Court Opinion

ID: 6514234
Source: CourtListenerOpinion
Date Created: 2022-07-19 18:25:08.00199+00
Date Added: 2024-06-11T15:54:26.622426
License: Public Domain

WALKER, J.
In such cases as the law prescribes a State or County license to engage in, or carry on any business, or to do any act, the amount required for such license must be paid to the Probate Judge of the Oounty in which it is proposed to engage in, or carry on such business, or to do such act; the money so paid for licenses being part of the revenue of the *127State or County, as the case may be, and received by the Probate Judge in his official capacity, he is prohibited, under criminal penalties, from knowingly converting or applying any of it to his own use, or to the use of any other person, or permitting another to use any of it; and he must, on the last day of each quarter, pay to the State Treasurer the money received by him for such licenses belonging to the State, and to the County Treasurer the money received by him for such licenses .belonging to the County, less the amount of the commissions allowed to him by law. — Code of 1888, §§ 632, 3803, 3805, 633. The plain statutory requirements here referred to exert a controlling influence in the determination of the question presented in this case by the contention that the failure of the defendant Alston to pay to the State certain license money which he collected, and with which he is chargeable as Probate Judge should be excused on the ground that said license money has been lost by reason of the failure of a bank in which it had been deposited at a time-when said bank enjoyed the confidence and esteem of the business world and of the embarrassment of which said Alston had no reason to know or suspect until after the failure was publicly announced. Can this excuse avail as a defense to the suit of the State to recover the amount of its license money so lost ? This inquiry involves the question of right of the Probate Judge to make the deposit as he did. Alston as Probate Judge accepted payment of the license money in the check of the licensee made payable “ to County and State of Ala., or bearer.” This check Alston presented to the bank and had the amount thereof put to 1ns credit on an account, entered on the books of the bank with “A. H. Alston, Judge of Probate, License Money.”
Deposits made with bankers are either general or special. In the case of a special deposit the bank merely assumes the charge or custody of property without authority to use it and the depositor is entitled to receive back the identical money or thing deposited. In such case the. right of property remains in the depositor, and if the deposit is of money the bank may not mingle it with its own funds. The relation created is that of bailor and bailee, and not that of creditor and debtor. Boyden v. Bank of Cape Fear, 65 N. C. 13 ; Dawson v. Real Estate Bank, 5 Ark. 297; Lowry v. Polk County, 51 Iowa, 50; 33 Am. Rep. 114; 2 Am. & Eng. Ency. of Law, 93; 1 Morse on Banks and Banking, §§ 183 et seq. When a money deposit is made it is to be regarded as a general deposit unless there is evidence to show that it was the bank’s duty, by agreement express or clearly implied, to keep it separate and apart from its own funds and to return that identical money to the de*128positor. Money received by a bank on general deposit becomes the property of the bank and can be loaned or otherwise used by it as other moneys belonging to it. The bank becomes the debtor of.the depositor and the obligation is satisfied by honoring the depositor’s checks to the amount of his deposit. The depositor’s claim is a mere chose in action for so much' money. He becomes a creditor of the bank. — Bank of Republic v. Millard, 10 Wallace 152 ; 2 Am. & Eng. Ency. of Law, 93, 94. The words “Judge of Probate, License Money” annexed to the name of the depositor served to distinguish that particular account and to keep it separate from other dealings he might have with the bank. Moneys deposited on an account kept in that form would be more readily traced, and the bank, perhaps, would be chargeable with notice of the source from which the depositor derived funds which he directed to be credited to him in that way. But the addition of the words referred to would not operate to change the character of the deposit from a general to a special one. There is nothing to indicate that the amount charged against itself by the bank on this account was kept separate or unmingled with its own property. The contrary appears. Manifestly, the bank did not undertake to become the bailee of that license money. The effect of the transaction was simply to substitute one person to another’s position as a creditor of the bank to the amount of the check deposited. The maker of the check had no property in the funds of the bank by virtue of his account therewith. The entry of 1 he amount of the check on Alston’s account was but a shifting of the bank’s liability. So far as Alston was concerned, the bank, by accepting the deposit, merely became his debtor and assumed the obligation to honor his checks to the amount so credited to him. — Havens v. Lathene, 75 N. C. 505; McLain v. Wallace, 103 Ind. 562; 1 Morse on Banks and Banking (3d Ed.) § 186 ; 2 Ib. § 604. The money of the State was thus turned over to the bank on general deposit and became a part of its funds and subject to its use as any other of its property. This use of the public money by the Probate Judge was without warrant of law. He had no right to convert it to his own use or permit any one else to use'ir. The deposit was of like effect as a loan of the money. It was an unauthorized use thereof. The Probate Judge by that act voluntarily relinquished his custodjr and control of this public fund so that he could not reclaim it. When the State demands it his answer is that he no longer has it but has a claim for the amount thereof against an insolvent bank. In view of the statutory provisions above referred to, we think that this answer is wholly insufficient as a *129defense. The effect of the, statutes is to make the Probate Judge the custodian of that money and tojDrohibit him from permitting another to use it. Whether or not it would have been wise to authorize the deposit of the public funds in banks of reputed solvency was a matter for legislative determination. The legislature has prohibited any such disposition of public moneys as is effected by a general deposit thereof in bank. The courts can not recognize ks legitimate and excusable that which the statutes have forbidden. They are without power to dispense with the requirements of the statute though it may be apparent that the defendant did not knowingly violate the law; that, in making-the deposit, he was acting under a generally prevailing misapprehension that such disposition of public moneys was authorized; and that he may have honestly thought that it was the safest and most prudent thing to do under the circumstances' until the arrival of the time when he was required to make payment to' the State. The deposit itself having been unlawful, a violation of an official duty and a breach of the condition of the bond, a defense which necessarily involves reliance upon that act as valid and authorized must unavoidably tail. — Lowry v. Polk County, 33 Am. Rep. 114; Ward v. School District, 10 Neb. 294; 35 Am. Rep. 477.
It would be outside of the issues in this case to undertake to specify what would be regarded as a discharge by an officer entrusted with public money of the duty to keep it safely until he is required to pay it over. In the case of The State v. Houston, 78 Ala. 576, the defense that certain tax money which had not been paid over was taken from the collector’s person by a robbery was set up in a suit on the collector’s bond. The court there stated the elements-essential to the validity of that defense, Clopton, J., delivering the opinion, said: “If, having observed the'highest care, vigilance, and diligence to prevent loss, the collector is robbed of money belonging to the State by irresistible force, it constitutes a valid defense to an action on his bond for the recovery of such money. We say money belonging to the State, lor, if it appears that the specific, funds received by the collector have been used or changed for any unauthorized purpose, he becomes eo instanti a debtor, and he and his sureties- are bound to absolute payment, as for a debt. In such case, subsequent robbery of money substituted for the amount misused, is no defense. The robbery must be of money the property of the State.” In the present case, as has been shown, the absolute liability, as for a debt, was fixed upon the Probate Judge and the sureties on his bond by the unauthorized deposit in bank; so that no' *130question is presented as to what the liability would have been if the Probate Judge bad not voluntary relinquished his custody of that license money. In the absence of any specific regulation as to the mode or place of keeping public funds, it would seem that the question as to whether or not the custody over them lias been maintained with highest degree of care, vigilance and diligence known to the law, would depend, in a measure, upon the particular situation of the officer charged with the preservation thereof, and upon the existence of means available to him of providing a place of safe keeping. This decision does not involve the assertion that the security afforded by bank vaults may not in any case be availed of by an officer-entrusted with the custody of public moneys.
Affirmed.