Mulcahey v. . Emigrant Industrial Sav. Bank.

Andrews, Ch. J. A verdict was directed for the plaintiff for the whole amount of the deposit made by her and O’Keefe, notwithstanding the payment of the same by the bank, before the commencement. of the action, to the administratrix of O’Keefe, on the ground that the legal title to the fund vested in the plaintiff, on the death of O’Keefe, as survivor, and that she alone was entitled to receive it. The account with the bank was opened in 1862, and the last deposit was made in 1871. Simultaneously with the first deposit, the usual savings bank pass-book, with rules printed thereon, was issued with the following heading : “ Dr. The Emigrant Industrial Savings Bank, in account with John O’Keefe or Ellen Mulcahy, Cr.,” and the account on the books of the bank was in the same form. There is no explanation of the reason for opening the account in this way, except what may be inferred from the relationship of aunt and nephew, existing between the plaintiff and O’Keefe, and the admission on the trial that when the first deposit was made, the plaintiff in the presence of O’Keefe, *438 said to the officers of the bank “ that either of them, or both could draw the money.” There is. no distinct evidence as to the respective interests of the plaintiff and O’Keefe, in the money deposited with the defendant. It was admitted that they were both present when the deposits forming the account were made. The plaintiff testified that she “ saved her husband’s money and deposited it in the bank.” It does not appear what portion of the money, if any, belonged to O’Keefe, but the evidence justifies the inference that each of the depositors contributed to the fund, and that as between themselves their interests therein were several, and not joint. One of the rules of the defendant, printed on the pass-book, provides that all payments tb persons producing the pass-book, shall be valid payments to discharge the bank. O’Keefe died in 1SJ3. The plaintiff, on the day after his burial, informed the officers of the bank of his death, and that Mrs. O’Keefe had the passbook,’and notified them “not to give her money to Mrs. O’Keefe when she should come with the bank-book,” and asked them “ what way she had for saving her money. ” The bank, however, a few days thereafter, not regarding the notice, paid the deposit to Mrs. O’Keefe, on her presenting the pass-book, with letters of administration issued to her on the estate of her husband. We are of opinion that as the evidence stood, the court erred in directing a verdict for the plaintiff for the full amount of the deposit. The principle seems to be settled, that the right of action on a bond held by two joint obligees, or on a promise for the payment of money to two joint promisees, vests on the death of one, in the survivor. (Blake v. Sanborn, 8 Gray, 154; 1 Parsons on Contracts, 31, and cases cited.) But the right of the deceased obligee or promisee is not' extinguished by his death. The survivor will hold the security, and the proceeds, as trustee to the extent of the interest of the deceased joint obligee or promisee, in the debt or fund. If this was the bald case of a joint deposit, of a joint fund, belonging to the two depositors, it would seem to follow that the legal title to the deposit, vested on the death of O’Keefe in the plaintiff, and that the *439 liability of the bank at law, was not discharged by payment to his administrator. Whether in that case the payment to the extent of the actual interest of O’Keefe, would not be good in equity, is a question we need not now consider. But the transaction in this case was peculiar. It is quite plain that the account was opened in the form it was, to carry out the intention of the depositors that each should have the right to draw the money, and to justify the bank in paying on the separate order of either. The right of the bank thus to pay, and of each depositor to demand payment, was not we think terminated by the death of O’Keefe. The authority O’Keefe had, was coupled with an interest, and vested on his death in his personal representative. The bank agreed in substance to pay to either depositor, on the production of the pass-book. The several character of its obligation was not transformed by the death of O’Keefe, into an obligation to pay to the survivor alone. But when the bank had notice that the fund belonged to the plaintiff, and was prohibited by her from paying it to the representatives of O’Keefe, it could not thereafter justify a payment to the latter under the original authority, or by reason of the rule in the pass-book, if the money of right, as between the plaintiff and the estate of O’Keefe, belonged to the former. The case was a proper one for an interpleader, in which the rights of the respective claimants could be judicially ascertained. Having paid over the fund on the demand of Mrs. O’Keefe, the bank assumed the hazard of being compelled to pay again to the plaintiff, on her establishing her actual right as between her and the estate of O’Keefe. We think the plaintiff was not entitled to. recover, except to the extent of her actual beneficial interest in the debt owing by the bank, and that the theory upon which the verdict was directed, cannot be sustained. The judgment should therefore be reversed, and a new trial granted, costs to abide the event. All concur, except Tracy, J., absent. Judgment reversed.