Opinion
No. 27144.
May 28, 1928.
1. GARNISHMENT. Deposit in name of individual followed by words showing depositor is representative of another may be garnished, absent proof depositor is not owner.
Where money is deposited in bank in name of an individual followed by word "agent," "trustee," or other words showing that depositor is acting as representative or fiduciary of third person deposit may be garnished to pay depositor's debt, if it is not proved that depositor is not owner of deposit.
2. GARNISHMENT. Debtor's claim that deposit garnished consisted of public funds without disclosing true owner does not present defense that funds are held in representative or fiduciary capacity.
Defense that garnished funds deposited in name of debtor are held in representative or fiduciary capacity cannot be asserted by debtor himself without disclosing name of true owner and his right to represent owner, and mere claim by debtor that such funds are public or trust funds without disclosing true owner and facts showing right of debtor to represent such owner in asserting claim to funds is insufficient to present such defense.
3. APPEAL AND ERROR. Supreme Court on appeal cannot consider facts occurring since trial below.
Supreme Court can only consider record as filed in Supreme Court on appeal, and cannot consider rights of parties arising out of facts or matters occurring since trial in court below.
APPEAL from circuit court of Washington county; HON. S.F. DAVIS, Judge.
J.M. Cashin, for appellant.
Chancery clerks are not made by law custodians of any public funds and consequently can have no such funds on deposit. The addition of the word "chancery clerk" to the name of L.M. Nicholson did not make the deposit a special one; Tiffany on Banks and Banking, p. 44, citing McLain v. Wallace, 103 Ind. 562, 5 N.E. 511, and other authorities. But even if it be conceded that no part of the five thousand four hundred thirty-three dollars and ninety-one cents belonged to L.M. Nicholson, still he cannot be heard to claim that the money did belong to him, because public policy forbids the debtor himself, who has deposited funds in his own name, from setting up the pretense that he holds them as trustee for another, for the debtor himself, may the very next day resume the control which he had as between himself and garnishee over the funds, and thus defeat both his garnishing creditor and his own cestui que trust, see note to Home Land Loan Co. v. Routh, Ann. Cas. 1917C., commencing at the top of the second column on page 1146. If he holds the fund as trustee for another only the cestui que trust, or owner of the funds has a right to claim the fund or any part of it as his.
Humphreys Anderson, filed a suggestion and brief for the appellee, Bank, garnishee.
Argued orally by J.M. Cashin, for appellant.
On December 6, 1926, the appellant, O.J. Turner, obtained a judgment in the circuit court of Washington county, against the appellee, L.M. Nicholson, for six hundred dollars and costs; and, this judgment not having been paid and satisfied, the appellant, thereafter, upon a proper suggestion, secured the issuance and service of a writ of garnishment against the First National Bank of Greenville.
At the next regular term of the circuit court, the garnishee answered that it was indebted to L.M. Nicholson in the following manner: that is to say, there appeared on the books of said bank the following three accounts: First, L.M. Nicholson, to which there was no credit; second, L.M. Nicholson, chancery clerk, to which there was a credit of five thousand four hundred thirty-three dollars and ninety-one cents; and, third, L.M. Nicholson, chancery clerk, guardian of L.M. Gilchrist, to which there was a credit of twenty-six dollars and three cents. In this answer the garnishee suggested that it was advised and believed that the defendant, Nicholson, would claim the debt of each of these accounts to be exempt from garnishment, levy, or sale.
The appellee, Nicholson, then filed his claim of exemption, alleging that the money credited to the account of L.M. Nicholson, chancery clerk, was exempt from garnishment, levy, or sale, because all of said money was public funds and trust money — no part of it belonging to him — and that the money credited to the account of L.M. Nicholson, guardian of L.M. Gilchrist, belonged to the estate of the said Gilchrist, and not to the appellee. The appellant demurred to so much of the claim as applied to the five thousand four hundred thirty-three dollars and ninety-one cents deposited to the credit of L.M. Nicholson, chancery clerk, on grounds that may be summarized as follows:
(1) That the claim of exemption is insufficient in substance and law to show that said money is exempt from garnishment, and does not show or state any facts tending to show that said money constituted public funds or trust money, and does not show the names of the persons to whom said money belonged, if it does not belong to the defendant.
(2) The addition of the words "chancery clerk" after the name of the defendant on such deposit account is merely descriptio personae, and imparts no notice to the garnishee, or to the creditors of said defendant that said money does not belong to the defendant.
(3) That, if it be true that said sum is a public fund and trust money, it is still subject to the garnishment, unless and until the same is claimed by the owner or owners thereof; and the right to claim the sum as exempt from garnishment proceedings can only be asserted by the owner or owners of the money.
(4) That the said defendant having deposited said money with the garnishee to his own credit, public policy forbids him setting up the claim that he holds said money for another.
(5) That said plea, or claim of exemption, does not show any facts from which it can be inferred that said money does not belong to the defendant, or that he holds same as trustee for another, or for whom he holds it; and, even if it did, public policy forbids the court to receive such a suggestion from the defendant himself.
This demurrer was overruled, and the appellant having declined to plead further, a judgment was entered, holding that the sum admitted by the garnishee to be owing to the defendant, L.M. Nicholson, and deposited to his account in the name of L.M. Nicholson, chancery clerk, was exempt from garnishment, and discharging the garnishee, and, from this judgment, this appeal was prosecuted.
That the true owner of money deposited in the name of an individual, may, in a garnishment proceeding to subject said money to the depositor's debts, assert and maintain his right to said money, was held in the recent case of Brandon v. Interstate Life Accident Insurance Co. (Miss.), 115 So. 888. And money deposited in a bank in the name of an individual, followed by the word "agent," "trustee," or other words showing that the depositor is acting as the representative, or fiduciary of a third person, cannot be garnished as funds of a depositor where it is proved that the depositor did not own funds, but was acting for another; but, if it is not proved that the depositor is not the owner of the deposit, he will be treated as owner, and the deposit may be garnished to pay his debt. However, the defense that such funds are held in a representative or fiduciary capacity cannot be asserted and maintained by the debtor himself without disclosing the name of the true owner and his right to represent such owner; and a mere claim by the debtor that such funds are public or trust funds, without disclosing the true owner and facts showing the right of such debtor to represent such owner in asserting a claim to the funds, is insufficient to present such a defense. We think, therefore, that the demurrer to the claim filed by the defendant, Nicholson, should have been sustained.
The garnishee, the First National Bank, has filed in this cause a suggestion or statement of certain facts that have occurred since the trial of this cause in the court below, and has requested us to take cognizance of such matters. We can only consider the record as filed in this court; and the rights of the garnishee, if any, arising out of the facts or matters occurring since the trial in the court below, must be presented in that court.
For the reason herein indicated, the judgment of the court below will be reversed, and the cause remanded.
Reversed and remanded.