Squire v. Oxenreiter, No. 25525.

CourtUnited States State Supreme Court of Ohio
Writing for the CourtWEYGANDT
Citation200 N.E. 503,130 Ohio St. 475
Docket NumberNo. 25525.
Decision Date04 March 1936
PartiesSQUIRE, Superintendent of Banks, v. OXENREITER et al.

130 Ohio St. 475
200 N.E. 503

SQUIRE, Superintendent of Banks,
v.
OXENREITER et al.

No. 25525.

Supreme Court of Ohio.

March 4, 1936.


Error to Court of Appeals, Lucas County.

Action by Albert E. Oxenreiter and others against S. H. Squire, State Superintendent of Banks. Decree of the court of common pleas for defendant, and decree for plaintiffs in the Court of Appeals on hearing de novo, and defendant brings error on allowance of motion to certify.-[Editorial Statement.]

Judgment of the Court of Appeals reversed, and final judgment entered for defendant.

This chancery action was instituted in the court of common pleas by Albert E. Oxenreiter and four others on their own behalf and as members of a protective committee of stockholders of a corporation called the International Telepost Company, Inc., which for some time had been in the throes of a receivership. The capacity of the plaintiffs to maintain this suit is not questioned.

The defendant, S. H. Squire, is superintendent of banks of the state of Ohio, and as such is in charge of the liquidation of a banking corporation which until August 17, 1931, operated under the name of The Ohio Savings Bank & Trust Company, of Toledo, Ohio.

The relief sought in the petition is the declaration of a trust and preference as to money deposited with the bank by certain stockholders of the International Telepost Company, Inc., in conformity with a written agreement dated June 1, 1931. The original parties to this contract are the plaintiffs and the bank. However, it is recited in the contract that any stockholder may become a party thereto by simply depositing with the bank his certificate together with the sum of $1 per share. When the bank was closed on August 17, 1931, a total of $9,383.30 had been thus accumulated for the purpose of a possible reorganization of the International Telepost Company, Inc.

In the court of common pleas the case was heard upon an agreed statement of facts and a written statement of counsel. A decree was rendered for the defendant.

In the Court of Appeals the case was heard de novo, and a decree was entered impressing the assets of the bank with a trust and allowing the plaintiffs a preference for the unpaid balance of their claim.

The case is in this court by reason of the allowance of a motion to certify the record.



Syllabus by the Court.

[Ohio St. 475]1. In the absence of evidence to the contrary, a deposit in a bank is presumed to be general in its nature.

2. When a trustee properly deposits known trust funds in a bank, a new fiduciary relationship is not thereby created between the trustee and the bank solely by reason of the known original trust nature of the funds; the bank is a debtor to the trustee, and the trustee holds the claim against the bank in trust for the fiduciary.

3. If one person pays money to another, it depends upon the manifested intention of the parties whether a trust or a debt is created.

4. If money is deposited in a bank for a special purpose, the bank is a trustee or bailee of the money if it is the understanding of the parties that the money deposited is not to be used by the bank for its own purpose.

5. If the intention is that the person receiving the money shall have unrestricted use thereof, being liable to pay a similar amount whether with or without interest to the payor or a third person, a debt is created.

[Ohio St. 483]JONES, J., dissenting.


[Ohio St. 476]

[200 N.E. 504]

John W. Bricker, Atty. Gen., and Brown & Sanger, and Sholto M. Douglas, all of Toledo, for plaintiff in error.

Welles, Kelsey & Cobourn, Denman, Miller & Beatty, Frank A. Harrington, and Frank C. Eickemeyer, all of Toledo, for defendants in error.


WEYGANDT, Chief Justice.

This is another of the many so-called preference cases that have been troubling the bench and bar rather persistently during recent months. As usual, the chief difficulty encountered lies [Ohio St. 477]not so much in ascertaining the pertinent principles of law as in their application to the slightly varying factual settings of the individual cases.

In the instant controversy, the chief and controlling question is met at the very threshold. Did the parties by their written agreement intend to create a relationship of trustee and cestui or merely that of debtor and creditor? Restating the question more simply and specifically, was the bank intended to be a trustee or merely a debtor? The difficulty of determining the answer is intensified by reason of the necessity of relying upon mere inference alone. This is cogently illustrated by the written statement of one of plaintiffs' counsel that ‘at the time of entering into the aforesaid agreement it was not understood or known by any of the members of the committee or their attorneys the exact manner in which the funds in question would be handled by the bank.’

