Opinion
Argued May 1, 1882
Decided May 30, 1882
William F. Cogswell for appellant.
J.D. Decker for respondent.
The evidence excluded upon the trial was admissible, if at all, upon the assumption that the husband, who brought the fund for deposit, was either its real owner, or entitled to be dealt with as such by the bank. In such event he could have dictated the terms of the deposit and the manner of its withdrawal, and the bank accepting the arrangement, and acting upon vouchers made accordingly, could have reasonably expected protection. But if the husband came as agent, and not as owner, or the attending circumstances were such as to charge the bank with knowledge of his real relation to the fund, an arrangement hostile to the safety of the principal, and beyond the apparent scope of the agency, drew after it the peril attaching to a want of actual authority.
The first deposit was of a check drawn by an administrator, payable to the order of the wife, and indorsed by her so as to give title to the holder. So far, the possession of the husband was consistent either with an ownership or an agency, and the bank was not bound to infer the latter. But the husband requested the deposit to be put in the name and to the credit of the wife, and a pass-book to be made for delivery to her, showing her to be the real depositor. This request fairly disclosed the agency. Taken in connection with the check payable to the wife's order, it plainly indicated that the money was hers, intrusted to the agent for the purpose of a deposit to her credit. Had the transaction stopped here, no mistake as to its purport would have been possible, and the bank would have been bound to recognize the wife as owner, and pay only upon her order. But the further condition was imposed upon the deposit that the husband should be at liberty to withdraw it upon checks signed by him in his wife's name. On its face the complete proposition was an inconsistency, suggestive of a possible fraud, and out of the usual and ordinary course of business. It was inconsistent, because the bank was asked at the same moment to treat the wife as owner and depositor, and as neither, and so give to her an apparent credit which was in truth a delusion. It was suggestive of fraud, because while assuring her of the safe disposal of her money, and the honest fulfillment of the agency she had created, it enabled her credit to be stolen away without her knowledge, and disclosed plain traces of duplicity and equivocal purpose. It was out of the usual and ordinary course of business. If the money had been the husband's, and he had merely wished to enable his wife to draw on it at will, he would naturally have deposited it to his own credit and given her his checks, or authorized the bank to accept hers. If, on the other hand, as the bank was fairly warned, the money was hers, and she desired her husband to draw upon it freely, she would have given him her checks, or sent an order to accept his. When the bank was tendered a deposit upon conditions such as we have described, and with such knowledge as the circumstances tended to impart, its duty was to refuse the deposit or require the assent of the wife. Omitting to do so, it took the risk of the actual truth, and paid the unauthorized checks at its peril. Any other rule would permit a bank to be blind when it ought to see, and furnish dangerous facilities for fraud. In the present case just that happened which might easily have been foreseen. The husband drew his wife's money upon fraudulent vouchers, with such aid from the bank as made it liable for the consequences. The husband's possession of the money did not authorize it to infer authority to sign the wife's name to future checks. It relied upon the husband's honesty without inquiry as to the fact, and must take the risks of its reliance. Its pass-book was something more than a mere receipt. It imported, besides, a promise to pay on demand, and so had in it elements of contract. The bank made the wife its depositor, whom it was bound to protect against vouchers not known to be actually hers. It established a relation which it was required to respect so long as it existed, and from the duties of which it could not escape without her real authority. It trusted the husband beyond the scope of his apparent authority, and must bear the consequent loss. The evidence offered would not have constituted a defense, and was, therefore, properly excluded.
The judgment should be affirmed, with costs.
All concur, except TRACY, J., absent, and DANFORTH, J., who took no part.
Judgment affirmed.