wrongfully. This was error. If defendant received the money, it should be required to show a proper disposition of it.

Judgment will be affirmed as far as the action, for damages for fraud of the bank is concerned, and will be reversed and remanded as to the other issues involved in the case.

All concur.