Case Name: DELAHUNTY v. CENTRAL NAT. BANK OF CITY OF NEW YORK
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1899-02-10
Citations: 56 N.Y.S. 39
Docket Number: 
Parties: DELAHUNTY v. CENTRAL NAT. BANK OF CITY OF NEW YORK.
Judges: 
Reporter: West's New York Supplement
Volume: 56
Pages: 39–45

Head Matter:
(37 App. Div. 434.)
DELAHUNTY v. CENTRAL NAT. BANK OF CITY OF NEW YORK.
(Supreme Court, Appellate Division, First Department.
February 10, 1899.)
Banks—Deposits—Demand and Refusal—Waiver.
On bis appointment, a receiver of a depositor wrote the bank, asking that the amount of the deposit be sent to him. For answer, the bank’s attorneys wrote that the bank was itself a creditor of the depositor in an amount exceeding the deposit. ¡Held, that there was sufficient demand and refusal to entitle the receiver to sue for the deposit.
Rumsey, J., dissenting.
Appeal from trial term, New York county.
Action by John Delahunty, as receiver, etc., against the Central National Bank of the City of New York. From a judgment dismissing the complaint after a trial, plaintiff appeals.
Reversed.
The plaintiff, as receiver, sued to recover a balance of account in favor of the firm of William Campbell & Co., who were depositors with the defendant. The answer, besides setting up an affirmative defense, admits that a certain balance in favor of the said firm existed at the date alleged, but denies the demand and refusal to pay. On the trial the only question passed upon was whether a sufficient demand had been made before the commencement of the action. Upon that question the plaintiff offered the following letter, the receipt of which was admitted by the defendant:
“New York, May 12th, 1897.
“Central National Bank of New York—Gentlemen: I have been appointed receiver of the late firm of William Campbell & Company, which has on deposit with you the sum of $1,138.08. Will you please send me that amount, and let me know what papers you require for vouchers, showing my appointment, and I will prepare and send them to you.
“Yours, truly, John Delahunty, Rec’r.”
The answer to this letter by the defendant’s counsel is as follows:
“New York, May 13th, 1897.
“John Delahunty, Esq.—Dear Sir: The Central National Bank of New York has referred to us your letter of yesterday, requesting us to attend to it. You are probably not aware that the bank is itself a creditor of' Campbell & Go., to an amount far exceeding these moneys mentioned in your letter to it.
“Yours, truly, Duer, Strong & Jarvis.”
After the admission of these letters, and an attempt to introduce some other evidence on the subject of demand,—which, because immaterial, was excluded, and need not be considered,—the plaintiff rested. Thereupon the defendant moved for a nonsuit, on the ground that no sufficient evidence of demand and refusal had been given, which motion was granted, and the plaintiff excepted; and it is from the judgment thereafter entered that this appeal is taken.
Argued before VAN BRUNT, P. J., and BARRETT, RUMSEY, PATTERSON, and O’BRIEN, JJ.
J. Woolsey Shepard, for appellant.
George A. Strong, for respondent.

Opinion:
O'BRIEN, J.
It must be regarded as settled that as to moneys deposited in bank, before the same can be recovered in a suit,, it is a condition precedent that a demand should be made therefor. This flows from the relation between a depositor and the bank, and from the promise which the law implies, that the deposit will be returned after demand. The contract, therefore, is that the bank is entitled to retain the deposit until some suitable request is made for its return. The authorities are far from uniform as to the precise nature of the demand, some using the expression that a demand in some form is necessary, leaving its sufficiency to be determined by •the facts appearing in each case. Where, however, the bank has, by refusal, or by an appropriation of the money, or by any other act, shown an indisposition to honor a demand, the cases hold that under such circumstances a demand is unnecessary. So, too, "if, when a demand is made, a specific objection is made as a reason for not complying with the demand, all other objections which, if made, might be readily obviated, are waived. And where the demand is not made of the proper person or in the proper manner, or is made by the wrong person, objection should be taken at the time.'.' 5 Am. & Eng. Enc. Law (1st Ed.) p. 528g. The question therefore turns upon whether the letter of the receiver was a proper demand, and, if not, whether the answer thereto can be construed as of a nature to justify the failure to make further demand. There can be no doubt that the receiver wanted, and requested of the bank, a return of the deposit;"and, while the requirement that it should be sent to the receiver's office was one that the bank was not obliged to comply with, it was an objection which should have been taken at the time. The receiver made his request in the form outlined in his letter; and if it was the intent or purpose of the bank, before honoring the demand or paying the money, to insist that the receiver should draw his check in the usual way against the account, and, either personally or through some other medium, present it with evidence of his authority, it seems but reasonable that it should then have taken that objection, and so notified the receiver. It did not, however, take the objection that the receiver had no right to ask the bank to send the money to him; but, instead of meeting the request as made, the bank turned the receiver's letter over to its attorneys. We are thus brought to a consideration whether or not such action on the part of the bank, coupled with the subsequent letter of the attorneys, was a refusal. That the bank did not intend to comply is reasonably to be inferred, because the letter received was turned over to its attorneys, who subsequently, on its behalf, answered it, and in such answer, instead of making any point about the manner of the demand, or the place where the money was to be paid, or to the failure to show authority or warrant to receive it, the attorneys stated that the receiver was "probably not aware that the bank is itself a creditor of Campbell & Co., to an amount far exceeding these moneys mentioned in 3rour letter to it." There is certainly nothing in this letter from which the inference can be drawn that the bank intended to compty with the request, or that, if the receiver went to the bank, it would pay the money. On the contrary, we think the receiver had a right to conclude that the position taken by the bank was that it was entitled to appropriate the deposit in payment of an indebtedness due it from Campbell & Co., and that this attitude rendered useless or obviated the necessity of any further or more formal demand. The receiver, therefore, having waited about six months without hearing further from the bank, and being thus strengthened in the first impression produced by the receipt of the attorneys' letter, commenced this action. The reply of the attorneys fully justifies the inference that, under claim of right, the bank intended to retain the moneys and apply them to its own indebtedness. If such was not the intention, the language was so evasive, and so well calculated to produce that impression, that fault cannot be found with the receiver, if he was thus misled. While, therefore, it may not be that the receiver's letter, taken by itself, was a sufficient demand, yet, when coupled with the bank's action, and the language of the attorneys' letter, in which the bank's position was defined, we think it was error for the trial justice to hold that any further or more formal demand was necessary before suit. The right suggested in the letter of the attorneys, and alleged in the' answer, to appropriate these moneys to the bank's indebtedness,, might or might not have been sustained upon the trial; but that question is not presented upon this appeal, the nonsuit being placed1 on the ground of the failure of the plaintiff to show a demand in any form, or a sufficient refusal on the part of the bank.
We think the ruling made was incorrect, and that the judgment should be reversed, and a new trial ordered, with costs to the appellant to abide the event. All concur, except RUMSEY, J., dissenting.