Court Opinion

ID: 9617668
Source: CourtListenerOpinion
Date Created: 2023-08-22 04:59:32.329315+00
Date Added: 2024-06-11T18:04:14.245262
License: Public Domain

Mr. Justice Frantz
specially concurring:
It is my conviction that aim has not been directed toward the center of the problem presented by the record in this case, but rather, and at best, toward peripheral questions, all of which induce me to urge that we resolve the only question which, in my opinion, invites *590solution, and which would be dispositive of this controversy. I respectfully expostulate with my colleagues that we miss the point of the case in directing our considerations to questions of who owned the vehicle, tracing trust funds, and so forth.
Open sesame to the solution of the dispute between the parties is the conduct of Rust and the Bank on December 20, 1954, at about the hour of four o’clock in the afternoon. Deposit of the check was made at that time, and in this connection it is important to remember the interplay of the components of this transaction. Whatever the incidents, circumstances and negotiations may have been, leading to the deposit of the check (and there is considerable contrariety of testimony on these matters), they were merged in that certain instrument, the deposit slip.
At the time of acknowledging receipt from Rust of the check drawn by B. & M. Service in the sum of $6,120.00 from which was deducted $325.00 cash paid to Rust, the deposit slip recited:
“All deposits are accepted for collection only and credited subject to final cash payment and are handled at risk of depositor. Credit is given conditionally, this bank reserving right to charge back to depositor all unpaid items or returns therefor which are unpaid, although item itself is not returned, items on this bank not found good will be charged to depositor. This bank will use due diligence in selecting responsible collecting agents but will not be responsible for their acts or omissions, negligent or otherwise, or for loss of items in mail.”
It has been held that such a deposit slip is contractual in nature, First National Bank of Denver v. Henning, 112 Colo. 523, 150 P. (2d) 790; American Savings Bank & Trust Co. v. Dennis, 90 Wash. 547, 156 Pac. 559; Ryan v. Columbia National Bank, 142 S.C. 231, 140 S.E. 593, and “that pursuant to the provisions of the deposit slip, [the] bank, at the time of deposit, was merely an agent to collect.” Bromfield v. Cochran, 86 Colo. 486, 283 Pac. *59145. Involved in the latter case was a deposit slip containing language concerning the bank acting as agent similar to that appearing in, and quoted from, the deposit slip in question.
Receipt of the check, payment of $325.00 to Rust, and use of the deposit slip with the quoted language were all parts of one act. The conditions contained in the deposit slip, if rendered ambiguous by the circumstances, must be construed most strongly against the bank, the drafter of the provision. People’s Gin Co. v. Canal Bank & Trust Co., 168 Miss. 630, 146 So. 308. “Whatever the rule may be in other jurisdictions, and there is some conflict in the authorities, it seems to be reasonably well settled in this state that, where a check is received and deposited as in this case, and the depositor checks against it with the understanding that, if the bank fails to collect the check, the amount is to be charged back, the check remains the property of the depositor, and title thereto does not pass to the bank. The allowing a depositor to check against such paper is a mere gratuitous privilege.” (Emphasis supplied.) American Savings Bank & Trust Co. v. Dennis, supra. See Joppa v. Clark Commission Co., 132 Ore. 21, 281 Pac. 834; E. A. Tovrea & Co. v. Degnan, 27 Ariz. 539, 234 Pac. 820.
The written right to charge the checks back is indicative of the bank’s status as agent for the depositor. First National Bank v. Fleming State Bank, 74 Colo. 309, 221 Pac. 891; First National Bank of Denver v. Federal Reserve Bank, 6 F. (2) 339. In the latter case Judge Phillips spoke for the court of this federal circuit, and said:
“Although the checks were indorsed in blank, they were indorsed and deposited to be transmitted for collection, and the credit given therefor in the account of' the Lumber Company with the plaintiff bank was subject to the right to charge the checks back to such account if payment therefor in cash was not received. Such *592being the facts, the indorsement did not transfer the title to the checks to the plaintiff.” (Emphasis supplied.)
The relationship between a bank and its depositor, whether that of agent and principal or debtor and creditor, cannot be unilaterally changed. “If the admitted relation of principal and agent is to be suddenly changed to that of debtor and creditor, such a result must be brought about by some definite act, and it seems to us that this definite act must be one concurred in by the principal, as the relation of debtor and creditor is a contractual relation and bilateral in its inception.” People ex rel. Nelson v. People’s Bank & Trust Co., 353 Ill. 479, 187 N.E. 522, A.L.R. 1328.
“In the absence of a contractual agreement to that effect, a bank which has received an item as agent for collection cannot change its status as agent into some other relation, such as that of debtor, at its will and without notice for its own purpose or for the benefit of a sub-agent.” 9 C.J.S. 507, Sec. 248. “A bank cannot divest itself of a trust relation and assume the other at its own convenience. The transformation does not effect the depositor unless this is known by him, either by agreement or usage.” Hall v. Beymer, 22 Colo. App. 271, 125 Pac. 561. See Charles Hing v. Joe Lee, 37 Calif. App. 313, 174 Pac. 356.
We are dealing with the deposit of a check, and not cash. “When, as here, a check is indorsed in blank by the payee, and placed in a bank other than the one on which it is drawn, whether such a transaction constitutes a sale of the check to the first bank or is merely a deposit for collection depends upon the facts and circumstances attending the transaction. If it is a sale title passes to the bank in which the deposit is made, if it is for collection only, or the check is deposited as a check, the relation of debtor and creditor does not arise, and the check remains the property of the depositor, and is in the hands of the bank as his agent for collection, with title still in the payee, and not in the indorsee. * * *
*593“In this state the general custom and understanding is that, when a customer deposits in his bank checks drawn on another bank, they are received for collection, and are charged to the customer’s account if dishonored. Some banks, by way of precaution, print upon their deposit slips notice to this effect. The banks, generally, in the absence of special notice,.regard such transactions as deposits for collection, and, even when credited to a checking account, the right recognized by the law merchant to charge back to the account a dishonored check is exercised. Town of Manitou v. First National Bank of Colorado Springs, 37 Colo. 344, 356, 86 Pac. 75.” First National Bank v. Fleming State Bank, supra, cited with approval in Bromfield v. Cochran, supra.
See First National Bank v. Henning, supra, for an excellent application of the rule in a case involving conditions contained in the deposit slip similar in many respects to those in the deposit slip prepared by the bank and used by Rust in this case.
I submit that the deposit slip fixed the relationship of the bank and Rust; that relationship was one of agent and principal, under which Rust owned the check; that the relationship could not be changed by the unilateral action of the bank; and that all questions should be resolved in this case on the basis of Rust being the owner of the check.