Neely v. Rood

• Decision Date: 18 June 1884
• Court: Michigan Supreme Court
• Parties: NEELY v. ROOD.

19 N.W. 920

54 Mich. 134

NEELY v. ROOD.

Supreme Court of Michigan

June 18, 1884

One who has left moneys in trust in the hands of a person who has misapplied them, cannot recover them from the latter's assignee, or from a third person, unless he can substantially identify them in the hands of the person whom he seeks to charge.

Money deposited on general account, and not left as a special deposit, becomes the money of the bank, and the bank is then the depositor's debtor for the amount.

Error to Marquette.

F.O Clark, for plaintiff and appellant.

E.E Osborn, for defendant.

CHAMPLIN J.

Plaintiff brought assumpsit, his declaration containing only the common counts. It appears that on the thirty-first day of December 1881, plaintiff gave to one John E. Ward his check on the First National Bank of Marquette, Michigan, for $469, payable to the order of John E. Ward, county treasurer for the purpose of having Ward pay to the auditor general, at Lansing, certain back taxes upon lands owned by plaintiff, amounting to $468.38. John E. Ward, at this time, was county treasurer of Marquette county, but the check was not received by him in his official capacity, nor was it any part of his official duty to pay such taxes. He kept a bank account at the First National Bank of Marquette, and also at the Lansing National Bank of Lansing. So far as appears, his undertaking to pay these taxes for Neely was wholly gratuitous. He had been in the habit of accommodating parties in this way, and kept a deposit in the Lansing National Bank for this purpose. When any one paid him money to pay back taxes he did not forward it to Lansing, but deposited it at Marquette, and would draw checks in favor of the auditor general on the Lansing National Bank. The funds deposited in this bank were made in this way: Whenever he received, in the course of his business, any exchange on Chicago, New York, or Detroit, he sent it to this bank at Lansing, and thus saved exchange between Marquette and Lansing. When he received the check from Neely he deposited it to his own credit in his account with the First National Bank of Marquette, and afterwards drew it out and applied the money to his own use. He never paid the taxes to the auditor general. About a week prior to January 24, 1882, Ward discovered that he was a defaulter in his office of county treasurer. In this emergency he went to Mr. Wadsworth, one of his sureties on his official bond, to whom he made known his financial condition, and proposed to secure his sureties by transferring to them all his property. During the interview he informed Wadsworth that he had a balance in the bank at Lansing of about $1,500, and that parties had left with him about a thousand dollars for him to pay back taxes with, but did not mention Neely's name as being one of the number. This was on the twenty-third of January. On the 24th, the defendant, Rood, who was also one of his sureties, came to him with a request signed by all the sureties on his official bond, requesting him to make the transfer of his property to defendant, Rood, for the purpose of protecting them against loss on account of his defalcation, which he proceeded to do without delay. At that time there was standing to his credit in the bank at Marquette about $91, and in the bank at Lansing $1,423.44. He had made no remittances to the bank at Lansing after receiving the check from Neely, but had checked out some in the mean time. He drew checks in favor of Rood for the balances in both banks, but did not tell him that any of the money in the bank at Lansing was subject to the payment of any back taxes of Neely or other persons, and the jury found as a fact that Ward did not hold $469 on deposit in the Lansing bank for the purpose of paying Neely's back taxes, as the money given to him for that purpose by Neely.

Under these facts plaintiff claims that Ward held this $468.38 only in trust, and that he could not transfer title to it to Rood but that he received it as the money of the plaintiff, and Rood is liable to him for money had and received, and that this action is brought upon that theory, and also upon the theory that it is immaterial whether it was the identical money given to Ward by plaintiff; that he could not transfer any money to Rood until the money he held in trust for others was provided for and set off. The infirmity of this position is that it assumes that Rood received the $468.38 which Neely placed in Ward's hands to pay his back taxes. The rule contended for is well settled, that where property, held upon any...