Opinion ID: 680577
Heading Depth: 3
Heading Rank: 1

Heading: Unbonded Trustee

Text: 10 Appellants claim James Dodson, the original chapter 7 trustee, was not bonded from January 1987 through March 1988 and that afterwards his bonding was inadequate. They argue that this inadequacy rendered Dodson powerless to act as trustee, see Block v. United States, 9 F.2d 618 (2d Cir.1925), implying that the bank was at fault for freezing the accounts at his request. 11 First Bank responds that Dodson's impropriety, if any, supports the interpleader action. First Bank originally acceded to Dodson's request, thinking he was properly authorized. Appellants' objections convinced the bank that Dodson's authority was disputed, thus making an interpleader action necessary. The bank is correct. Appellants show no evidence indicating that the bank knew of a dispute or of any impropriety when the bank froze the accounts. Moreover, Appellants cite no authority for the proposition that the bank had a duty to determine whether Dodson was bonded before it acted on his otherwise lawful request.