Court Opinion

ID: 6868058
Source: CourtListenerOpinion
Date Created: 2022-07-23 20:57:14.462113+00
Date Added: 2024-06-11T16:05:21.496015
License: Public Domain

T NORTHCOTT, Circuit Judge
, (dissentln§T
_ I cannot concur in the above opinion. When the receiver of the Citizens National Bank took charge of its affairs, he found the $10,000 item in controversy held as a claim against First Bank & Trust Company, The collection of the item had not been completed at the time. The claim against First Bank & Trust Company, asserted as preferred by the receiver for the amount that was afterward allowed, included this $10,000 item. The Citizens National Bank had stopped payment on the remittance check which had been sent, when it was presumed that the collection had been made, The preferred claim of the receiver of Citizens National Bank was in dispute, and there was litigation involving the allowance of the preference. The collection had not been completed by the Citizens National Bank, but was completed at the end of litigation, by the receiver of that institution.
Under the North Carolina statute (Consolidated Statutes Supplement 1924, § 220 ■\?a á,ar-C011rrU6- T5 6 nprTeme °r>r ? North Carolina in Braswell, Inc. v. Bank, 197 N.C. 229, 148 S.E. 236, tíre relation be-1* , / j - „ tween the forwarding bank and the collect-mg bank was that of principal and agent, not that of creditor and debtor. The discussion of this question m Jennings v. United States Fidelity & Guaranty Company, 294 U.S. 216, 55 S.Ct. 394, 395, 79 L.Ed. 869, 99 A.L.R. 1248, seems to me to hold to this effect definitely. In referring to the Indiana Code, which in my opinion has the same effect as the North Carolina Code, Mr. Justice Cardozo says: “Under that Code (§ 2), the relation between the forwarding bank and the collecting bank is that of principal and agent until the agent has completed the business of collection. Whether a fiduciary relation continues even afterwards, upon the theory that the proceeds of the collection until remitted to the forwarder are subject to a trust, depends upon the circumstances.”
j am of the 0pinion that under the de_ cision of the Supreme Court in the Jenni Cage ^ fact that North Caro_ Hna statute refers t0 checkS; and not cer. tificates of deposit; does not change the effect of the statute as tQ the relationship between the forwarding and the collecting bank.
The conectjng bank had failed to compíete the business of collection, and the test¡mony sbows that the entry was carried as an uncollected item by Citizens National Bank. The business of collection was completed, as far as the item in dispute is concerned, by the receiver, after he took charge of Citizens National Bank, and, in completing the collection, the receiver acted as agent for the forwarding bank. I cann0£ agree with the statement in the opinion 0f the court that no claim was filed by the receiver of the Citizens National Bank against the receiver of the First Bank & Trust Company with respect to the $10,000 certificate of deposit. It is admitted, and cannot be disputed, that the claim filed by the receiver of the Citizens National Bank for $32,485.72 was for a balance growing out of a settlement between the two banks, jn which settlement the $10,000 item was included. The receiver of the Citizens National filed a claim for this very balance and it was allowed and paid as preferred. How Can it be said that no claim was filed with respect to the $10,000 certificate of deposit?
Jt seems tQ me ^ k is kighly unjust and inequitable to allow the fund belong- . A .7 n , . u , £ t0 the apfllefS ^srgnor collected by the receiver of a closed bank, to be used for ^ benefit of credkors who had trusted the credit f * dosed ^ The forwarding ^ ^ trmted ^ dosed bank foSr maki ^ and ' h Droceeds remlttmS me proceeas.
Under the decision of the Supreme Court in the Jennings Case, supra, as I construe it, the finding of the court below was right and the judgment should be affirmed.