Lawrence v. Lincoln County Trust Co.

• Decision Date: 08 February 1926
• Citation: 131 A. 863
• Parties: LAWRENCE, Bank Commissioner, v. LINCOLN COUNTY TRUST CO.
• Court: Maine Supreme Court

131 A. 863

LAWRENCE, Bank Commissioner,

v. LINCOLN COUNTY TRUST CO.

Supreme Judicial Court of Maine.

Feb. 8, 1926.

Report from Supreme Judicial Court, Lincoln County, in Equity.

Suit by Fred F. Lawrence, Bank Commissioner, against the Lincoln County Trust Company. On report after a petition by the receivers of defendant for instructions as to claims presented by the Wiscasset Grain Company. Decree in accordance with opinion.

Argued before WILSON, C. J., and PHILBROOK, DUNN, DEASY, STURGIS, and BARNES, JJ.

Walter S. Glidden, of Bath, for petitioning receivers.

G. Allen Howe, of Brunswick, for Wiscasset Grain Co.

PHILBROOK, J. The parties whose names give title to this case are nominal. The real, actual, interested parties are the receivers of the defendant corporation and the Wiscasset Grain Company. The controversy arises on the equity side of this court, and upon the receivers' petition for instructions as to their duties relative to two claims now presented by the grain company. The case is reported on an agreed statement of facts; this court to render such decision and give such instructions as may be equitable and proper.

Acting under authority given him by R. S. c. 52, §§ 86 and 54, the bank commissioner applied to a Justice of the Supreme Judicial Court for an injunction to restrain the bank from proceeding with its business. Such order was made March 13, 1923, and served on the bank March 14, 1923, at about 1:30 o'clock in the afternoon. On March 29, 1923, commissioners were appointed to receive and decide upon all claims against the bank. On May 9, 1923, the court directed that the commissioners should hold meetings for the aforesaid purpose on seven designated days between May 26 and July 7, 1923, both inclusive, they to give appropriate notice of their meetings. The commissioners were further ordered by the court to report not later than August 1, 1923, and they did in fact report on July 30, 1923, their report being accepted and confirmed by a court decree dated October 24, 1923. The grain company did not present to the commissioners, at any time prior to the filing or to the acceptance of said report, either of its claims now under consideration, and never formally presented any claim nor instituted any proceedings until November, 1924, when it filed in court a petition praying that these claims might be allowed and ordered paid in full by the receivers. This petition was withdrawn by agreement in order that the questions at issue might be taken up on the receiver's petition for instructions.

Claim of the drain Company Barred.— At the outset the receivers urge that the claims of the grain company are barred, citing R. S. c. 52, § 55, as amended by P. L. 1921, c. 35, which provides for the appointment of commissioners to receive and decide upon all claims against savings banks and trust companies which are in the hands of receivers.

It is expressly provided by R. S. c. 71, § 20, that claims against insolvent estates not presented, and claims disallowed without appeal, are forever barred from recovery by suit. But that is not this case. With reference to claims against insolvent savings banks and trust companies, the statute (R. S. c. 52, § 55, supra), specifically provides that:

"On application of any person interested, the court may extend the time for hearing claims by the commissioners, as justice may require."

The receivers contend that in the instant case the grain company, both by its counsel and by its manager, manifested indifference and plain negligence in failing to seasonably present the claims now in controversy to the commissioners, and that justice does not now require that this claimant be allowed opportunity to prove its claim after so great a lapse of time, and when the receivership has so far progressed that dividends of 80 per cent. have been paid to the savings bank depositors from the segregated assets. "Could there be a plainer case upon which to base a finding of equitable estoppel," is the query of the receivers.

Allowance of Claims Presented to the Court instead of to Commissioners.—The receivers also contend that claims against the insolvent bank should be presented to the commissioners, in the first instance, and that this court is not vested with the right to receive and decide upon such claims, because the statute has distinctly provided the procedure otherwise. We concede that this contention is sound where the claim rests purely and simply upon the legal relation of debtor and creditor. To hold otherwise would create a confusing, if not unfair, precedent, since by such ruling any creditor could ignore the plain statutory provisions and impose a burden on the court which should be borne othe

Equitable Nature of These Claims.—We now approach the real ground upon which the grain company asks payment of its claims in full, and in order to discuss that ground we must state the nature of the claims. Statements of fact herein made are gleaned from the agreed statement and from the receiver's petition for instructions. For convenience and brevity of expression these claims, two in number, will be referred to as the draft claim and the check claim.

The Draft Claim.—The nature of the grain company's business involved the occasional deposit and collection of drafts upon customers to whom grain was sold and shipped. On an average of 10 or 12 times a year it would have occasion to deposit such drafts with the bank for collection. On March 10, 1923, it made a sight draft for $1,129.44 on one S. E. Winchenbach, of Waldoboro, Me. This draft was on the same day given to the bank for collection, and was forwarded by it to Waldoboro in the ordinary course of business. The net proceeds of this draft, amounting, less costs of collection, to $1,128.32, was forwarded to and received by the bank between 10 o'clock and 10:30, as nearly as can be ascertained, in the forenoon of March 14, 1923, the day of the closing of the bank. The grain company at all times kept in the bank sufficient balance for its business requirements, and whenever it deposited drafts for collection never needed, or asked, for tentative credit against them. According to the brief statement, the course of dealing between the grain company and the bank with regard to these drafts was as follows: The manager of the grain company, Mr. Willband, gave instructions to the bank to make collection and report to him. No further specific instructions were given, and he never instructed the bank to await further or additional orders and instructions from him before crediting the proceeds of drafts to the grain company's account. When a draft was collected, the bank officials, at some time during the day on which the collection was received, always credited the proceeds to the grain company's account. The grain company made almost daily deposits, and sometimes deposited more than once a day. These deposits were usually made by its bookkeeper, although sometimes by Mr. Willband himself. As collections were sometimes uncertain, Mr. Willband kept very close tab on these drafts, and from time to time would inquire of the bank if collections bad been made. Whenever the bank collected a draft they would notify the bookkeeper the next time she came to deposit, and credit would be entered on the grain company's passbook, which she would have with her, as the bank used the system of individual depositors' passbooks. Sometimes she would add the amount of the draft to the deposit slip which she had...