Court Opinion

ID: 5329530
Source: CourtListenerOpinion
Date Created: 2022-01-08 05:08:00.95208+00
Date Added: 2024-06-11T08:29:25.845021
License: Public Domain

Crosby, J.
(dissenting). I dissent. It seems to me that the judgment herein proceeds upon the theory that when plaintiffs have proven two things, viz.: (1) That water district funds were placed in Klink’s personal account in defendant’s bank and (2) that some of such funds were used by Klink for his personal benefit under circumstances constituting notice to said bank, then defendant is held hable for all water district money traced into Klink’s personal account, without proof that it was all diverted from its proper use.
I do not understand that the authorities warrant any such theory. (Bischoff v. Yorkville Bank, 218 N. Y. 108; Havana Central R. R. Co. v. Knickerbocker Trust Co., 198 id. 422.)
The burden is upon plaintiffs to show a misappropriation of the trust funds. It is not to be presumed that Klink did not use them properly. (Clarke v. Public National Bank & Trust Co., 259 N. Y. 285.)
The only proof of misappropriation of water district money by Klink is found in a stipulation that during the period of Klink’s defalcation he withdrew $18,244.66 from his personal account in *74the defendant bank for personal purposes, and it also appears that he paid, out of said account, to the defendant bank $2,878.72 of personal notes. This makes a total of $21,123.38 used by Klink out of his personal account for his personal uses and purposes. Plaintiffs’ witness, the expert accountant, Thorny, identified, from a transcript of Klink’s account with defendant bank, certain credits derived from water district funds. But after all such credit items were so identified, there were left an aggregate of $14,256.17 of credits to Klink’s personal account not claimed by plaintiffs to have been derived from water district funds. This $14,256.17 must be deemed money belonging to Klink personally.
If $21,123.38 of money from Klink’s account was paid out for his personal benefit, and $14,256.17 of it was his own money, the plaintiffs have established a misappropriation of the difference only, or $6,867,21. I vote to modify the judgment by a reduction to the sum of $6,867.21 and interest.
Judgment in favor of the plaintiffs modified on the law by reducing the recovery to the sum of $16,964.60 and interest as of the date of entry of the judgment, and as so modified affirmed, without costs of this appeal to either party. Certain findings of fact and conclusions of law disapproved and reversed and new findings and conclusions made.
Judgments in favor of the defendants Rowland and Buckland unanimously affirmed, with separate bills of costs.