Court Opinion

ID: 7991779
Source: CourtListenerOpinion
Date Created: 2022-09-09 01:32:00.579759+00
Date Added: 2024-06-11T16:35:23.787663
License: Public Domain

Smith, C. J.,
delivered a dissenting opinion.
The jury found, as a fact, and- the majority opinion concedes for the purpose of this discussion, that at the time the deposit in question was received the bank was insolvent, and that appellant either knew or had good reason to believe that this was true.' The money was received by the bank in the usual and ordinary way, and hecame, immediately upon its receipt, the property of the bank.
Appellant claims that it was the bank’s intention to return the money to the depositor in event it should be determined by its directors that it was necessary for the bank to discontinue business: In other words, his claim is that the deposit was received without any intention of defrauding the depositor. The defect in this defense is that the presence or absence of an intent to defraud is immaterial; for the statute makes it unlawful to receive a deposit into an insolvent bank with knowledge of *124its insolvency without reference to the intent with which the deposit was received. If a fraudulent intent is necessary, few convictions can he had under this statute, for the reason that, I think I am safe in saying, few deposits are received with an intention on the part of the bank officials of defrauding the depositor. Insolvent banks-are usually kept open because of the fact that, should they discontinue business, it is hardly possible for them to realize the value of their assets, and because of the hope of their officials that they will in the end recoup) their losses and be enabled to discharge all of their liabilities and save harmless their stockholders. The statute was designed to prevent insolvent banks from pursuing this-course, to prevent them from continuing to receive, and subject to probable loss, the money of unsuspecting depositors. What happened here is just what the statute' was designed to prevent; for the depositor has lost his-money when, had he been told of the insolvency of the bank, he could have prevented the loss by not making the deposit.
It is true that by a proper proceeding this depositor could have recovered the particular money deposited by him. while it remained in the hands of the bank, but this results not from the fact that there existed an intention on the part of the bank officials to return it to him in event a certain condition should arise, but results from that principle of law which permits a fraudulent contract to be repudiated by the innocent party and which then revests him with the ownership of property obtained from him by virtue of the fraudulent contract. Any depositor whose money has been received by a bank when insolvent, to the knowledge of its officials, can recover it while it remains in the hands of the bank, provided the insolvency of the bank was unknown to the depositor at the time the deposit was made. If authority is desired for this statement of the law, see 1 Bolles, Modern Law of Banking, 188, and, as illustrating the principle, Bank v. Strauss, 66 Miss. 479, 6 So. 232, 14 Am. St. Rep. 579.
*125The statute here under consideration was construed in -accordance with the views herein expressed in Hughes v. Like, 63 Miss. 552. In that case Tr., a banker, having 'failed in business and made an assignment, H., one of his •depositors, sued out an attachment against him on the ground that the debt due the plaintiff was ‘fraudulently -contracted.’ On the trial of the issue joined to test the ground of the attachment the plaintiff adduced evidence tending to show that L. knew at the time he received plaintiff’s deposit that the bank was insolvent.” The plaintiff asked, but was refused-, f‘an instruction to the effect that, if L. was guilty of violating the statute (the one here in question in receiving H.’s deposit, then he fraudulently contracted the debt therefor.” This court .affirmed the action of the trial court in refusing this instruction, and, speaking through Judge Campbell, pointed out the distinction between the civil and criminal liability of a banker for receiving a deposit into his bank knowing it to be insolvent, as follows: “The first instruction asked by the plaintiff was properly refused, and was correctly modified by the court. It is true that one may be .guilty; and sent to the penitentiary, under paragraph 2814 •of the Code, without having entertained the fraudulent purpose necessary to sustain an attachment. Guilt, under paragraph 2814, depends on the facts recited in it, and not upon intent or purpose. The object of the statute is to protect the confiding public from the victimization apt to result from depositing in an insolvent establishment, and it seeks to give protection by denouncing its penalty against him who receives' a deposit, knowing, or "having good reason to believe, that the establishment is -insolvent, without informing the depositor of such condition. Receiving a deposit in such circumstances constitutes the crime, no matter what may be the purpose or hope of the person receiving it. He may think all will be well, and that his insolvent condition will never be !known, and that he will achieve success by the use of his *126credit, and Ms purpose may be to act honestly and pay all depositors, but, if he receives a deposit, knowing or having reason to believe that insolvency exists, he is-guilty of a felony, and cannot escape the just consequences of his crime because of his hopes and purposes. The legislature has determined that it is dangerous to the-community for an insolvent bank to receive deposits, because of the probable result, and, in order to prevent the evil, has declared it felony for any person to receive deposits into an insolvent establishment without informing the depositor of such condition. No professed or really existing honesty of purpose will relieve against the crime, wMch consists in doing what is forbidden, regardless of motive. If the bank is insolvent, dare not to receive a deposit from an unsuspecting person, but tell him of the insolvent condition, that he may foresee the evil and avoid it.” It is true that the criminal liability of the defendant was not there in question, but it was necessary in order that the court might intelligently decide the matter before it for it to draw the distinction between civil and criminal liability under the statute, and, while it may be-that the construction there placed upon the statute is not binding upon us, it expressed the views of a very able court, and, in my judgment, is correct. The statute has been twice re-enacted since that case was decided, and for that reason the views therein expressed, whether necessary to the decision or not, should not be lightly disregarded.
Only two cases have been cited in support of appellant’s contention, and these are the two referred to in the-majority opimon, to wit, Commonwealth v. Junkin, 170 Pa. 194, 32 Atl. 619, 31 L. R. A. 124, and State v. Strait, 99 Minn. 327, 109 N. W. 598. The first decision seems to-proceed upon two grounds: (T) That the deposit was received without any intention to defraud; and (2) that no-deposit was, in fact, made, for the reason that the person receiving the deposit secretly intended to return it. The-*127ground on which, the second ease proceeds is not clearly stated, but it refers to the first as authority for the conclusion reached. I have already discussed the first ground on which Commonwealth v. ’jwiTtin proceeds, and do not deem the second worthy of consideration, for the reason that no other cases have come under my observation wherein it is held that a contract can be modified or changed by reason of an intention on the part of one of the parties thereto different from that expressed in the contract and not disclosed to the other party. In the case of State v. Strait, the deposit there in question had been received by the cashier and ’mingled with the money of the bank before he was notified by Strait, one of the owners of the bank, to put all money received on deposit in envelopes marked with the names of the depositors, so that it might be returned to them. An amount of money equal to the deposit in question was then put in an envelope, marked with the depositor’s name, and, though by an oversight it was not returned to the depositor, the court held that no crime had been committed. It would follow from this that no conviction can be had if the debt which the bank owes the depositor by reason of his having made the deposit is afterwards paid. At least one statute has come under my observation which contains a provision to the effect that loss to the depositor must result from the reception of the deposit in order for a crime to be committed, but the statute here under consideration contains no such provision.
It may be, and I am inclined to think, that the statute should be amended so as to provide for the doing of what was done by appellant here, but that is the province of the legislature, and not of the court. Should the statute be so amended, the amendment should be so framed as to protect the rights of the unsuspecting stockholder, as well as of the person receiving his deposit.
For these reasons, I think the judgment of the court below should be affirmed.