Highfield v. First Nat. Bank Of Rome

• Decision Date: 14 July 1932
• Docket Number: No. 21917.,21917.
• Citation: 165 S.E. 135,45 Ga.App. 431
• Parties: HIGHFIELD. v. FIRST NAT. BANK OF ROME.
• Court: Georgia Court of Appeals

45 Ga.App. 431

165 S.E. 135

HIGHFIELD.

v.FIRST NAT. BANK OF ROME.

No. 21917.

Court of Appeals of Georgia, Division No. 2.

July 14, 1932.

Syllabus by the Court.

1. A depositor in a savings bank is bound by the reasonable rules and regulations of the bank to which he assents. A rule providing that "every effort will be made to protect depositors against fraud, but payment made to a person presenting pass book shall be good and valid on account of the owner, unless said pass book has been lost, and notice in writing given to the cashier of the bank before such payment is made, " is reasonable and binding upon depositors.

2. A savings bank will be protected in paying money to a person presenting the passbook when it does so in the exercise of reasonable care and diligence and in good faith, where the depositor has assented to the above rule.

3. In the absence of any modifying agreement between a savings bank and the depositor, the bank is only authorized to pay deposits to the depositor, or his legal representative.

4. The mere presentation of the passbook is not authority for payment of the deposit, in the absence of any agreement to that effect.

5. The reasonable rules and by-laws of a savings bank for withdrawing deposits, if properly made known to the depositor, are part of the contract between him and the bank.

6. The mere printing in a passbook of a provision releasing a savings bank from liability in paying out money to one presenting the passbook, when done in good faith and in the exercise of ordinary diligence, does not bind the depositor unless he is required to sign it or his attention is particularly called to it.

7. The requirements of a general statute, that all deposits shall be paid to the depositor or his legal representatives, cannot be changed by a by-law adopted by a savings bank, unless the attention of the depositor is called thereto and he actually or impliedly assents.

Error from City Court of Floyd County; John W. Bale, Judge.

Suit by John Highfield against the First National Bank of Rome. Judgment for defendant, plaintiff's motion for a new trial was overruled, and plaintiff brings error.

Reversed.

On January 3, 1929, John Highfield, the plaintiff, deposited $500 in the savings department of the First National Bank of Rome, the defendant, receiving at the time a passbook from said bank, which passbook had printed therein, just above the entry of deposit, the following: "This book is accepted, and all deposits are made subject to the by-laws of the bank as herein printed, and made a part of this deposit contract." Among these by-laws or rules and regulations is the following: "Every effort will be made to protect depositors against fraud, but payment made to a person presenting pass book shall be good and valid on account of the owner, unless said pass book has been lost, and notice in writing given to the cashier of the bank before such payment is made." Early in January, 1931, the plaintiff looked for his passbook, which he kept in the bottom of his trunk, in order to bring it to the bank to have the interest credited thereon; but he could not find the same. He went to Rome and advised the bank officials to that effect, whereupon he was informed that the money had all been checked out on checks purporting to bear his signature signed by his mark, by a man asserting himself to be the plaintiff. Plaintiff signed none of these checks and authorized no one else to do so for him, and knew nothing about the money being paid out by the bank. On his demand for payment of this deposit to him, the bank refused to pay. The bank had paid the money out to a man whom it supposed to be the plaintiff, and who presented the passbook. The bank officials and employees did not know the plaintiff personally, and the loss of the passbook by the plaintiff had not been reported to it. It acted in good faith in paying out the money and thought that it was paying the same to the plaintiff. There was nothing in any way to raise the bank's suspicion that the checks given by this man were not bona fide and that he was not the plaintiff. The bank carried a large number of savings accounts, and the officer of the bank in charge of that department did not know many of the persons carrying these accounts. The bank knew nothing of the plaintiff's contention until he came to the bank in January, 1931, when it informed him that his account had been closed.

