Bulakowski v. Philadelphia Saving Fund Soc.

• Decision Date: 25 April 1921
• Docket Number: 275
• Parties: Bulakowski v. Philadelphia Saving Fund Society, Appellant
• Court: Pennsylvania Supreme Court

113 A. 553

270 Pa. 538

Bulakowski v. Philadelphia Saving Fund Society, Appellant

No. 275

Supreme Court of Pennsylvania

April 25, 1921

Argued March 22, 1921

Appeal, No. 275, Jan. T., 1921, by defendant, from judgment of C.P. No. 4, Phila. Co., Dec. T., 1919, No. 3031, on verdict for plaintiff, in case of Andrzej Bulakowski v Philadelphia Savings Fund Society. Reversed.

Assumpsit to recover the amount of a deposit in a saving fund society. Before FINLETTER, J.

The opinion of the Supreme Court states the facts.

Facsimiles of various signatures, mentioned in the opinion of the Supreme Court, are as follows:

Signature of plaintiff on opening account:

Andrzej Bulakowski

Signatures on disputed receipt:

Andrzej Bulakowski

Signature of plaintiff written four days after disputed receipt:

Andrzej Bulakowski

Signature of plaintiff to affidavit to statement of claim:

Andrzej Bulakowski

Verdict and judgment for plaintiff for $2,017. Defendant appealed.

Error assigned, among others, was refusal of judgment for defendant n.o.v., quoting record.

The judgment is reversed.

W Logan MacCoy, of MacCoy, Evans, Hutchinson & Lewis, for appellant. -- The rule of defendant, assented to by the plaintiff, constitutes a reasonable and enforceable contract, unless defendant acted without ordinary care.

The burden of proof was on plaintiff: Kelley v. Buffalo Savings Bank, 180 N.Y. 171.

There is no evidence that defendant acted without ordinary care: Krishkan v. New York Savings Bank, 156 N.Y.S. 298.

Ordinary care as established by the universal custom of savings institutions and sanctioned by the courts, consists in requiring (a) the production of the passbook, (b) a signature so closely resembling the depositor's that competent persons will honestly believe it genuine, and (c), in case of doubt regarding the signature, correct answers to the test questions.

John N. Landberg, for appellee.

Before MOSCHZISKER, C.J., WALLING, KEPHART, SADLER and SCHAFFER, JJ.

OPINION

MR. JUSTICE KEPHART:

A savings bank is an institution organized to promote prosperity of persons of small means and limited opportunities, wherein earnings may be gained on aggregate small deposits, which earnings, after deducting necessary expenses, and a reserve for depositors' security, are divided among the depositors. There is no capital stock, nor are there stockholders in such institutions, and it is not a bank in the commercial sense of that word. It is not, however, for all purposes, a charitable society, and, under certain instances, has been held to be a business corporation: West's App., 64 Pa. 186; Bank for Savings v. The Collector, 70 U.S. 495. The relation between the institution and the depositor is, in some aspects, that of a trustee and cestui que trust ( Barrett v. Bloomfield Savings Institution, 64 N.J. Eq. 425, 433; State v. People's National Bank, 75 N.H. 27, 29); but it has been held the relation is the same as that of a depositor in a commercial bank, that of debtor and creditor: 7 C.J. 863, sec. 906. As affects the question before us, it is difficult to define -- probably a little of both. A savings bank is not held to the same high degree of care as that required of a commercial bank, respecting its depositors or creditors: Kelley v. Buffalo Savings Bank, 180 N.Y. 171; 69 L.R.A. 317. A savings bank is liable to its depositors for want of ordinary care. It does not insure a fund on deposit, nor is its work purely gratuitous; and, while the depositors are the only ones to derive a benefit, none being secured by the organizers or trustees, it has been deemed wise, as a matter of public policy, to adopt the rule of ordinary care with relation to funds on deposit. The bank is of course required to pay the depositor or his attorney the amount credited in his deposit-book, unless relieved through some extraordinary circumstance; and, inasmuch as the depositors of savings institutions are so numerous and cannot be personally known to the officers of the bank, and as possession of the bank book is, under the deposit contract, prima facie evidence of the right to draw on the fund it represents, it became necessary to adopt rules to guard against imposition, not only by the depositors themselves, but by others through the carelessness of depositors. Accordingly, the rule hereinafter mentioned, or a similar one, with a number of others, has been adopted for the protection of such banks. These rules are printed in the deposit- or pass-books, by accepting the book, the depositor assents to the regulations and they become a part of the contract of deposit for the protection of the bank and the depositor, binding on both alike: Burrill v. Dollar Savings Bank, 92 Pa. 134; 3 R.C.L. 707, sec. 339; 7 Corpus Juris, 869, sec. 918. It is not material whether the depositor is able to read the English language. His duty is to make himself familiar with the rules. The situation is not similar to the case of an agent imposing some condition on an illiterate foreigner. Here the savings bank is sought by the depositor for the care of his savings. He should read, or have read to him, everything that relates to the deposits: Burrill v. Dollar Savings Bank, supra.

The rule printed in the depositor's book reads: "If any person shall present a deposit book at the office of the society pretending to be the depositor named therein, and shall thereby obtain the amount deposited, or any part thereof, and the actual depositor shall not have given previous notice at the office of the loss or theft of the book, the society will not be responsible for the wrongful payment, nor be liable to make good the same; provided that it has been entered in the book when made"; and, where ordinary care has been exercised and the money of a depositor is paid to a person other than the depositor, because of the failure of such depositor to comply with this rule, the bank would not be liable to the owner of the deposit for the loss.

But the bank must not be negligent in paying the money on deposit to another than the true owner or authorized agent, even though the pass-book is presented as authority for the payment and the true owner does not give the notice required by the rule. The bank is bound to exercise ordinary care to safeguard its depositors. Want of care may arise from a number of circumstances, as, where the bank required only the deposit-book to be presented, without other reasonable means of identification, or where knowledge was brought home to the bank's officers, of doubtful circumstances, calculated to excite suspicion in an ordinarily careful person, as, for instance, dissimilarity in the handwriting, patent to a person filling the position and performing the duties required of bank officers.

Under certain conditions there is a presumption the officers performed their duty. But when plaintiff shows money was deposited and the bank fails to return it, on proper notice, a prima facie case is made out; so in the present instance, with the money deposited and the bank failing to return it, a prima facie case was made out. It also appears from plaintiff's statement the bank book was stolen, and the only notice given of the loss was after the money was paid by the bank.

The bank had to exculpate itself from liability, and relied...