Milhouse v. Citizens Bank

Pottle, J. This case falls within the well-settled rule, that “a bank may apply the' amount of the account of one of its depositors to a matured debt due by him to the bank, without reference to the insolvency of the depositor.” See Luthersville Banking Co. v. Hopkins, 12 Ga. App, 488 (77 S. E. 589) ; Bank of Lawrenceville v. Rockmore, 129 Ga. 582 (59 S. E. 291) ; Davenport v. State Banking Co., 126 Ga. 136 (54 S. E. 977, 8 L. R. A. (N. S.) 944, 115 Am. St. E. 68, 7 Ann. [241] Cas. 1000). This right of set-off may be exercised by a bank at any time after maturity of the debt. Luthersville Banking Go. V. Hopkins, supra. It follows that a bank may, even after the presentation of checks drawn by the depositor on the fund then standing to his credit, apply the fund to the matured indebtedness owing by the depositor to the bank. Nor would the bank’s right thus to apply the fund be defeated merely because, before the application was made, a check drawn by the depositor had been presented for payment, which check was given for money previously collected by the depositor for the payee. The right to make the application exists whether the indebtedness of the depositor be that of a principal or upon an obligation on which he is only secondarily liable. Judgment affirmed. Decided January 20, 1914. Action for damages; from city court of Yaldosta — Judge Cranford. September 1,1913. Whitaker & Dukes, James M. Johnson, for plaintiff in error. Denmark & Griffin, contra.