79 F.2d 877 (4th Cir. 1935), 3894, Marchant v. Summers

Docket Nº:3894.
Citation:79 F.2d 877
Party Name:MARCHANT v. SUMMERS.
Case Date:November 12, 1935
Court:United States Courts of Appeals, Court of Appeals for the Fourth Circuit
 
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Page 877

79 F.2d 877 (4th Cir. 1935)

MARCHANT

v.

SUMMERS.

No. 3894.

United States Court of Appeals, Fourth Circuit.

November 12, 1935

Page 878

Appeal from the District Court of the United States for the Eastern District of South Carolina, at Charleston.

W. C. Wolfe, of Orangeburg, S. C., for appellant.

Carroll E. Summers, of Orangeburg, S. C., for appellee.

Before PARKER, NORTHCOTT, and SOPER, Circuit Judges.

PARKER, Circuit Judge.

This is an appeal from a decree which directed the receiver of a failed national bank to turn over to plaintiff four $100 Liberty Loan bonds, together with the proceeds of certain interest coupons, in the hands of the receiver. It appears that in 1919 plaintiff deposited the bonds with the bank for safe-keeping under an agreement which required the bank to collect the interest thereon and deposit it to plaintiff's account. The agreement, which was in writing, after reciting the deposit of the bonds with the bank, set forth the terms under which they were to be held by it, as follows:

'This certificate is non-transferable and therefore non-negotiable. The bank agrees to collect the semi-annual interest on said bonds when due and credit to the owners account with this bank.

'This bank reserves the privilege of using the bonds represented by this certificate in such a manner and for such purposed as it may choose and requires five (5) days notice when the return of the above amount of bonds is desired--not necessarily the identical bonds, but bonds of the same issue, same denomination and value.

'This bank makes no charge for this service but reserves the right to return the above amount of bonds to the owner after reasonable notice and in case of this certificate being lost or destroyed the bank reserves the right to require the owner to publish proper public notice thereof before the issuing of a duplicate or the delivery of the bonds.'

The bank held the bonds, collecting the interest coupons and crediting same to plaintiff, until November 24, 1931, or January 12, 1932. On one or the other of these dates it pledged them along with bonds belonging to other customers, totaling $17,000, to secure deposits which had been made with it by the Postal Savings Bank. It had already deposited bonds of its own to secure this postal savings account; but upon being called upon for additional security, it pledged two lots of bonds belonging to its customers, one on November 24, 1931, and the other on January 12, 1932, among which were the bonds of plaintiff. These bonds of customers were not credited to them or in any way entered upon the books of the bank until they were pledged to secure the postal savings account. They were then listed among the bank's resources as 'bonds owned by customers' and among its liabilities as 'bonds borrowed from customers.'

After the bank was placed in receivership, the amount due the Postal Savings Bank was paid from the proceeds of the sale of the bonds belonging to the bank, and the bonds of customers which it had pledged, or bonds of like character and amount, were returned to its receiver and are now held by him. The order appealed from directed the receiver to turn over four of these, together with the proceeds of the interest coupons which he had collected, to the plaintiff. The receiver contends (1) that the effect of the deposit of the bonds was to create a mere debtor and creditor relationship between the bank and plaintiff, and (2) that, in any event, plaintiff

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is not entitled to the return of bonds after the pledge to secure the postal savings account, as the bonds returned to the receiver are not shown to...

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