Haseman v. Union Bank of Mena, 79-319

• Decision Date: 31 March 1980
• Docket Number: No. 79-319,79-319
• Citation: 597 S.W.2d 67,268 Ark. 318
• Parties: Christena HASEMAN, Appellant, v. UNION BANK OF MENA and Liston Haseman, Jr., Appellees.
• Court: Arkansas Supreme Court

Page 67

597 S.W.2d 67

268 Ark. 318

Christena HASEMAN, Appellant, v. UNION BANK OF MENA and Liston Haseman, Jr., Appellees.

No. 79-319.

Supreme Court of Arkansas.

March 31, 1980.

Rehearing Denied May 5, 1980.

James Howard Smith, Little Rock, for appellant.

Robert L. Shaw and Glen G. Langston, J. David Maddox, Mena, for Haseman.

HICKMAN, Justice.

This is the second appeal of this case. In Haseman v. Union Bank, 262 Ark. 803, 562 S.W.2d 45 (1978), we reversed and remanded this cause for a new trial. The trial judge in that case had directed a verdict for the appellee, Liston Haseman, Jr.; a verdict was returned in favor of the bank. The matter was retried and the case was submitted to the jury; the jury returned a verdict in favor of the appellee, Union Bank of Mena, but entered judgment for the appellant, Christena Haseman, against her son, Liston Haseman, Jr., for $6,500.00.

The matter in issue hinges upon a withdrawal of $12,880.32 from a joint savings account. The account was in the name of Christena Haseman, her husband who is now deceased, and their son, Liston Haseman, Jr. It was a passbook account. The son was able to remove the money without presenting the passbook. Mrs. Haseman filed suit against the bank for wrongfully permitting the withdrawal in violation of the rules contained in the passbook and joined the son as a defendant to recover the money.

We set out the facts in the first Haseman case and essentially the same facts were presented to this jury.

On appeal, this time, Christena Haseman alleges four errors. First, the trial court erroneously instructed the jury that the bank could change the terms regarding the savings account without giving her actual notice of the change. Second, the court improperly instructed the jury that if they found the son was the owner of the property, then the money in the savings account was his. Almost all of the money was from the sale of timber on land in which Christena Haseman had a life estate and her son was the remainderman. Third, the appellant argues the court erroneously excluded a portion of a letter from the son's attorney which contained a declaration against his interest. Finally, the appellant argues the court should have granted judgment notwithstanding the verdict.

After reviewing the record we find it contains no reversible error and affirm the judgment of the trial court.

The passbook which Mrs. Haseman held contained a provision that no money could be withdrawn unless the passbook was presented. The use of passbooks by banks is discretionary. Ark.Stat.Ann. § 67-519 (Repl.1966). The passbook in question also contained the provision regarding a change in the rules. That provision reads:

Notice of any change or addition to Savings Department Rules and Regulations shall be conspicuously posted in the lobby of the bank and shall be binding on depositors after having remained so posted for five consecutive business days.

The bank offered evidence that before Liston Haseman, Jr. withdrew the money it changed its rule which required presentation of passbooks. Evidence was presented to the jury that a notice was posted in the bank lobby according to the rule which we have quoted. The appellant argues that even if the notice was properly posted, actual notice was required.

We do not agree that the notice was deficient in this case. The question of notice was a matter agreed upon when the passbook was issued. The general rule is that a depositor by accepting a passbook is bound by the rules it contains. Jefferson County Bldg. & Loan Ass'n. v. Southern Bank & Trust Co., 225 Ala. 25, 142 So. 66 (1932). The depositor need not read or understand the terms to be bound by them. Polonsky v. Union Federal Sav. & Loan Ass'n., 334 Mass. 697, 138 N.E.2d 115 (1956). See, generally, Annotation, 60 A.L.R.2d 708 (1958). There is, however, authority to the contrary. See Los Angeles Inv. Co. v. Home Sav. Bank, 180 Cal. 601, 182 P. 293 (1919).

We cannot agree with the appellant that the fact she did not receive actual notice and the money was withdrawn by her son made the bank liable as a matter of law for breach of contract. It was a question for the jury as to whether the bank complied with the contract and the jury found that the bank had, indeed, complied by posting the notice in the bank lobby. We find nothing unconscionable on the part of the bank in changing its rules as it did. After all, her son could not have withdrawn the money under any circumstances if his name had not been on the account. The question was, could the bank change its rule requiring the use of the passbook for a withdrawal without personal notice.

Nor can we say that the notice in this case failed to satisfy any requirement of due process of law. Due process does not always require actual notice. Londoner v. Denver, 210 U.S. 373, 28 S.Ct. 708, 52 L.Ed. 1103 (1908); Glidden v. Harrington, 189 U.S. 255, 23 S.Ct. 574, 47 L.Ed. 798 (1903); Prather v. Martin, 257 Ark. 576, 519 S.W.2d 72 (1975).

The second allegation of error concerns an instruction the court gave over the objections of the appellant regarding the son's ownership of the land. That instruction reads:

If you find that Liston Haseman, Jr. was the owner of the property from which the timber was sold and that Christena Haseman had a life estate in the property, then you must find for the Defendant, Liston Haseman, Jr., and against the Plaintiff, Christena Haseman, regarding the ownership of the money in the account, unless you find that a contract existed between Liston Haseman, Jr., and Christena Haseman, establishing ownership of the account different from the ownership created by law on the account.

The appellant argues this instruction was wrong because the son was not the owner of the land but merely a remainderman and that a life tenant in this case, Christena Haseman, had rights to the timber. The appellant is correct...