The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1897-07-26
THE CASE OF SPALnING-

The complete charge of the Judge to
the jury in the case of SpaIding. the
Chicago banker, indicted for enlbez-
zling the trust funds of the Illinois
university, changes the conclusions
warranted by the incomplete SYNOPSIS
contained in the press dispatch oe the
day. 1t appeared as evidence in the
case that the Legislature Of that state
authorized the trustees of the univer-
sity to deposit it's securities and funds
with some bank to be selected bv them
and receive interest on the deposits.
Under this arrangement the trustees
appointed Spalding, took security for
deposits, entrusted him with it's Sc
tain rate of interest, and it's money.
on which a slightly higher rate was
paid. Against these deposits the trus
tees drew warrants for current ex-
penses. Spalding, pressed by other de-
positors, hypothetical the securities of
the university and used the money. and
for this was indicted as for an embez
element
The court held that, under the act of
the legislature no relation Of trust
arose from the deposits either of the
securities or the money, but simply that
of lender and borrower: and SpaIding's
failure to redeliver either on demand
was simply the case of a debtor fail
ing to meet his obligations. If this
position is correct, then the charge of
the court that, in order to change this
relation to that of trustee and cestui
que trust, so as to make the act of
Spalding an embezzlement, there must
have been existing in his mind at the
time Of the hypothecation of the Sc
curities, or the use Of the money, the
actual intent to convert it to his own
use with no purpose of return, is evil
IDENTIFY sound law. The difficulty the
practical impossibility of establishing
the existence of such an intent cuts no
figure, any more than it would in the
case of one of the borrowers of this
money from Spalding himself. The ele-
ment Of fraud must be a part of the
initial transaction to make the con-
version an embezzlement alb initio. as if
Is In the offense of obtaining goods I'M
der false and fraudulent pretense.
But the larger question. ignored bv
the court, perhaps not even a question
at all, is whether there is not a differ
ence between the relation of a banker
and time depositor and that. saw. of
borrower and the same banker. or
between the ordinary lender and Dor
rover; difference resting not so much
IN any natural cause as in considera-
tions Of public policy The expansion
OF trade, the creation of credit. the de-
VeIopment of banking in connection
with this. and the important relations
assumed by the man who engages in
banking, seem to require that the or
binary relations existing between bor-
rover and lender, out of which rise the
condition of debtor and creditor he
made more stringent, holding the bank
er-borTower to a stricter liability and
imposing thereby a greater degree of
care and prudence upon him. Where
one assumes the occupation of borrow
ing, there seems to arise a difference
between him and one Who borrows as
an incident of his vocation If this is
a correct position, then it might well
follow that the mere inability to repay
deposits would constitute the crime Of