
    Mariano Fricano, Appellant, v. Columbia National Bank of Buffalo, Respondent.
    Fourth Department,
    March 6, 1907.
    Bank—relation between bank and depositor — erroneous charge as to liability of bank paying out money to person not depositor — estoppel.'
    The duty of a bank, other than a savings bank, toward depositors is not measured by reasonable care in paying out the amount of the deposit. The relation of banker and depositor is that of debtor and creditor, the deposit becoming the money of the'bank and the bank a debtor of the depositor. The bank is in no Sense a trustee and the rule as to reasonable care in ascertaining the identity of the .person who draws the deposit has no application. The bank is- hound absolutely, to pay or discharge the liability like any other obligation.
    Although a depositor by holding out another person as authorized to draw the deposit may be estopped, it is error to charge that the liability of the hank - ■ depends on the carefulness or good faith of the cashier in malting payment without also submitting- the acts of the depositor- claimed to constitute an estoppel. ■
    Appeal, by the plaintiff,. Mariano Fricano, from a judgment of tbe Supreme Court in favor of the defendant, entered in the office of the clerk o.f the county of Erie on the 26th day of December, 1905; upon the verdict of a jury, and also; from an order entered in said clerk’s office on the 26th day of December, 1905, denying the plaintiff’s motion for a new trial made upon the minutes.
    The action was' brought to recover the amount of.a deposit, claimed to have been made by the plaintiff in the defendant .bank' at. various times between the 13th day of January, 1903, and the 8th day of August, 1904, Upon which the plaintiff alleged there was due and unpaid to him a balance of $830. The defendant denied ' (1) that the plaintiff was the real person who opened the account with it and (2) claimed- that, the account had been paid in full.
    
      Eugene M. Ba/rtlett and Horace- O. Lanza, for the appellant.
    
      John Cunneen and V. H. Riordan, for the respondent.
   Kruse, J.:

While the jury were well warranted in finding a verdict of no ■cause of action in this case,, we think the rule of law by which the jury were instructed to determine the.defendant’s liability was incorrect. The controversy was over the right of the plaintiff’s son to-draw- against:, the moneys deposited in the plaintiff’s name, and. to . charge, the same against that account. It was claimed by the defendant that, although the deposit, was made in the name of the plaintiff, when the account was opened the moneys were actually.deposited and the business done with the son, who afterwards drew the. checks in the. name of his father; and that th.e son actually presented with the deposit the identification card bearing the name which the son afterwards used in. drawing the checks upon the hank, and which the bank honored and paid ;, that even if: the money belonged to the father, and even if the father was present when, the deposit was made by the son, the father by permitting the son to do -what he . did although he assumed to and did use the name of the father, may not now question as against the bank the right of the son to receive payment of the moneys so deposited. The plaintiff contends that while the son was with him when the account was- opened, he himself made the deposit, wrote his own name upon the identification card, and that neither he nor his son were guilty of any imposition or fraud upon the bank, nor was the conduct of either such as to mislead the bank officers.

While the evidence was entirely sufficient to sustain the defendant’s contention in that regal'd, we think the trial court inadvertently misstated the rule of law applicable to the case. The court charged the jury that the defendant was bound to use that degree-of care which- an ordinarily prudent banker would have used under the same circumstances to protect the true owner' of the account in question from loss, and to safely keep and pay over the same on demand ; that if the plaintiff did write his name on the signature card at the time of opening the account, and the cashier failed to exercise that degree of care which an ordinarily prudent, cashier of a bank would have exercised under the same circumstances to ascertain the identity of the actual author of the signature, and in consequence of that failure the plaintiff has lost anything, the verdict should be for the plaintiff for the amount of the loss. He also charged, in substance, that- if the plaintiff in fact did own the moneys and' did write his name on the identification card, and if the defendant’s cashier exercised such care as has-been stated to ascertain and identify the aetilal owner of the money and the trae author of the signature, and by the exercise of such care and prudence-was unable to ascertain- that the plaintiff was such owner and author, and if the son procured the signature of -the plaintiff on the signature card and delivered it to the cashier and' represented that it was the genuine signature, and the" cashier was ignorant of the matter, and in the exercise of due care' believed and relied on the statements and representations, and. if for these reasons the defendant’s officers were without knowledge or information as to the true owner of the . account and the real author of the signature until after the account was closed, and if' during the time the accounts stood open on the defendant’s books its officers and employees exercised the degree of care which they were bound to use to- protect the plaintiff from loss, and finally .paid .it over on a check signed by the son Frank in the belief that he was the true owner, then their verdict must be for tbe' defendant of no cause of of action.

The defendant excepted to the part of the charge in which the duty of the bank to the depositor is measured by reasonable care. We think the exception was well taken. The liability of the bank to its depositors does not depend alone upon the exercise of reason-. able care by the bank to ascertain the identity of the depositor. Nor is: its obligation to keep or repay the fund that of reasonable care alone. Very likely what the learned trial judge had in'mind . was the rule applicable to savings banks,, where usually rules of that character govern. (Allen, v. Williamsburgh Savings Bank, 69 N. Y. 314; Kelley v. Buffalo Savings Bcmk,. 180 id. 171, 178.) Ordinarily, however; the relation of banker and depositor is that of debtor .and creditor; as soon ás the deposit is received it becomes the money of the bank and the bank a debtor to the "depositor for that amount. It is in no sense a trustee, and .the rule of reasonable cáre has no application in respect of moneys so received by the bank. It is bound absolutely to pay or discharge the.liability like any other obligation it owes. (Ætna National Bank v. Fourth National Bank, 46 N. Y. 82.)

We do not hold that the plaintiff may not have held out his son- or permitted his son to act in such a manner as to warrant the-cashier in relying thereon, and entirely justify the bank in paying the checks drawn by .the son in the name of the father, The rule is well Settled that an owner of property-may hold out another or allow such other person to appear as the owner thereof in such a way that, innocent third parties dealing with the apparent owner - will be protected (McNeil v. Tenth National Bank, 46 N. Y. 325), on the familiar principle that when two innocent persons must suffer by the act of a- third he who has enabled such third person to occasion the loss must bear. it. This element, however, was not embodied in the charge. Carefulness or good faith alone upon the part of. the cashier, without submitting the conduct of the plaintiff in connection therewith, was insufficient, to warrant the batik in paying the son so as to exonérate itself from liability against the claim of the father,.

"We conclude, therefore, that the judgment and order should be reversed and a new trial granted, with costs to the appellant to abide the event.

All concurred.

Judgment and order reversed and new trial ordered, with costs to the plaintiff to abide the event.  