Marietta Trust & Banking Co. v. Faw
| Decision Date | 15 January 1924 |
| Docket Number | 14972. |
| Citation | 121 S.E. 244,31 Ga.App. 507 |
| Parties | MARIETTA TRUST & BANKING CO. ET AL. v. FAW. |
| Court | Georgia Court of Appeals |
Syllabus by the Court.
As against the usual general grounds of a motion for a new trial, a verdict directed by the court stands upon the same footing as if found and returned by the jury; a special assignment of error being necessary to bring under review the judgment of the court directing such verdict. Dickenson v. Stults, 120 Ga. 632 (1), 48 S.E. 173; Stone v Hebard Lumber Co., 145 Ga. 729 (2), 89 S.E. 814.
Where a customer of a bank deposits therein a bond, for the sole purpose of safely keeping the same until demanded by her, the deposit is special; and such special deposit is gratuitous if it be accepted for the accommodation of the depositor, and without any undertaking by her, express or implied, to pay or do anything as compensation or reward for keeping the deposit. Merchants' National Bank of Savannah v Guilmartin, 88 Ga. 797 (2), 15 S.E. 831, 17 L.R.A. 322.
While slight diligence in the protection and preservation of a special deposit is the degree of care imposed by law upon a gratuitous bailee, yet where, as in this case, such bailee is a bank, already reduced to financial stringency by the defalcations of its vice president, who, at the time the special deposit was made, had long been and still was in charge of the bank's business and assets, and who had for years before such special deposit was made, successfully concealed from the president and directors all knowledge of his fraud and of the bank's real condition, by substituting forgeries for the money stolen by him from the bank, and who, after receiving such special deposit for the bank, stole it, converted it into cash, and placed that cash in the bank, substituting it for one or more of his prior forgeries, the bank cannot, while retaining the proceeds of such conversion of the special deposit, escape liability to the depositor on the theory that all the wrongful acts shown were the unauthorized individual acts of the vice president and that the bank itself had exercised due care in the preservation of the special deposit for the benefit of the depositor. If the bank had received no benefit or profit from the transaction, the result might be different. Merchants' National Bank v. Guilmartin, 88 Ga. 797, 15 S.E. 831, 17 L.R.A. 322; Id., 93 Ga. 503, 21 S.E. 55, 44 Am.St.Rep. 182; Davenport v. Underwood, 9 Bush (Ky.) 609; Bank v. Dunbar, 118 Ill. 625, 9 N.E. 186.
(a) Even if the bank had received no benefit from the transaction, still the length of time the vice president's defalcations had existed--"seven or eight years, possibly longer," according to his own testimony--without knowledge or suspicion of the same on the part of the president or directors of the bank, and without their becoming acquainted with the bank's real financial condition, would leave it a question for determination by the jury as to whether or not the directors had exercised due care in retaining such a person in the office of vice president and in charge of the bank's business and assets. Civil Code 1910, §§ 3470, 4530, 5735. A director of a bank has duties to perform more essential than that of allowing his name to be printed on the bank's stationery; and negligent ignorance is sometimes equivalent knowledge. Penal Code 1910, § 204; Schmidt v. Block, 76 Ga. 823 (a); Atlanta v. Perdue, 53 Ga. 607.
(b) Nor will the bank be heard to plead, under the facts of this case, that its vice president exceeded his authority as such officer in receiving the special deposit for the bank. Even if it conclusively appeared that he did so exceed his authority, still the bank must either repudiate or ratify the transaction as a whole. It cannot ratify in part and repudiate in part; and the retention by it of the net proceeds of the transaction amounts to a ratification by it of the whole transaction.--Civil Code 1910, § 3593.
The defendant bank being now in the hands of the state superintendent of banks, who admittedly has in his custody sufficient assets of the bank to meet plaintiff's demand, does not affect the results. Park v. Carmichael, 20 Ga.App. 36 (3), 92 S.E. 397, and citations; Park v. Swann, 20 Ga.App. 39 (3, 4), 92 S.E. 398; Ga. L. 1919, pp. 158, 159, §§ 15, 19; Ga. L. 1922, p. 65,§ 7a.
Under the foregoing rulings, the evidence not only authorized, but demanded, the verdict; and the court did not err in overruling the defendant's motion for a new trial.
Error from Superior Court, Cobb County; John D. Humphries, Judge.
Action by Elizabeth C. Faw against the Marietta Trust & Banking Company and others. Judgment for plaintiff, and defendants bring error. Affirmed.
Where the customer of a bank deposited with it a bond for safe-keeping, the deposit being a special gratuitous one, and an officer of the bank stole and converted it into cash, placing the cash in the bank as a substitute for some of his prior forgeries, the bank could not while retaining the proceeds of such conversion escape liability to the depositor on the theory that the wrongful acts were the unauthorized acts of the officer and that the bank had exercised due care in preserving the special deposit.
As against the usual general grounds of a motion for a new trial, a verdict directed by the court stands upon the same footing as if found and returned by the jury; a special assignment of error being necessary to bring under review the judgment of the court directing such verdict.
Fred Morris, of Marietta, for plaintiffs in error.
J. Z. Foster and Anderson & Roberts, all of Marietta, for defendant in error.
The headnotes announce the principles decided. A statement of the facts on which they are based is the only elaboration necessary.
On February 20, 1923, Elizabeth C. Faw sued the Marietta Trust & Banking Company and T. R. Bennett, as superintendent of banks of the state of Georgia, alleging, in brief, the following The defendant bank, after operating for several years as a chartered bank of this state, was on February 4, 1922, taken over by the superintendent of banks in accordance with the terms of the banking laws...
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