Grenada Bank v. Moore
| Decision Date | 26 February 1923 |
| Docket Number | 23017 |
| Court | Mississippi Supreme Court |
| Parties | GRENADA BANK v. MOORE |
1. BANKS AND BANKING. Bank liable to depositor for loss by conversion of controlling officer, even though gratuitous bailee.
Where a bank accepts special deposits, and a person makes a special deposit of his securities therein, and its managing officer subsequently converts the securities to his own use, the bank, even though a gratuitous bailee, is liable to the depositor for the loss, regardless of whether such loss is occasioned by mere negligence or fraud; the act of conversion by the controlling officer being, in effect, the act of the bank itself.
2. BANKS AND BANKING. Value of business of depositor sufficient consideration for mutuality of trust to safely keep deposited securities.
Where a customer and general depositor of a bank which invites and accepts special deposits makes a special deposit of his securities therein which are subsequently lost or converted by its officers or servants, the bank is liable to the depositor for the loss of the securities, the bailment being one for hire, in that the bank acts for a consideration by virtue of its business dealings and relations with the depositor, his business being valuable and profitable to the bank is sufficient consideration for mutuality in the contract of trust to safely keep the securities.
HON. T P. GUYTON, Chancellor.
APPEAL from chancery court of Choctaw county, HON. T. P. GUYTON Chancellor.
Suit by C. A. Moore, administrator of the estate of John L. Moore deceased, against the Grenada Bank. From a decree for plaintiff, defendant appeals. Affirmed.
Judgment affirmed.
Green & Green and T. E. Pegram, for appellant.
Boothe & Pepper and Teat & Potter, for appellee.
This is a suit in equity by C. A. Moore, administrator of the estate of John L. Moore, deceased, against the Grenada Bank to recover certain bonds, or their value, twenty thousand five hundred dollars, deposited by the deceased, John L. Moore, in the bank of Ackerman, a branch of the Grenada Bank; and from a decree in favor of the appellee administrator, the bank appeals.
The case is simply this: John L. Moore, deceased, in his lifetime deposited in the bank of Ackerman, a branch of the Grenada Bank, certain bonds of the value of twenty thousand five hundred dollars as a special deposit; the manager of the Ackerman Bank, C. A. Torbert, was also the vice president and cashier of the Grenada Bank. Mr. Moore was a depositor and customer of the Ackerman Bank for many years before his death, and from time to time purchased the bonds in question and delivered them to the Ackerman Bank through its manager, C. A. Torbert. The coupons of these bonds were regularly clipped by the bank and the proceeds placed on deposit to the credit of Mr. Moore, who seemed to have had implicit confidence in the bank and its manager, Torbert, and intrusted it with the special keeping of the bonds in its vaults.
Torbert, as we have already said, was the manager of the Ackerman Bank and vice president and cashier of the mother bank at Grenada. Torbert took the bonds out of the Bank of Ackerman and hypothecated them with different parties and borrowed large amounts of money on them, which money he used for his own individual purposes; and this suit was for the purpose of recovering the bonds or their value from the Grenada Bank.
It appears that the money obtained by Torbert was used by him in paying off certain worthless obligations due to...
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...his box in connection with its other banking services, then it was a bailee for hire. The cases cited on this point are Grenada Bank v. Moore, 131 Miss. 339, 95 So. 449, and Leach v. Hale, 31 Iowa 69. In our opinion better reasoned authorities are to the contrary. [3 R. C. L. sec. 187, p. 5......
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