Jockusch v. Towsey

Bonner, Associate Justice. The collection of checks, bills of exchange, drafts, notes, and accounts, is within the ordinary business of banks, in behalf of their customers. As a general rule, after the collection is made the bank becomes a simple contract debtor for the amount, less any commissions which may be charged. If the party for whom the collection was made was a regular depositor, the sum would be placed to his credit upon his regular deposit account, unless some peculiar usage or special instruction should demand a different course of dealing. If the party has no deposit account, the bank simply owes him the amount on demand. ( Morse on Banks and Banking, p. 322; Planters’ Bank v. Union Bank, 16 Wall., 501; in re Bank of Madison, 9 Nat. Bank. Reg., 184; Duncan v. Magette, 25 Tex., 248.) We are of opinion, both on principle and authority, that after a bank has suspended, it thereby ceases to have the general power and authority which it previously had to col [133] lect paper which, before its suspension, had been deposited with it for this purpose, so as to make it a general creditor of the depositor, but that this subsequent collection must-be held by it as agent in trust for the owner. (German American Bank v. Third National Bank of Missouri, 2 Tex. Law Jour., 150.) How far this principle might apply in this case, where the defendant bank, before its suspension, had parted with its control over the "paper, by indorsing it to their correspondents, Baltzer & Taaks, in the city of New York, with instructions'to collect and apply proceeds to an indebtedness due to them by the defendants, we feel difficulty in deciding, and particularly in view of the subsequent act of Thomas McGreal, by whom the original deposit was made, in receiving from defendants $2,500 on account of this collection so made and applied, and in agreeing to accept their promise to pay balance from their settlement with preferred creditors, as shown by his written receipt and agreement, in evidence. McGreal, at this time, had not assigned the claim to the plaintiff's, and, so far as shown by the record, had full authority to adjust and settle the matter. The charge of the court assumed, as a question of law, that if the defendants received the drafts for collection, and collected the same, this constituted such a fiduciary relation that their subsequent discharge in bankruptcy did not release them from liability. This charge was excepted to at the time, and is assigned as error. We think the assignment well taken. As shown from the above authorities, whether the defendants occupied the relation of ordinary debtors or the fiduciary relation of agents or trustees, was a question of law to be deduced from the facts of the case, and was the main issue presented by the pleadings. The facts and circumstances in regard to the receipt of the drafts and their subsequent collection, the suspension of the defendants as bankers and their subsequent transaction and agreement with McGreal, were questions necessary to be [134] determined by the jury, under appropriate instructions, in order that the law arising thereupon should be applied. For the error in not submitting them to the jury, the judgment must be reversed and the cause remanded. Reversed and remanded.