Court Opinion

ID: 7809849
Source: CourtListenerOpinion
Date Created: 2022-09-07 17:11:31.16185+00
Date Added: 2024-06-11T16:30:26.411067
License: Public Domain

HABT, J., (after stating the facts). The court was right in holding that the money garnished in the hands of the Peoples Savings Bank belonged to the intervener, the Yukon National Bank, and in this respect the case is ruled by Cox Wholesale Grocery Co. v. The National Bank of Pittsburg, Kansas, 107 Ark. 601. In that case it was held that where a bank receives upon deposit a draft indorsed without restriction and gives credit for it to the depositor as cash in a checking account, the bank becomes the absolute owner of the draft so deposited. The effect of crediting the proceeds is simply to establish the relation of debtor and creditor between the bank and the depositor. The cases of Sanders v. W. B. Worthen Co., 122 Ark. 104, and Southern Sand & Material Co. v. Peoples Savings Bank & Trust Co., 101 Ark. 266, and other cases relied upon by counsel for the plaintiffs, have no application to the facts of the present case. The question of whether the bank was a bona fide holder of the draft for value so as to be protected against infirmities therein, is not involved in the present case. The maker of the draft is not asserting that it was procured by fraud or that there is any infirmity in it. The fact that the maker of the draft might interpose a defense against the bank when sued on the paper does not impair the negotiability of the draft. The Yukon Mill & Grain Company transferred the draft to the Yukon National Bank. The draft was a negotiable paper and the title to it passed to the bank before the writ of attachment and garnishment in this case was issued. Hence so far as the plaintiffs and garnishee are concerned, the Yukon National Bank had a right to the proceeds of the draft. The court erred, however, in rendering judgment against the plaintiffs for interest on $2,303.50, the full amount of the draft from October 2,1917, the date Of filing the suit, to September 25,1918, the date of the judgment. The amount sued for hy the plaintiffs was $210 and the costs amounted to only $20. Therefore, interest at the rate of 6 per cent, should have been allowed only on the sum of $230 from October 2, 1917, to September 25, 1918, which would amount to $21.40. Therefore the court should have only rendered judgment for this amount. For the error in not doing so, the judgment must be reversed. But, inasmuch as the case has been fully developed, judgment will be rendered here against the plaintiffs in favor of the intervener for that amount. This will carry the cost of the appeal. Section 970 of Kirby’s Digest provides that if the judgment be reversed, the appellant shall recover his costs. This is an action at law and this court has no discretion in the matter of adjudging costs when it reverses the judgment. American Soda Fountain Company v. Battle, 85 Ark. 213. It is so ordered.