Southern Exchange Bank v. Pope

Fish, C. J. (After stating the foregoing facts.) 1. The amendment to the petition was properly allowed over objection by the defendant “that it was irrelevant and immaterial and changed the cause of action and set up a new cause of action.' 2. Nor was it error to overrule the demurrers to the petition. “ A deposit may be for a specific purpose; as where money or property is delivered to the bank for some particular designated purpose, as a note for collection, money to pay a particular note or draft, etc. While such a deposit is sometimes termed a ‘ special deposit and partakes of the nature of a special deposit to the extent that title remains in the depositor and does not pass to the bank, yet it seems more accurate to look on this as a distinct class of deposit. In using deposits made for the purpose of having them applied to a particular purpose, the bank acts as the agent [166] of the depositor, and, if it should fail to apply it at all, or should misapply it, it could be recovered as a trust deposit; and the agency created by the deposit is revokable by the depositor at any time before the purpose of the deposit has been accomplished.’' 7 C. J. 632, § 307, where many cases are cited in support of the text in notes 7, 8, 9, 10, 11. Among the cases cited are McGregor v. Battle, 128 Ga. 577 (58 S. E. 28, 13 L. R. A. (N. S.) 185), and Howard College v. Pace, 15 Ga. 486. It was held in the latter case: “Where money is paid by A into the hands of B, to remain at the disposal of C, the right to that money continues in A until B gives and C takes credit for it, or B actually pays it to C; up to this period B is the agent of A only, and A may countermand the authority to make the payment; in the same manner as a person who sends another to pay money may stop him before he arrives at the place where it is to be paid, and require him to deliver it back.” Also Mayer v. Chattahoochee National Bank, 51 Ga. 325 (2), was cited. It was there held: “When A deposits money in a bank, with direction that it is to be paid out to a check which he has given, or will give, to C, the money is still the money of A until the bank either pays it, lor promises C to pay it, or unless it be deposited at the instance or procurement of C, or under an arrangement with him.” In Dolph v. Cross, 153 Iowa, 289 (133 N. W. 669), it was held that a depositor, making a deposit for the specific and stated purpose of meeting checks which he had just issued, binds the bank by the special conditions imposed, and does not make the bank merely the debtor of the depositor, as is the case with general deposits. And it has been held that a parol direction is sufficient to create a “ specific deposit ” or a deposit for some specific, designated purpose. Of course it is the duty of the bank, when it becomes the agent of a depositor by accepting from him a “ specific deposit,” or one for a particular designated purpose, to use the deposit for that purpose and no other; and it has been held that the least turning aside by an agent of funds of his principal, held by the agent for a particular,, designated purpose, is legally a wrongful act, •and subjects any person who knowingly aids in such diversion to full responsibility. 21 R. C. L. 833, § 15. [167] Notice to the president of a bank of facts affecting its interest is imputed to the bank. Fouché v. Merchants National Bank, 110 Ga. 827 (3) (36 S. E. 256), and cases cited; Faircloth v. Taylor, 147 Ga. 787 (4) (95 S. E. 689); Balfour v. Fresno Canal etc. Co., 123 Cal. 395 (55 Pac. 1062); Magee on Banks and Banking (3d ed.), 120; 1 Michie on Banks and Banking, 825, § 116 (1); 834, § 116 (3). A principal can not ratify an act of his agent in part, and repudiate it in part. He must either ratify or repudiate it in its entirety; if he receives money or other benefit under a contract of his agent he must restore it upon demand, or account for it. Applying the foregoing legal principles to the allegations of the petition as set forth in the statement of facts preceding this opinion, it set forth a cause of action against the Southern Exchange Bank, as well as the Bank of Alamo. The special demurrer to the petition was without merit. The ground of it was that the petition did “not definitely and fully inform this defendant of the facts that would impart to it such knowledge of the facts and circumstances upon which the plaintiff relies that would put this defendant on notice of the special deposit and trust as aforesaid.” 3. The rulings announced in the third headnote do- not need elaboration. Judgment affirmed. All the Justices concur, except Hill; J., absent.