Court Opinion

ID: 9447682
Source: CourtListenerOpinion
Date Created: 2023-08-03 22:41:08.541924+00
Date Added: 2024-06-11T17:31:08.601828
License: Public Domain

WILBUR K. MILLER, Chief Judge
(dissenting in No. 15,582).
The American Security and Trust Company was not a party to the suit in the California court, and the record before us tells us very little about that proceeding. We know that the check of March 5, 1954, was endorsed by the payee to Kyle C. Grainger, a California attorney, who paid nothing for it. Grainger endorsed the instrument, without recourse, to Harold J. Ostly, the Clerk of the California court, who also paid nothing for it. We are not told why the check was endorsed to the Clerk; presumably he was to hold it in escrow pending the outcome of certain litigation in his court.
Nor do we know when the cheek was endorsed to the Clerk. If that was before the issuance of thé duplicate on July 14, 1954, (as it probably was) and if the Clerk had promptly cashed the *287check so the proceeds could be held m escrow (as he should have done), the duplicate would not have been issued, and this lawsuit would not have arisen.
Instead of that, the Clerk or the County Treasurer held the check itself until October, 1956, — more than two years and seven months after its date — and then Ostly delivered it to the appellant, still without his endorsement, but with the following stamped thereon: “Pay to the order of any bank. Prior endorsements guaranteed. H. L. Byram, Treasurer, County of Los Angeles.”
The majority opinion says, “Pursuant to provisions of the California Code, Ostly turned the check over to the County Treasurer of the County of Los Angeles who held it in his official capacity subject to the outcome of an action brought by appellant * * *. Ostly, however, did not endorse the instrument.”
I suggest the majority err in saying Ostly delivered the check to the County Treasurer “[pjursuant to provisions of the California Code” and in saying the Treasurer held it in his official capacity. The California Code provisions to which the majority apparently refer were quoted in the appellant’s brief. I reproduce .them in the margin.1 From these statutes, it will be observed that money deposited with the clerk or judge of any court “shall be forthwith deposited” with the treasurer. This provision does not authorize the treasurer to receive and hold — perhaps indefinitely —a check endorsed to but unendorsed by the clerk, nor does it authorize the handling of any check in that fashion. On the contrary, the statute clearly contemplates that any check delivered to a clerk or judge shall be cashed and the proceeds deposited with the treasurer. Plainly, the Code does not authorize the careless conduct of which these officials were guilty.
For the same reason, I suggest the Treasurer was not authorized to, and did not, hold the check “in his official capacity.” The statute does not authorize him to hold a check in escrow or otherwise, as I have said. It does not appear that the California court directed either the Clerk or the Treasurer to hold the cheek itself; and it is inconceivable to me that the court would direct that the check be physically held — particularly for a period of years and without notice to the American Security and Trust Company. Mrs. Whitehead was not innocent in these matters; she was the litigant at whose instance the court officials acted, and should have seen to it *288that they acted properly. She should toe charged with their omissions.
The foregoing considerations are to be taken into account, I think, in determining whether “the loss of the $6,000 is required under principles of equity to be borne by the bank,” as the majority say.
For the reasons set forth by the late District Judge James W. Morris in his ■excellent opinion finding for the American Security and Trust Company,2 and because of the circumstances outlined herein, I would affirm.

. “ ‘When any money is deposited with the clerk or judge of any court pursuant to any action or proceeding in the court, or pursuant to any order, decree, or judgment of the Court, or when any money is to be paid to the treasurer pursuant to any provision of this title or the Code of Civil Procedure, such money shall be forthwith deposited with such treasurer and a duplicate receipt of the treasurer for it shall be filed with the auditor. The certificate of the auditor that a duplicate receipt has been filed is necessary before the clerk, judge, or party required to deposit the money is entitled to a discharge of the obligation imposed upon him to make the deposit.
“ ‘When any money so deposited is to be withdrawn or paid out, the order directing the payment or withdrawal shall require the auditor to draw his warrant for it and the treasurer to pay it * * *’ California Anno.Government Code (West, 1955), Tit. 8, § 68084. (Emphasis supplied.)”
“ ‘The county treasurer shall receive and keep safely all monies belonging to the county and all other money directed by law to be paid to him and apply it and pay it out, rendering the account as required by law.’ Ibid., Tit. 3 § 27000. (Emphasis supplied.)”
“ ‘Whenever money is paid into or deposited in the Court, the same must be delivered to the clerk, or, if there be no clerk, to the judge, in person, or to such of the clerk’s deputies as shall be specially authorized by his appointment in writing to receive the same * * * The judge, clerk, or such deputy clerk, must, unless otherwise directed by law, deposit such money with the county treasurer, to be held by him subject to the order of the court * * * ’ California Anno.Code Civ.Procedure (West, 1954), Tit. 7, § 573. (Emphasis supplied.)”

. Whitehead v. American Security & Trust Co., D.C.D.C.1959, 188 F.Supp. 589.