223 P. 1091 (Kan. 1923), 24,724, Barrett v. Foster

CourtUnited States State Supreme Court of Kansas
Writing for the CourtHARVEY, J.:
Citation223 P. 1091,114 Kan. 804
PartiesJOEL BARRETT, Petitioner, v. F. H. FOSTER, Bank Commissioner, (CARL J. PETERSON, substituted), Respondent
Date08 December 1923
Docket Number24,724

Page 1091

223 P. 1091 (Kan. 1923)

114 Kan. 804

JOEL BARRETT, Petitioner,

v.

F. H. FOSTER, Bank Commissioner, (CARL J. PETERSON, substituted), Respondent

No. 24,724

Supreme Court of Kansas

December 8, 1923

Decided July, 1923.

Original proceeding in mandamus.

SYLLABUS

SYLLABUS BY THE COURT.

MANDAMUS--Guaranty Fund--Certificate of Deposit--Not Entitled to Certificate on State Bank Guaranty Fund. Upon the failure of a bank, operating under the state bank guaranty law, the holder of a certificate of deposit, in the following form: " has deposited in this bank $ . Payable to the order of himself in current funds on return of this certificate properly endorsed interest at the rate of 4 per cent per annum for all full months if left six months. , Cashier. Not subject to check"; is not entitled to a certificate on the state bank guaranty fund.

Robert Stone, George T. McDermott, Robert L. Webb, Beryl R. Johnson, all of Topeka, and A. M. Casten, of Quenemo, for the plaintiff.

Charles B. Griffith, attorney-general, John G. Egan, W. C. Ralston, assistant attorneys-general, and J. B. Larimer, of Topeka, for the defendant.

OPINION

[114 Kan. 805] HARVEY, J.:

This is an original proceeding in mandamus to compel the bank commissioner to issue a certificate upon the state bank guaranty fund for the amount of a certificate of deposit. Briefly, the facts are:

The Farmers State Bank of Quenemo, Kansas, operating under the provisions of the State Guaranty Law, on May 13, 1921, issued a certificate to Joel Barrett for a deposit then made or an amount then on deposit, which certificate reads as follows:

"Deposits Guaranteed

"THE FARMERS STATE BANK

83-548

QUENEMO, KANS. May 13, '21. No. 3189

"Joel Barrett Has deposited in this Bank One thousand two hundred eighty-five dollars forty cents $ 1285.40. Payable to the order of himself in current funds on return of this Certificate properly endorsed interest at the rate of %4per annum for all full months if left six months.

Signed W. J. HUTCHISON

"Not subject to check."

Cashier.

The deposit remained in the bank and was there when the bank was closed by the bank commissioner for insolvency on February 18, 1922. On April 22, 1922, plaintiff presented to the bank commissioner proof of claim for $ 1,311.10, being the face of the certificate with interest for six months at 4 per cent per annum and requested the bank commissioner to issue to him a certificate for that amount against the state bank guaranty fund, which request was refused.

Under the provisions of the state bank guaranty law (Gen. Stat. 1915, §§ 600, 601), as heretofore construed by this court ( State Bank v. Bank Commissioner, 110 Kan. 520, 204 P. 709; Barber County v. Bank Commissioner, 113 Kan. 180, 213 P. 1054), a deposit is not within the protection of the bank guaranty act if it does not conform to the rules of the bank commissioner governing such deposit. Under the authority conferred upon him by statute the bank commissioner promulgated a rule or order as to the class of deposits that should be within the protection of the bank guaranty act, which, so far as is pertinent here, reads as follows:

" . . . The following rates are hereby approved: A maximum rate of 4 per cent on time certificates of deposit not payable in less than three months and not extending more than two years and having a definite date of maturity when interest shall cease. . . . The maximum rate of 3 per cent per annum applies to all other forms of deposit . . . ."

[114 Kan. 806] Examining the certificate in this case it will be noted that it is ". . . payable . . . on return of this certificate properly endorsed . . . ." By its terms the holder was at liberty to return it for payment the next day after it was issued or at any time thereafter, which might extend for several years. Hence, it was an instrument payable on demand. (Gen. Stat. 1915, § 6534; Emerson v. North Amer. Trans. Co., 303 Ill. 282, 135 N.E. 497; Pierce v. State National Bank of Boston, 215 Mass. 18, 101 N.E. 1060; Talladega Insurance Co. v. Woodward, 44 Ala. 287; Hillsinger v. Georgia Railroad Bank, 108 Ga. 357, 33 S.E. 985; Elliott v. State Bank, 128 Iowa 275, 103 N.W. 777; Easley v. East Tennessee Nat. Bank, ...

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