The plaintiff did not know that the passbook given him by the bank had any printing in it. He thought that this book just showed how much money he had deposited in thebank, and he did not know that it contained any other provisions at all. Plaintiff can neither read nor write, and when he made the deposit the bank officials handed him the passbook and he carried it home with him. Neither at the time he made the deposit nor thereafter did any official or employee of the bank call his attention to any by-laws, rules, or regulations printed in the passbook or anywhere else with reference to the deposit. He knew nothing of these things in any way and no one ever explained them to him. As he could not read, he never knew of the existence of any such rules or by-laws, nor did he ever assent or agree to them, for the reason that he did not know of them, nor did he ever sign his name by mark or otherwise in said book or authorize any one to do so for him. Plaintiff's son-in-law was subsequently convicted of forgery in this matter, on plaintiff's testimony, and sentenced to the chain gang. Plaintiff again demanded payment of the deposit, and on the bank's refusal to pay he brought suit against it in Floyd superior court. From the pleadings and evidence the above facts undisputedly appear.

The jury returned a verdict for the defendant, and the plaintiff moved for a new trial on the general grounds and on the following ground: The court erred in charging the jury as follows: "I charge you that the rules and regulations printed in the pass book in evidence are binding upon the plaintiff even though he could not read or write, had not signed the agreement referring to the rules and regulations, and the same had never been read or explained to him." The court then charged the jury that the defendant would not be liable if its employees acted in good faith in paying checks presented with the passbook unless there were circumstances calculated to arouse the suspicions of a reasonable man that the person presenting the passbook and accompanying checks did not have the right to withdraw the money. Plaintiff insists that the above-quoted charge was error: (1) Because the evidence shows that the rules and regulations referred to in said charge were never signed, approved, adopted, or consented to or otherwise agreed to by him; (2) because the evidence shows, without dispute, that plaintiff could neither read nor write and that said rules and regulations were never explained to him, that he had no knowledge thereof, and that the bank had no authority to pay out said money on said checks in the absence of an agreement on his part that the payment of checks purporting to be signed by him accompanied by said pass book would discharge the bank's liability to him for the amount of his deposit; (3) because plaintiff must have had knowledge of and actually or impliedly assented to said rules and regulations in order to have been bound by them, and, since the undisputed evidence showed that he had no knowledge of and did not actually or impliedly assent to said rules and regulations, he was not bound thereby; and (4) because the effect of such charge was to tell the jury that said rules and regulations amounted to and constituted a part of the contract between him and the bank, whereas the undisputed evidence showed that he had not entered into such contract with the bank as he had no knowledge of and had not, therefore, assented to be bound by said rules and regulations.

The court overruled the motion for new trial, and to this judgment the plaintiff excepts.

Wright & Covington and Porter & Mebane, all of Rome, for plaintiff in error.

Maddox, Matthews & Owens, of Rome, for defendant in error.

SUTTON, J. (after stating the foregoing facts).

"A depositor in a savings bank is bound by the reasonable rules [and regulations] of the bank, to which he assents * * * in writing. A rule providing that 'every effort will be made to protect depositors against fraud, but payment made to a person presenting passbook shall be good and valid on account of the owner, unless the passbook has been lost and notice in writing given to (the) bank before such payment is made, ' is reasonable, and binding upon depositors. Under the terms of such a rule, where a passbook is presented by a person other than the depositor to whom it belongs, together with a forged check bearing a signature similar to that of the depositor, and there is nothing to arouse the suspicion of the teller or put him upon inquiry as a reasonably prudent man as to the genuineness of the check, and the bank in good faith pays the check, believing the person presenting it to be the depositor, it is not liable in a suit by the depositor to recover the money so paid." Langdale v. Citizens' Bank, 121 Ga. 105, 48 S. E. 708, 69 L. R. A. 341, 104 Am. St. Rep. 94, 2 Ann. Cas. 257. It will be noted that the undisputed evidence in that case shows that Langdale had assented to the rule above quoted, and that the cashier of the bank cautioned him to take good care of his passbook, and not let it "lie around loose, " pointing out to him the rules on the subject. The court in that case said that especially when the depositor agrees in writing that he shall be bound by the rules and regulations of a savings bank, do they enter into the contract of deposit, and that, by agreement between the bank and its depositor, possession of the passbook is made...