Tingley v. North Middlesex Savings Bank

• Decision Date: 27 February 1929
• Citation: 266 Mass. 337
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: OTTO F. TINGLEY, administrator de bonis non with the will annexed, v. NORTH MIDDLESEX SAVINGS BANK & others.

266 Mass. 337

OTTO F. TINGLEY, administrator de bonis non with the will annexed, v. NORTH MIDDLESEX SAVINGS BANK & others.

Supreme Judicial Court of Massachusetts, Middlesex.

February 27, 1929

December 11, 1928.

Present: RUGG, C.

J., CROSBY CARROLL, & WAIT, JJ.

Trust Constructive. Savings Bank. Conversion.

A by-law of a savings bank provided: "Upon the death of a depositor payment of his deposit will be made to his executor or administrator . . . and such payment shall discharge the Bank from all further liability on account of such deposit." A woman who was a depositor with the bank died, leaving a will. The bank with full knowledge of the facts and circumstances, permitted the executor of the will to transfer the account to himself and then accepted the deposit as a pledge to secure the payment of notes given by him as an individual for money lent to him of his own use. In a suit by an administrator de bonis non of the estate of the woman to recover the deposit, it was held, that

(1) On the facts above stated, the bank was charged with notice that the relation of the executor to the deposit was a trust relation and that he had no right to use the deposit for his personal benefit;

(2) The acts of the executor were a conversion of the deposit to his own use;

(3) The bank, by participating in the wrongful act of the executor while charged with notice of the wrong, became liable to account for the fund as in its own wrong;

(4) In the circumstances, the by-law of the bank afforded it no protection.

PETITION IN EQUITY filed in the Probate Court for the county of Middlesex on August 25, 1927, and described in the opinion.

The respondents, administrators with the will annexed of Stephen L. Tingley, admitted the truth of the facts alleged in the petition.

The respondent North Middlesex Savings Bank sought to hold the deposit in question and to apply it, pro tanto, to satisfaction of the notes to secure which it received it; and in its answer alleged that, acting under article 12 of its by-laws, which was printed on its pass book, it "in good faith and without fraud" made the transfer which the petitioner attacked. Said article 12 reads as follows: "Payments will be made upon demand to depositors in person or to any person properly authorized in writing, except that the Treasurer may at any time require a depositor to give not exceeding ninety days notice of intention to withdraw the whole or any part of the deposit. No payment shall be made, however, unless the pass book is produced, that such payment may be entered thereon, except as provided in Article 15.

"Upon the death of a depositor, payment of his deposit will be made to his executor or administrator, or, if less than one hundred dollars, may be made, when authorized by the Board of Investment, to the next of kin, legatee or persons beneficially entitled, and such payment shall discharge the Bank from all further liability on account of such deposit.

"Money deposited in the name of a minor may, at the discretion of the Board of Investment, or of the Treasurer, if authorized by said Board, be paid to such minor or to the person making such deposit and the same shall be a valid payment."

The suit was heard by Leggat, J., a stenographer having been appointed under G.L.c. 215, Section 18, to take the evidence. Material facts found by the judge are stated in the opinion. By order of the judge, a final decree was entered ordering the transfer sought by the petitioner. The respondent bank appealed.

R.H.J. Holden & J.D. Carney, for the respondent North Middlesex Savings Bank, submitted a brief.

S. Bell, (O.

W.Marvin with him,) for the petitioner.

RUGG, C.J. This is a petition by the administrator debonis non with the will annexed of the estate of Mary A. Tingley praying that the North Middlesex Savings Bank be ordered to transfer to the credit of the estate of Mary A. Tingley a deposit standing in the name of Stephen L. Tingley, who has deceased and whose...