Bartholomy v. Harrison

• Decision Date: 24 August 1934
• Docket Number: No. 5409.,5409.
• Citation: 74 S.W.2d 69
• Parties: LOUIS B. BARTHOLOMY, GUARDIAN AND CURATOR OF ESTATE OF ROY LEE BARTHOLOMY AND DOLLY MAY BARTHOLOMY, MINORS, RESPONDENT, v. D.R. HARRISON, COMMISSIONER OF FINANCE, IN CHARGE OF PORTAGEVILLE BANK, APPELLANT.
• Court: Missouri Court of Appeals

74 S.W.2d 69

LOUIS B. BARTHOLOMY, GUARDIAN AND CURATOR OF ESTATE OF ROY LEE BARTHOLOMY AND DOLLY MAY BARTHOLOMY, MINORS, RESPONDENT, v. D.R. HARRISON, COMMISSIONER OF FINANCE, IN CHARGE OF PORTAGEVILLE BANK, APPELLANT.

No. 5409.

Springfield Court of Appeals. Missouri.

August 24, 1934.

Appeal from Circuit Court of New Madrid County. — Hon. John E. Duncan, Judge.

REVERSED AND REMANDED (with directions).

Sharp & Baynes for appellant.

Plaintiff (claimant) was only a general creditor. Paul v. Draper, 158 Mo. 197. A deposit made by a trustee is considered as a general deposit and if the bank fails to pay the deposit the beneficiaries have no particular claim or rights over the other creditors. Wheelock v. Cantley, 50 S.W. (2d) 731; Compton Company et al. v. Farmers Trust Co., 279 S.W. 746, 748. The burden is on claimant to prove that the deposit was special or some state of facts entitling him to a preference. Ellington v. Cantley, 300 S.W. l.c. 530.

H.C. Riley for respondent.

Mr. Fields, cashier of the bank, having full knowledge of the source and ownership of the funds placed in the bank by the curator, he as well as the bank is charged with knowledge of his duties and their limitation. Johnson v. Payne & Williams Bank, 56 Mo. App. 257, 263; In re Farmers Exchange Bank of Gallatin, 37 S.W. (2d) 936, 942. The provisions of the statutes of this State governing the duties of a curator in loaning and investing the funds of his ward are plain. Secs. 412, 418, R.S. Mo. 1929. Where deposits are made against some statutory provision and the bank knowing the origin and nature of the deposit such bank becomes the trustee of such fund. State v. Page Bank, 14 S.W. (2d) l.c. 599; City of Maryville v. Farmers Trust Co., 45 S.W. (2d) 103; Special Road District v. Cantly, 8 S.W. (2d) 944; Cameron Road District v. Cameron Trust Co., 51 S.W. (2d) 525; In re Liquidation Gower Bank of Gower, 55 S.W. (2d) 713. Where no authority to make a deposit relation of debtor and creditor is not created, the bank becomes a trustee and this fund trust is impressed upon the funds in the custody of the Finance Commissioner. Deal v. Bank of Smithville, 52 S.W. (2d) l.c. 205; State v. Page Bank, 14 S.W. (2d) l.c. 599; Special R. Dist. v. Cantley, 8 S.W. (2d) 944.

SMITH, J.

This is a claim for preference. The facts are simple. The bank was closed and is now in process of liquidation. Louis B. Bartholomy was appointed guardian and curator of the estate of the Bartholomy minors and gave bond as such guardian and curator. As such curator the sum of $2157.73 came into his hands and he deposited this amount in the Portageville Bank. The first deposit was made July 21, 1931, in the sum of $2000; on August 8, 1931, $151.59 was deposited and on October 3, 1931, $6.43 was deposited. This was deposited and carried on the books in the name of "Louis Bartholomy, Guardian of Roy Lee and Dolly May Bartholomy." Certain checks were drawn by the guardian and curator against these deposits until the bank closed on January 12, 1932, when there remained a balance due on the deposits of $1643.54. These funds were not deposited for any special or particular purpose.

The guardian and curator filed in due time a claim for preference for this amount. The claim was allowed as an ordinary claim by the commissioner and certified to the Circuit Court, and was there allowed in full as a preferred claim. From the judgment allowing the claim as a preference the Commissioner of Finance appealed to this court.

There is no controversy over the amount involved nor over any fact at issue in the case, and it was admitted that there were sufficient funds on hand to cover this claim at the time the bank closed.

The plaintiff contends that because this money belonged to his wards and that the banker had knowledge that it was money belonging to minors when deposited that the bank took the money as a preferred claim. It is his contention that under the provisions of Sections 412 and 418 of the Revised Statutes of Missouri, 1929, the guardian and curator should have loaned this money on approved real estate or bought certain bonds in the statutes designated, and that since it was not invested in that manner, and since the bank officer had knowledge of the source and ownership of the funds at the time the money was deposited, the bank received the money contrary to the statutory provisions, and thus received it as trustee, and that for thus unlawfully receiving this deposit by the bank the claim should be allowed as a preference.

We have not been cited any case by the plaintiff, nor have we found any, that holds it to be unlawful for a bank to receive money deposited by a guardian and curator. We do not think the statutes cited by the plaintiff, supra, can be construed to mean that it is unlawful for a bank to so receive such deposits.

The plaintiff has cited several cases where deposits are made contrary to some statutory provisions in which the bank had knowledge of facts sufficient under the law to constitute the bank a trustee of such funds entitling the depositor to a preference, but the facts in those cases are not the same as in this case, and those cases relied upon here are not in point.

On the other hand we are cited cases by the defendant, which convince us that the trial court erred in rendering the judgment here.

There is no question but that Section 418, Revised Statutes of Missouri, 1929, provides how the ward's money shall be loaned, when a loan is made. Prior to 1919 the guardians and curators were required to "loan the money of their wards at the highest legal rate of interest that can be obtained, on prime real estate security," except where the estate was less than three hundred dollars it might be loaned upon personal security. In 1919 the latitude was broadened to permit the funds to be invested in certain bonds designated in the statute. [Section 418, supra.] The statute is no more binding upon the guardian and curator now than it was prior to the amendment in 1919, and the duties of the...