Clarke v. National Bank of Montana

• Citation: 252 P. 373,78 Mont. 48
• Decision Date: 28 December 1926
• Docket Number: 6026.
• Parties: CLARKE v. NATIONAL BANK OF MONTANA.
• Court: Montana Supreme Court

252 P. 373

78 Mont. 48

CLARKE v. NATIONAL BANK OF MONTANA.

No. 6026.

Supreme Court of Montana

December 28, 1926

Appeal from District Court, Lewis and Clark County; A. J. Horsky Judge.

Action by George K. Clarke, as receiver of the Home State Bank of Manhattan, Montana, against the National Bank of Montana. Judgment for defendant, and plaintiff appeals. Affirmed.

Walter Aitken, of Bozeman, for appellant.

C. A Spaulding, of Helena, for respondent.

STARK J.

This is an action brought by plaintiff as receiver of Home State Bank of Manhattan, Montana, to recover from the defendant the sum of $174.15 and interest, alleged to be a balance due from defendant to the plaintiff, as receiver, on deposit with the defendant and payable on demand. Under sufficient pleadings the following facts were developed at the trial:

On May 19, 1924, People's Store of Manhattan was indebted to Davidson Grocery Company, of Butte, in the sum of $174.15 and on that day drew its check in favor of the grocery company for the amount on Home State Bank of Manhattan, in which it then and at all times thereafter had sufficient funds to meet it when presented for payment. This check it forwarded to the grocery company by mail, and it was by the latter received on May 20, and on the same day indorsed and deposited with Metals Bank & Trust Company of Butte for collection. On May 21 the Butte bank forwarded the check to defendant, its Helena correspondent, for collection and credit. The Manhattan bank had an account with defendant at the time with a balance in its favor more than sufficient to cover the check. On receipt of the check, defendant credited the account of the Butte bank with the amount thereof, subject to payment, and charged the Manhattan bank with the item.

There is some dispute in the testimony as to when this check was forwarded to the Manhattan bank. Smith, vice president of the defendant, testified that it was so forwarded the day it was received by the defendant. However, the assistant cashier of the Manhattan bank, testifying concerning the time of its receipt by that bank, said:

"The check was received on the afternoon of May 23, 1924. I remember the check distinctly as having received it, and at the time it was received I was the only one in the bank. I received it around the hour of 4 o'clock,"

-and further testified that the banking hours of his bank were from 9 to 4; that at 4 o'clock, or a few minutes thereafter, he personally went to the post office and obtained the letter containing the check. The letter of transmittal stated that the check was inclosed "for credit."

On May 23 the cashier of the Manhattan bank was in Helena for the purpose of interviewing the superintendent of banks, and at that time advised the superintendent that he (the cashier) was not going back to Manhattan to open the bank the next day unless some representative of the banking department went with him and took charge of it. Pursuant to this application, one of the deputies of the superintendent of banks went to Manhattan with the cashier that night and assumed direction of the affairs of the bank before the opening hour next morning, Saturday, May 24, 1924. The doors of the bank were opened for business on May 24, pending negotiations which were being conducted by the officers in the hope of obtaining assistance to keep on doing business, but, apparently, no deposits were received and no checks paid on that day, although one check was presented for payment, but payment thereof was refused by the assistant cashier, as he claims, under instructions from the representative of the superintendent of banks, and by direction of this representative payment of the check of $174.15 was likewise refused, but no notice thereof was given to defendant on that day.

By resolution of the board of directors of the Manhattan bank, passed on May 25th, that institution suspended business, and at 6 p. m. on that day its affairs were wholly taken over by the superintendent of banks, with O. A. Tweed, deputy, in charge.

On Monday, May 26, 1924, the check in question was returned to the defendant and received by it on May 27 from "the examiner in charge." Upon receipt of the check by the defendant, its amount was charged to the account of the Butte bank and on the same day the check was returned to it. The check was held by the Butte bank until June 2, when it was returned to the defendant and by the defendant returned to the examiner in charge of the Manhattan bank, with the information that the Butte bank would not accept the check "because of the delay incurred on the part of the Home State Bank in not returning the item sooner." On July 11, 1924, the defendant again credited the account of the Butte bank with the $174.15, which it had charged back to it on May 27, upon return of the item from the examiner in charge of the Manhattan bank. This check was never charged to the account of People's Store with the Manhattan bank. On July 31, 1924, plaintiff was appointed receiver of the Manhattan bank and thereafter made demand upon the defendant for payment of $174.15, as a balance due the Manhattan bank from defendant. Payment being refused, this action was instituted on February 14, 1925, and was subsequently tried to the court without a jury. The court made and filed findings of fact and conclusions of law in favor of the defendant, under which judgment was given, made, and entered in its favor, from which the plaintiff has appealed.

Numerous assignments of error in appellant's brief question the sufficiency of the evidence to sustain certain findings of fact made by the trial court, and also the correctness of the conclusions of law, assuming that the facts found were sustained by the evidence.

Among the findings of fact so questioned is one to the effect that the check in controversy was held and retained by the Manhattan bank for more than 24 hours after it was received by it, to wit, until May 27, 1924, and no notice of any kind given to the defendant in relation thereto. In our view of the case, about to be developed, the crucial question is whether the check was so retained by the Manhattan bank.

In the preceding statement of fact we have undertaken to set out those developed at the trial, which seem to be material and concerning which there was no dispute, and we shall now endeavor to apply the law to these unquestioned facts.

The sections of the Code applicable to the facts in this case are section 8592, Revised...