Court Opinion

ID: 5226987
Source: CourtListenerOpinion
Date Created: 2022-01-06 16:47:08.642169+00
Date Added: 2024-06-11T08:27:36.430016
License: Public Domain

Ingraham, P. J. (dissenting):
The Carnegie Trust Company was organized pursuant to the laws of this State and was a corporation doing business under the Banking Law of this State as a trust company (Consol. Laws, chap. 2 [Laws of 1909, chap. 10], art. 5, as amd.). By section 186 of the act the trust company was. authorized to accept trusts from and execute trusts for married women, in respect to their separate property, to act under the order or appointment of any court of record as guardian, receiver or trustee of the estate of any minor, and as depositary of any moneys paid into court, as provided by the Code of Civil Procedure, whether for the benefit of any such minor or other person, corporation or party; “to take, accept and. execute any and all such legal trusts, duties and powers in regard to the holding, management and disposition of any estate, real or personal, and the rents and profits thereof, or the sale thereof, as may be granted or confided to it by any court of record, or by any person, corporation, municipality or other *601authority; * *. * to take, accept and execute any and all such trusts and powers of whatever nature or description as may be conferred upon or intrusted or committed to it by any person or persons, or any body politic, corporation or other authority, by grant, assignment, transfer, devise, bequest or otherwise, or which may be intrusted or committed or transferred to it or vested in it by order of any court of record, or any surrogate, and to receive and take and hold any property or estate, real or personal, which may be the subject of any such trust; * * * and to accept the appointment of executor of or trustee under the last will and testament, or administrator with or without the will annexed, of the estate of any deceased person, and to be appointed and to act as the committee of the estates of lunatics, idiots, persons of unsound mind and habitual drunkards.” Section 189 of the act provides that such a trust company may be administrator, guardian or trustee, and provides for the granting of letters testamentary or of administration by any surrogate, or the issuance by any court of letters of guardianship of any infant. Section 190 of the act (as amd. by Laws of 1909, chap. 240) provides that “No bond or other security, except as hereinafter provided, shall be required from any such corporation for or in respect to any trust, nor when appointed executor, administrator, guardian, trustee, receiver, committee or depositary. * * * If dissolved by the Legislature or the court, or otherwise, the debts due from the corporation as such executor, administrator, guardian, trustee, committee or depositary shall have the preference.” The plaintiffs claim that the money deposited by the receiver or trustee in bankruptcy is entitled to be preferred over other deposits upon the dissolution of the trust company. The plaintiff in one of the actions was appointed by the United States District Court as receiver of a firm against whom proceedings in bankruptcy had been instituted and, in the second case, the plaintiff had been appointed a trustee of a person who had been adjudicated a bankrupt. These plaintiffs had deposited these funds in the Carnegie Trust Company as a depositary, not under the specific order of a court of record, but it was the receiver and the trustee respectively who selected the Carnegie Trust Company as the *602depositary of the moneys coming into their hands. The Carnegie Trust Company had been, with other banks and trust companies, designated as a depositary of moneys of bankrupt estates under section 61 of the Bankruptcy Act (30 U. S. Stat. at Large, 562), but there was no order of the court directing that this particular institution should be selected as the depositary of these moneys; nor, as I understand it, did the trustee or receiver receive this moneyas money paid into court. They were acting under the Bankruptcy Act as the persons entitled to collect the estate of the bankrupt and apply it to these creditors, blow, the' moneys deposited by the receiver and trustee were ordinary deposits subject to check at sight, and it seems to me that the relation between the receiver and trustee and the Carnegie Trust Company was the same as any other depositor who had opened an account and deposited money subject to check. It was not, strictly speaking, • moneys paid into court which involved a fund which the court holds, either by its clerk or by a depositary named by it, the moneys of parties to the litigation, but rather as the depositary of moneys held by a trustee, it had received money deposited with a banking corporation for the purpose of safekeeping and which is under the control, not. of the court, but of the trustee or receiver. A' consideration of the provisions of the Banking Law to which attention has been called shows that the preference intended to be given was in a case where the trust company , had itself been appointed trustee,, guardian, executor, administrator, committee, receiver or depositary. Where the court itself had selected the trust company to act in one of these capacities and where money thus in its possession was money which it had received in such a capacity a preference was given. There is no express provision of the statute which gives to a receiver appointed by a State court a preference for moneys deposited by him as such receiver over other depositors. As it appears by the sections of the Banking Law before referred to, a trust company could be appointed by the court as its receiver, as its trustee, as an executor or administrator of an estate, and when acting in such a capacity it receives money or property the parties entitled to that money or property are entitled to a preference, but there is no provision, as I read the statute, that *603when an executor, administrator or other person who receives money in a fiduciary capacity selects a bank as its depositary, such executor or administrator or trustee should receive a preference for the money so deposited over other depositors. When the United States court designated this trust company as a depositary it exercised an independent authority over which the State of New York had no control." It required the trust company to give a bond to secure its deposits which it must be assumed was considered sufficient to secure them. Such designation, it seems to me, had no relation to the Banking Law of the State of New York, and its act in making such designation gave to the receiver or trustee in bankruptcy no power to enforce a provision of the Banking Law which was intended solely to provide for cases where the courts of this State had designated this trust company as one to execute a trust and to affect money or property which the trust company had received under such appointment or designation.
For this reason I think the judgment appealed from should be affirmed.
Judgments reversed and judgments ordered for appellants as prayed for in their complaints, with costs in both courts. Orders to be settled on notice.