
    James J. Gearns, Adm’r, Appl’t, v. The Bowery Savings Bank, Resp’t.
    
    
      (Court of Appeals,
    
    
      Filed October 25, 1892.)
    
    Savings banks—Payment, to holder on pass-book—When negligence A QUESTION FOR THE JURY.
    Plaintiff, as administrator for Marry Ann Gearns, drew $1,500 from defendant and redeposited as administrator, taking a new book. Three years later defendant paid the amount then to plaintiff’s credit to one K. on his presenting the pass book and a power of attorney, with the individual signature of plaintiff, and which described plaintiff as executor of Patrick J. Gearns, deceased. On the trial of this action to recover the amount plaintiff testified that he did not sign the power of attorney, and the court refused, on his request, to submit to the jury, unless the defendant so requested, the question whether, under all the facts and circumstances di s-closed, the defendant’s officers, in making the payment, exercised that degree of care and diligence which the law imposed upon them. Beld, error; that if it was proper to submit the question of negligence at the request of the defendant it was at least equally proper and competent to submit it to the jury at the request of the plaintiff.
    Appeal from judgment of the New York superior court, general term, affirming judgment entered on verdict for defendant.
    
      Victor J. Dowling, for app’lt; Carlisle Norwood, for resp’t.
    
      
       Reversing, 3.8 St. Rep., 1025.
    
   O’Brien, J.

At the time of the death» of Mary Ann Gearns in the month of February, 1882, there was on deposit to her credit with the defendant about $1,500. This deposit was evidenced by a pass book which the defendant had delivered to her and which contained a statement of the account.

This deposit was to be repaid by the defendant under certain rules and regulations prescribed by the trustees, which it must be presumed the depositor assented to and form part of the contract between the parties. These rules, so far as they bear upon the question involved in this case, provided that all deposits should be entered upon the books of the bank, and" that a pass book should be given to' the depositor, in which the sum deposited should be entered, and should constitute the .voucher and evidence of the property of the depositor in. the bank. They also provided that all payments made to persons producing the deposit book should be deemed good and valid payments to depositors respectively. On the first of December, 1885, the plaintiff was appointed administrator of Mary Ann Gearnsj the original depositor, by the surrogate of New York, and two days thereafter he presented the pass book in .which the deposit had been entered at the bank, with a certificate of the surrogate showing his appointment as administrator and thereupon the defendant transferred to his credit, as such administrator, the" amount of the deposit with the accrued interest, amounting to the sum of $1,769.06. The defendant also took from the plaintiff a receipt for that sum, as administrator, and issued to him in that capacity a new pass book in which that sum was credited and the old book was surrendered. On July 27, 1886; the plaintiff drew from the bank from this deposit $434, giving bis receipt therefor as administrator and no other sum was paid to the plaintiff. This action was brought to recover the balance and the plaintiff has been defeated.

It appears that the balance, amounting-to $1,552.86, including interest, on the 4th day of February, 1889, was paid by the defendant to one Keeler, an attorney, and the validity of this payment as against the plaintiff was the question litigated at the trial. It appears that Keeler presented the pass book to the defendant together with a paper purporting to lie a power of attorney from the plaintiff.^ It purported to bear the signature of the plaintiff, not in his representative, but only in his individual capacity. The plaintiff, however, denied that he ever signed it, and the genuineness of this signature was the only question submitted to the jury. The evidence was conflicting, and as the verdict was in favor of the defendant, the plaintiff is concluded by the finding. The evidence would seem to indicate that if the plaintiff signed the paper, his signature was procured by fraud, but if the defendant had the right to, and did act upon it, the circumstances under which the signature was obtained would0not change its liability. The instrument also purported to be acknowledged before Keeler himself, as a commissioner of deeds, but the plaintiff testifies that he never acknowledged it, and Keeler was not produced at the trial, nor does it appear where he is, farther than a statement in the brief of the learned .counsel for the appellant that he is a fugitive from justice. The plaintiff was also at the time that the money was drawn from the bank by Keeler, and at the date of the'instrument, the executor of the will of Patrick J. Gearns, deceased. The language of the power of attorney, so far as the same is material here, is as follows: “Know all men by these presents, that I, James J. G-earns, as executor of the last will and testament of Patrick J. G-earns, deceased, ■ have made, constituted and appointed, and by these presents do make, constitute and appoint William A. Keeler, attorney at law, my true and lawful attorney for me, in my name, place and stead, hereby authorizing him to draw all moneys credited to me as executor of the estate of- Patrick J. G-earns, deceased, now in the Bowery Savings Bank in the city of New York, as appears from bank book Mo. 610,460 ; and likewise my said attorney, William A. Keeler, hereby is granted full power and authority to have and receive from the Bank for Savings in the city of Mew York, all moneys due me as executor and administrator of the estate of Patrick J. Gearns, deceased, as may appear due me by the bank book Mo. 547,881, and also all moneys now to my credit in the Emigrant Industrial Savings Bank as shown in, book 166,271, giving and granting to my said attorney full power and authority to do and perform all and every act and thing whatsoever requisite and necessary to be done in and about the premises, as fully to all intents and purposes as I might or could if personally present, with full power of substitution and revocation, hereby ratifying •and confirming all that my said attorney or his substitute shall lawfully do or cause to be done by virtue hereof.”

