Case ID: mont_75/html/0184-01.html
Source: Caselaw Access Project
Author: {"author": "MR. JUSTICE MATTHEWS", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

LASHORN, Appellant, v. FIRST STATE BANK OF LIVINGSTON et al., Respondents.
    (No. 5,807.)
    (Submitted January 7, 1926.
    Decided January 18, 1926.)
    [243 Pac. 573.]
    
      Banks and Banking — Insolvency—Certificates of Deposits— Trust Funds — What not Preferred Claims.
    
    Banks and Banking — Insolvency — Certificates of Deposit — General. Deposits.
    1. Deposits for a specified time for which the bank issues certificates of deposit constitute general deposits, and upon failure of the bank the depositor becomes its general creditor.
    Same — Deposit of Trust Funds not Special — Preferred Claims.
    2. A deposit of trust funds with the knowledge of the bank that they are such does.not of itself constitute the deposit a special one, so as to entitle the depositor to a preferred claim against the bank on becoming insolvent. (See syllabus in Pethybridge v. First State Bank, ante, p. 173.)
    
       Banks and Banking, 7 C. J., see. 544, p. 750, n. 60.
    
       Banks and Banking, 7 C. J., see. 306, p. 630, n. 3; sec. 308, p. 633, n. 15; see. 544, p. 750, n. 60; see. 548, p. 752, n. 81 New.
    1. What is special, as distinguished from general, deposit, see notes in Ann. Cas. 1913E, 45; Ann. Cas. 1918B, 390.
    2. See 3 B. C. L. 518.
    
      Appeal from District Court, Park County; H. J. Miller, Judge.
    
    Action by M. H. Lashorn, as treasurer, etc., against the First State Bank of Livingston and its receiver, to compel allowance of his claim against the bank as a preferred one. From a judgment for defendants, plaintiff appeals.
    Affirmed.
    
      Messrs. Gibson é Smith, for Appellant, submitted a brief; Mr. Yard Smith argued the cause orally.
    
      
      Messrs. Miller & O’Connor, for Respondent, submitted a brief; Mr. M. J. O’Connor argued tbe cause orally.
   MR. JUSTICE MATTHEWS

delivered the opinion of tbe court.

M. H. Lashorn, as treasurer of tbe Co-ordinate Bodies of tbe Ancient and Accepted Scottish Rite of Freemasonry, of Livingston, Orient of Montana, sought to compel tbe allowance of bis claim for tbe amount tbe lodge bad on deposit at the time tbe defendant bank became insolvent, as a preferred claim. Issue was joined, and a trial thereon bad, resulting in a judgment in favor of tbe defendants, from which judgment plaintiff has appealed.

Tbe facts adduced on tbe trial are identical with those in tbe the case of W. H. Pethybridge, as guardian, against these defendants (ante, p. 173, 243 Pac. 569), except as to tbe capacity of plaintiff, and that the original deposits were on time, and for which certificates of deposit were issued, and that in this case there is no intimation that plaintiff did not have authority from tbe lodge for all that be did, or that any one of bis acts was in violation of rule or regulation of tbe lodge or of any law of tbe state of Montana.

It affirmatively appears from tbe record that, at tbe time tbe deposits were made, there was no agreement or understanding between plaintiff and tbe bank that tbe deposits should constitute special deposits.

1. Deposits of funds for a specified time, and for which certificates of' deposit are issued, constitute general deposits, and, “tbe bank becoming insolvent, tbe depositor must be remitted to tbe position of a general creditor.” (2 Micbie on Banks & Banking, sec. 152.)

2. Counsel for plaintiff contends that, as tbe funds de posited by plaintiff were trust funds in bis bands, their deposit in a bank having notice of this fact constituted a special deposit, and whether tbe deposit was rightfully or wrongfully made, the funds may be followed into the hands of the defendant receiver. As pointed out in the Pethybridge Case above, this contention is untenable, and, on the authority of that case, the judgment herein must be affirmed.

Judgment affirmed.

Affirmed.

Mb. Chief Justice Callaway and Associate Justices Hol. loway, Galen and Stark concur.