State v. Montgomery Sav. Bank

• Decision Date: 03 February 1917
• Docket Number: 3 Div. 249
• Citation: 199 Ala. 365,74 So. 942
• Parties: STATE v. MONTGOMERY SAV. BANK.
• Court: Alabama Supreme Court

74 So. 942

199 Ala. 365

STATE v. MONTGOMERY SAV. BANK.

3 Div. 249

Supreme Court of Alabama

February 3, 1917

Rehearing Denied March 26, 1917

Appeal from City Court of Montgomery; Gaston Gunter, Judge.

Action by the State of Alabama against the Montgomery Savings Bank. From a judgment for plaintiff, it appeals. Transferred from Court of Appeals under section 6, Acts 1911, p. 449 Affirmed.

W.L Martin, Atty. Gen., R.B. Evins, of Greensboro, and Steiner Crum & Weil, of Montgomery, for appellant.

Ball &amp Samford, of Montgomery, and Logan & Logan, of Centerville, for the State.

McCLELLAN J.

This action was instituted by the state of Alabama against the Montgomery Savings Bank (appellee) to recover the sum of $100,000. The complaint contains the common counts as well as counts declaring upon a conversion by the bank of funds belonging to the state. Following a verdict for the plaintiff assessing the damages at one cent and judgment entered in accordance therewith, the plaintiff moved for a new trial. This motion was overruled. Where the judgment appealed from is in favor of the plaintiff, and plaintiff appeals, this court "will not consider as reversible error any ruling of the primary court bearing merely on the naked question of the defendant's liability, and not affecting the amount of the damages recovered, however erroneous it may be in fact, because, if error, such ruling is error without injury to the plaintiff." Randle v. B.R.L. & P. Co., 169 Ala. 314, 318, 53 So. 918, 919, and cases there cited.

J.G. Oakley was president of the board of convict inspectors during the year 1912, and up to, to wit, March 12, 1913. Theo Lacy was chief clerk in the convict department. On March 8, 1913, Oakley, as president, had to his credit on general deposit with the appellee a balance of approximately $40,000. On that day Lacy took to the bank checks and drafts from various parties payable to Oakley, as president, aggregating $103,868.92. These checks and drafts were listed on a deposit slip form on which this appeared: "Deposited with Montgomery Saving Bank, Montgomery, Ala., March 8, 1913. Credit of J.G. Oakley, Prest. *** Deposited by Theo Lacy." Aside from the date and names quoted, the face of the form was stereotyped. On the back of each of the checks and drafts, the aggregate amount of which constituted the sum last stated, through the use of a rubber stamp, these words were impressed: "For deposit only, James G. Oakley, President." And on the back of each checks or draft, Oakley, in his own hand, had made this indorsement: "J.G. Oakley, Pres." Subsequent to a specific agreement between the representative of the appellee and Oakley with respect to the collection of these checks and drafts to be stated the total amount represented by them was credited in order upon the existing general deposit account of Oakley as president; the described deposit slip being accepted by the bank without change. On March 11, 1913, in accordance with the agreement just referred to, the check of Oakley as president on the appellee for $110,000 was paid to Lacy, largely in cash, along with exchange for the difference. Lacy absconded therewith, was later tried, and is now serving sentences imposed for his embezzlement. The agreement alluded to, together with the reasons inducing it, was this: Oakley's accounts with the state were in course of examination by a state examiner of accounts, and Oakley desired to have in cash all the funds belonging to the state chargeable against him. Oakley wanted these checks and drafts collected at the earliest moment, and the proceeds in cash delivered for use in settling his accounts with the state. After conference between Oakley and the bank's officer it was specifically agreed that the bank should undertake to serve his purpose by Tuesday, March 11, 1913, though it was also agreed that Oakley would take exchange for the amount the bank could not collect by March 11, 1913, supplementary of the amount in cash that was collected. According to this testimony the bank was created the agent of Oakley to collect the checks and drafts delivered to it on March 8, 1913, and pay the same to Oakley; the agreement as made operating to prevent, as to these checks and drafts, the creation of a general deposit by Oakley with the bank. The state insists that, when the statements and indorsements on the deposit slip and on the checks and drafts and the bank's act of crediting the aggregate amount of these checks and drafts on the general deposit account of Oakley as president and the crediting of the payment of the $110,000 check on that account are considered, at the very least, an issue for the jury to decide was made by these matters of evidence, viz. whether there was a deposit of the amount represented by these checks. In the brief for appellee it is, in effect, admitted that the issue indicated was a matter determinable alone by the jury. Because of the view prevailing in this court, it is not now important to consider the ultimate effect of the issue and of its solution upon the fate of this appeal. Whether the funds or values delivered to Lacy in consequence of Oakley's check for $110,000 were the result of an order against a general deposit account in Oakley's favor or not is not now regarded as an influential or controlling factor in the present review of the judgment on which this appeal is based.

Our conclusion is that, since Oakley, as president of the board of convict inspectors, was at that time the proper, lawfully designated receiptor and custodian of funds coming to the state through the operation and activity of the convict department, including the collection of demands of the state against debtors to it in consequence of the conduct of its convict department, the delivery in good faith to Oakley or to his authorized agent, Lacy, the chief clerk in the department, by this bank, of funds or values, was a delivery or payment wherefrom resulted the discharge of the bank from liability to account to the state for funds or values thus restored by it to the state's duly authorized and empowered head of the convict department. There is no evidence of mala fides on the part of the bank in making or when making this delivery to Lacy. The evidence is conclusive to the point that the entire basis of this action was and is funds and values delivered to the chief clerk on the order of the president of the board of convict inspectors. Hence, if our stated conclusion is correct, the bank was due the general affirmative charge; and errors, if any, intervening were without prejudice to this appellant. It is provided in Code, § 6515, as follows:

"The state convicts shall be hired or employed at such labor and in such places and under such regulations within the state as may be determined by the board of inspectors, with the approval of the Governor, having in view the end of

making the system self-sustaining as far as consistent with the humane treatment of the convicts."

Code, § 6480, provides:

"The president of the board of inspectors shall superintend the management of the convicts, and all subordinate officers, persons, or guards. It shall be his duty to see that the laws in relation to convicts and the rules of the board of inspectors are enforced; and his orders shall be obeyed by all contractors, officers, guards, and convicts. He has the general oversight of all the officers and convicts and of the land and other property belonging to the several prisons; he may sell by order of the board any personal property not needed at any prison and cover the proceeds into the state treasury to the credit of the convict fund, and may order any convict transferred from one prison to another as he may think expedient."

By Code, § 6499, the president of the board of convict inspectors was constituted the collector of accounts due the state in that department; and quarterly settlements were required by him with the state auditor, whose act in certifying alone authorized the president to pay to the state treasurer,...