England v. Hughes

Hart, J.,

(after stating the facts.) The circuit court sustained a demurrer to the answer of the defendant, and so the allegations of the answer must be taken as true. The answer alleges that each of the plaintiffs had on general deposit in the bank at the time it failed the sum respectively set opposite his name; that the bank was adjudged insolvent and a receiver appointed; that under an order of the Comptroller of the Currency notice was duly given requiring all depositors and other creditors of the' bank to file their claims with the receiver within ninety days, and that the plaintiffs failed to do this.

By a general deposit, a bank becomes the debtor of the depositor, and bound by an implied contract to pay the same upon his demand or order. Steelman v. Atchley, 98 Ark. 294; Himstedt v. German Bank, 46 Ark. 537; Henry v. Conley, 48 Ark. 267; Carroll County Bank v. Rhodes, 69 Ark. 43; Covey v. Cannon, 104 Ark. 294; Citizens Bank & Trust Co. v. Hinkle, 126 Ark. 266, and State National Bank v. First National Bank, 124 Ark. 531, and Burton v. United States, 196 U. S. 301.

When the bank failed and went into the hands of the comptroller, its business was at an end, and when the comptroller, under section 5235 of the Revised Statutes of the United States, directed the receiver to publish a notice for three consecutive months calling on all persons who might have claims against the bank to present the same and make legal proof thereof, this amounted to a waiver of the necessity for a demand by the depositor before he became entitled to sue for or claim his money. By closing its doors and ceasing to do business, the bank said in effect that it would not pay the depositors, and the law does not require a vain or fruitless thing to be done. Michie on Banks and Banking, vol. 2, p. 2323. Planters Bank v. Farmers Bank (Md.), 8 Gill & J. 449; Union Bank v. Planters (Md.), 9 Gill & J. 439, 31 Am. Dec. 113, and Watson v. Phoenix Bank (Mass.), 8 Metc. 217, 41 Am. Dec. 500.

It may be also stated in this connection that the appointment of a receiver will not stop the running of the statute of limitations against the claim of a creditor of an insolvent bank. Davis v. Scott, Recvr., 129 Ark. 226. More than three years elapsed from the time the notice to creditors 'was published by the receiver under orders from the.Comptroller of the Currency until this suit was brought. Hence counsel for the defendant claims that the plaintiffs are barred under the first subdivision of section 5064 of Kirby’s Digest which provides that all actions founded upon any contract or liability express or implied not in writing shall be commenced within three years.

On the other hand, counsel for the plaintiffs claim tbat section 5074 of Kirby’s Digest, which provides that all actions not included in the foregoing provisions shall be commenced within five years after the cause of action ■'ball have accrued, governs the case at bar. They base their contention on section 5081 of Kirby’s Digest, which provides that none of the provisions of this act shall apply to suits brought to- enforce payment on bills, notes, or evidences of debt issued by any bank or moneyed corporation.' They claim that amounts due by the bank on general deposits are “evidences of debt” issued by the bank. Hence they say that it is not an action specifically provided for in the statute of limitations and is included within the provisions of section 5074 of Kirby’s Digest. "We can not agree with counsel for the plaintiffs in their contention. When the statute of limitations in section 5081 of Kirby’s Digest speaks of bills, notes or evidence' of debt issued by any bank it refers to instruments of writing issued by the bank which shall circulate as currency or as a medium of exchange in this State and does not refer to general deposits. Deposit slips and deposit entries in pass books are not contracts in writing, but are mere memoranda 'or receipts. The use of deposit slips or pass books is well understood. It merely constitutes an acknowledgment that the amount of money named therein has been received by the bank, and it is not expected that the deposit slip will ever be presented to the bank again unless a dispute should arise as to the amount of the deposit, in which event it would become important as evidence. It is a receipt, merely, and will not support an action against the bank. The suit should be brought on the 'debt, and the deposit slip or pass book would be evidence as to the time and amount of the deposit showed thereon. 3 K. C. L., p. 531, par. 160; 7 C. J., pp. 637 and 638; Talcott v. First Nat. Bank of Larned, 53 Kan. 480; Com. v. Reading Saving Bank, 133 Mass. 16; Davis v. Lenawee Bank, 53 Mich. 163; Branch v. Dawson, 36 Minn. 193, and case note to L. R. A. 1918 B at 298. See also Citizens Bank & Trust Co. v. Hinkle, Admr., 126 Ark. 266. Of course, a certificate of deposit might be written by the bank in such language as to constitute it both a contract and a receipt. Such is not the case here however.

According to the allegations of the answer the plaintiffs deposited their money in the nsnal way on general deposit and the bank owed them the amounts which they deposited. If the deposit slips or pass books are nothing more than receipts, they could not form the basis of an action against the bank as above stated, and could only be used as evidence against the bank. It follows that the words, “evidence of debt,” as used in the statute refer to instruments issued by the bank and signed by it of the same class as bills and notes and which should pass current as money.

Counsel for the plaintiffs have cited two cases contrary to the views herein expressed, but we do not deem it necessary to review them. In the first place, it may be said that the decisions are based upon the peculiar language of the statutes of the States wherein they were decided. In the second place, if such were not the case, we think they are opposed to the great weight of authority, which hold that deposit slips and pass books are not written contracts but are receipts and nothing more.

It follows that the court erred in sustaining a demurrer to the answer, and for that error the judgment will be reversed, and judgment rendered here in favor of the defendant.