Pierson v. Swift County Bank
| Decision Date | 29 May 1925 |
| Docket Number | No. 24524.,24524. |
| Citation | 204 N.W. 31,163 Minn. 344 |
| Parties | PIERSON et al. v. SWIFT COUNTY BANK. |
| Court | Minnesota Supreme Court |
Appeal from District Court, Swift County; Harold Baker, Judge.
Action by A. L. Pierson and another against the Swift County Bank. After verdict for plaintiffs, defendant appealed from order denying alternative motion for judgment non obstante or new trial. Reversed, and judgment entered for defendant.
Daly & Barnard, of Renville, and Hudson & Hudson, of Benson, for appellant.
Geo. T. Simpson, of Minneapolis, and John I. Davis, of Benson, for respondents.
Plaintiffs, residents of Muscatine, Iowa, made a contract to sell a farm in Swift county, Minn., to the Wilmers Land Agency of Benson in that county. The Wilmers Land Agency in turn made a contract to sell the farm to George B. Bingham. It was arranged that the deed should run direct from plaintiffs to Bingham, and that Bingham should give back a mortgage to plaintiffs for the deferred part of the purchase price. A cash payment of $5,000 was to be made on March 1, 1920, at which time the deed and mortgage back were to be delivered. On March 24, 1920, the Land Agency deposited in defendant bank a check payable to the Land Agency for $5,720 drawn by Bingham on a South Dakota bank and the amount was credited to the checking account of the Land Agency. At the same time the Land Agency drew a check for $5,020 on defendant bank and payable to defendant bank "for A. L. Pierson." The next day, pursuant to instructions, defendant wrote to Thompson & Thompson, attorneys for plaintiffs at Muscatine, Iowa, stating that the Land Agency had deposited its check of $5,020 for the payment due March 1st and wished to examine the deed, and, if it was all right, would then make the payment; and asked that the deed be sent to defendant for collection with instructions in respect to recording the deed and the mortgage. On April 12, 1920, Thompson & Thompson wrote defendant:
On April 14, 1920, defendant wrote Thompson & Thompson:
The Land Agency drew checks on its bank account continually, and when the deed arrived did not have sufficient funds on deposit to pay the check given to defendant to cover the payment due plaintiffs, and never afterwards had sufficient funds to pay this check. It had drawn out its entire deposit and closed its account long before the commencement of this action. During the summer of 1920, there was considerable correspondence in respect to the payment due plaintiffs but without any result. In October 1920, one of the firm of Thompson & Thompson went to Benson and made an agreement with the Land Agency by which the Land Agency promised to make the delinquent payment and to complete the transaction in accordance with the terms then agreed upon. He did not see defendant, but thereafter wrote defendant stating the terms of settlement and giving defendant full instructions as to the manner in which it was to be carried out. The Land Agency, however, failed to perform any part of its agreement; and the check for $5,020, the deed and the mortgage still remain in defendant's possession, although defendant disclaims any interest in them or any right to retain them. In December, 1923, plaintiff brought this action to collect from defendant the sum of $5,020, the amount of the check, claiming that delivering the check to defendant constituted a special deposit of the amount for which it was drawn and that defendant held such amount as bailee for plaintiff.
The trial resulted in a verdict for plaintiff, and defendant appealed from an order denying the usual alternative motion for judgment non obstante or for a new trial.
Plaintiff concedes that depositing the Bingham check and crediting the amount thereof to the account of the Land Agency created between defendant and the Land Agency the usual relation of debtor and creditor existing between a bank and its depositors. But plaintiff contends that by delivering to defendant a check drawn on this account payable to the order of defendant, for plaintiff, with instructions to pay the amount thereof to plaintiff on delivery of a satisfactory deed, the Land Agency created a special deposit to which plaintiff became entitled when the deed was received by defendant.
The check was payable to defendant not to plaintiffs. We will concede, as claimed by plaintiffs, that it was equivalent to a deposit with defendant by the Land Agency of the amount thereof for the special purpose of paying the installment due plaintiffs on delivery of a satisfactory deed conveying the property to Bingham. Plaintiffs forwarded the deed but required the performance of certain conditions before its delivery. In the view we take of the transaction, it is not necessary to consider the effect of these conditions, for title to the deposit never passed to plaintiffs and defendant never held it as their agent or bailee.
The authorities cited by plaintiffs as, supporting their contention may be divided into two classes. First: Those in which a bank, while holding a special deposit or a deposit made for a...
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