Apart from the fact that this instrument bore the signature of the plaintiff individually and not as the personal representative of the original deposito', and that the person whose name was subscribed to it was described in the body of the paper as the executor of another estate or interest, it did not confer any power to demand or receive payment of the deposit in question. The fund to which-it referred was that of another person, namely, that credited to the plaintiff as the executor of Patrick J. Gearns, deceased. It is true that the power refers to bank book Mo. 610,460, which was the number by which the deposit m question was designated, but that was merely descriptive of the deposit to which the paper related, namely that of Patrick J. Gearns, deceased. "The instrument, therefore, upon its face conferred no power upon the attorney to demand payment of the deposit in question nor any authority upon the defendant to make payment to him. The uefendant’s justification for paying the deposit to Keeler must -rest upon the circumstance that he had possession of the pass book which evidenced the deposit and presented it to the defendant when he demanded the fund. Unless it is protected by this fact, and the rule under which the deposit was received, the defense must fail. It is well settled, however, that payment madq to a person who is not in fact entitled to draw the deposit, though he may have possession of the book and present it at the time of payment, will not discharge the bank, unless it exercised at least ordinary care and diligence in paying'the money to the wrong person.

If at the time a fact or circumstance was brought to the knowledge,^ the defendant’s officers which was calculated to and ought to have excited the suspicion and,inquiry of an ordinarily careful person, it was. clearly their duty to institute such inquiry, and their failure to do so presented a question for the consideration of the jury. Appelby v. Erie County Savings Bank, 62 N. Y., 12; The People v. Third Avenue Savings Bank, 98 id., 661; Allen v. Williamsburgh Savings Bank, 69 id., 314; Smith v. Brooklyn Savings Bank, 101 id., 58; Kummel v. Germania Savings Bank, 127 id., 488; 40 St. Rep., 252.

On the trial the plaintiff’s counsel- requested the court to submit to the jury tne question whether, under all the facts and circumstances disclosed, the defendant’s officers in making the payment exercised that degree of care and diligence which the law imposed upon them. The request was denied and the plaintiff's counsel excepted. The learned trial judge did rule that, though the power of attorney should be found to be a forgery, as claimed -by the plaintiff, still the defendant would be protected by the payment made, if in making it due care and caution was observed, and that he would submit that question to the jury if the defendant so requested, but otherwise not. The defendant’s counsel announced that he did not desire to go. to the jury on that question. The learned judge, held, therefore, as the record shows, that while the defendant might protect itself by proof of due care in making the payment, yet the absence of such care was not an element to be considered in determining the plaintiff’s right to recover. This, we think, was error. The defendant paid the deposit to a person who, upon the evidence, obtained possession of the, pass-book and procured the signature of the plaintiff to the power of attorney by fraud, if he signed it at all. It turned out that the power of attorney was defective in form, in that it did not in terms authorize the payment of the fund in question, but related to another and different fund. ■ The defendant could then fall back upon the defense that payment was made to the holder of the book, and hence, the question of negligence was involved in this branch of the defense, So the plaintiff, when he failed to satisfy the jury that the signature to the power of attorney was forged, could still urge that, though the signature was genuine, it had been procured by fraud, and that by the terms of the instrument, whether genuine or not, no power was conferred upon the beneficiary named therein to draw this money, nor any authority upon the defendant to make payment as it did.

If it was proper to submit the question of negligence to the jury at the request of the defendant, it was at least equally proper and competent to submit it to the jury at the request of the plaintiff. It could not be submitted in either case unless there were facts and circumstances from which an inference could be drawn one way or the other. ' The person who presented the book was a stranger, who evidently deemed it necessary to arm himself with something more, and with it he presented a paper which purported to contain authority to draw money from three, savings banks credited, not to the owner of this deposit, but to another estate, and which, when examined with the requisite care, might furnish reasonable ground for suspicion. It is not the province of this court or of any other court dealing with questions of law to determine the weight and effect of the circumstances brought to the attention of the defendant’s officers by the presence of the person in the bank to whom payment was made with the boojt and the so called power of attorney, nor to point out the inferences which a careful and prudent man might be expected to draw from them. It is sufficient to say that in our opinion they were of such a character as to require their submission to, the jury..

The judgment should be reversed and a new trial granted, costs to abide the event.

All concur, except Andrews, J., absent.  