Mutual Accident Ass'n v. Jacobs

Moran,- J. Appellant filed its petition in the County Court, representing that it had deposited in October, 1890, with S. A. Kean, the sum of $6,000 as a special deposit to be held by the said Kean to indemnify himself and one Cummings from any loss or liability that might be incurred by them or either of them by reason of their having signed an appeal bond (as sureties) in a case wherein one Emma A. Tuggle had recovered a judgment against petitioner, in the Circuit Court of McDonough County, and from which said judgment an appeal had been perfected to the Appellate Court; that at the time the said §6,000 was left with the said Samuel A. Kean, he was engaged in the hanking business at the city of Chicago under the name and style of S. A. Kean & Co., having a banking office at Ho. 100 Washington street, and also a branch office at 143-145 Adams street in said city, which latter was operated under the care and management of one Wesley L. Knox, an agent for the said Kean; that the money was deposited with said Kean at said branch banking office, and a special certificate of deposit therefor was issued, as follows: “ Chicago, October 4, 1890. This is to certify that the Mutual Accident Association of the Northwest has deposited with Samuel A. Kean, of the County of Cook and State of Illinois, the sum of $6,000, to be held by the said Kean upon the following conditions: Whereas, one Emma A. Tuggle of the County of McDonough, recovered a judgment against the said accident company, for the sum of $5,000 and costs, from which the said accident company has taken an appeal to the Appellate Court, and whereas the said Samuel A. Kean and Jesse H. Cummings have signed the appeal bond in the said case, now, therefore, this $6,000 deposited with Samuel A. Kean is to be held by the said Kean to indemnify himself and the said Jesse H. Cummings from any loss or liability incurred by them or either of them, by reason of having signed said appeal bond. And after the said Jesse II. Cummings and Samuel A. Kean are fully die charged from all liability under said bond, then the said $6,000 is to be returned to the said Mutual Accident Association, but not otherwise. (Signed) S. A. Kean & Co., Branch; Wesley L. Knox, Manager. ” The petition proceeds to allege that the $6,000 so deposited was and is no part of the assets belonging to him, the said S. A. Kean, or to his estate, but that the same was, and always has been, and still is, the property of the petitioner and placed in the hands of Kean as a special deposit in trust, with the distinct and positive understanding between petitioner and Kean, that said $6,000 was to be returned to petitioner by Kean as soon as said Kean and said Cummings should be discharged from all liability under said bond, as appears from the terms of said certificate. Petitioner prays that the said sum of $6,000 may be declared to be the property of petitioner and a trust fund in the hands of said Benjamin F. Jacobs, assignee of said Kean, and that an order may be entered by the court directing him, the said assignee, to pay, deliver and return the same to your petitioner, as -soon as the said Samuel Á. Kean and Jesse II. Cummings are fully discharged from all liability under the aforesaid appeal bond. The record shows an answe'r to said petition in which it is denied that said §6,000 ever became the property of said Samuel Á. Kean, and avers the truth to be that said deposit became at once, upon its receipt by him, the property of said 8. A. Kean; further denies that said §6,000 or any part thereof, was in the possession of the assignee, and states that immediately upon its deposit by the petitioner, the said sum of $8,000 became the property of the said Kean, and was by him commingled with other moneys and property of the said Kean in said banking business, and used and paid out by the said Kean in the regular course of business. A careful consideration of the evidence as contained in the record, satisfies ns that the statements of the answer are true. It was, we are persuaded, the meaning and the understanding of the parties to the transaction when the §0,000 was deposited, that it should become the property of the said Samuel A. Kean, and should be used by him in his business, to be returned to the depositors when the liability upon the bond ceased under the terms of the memorandum between them. This is shown by the circumstances of the transaction. A check payable to the order of 8. A. Kean & Co., for the said sum of $6,000, was drawn upon the Union National Bank, and delivered to the said S. A. Kean & Co. by the officers of the appellant, the accident association. It appears from the evidence that it was intended that the money should be drawn on this check, and it is shown that it was promptly so drawn and used in the banking business of S. A. Kean & Co., and that the officers of the Mutual Accident Association knew that it was so drawn. It further appears that in the negotiation between the parties, while it was not expressly agreed that there should be interest paid or allowed upon this §6,000 by Kean, it was impliedly understood that some interest would be allowed upon it—‘‘that the right thing would ~be done”—hut whether interest was .to be allowed or not, it was the manifest intention of the parties that the §6,000 was not to be kept as a special deposit intrusted to Kean and to remain unused in the banking house of S. A. Kean & Go., but that it was to be, as we have before said, used in the regular banking business of the said S. A. Kean, and that he was in' truth and in fact a debtor to the accident association for that sum, said debt to be paid to the accident association only upon the happening of a contingency on which the deposit was received. Under such circumstances it is impossible to construct a theory of trust with relation to said fund; that there was to be a special account of said money upon the books of the bank, is a very different thing from its being a special deposit. A special deposit is a deposit to be returned in the identical thing; that is, the very bills or coins are to be returned; while a general deposit is a deposit which is to be returned in kind, that is, not the same bills or coins, but the same amount of money, and “ when the identical thing delivered, though in an altered form, is to be restored, the contract is a bailment, and the title to the property is not changed; but. when there is no obligation to restore the specific article, and the receiver is at liberty to return another thing of equal value, the contract is not that of bailment.” Schouler on Bailments, p. 1. Where money is received in a bank as a special deposit, for safe keeping, with the understanding that it shall be cared for and the identical money returned, the bank has no right to use the money in its business; but where the money is deposited with the understanding that a like sum shall be repaid, it is not a special deposit, but is more in the nature of a loan, the relation of debtor and creditor being created by the transaction, and the rule is uniform that where such general deposit is made and the bank is permitted to use the money as its own in its general business, the relation established is not that of bailor and bailee, but is that of debtor and creditor, and no trust can be predicated on such a deposit. Otis v. Gross, 96 Ill. 612. Whatever might be the rule if the deposit could be held to be a special deposit as contended by appellant, it also clearly appearing upon the testimony that it is impossible to follow the deposit as a distinct fund, the. money composing it having been mixed with the general business of the bank, no uncertainty exists where, by the acquiescence, or with the consent of the alleged cestui que trust, there has been such mixture. Union National Bank of Chicago v. Goetz, 27 N. E. Rep. 907. We are unable to agree with appellants in their contention, either as to facts or the law. The judgment of the County Court refusing the prayer'of the petition was correct, and will therefore be affirmed. Judgment affirmed.