The most helpful part of the record is Exhibit A, which is attached to the agreed statements of facts. This is the written agreement of June 1, 1931, around which the entire dispute centers. As a preliminary matter, it will be helpful to note that this contract created at least one express trust. A careful study of the document plainly discloses a fiduciary relationship between the depositing stockholders and the

[200 N.E. 505]

plaintiffs as constituting the protective committee. This is illustrated by paragraph 4, which contains the following language:

‘The Depositors constitute the Committee their sole and exclusive attorneys and agents for the purpose of carrying out this agreement, and to execute, in their behalf, such instruments in writing, and to do and perform all such acts as said Committee, acting by a majority thereof, may deem proper to protect the interests of the Depositors. The Depositors hereby assign and transfer to the Committee...

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20 practice notes
  • Kroeger v. Brody, No. 25686.
    • United States
    • United States State Supreme Court of Ohio
    • March 25, 1936
    ...a financial institution in which funds of the trust are placed. Proposition 2 of the syllabus in Squire, Supt. of Banks, v. Oxenreiter, 130 Ohio St. 475, 200 N.E. 503. Counsel for defendant in error has cited a number of authorities which are not in point, because they relate either to ultr......
  • Union Props., Inc. v. Baldwin Bros. Co., No. 29307.
    • United States
    • United States State Supreme Court of Ohio
    • March 31, 1943
    ...relationship of debtor and creditor and the burden of proof is upon him who asserts the contrary. Squire, Supt. of Banks, v. Oxenreiter, 130 Ohio St. 475, 200 N.E. 503, approved and followed. 2. A special deposit in a bank creates a bailment and title does not pass to the bank. [47 N.E.2d 9......
  • Matter of Michel, Bankruptcy No. 684-00230
    • United States
    • United States Bankruptcy Courts. Sixth Circuit. U.S. Bankruptcy Court — Northern District of Ohio
    • August 13, 1985
    ...use the money as his own, in which case he is a debtor. . . . 53 O.Jur.2d Trusts, § 16 at pp. 412, 414; see also Squire v. Oxenreiter, 130 Ohio St. 475, 200 N.E. 503 (1936); Norris v. Norris, 57 N.E.2d 254 (Ohio By these standards, the evidence falls short of establishing that Michel was in......
  • Union Properties v. Baldwin Bros. Co., 29307.
    • United States
    • United States State Supreme Court of Ohio
    • March 31, 1943
    ...relationship of debtor and creditor and the burden of proof is upon him who asserts the contrary. Squire, Supt. of Banks, v. Oxenreiter, 130 Ohio St. 475, 200 N.E. 503, approved and followed. 2. A special deposit in a bank creates a bailment and title does not pass to the bank. [47 N.E.2d 9......
  • Request a trial to view additional results
20 cases
  • Kroeger v. Brody, No. 25686.
    • United States
    • United States State Supreme Court of Ohio
    • March 25, 1936
    ...a financial institution in which funds of the trust are placed. Proposition 2 of the syllabus in Squire, Supt. of Banks, v. Oxenreiter, 130 Ohio St. 475, 200 N.E. 503. Counsel for defendant in error has cited a number of authorities which are not in point, because they relate either to ultr......
  • Union Props., Inc. v. Baldwin Bros. Co., No. 29307.
    • United States
    • United States State Supreme Court of Ohio
    • March 31, 1943
    ...relationship of debtor and creditor and the burden of proof is upon him who asserts the contrary. Squire, Supt. of Banks, v. Oxenreiter, 130 Ohio St. 475, 200 N.E. 503, approved and followed. 2. A special deposit in a bank creates a bailment and title does not pass to the bank. [47 N.E.2d 9......
  • Matter of Michel, Bankruptcy No. 684-00230
    • United States
    • United States Bankruptcy Courts. Sixth Circuit. U.S. Bankruptcy Court — Northern District of Ohio
    • August 13, 1985
    ...use the money as his own, in which case he is a debtor. . . . 53 O.Jur.2d Trusts, § 16 at pp. 412, 414; see also Squire v. Oxenreiter, 130 Ohio St. 475, 200 N.E. 503 (1936); Norris v. Norris, 57 N.E.2d 254 (Ohio By these standards, the evidence falls short of establishing that Michel was in......
  • Union Properties v. Baldwin Bros. Co., 29307.
    • United States
    • United States State Supreme Court of Ohio
    • March 31, 1943
    ...relationship of debtor and creditor and the burden of proof is upon him who asserts the contrary. Squire, Supt. of Banks, v. Oxenreiter, 130 Ohio St. 475, 200 N.E. 503, approved and followed. 2. A special deposit in a bank creates a bailment and title does not pass to the bank. [47 N.E.2d 9......
  • Request a trial to view additional results

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