In re Plankinton Bank

• Decision Date: 10 April 1894
• Citation: 58 N.W. 784,87 Wis. 378
• Parties: IN RE PLANKINTON BANK. APPEAL OF VAN DYKE.
• Court: Wisconsin Supreme Court

87 Wis. 378

58 N.W. 784

IN RE PLANKINTON BANK. APPEAL OF VAN DYKE.

Supreme Court of Wisconsin.

April 10, 1894.

Appeal from circuit court, Milwaukee county; D. H. Johnson, Judge.

In the matter of the assignment of the Plankinton Bank. Petition by John H. Van Dyke. Petition denied, and petitioner appeals. Affirmed.

The petitioner sought to have the sum of $15,871.50, collected and held in trust by Frederick Day for him, and by him deposited in the Plankinton Bank, with interest, ordered and adjudged to be paid to the petitioner by William Plankinton, the assignee, out of the assets of the Plankinton Bank, in his hands as such assignee, in preference to all other creditors of the bank, or, if not so paid, then, as a general creditor of said bank, equally with its other creditors, etc. The case was heard upon stipulated facts, in substance: That said Day, when the transactions in question occurred, was engaged in the business of investing and loaning money upon bond or note and mortgage upon real estate for his clients or customers in that business. Prior to February 1, 1893, the petitioner had intrusted Day with large sums to be so loaned, and he was to retain the securities taken, collect the interest thereon as the same matured, and promptly pay the same to the petitioner, and in like manner collect and pay over the principal, unless directed to reinvest the same, and Day was to have a commission of 2 per cent. on the amount of interest collected and paid over. That between March 1, 1893, and May 16th, in the same year, Day collected on account of petitioner's loans, at various times, in all to the amount of $15,871.50, all of which, when and as collected, Day deposited in the Plankinton Bank, to the credit of his individual account, at all of which times Day was largely indebted to the bank, and all the time he was one of the directors and president and managing officer of the bank. The deposits were made by Day in person, or by his servants, in the usual manner, through the tellers of the bank, and without the intervention of any officer of the bank. Exhibit A, annexed to the statement, is a copy of Day's deposit accounts,--one a general account, headed “F. T. Day,” which was terminated April 4, 1893, and no money thereafter deposited to the credit of that account, and no checks were thereafter drawn against it, but all moneys thereafter charged against it were for checks previously drawn and subsequently presented. April 5, 1893, a new account was opened, called “F. T. Day, Special,” to which all moneys subsequently deposited were credited, and all checks thereafter drawn were charged. All checks drawn by Day before June 1, 1893, were paid and charged up as aforesaid, and this exhibit shows the daily balance of said accounts and overdrafts on the days mentioned. The items marked “Discount” were the discount of the individual notes of said Day,--namely, March 23d, $25,000, and March 31st, $40,000; and it appears that Day's general account was overdrawn March 1, 1893, $50,216.69, and continued to be largely overdrawn on every day except April 4th, and in the end, May 31st, it was overdrawn, notwithstanding said discounts, in the sum of $23,798.53. The account of “F. T. Day, Special,” was overdrawn May 15, 1893, after he had deposited the last moneys collected for petitioner in the sum of $11,506.67, and continued largely overdrawn to the end, and the amount of his said overdrafts when the bank assigned was over $30,000. The bank had no notice that any of the moneys deposited by Day with it were the moneys of the petitioner, except such notice, if any, as it is chargeable with in law, through said Day, or from the fact that said bank had notice that said Day conducted said loan business, collected money for others, deposited only in said bank, and kept no separate account. About March 1, 1893, the petitioner, being dissatisfied with Day's management of his business, directed him to make no further investments for him, but to pay all moneys collected by him on such loans to the petitioner immediately, except as otherwise specially directed by him. That they then entered into another agreement in respect to such loans as were then in default (made an exhibit to the statement). The petitioner had no knowledge of the amounts actually collected or received by Day between March 1, 1893, and the date of the assignment, or any of them, and had no notice or knowledge that they had been deposited by Day to his individual account in said bank, and never assented thereto. That the business relations between him and Day, as first above stated, had existed for a number of years prior to February 1, 1893, during which time moneys collected by Day for him were habitually deposited by Day in said Plankinton Bank to his own credit, in like manner as after said date. That petitioner had no knowledge of the manner in which Day kept his bank account aside from the fact that Day made payments to him from time to time, and always by means of the individual checks of Day upon said bank, and they were in the usual form, headed, “Real-Estate Loan Office of F. T. Day,” and were directed at the bottom, “To the Plankinton Bank, Milwaukee, Wis.” The petitioner never had any knowledge that the account or accounts of Day at said bank were overdrawn. Between the 5th day of April, 1893, and May 31st of the same year, Day drew checks on said bank in favor of his individual creditors, which were paid and charged to the special account, and some of them were in favor of parties having liens or claims on real estate and other property which was conveyed by Day to said bank, as collateral security for his indebtedness to said bank. The assignment of the bank to William Plankinton for the benefit of its creditors was made June 1, 1893, and he holds possession of the estate and assets of said bank as its assignee; and the 3d of June, Day made a like assignment for the benefit of his creditors to William H. Momsen, who is still such assignee. The court made an order denying the prayer of the petition, from which the petitioner appealed.Van Dyke & Van Dyke, for appellant.

Winkler, Flanders, Smith, Bottum & Vilas, for respondent.

PINNEY, J. (after stating the facts).

1. It is perfectly well settled that the mere fact that an officer of a corporation acquires knowledge of facts when not acting for it does not charge or affect the corporation with...