
    Overseers of the Poor of Norfolk v. The Bank of Va. & als.
    January Term, 1846,
    Richmond.
    
      [44 Am. Dec. 399.]
    
    (Absent Baldwin, J.)
    1. Principal and Agent — Conversion fay Agent. — So long as property or money belonging to the principal may be traced and distinguished in the hands of the agent, his representatives or assignees, the principal is entitled to recover it; unless it has been transferred for value, without notice.
    2. Same — Same — Proceeds of Original Fund.
      
       — The product or substitute of the original thing has the nature of the original thing itself imparted to it, so long as it can be ascertained to be such product or substitute.
    On the 21st of July 1845, the Overseers of the poor for Norfolk county recovered a judgment in the County Court of Norfolk for 2110 dollars 59 cents, and 8 dollars 93 cents costs, against the administrator of Mordecai Cooke. James H. Banghorne was their attorney prosecuting the motion on which the judgment was recovered; and on the same day on which the judgment *was obtained, Cooke’s administrator gave to Banghorne a check for the amount thereof, in these words: “$2119 52. Cashier of the Farmers Bank at Norfolk, pay to James H. Banghorne, attorney, 2119 dollars 52 cents, in full of judgment in favour of Overseers of the poor of Norfolk county against the estate of Mordecai Cooke, deceased, rendered by Norfolk County Court, on 21st instant.
    (Signed), M. Cooke.
    July 21st, 1845.”
    This check was deposited by Banghorne in the Bank of Virginia at Portsmouth, for collection, and was collected by the Bank, and put to the credit of Banghorne; who was taken ill on the Monday following, and died on the ensuing Wednesday. On the day of Banghorne’s death, a note due to the Bank of Virginia at Portsmouth, executed by him, and endorsed by J. G. Hat-ton and Samuel Watts, fell due, and was put into the hands of a notary to be protested ; but the endorsers waiving the protest, it was not protested.
    When the check was deposited by Bang-horne in the Bank of Virginia for collection, the officers of the bank were informed that the Overseers of the poor for Norfolk county had recovered a judgment against M. Cooke, as administrator of Mordecai Cooke, for a considerable amount. At that time Banghorne had to his credit in the bank 1 dollar 58 cents; and he subsequently checked on the bank for 9 dollars 66 cents, and for 55 dollars, both of which checks were paid. He died leaving an estate insufficient to pay his debts.
    After the death of Banghorne, the Overseers of the poor of Norfolk county applied to one of the Judges of the General Court for an injunction to restrain the Bank of Virginia from paying away the amount standing to the credit of Banghorne on the books of the bank; and asked that it might be paid to them: and on the ^qualification of an administrator of Banghorne, they amended their bill and made him a party.
    The administrator of Banghorne answered the bill, claiming the fund in bank as a part of the assets of Banghorne’s estate, to be administered by the administrator in a due course of administration. The Bank of Virginia answered, stating the facts so far as the bank was connected with the transaction, and insisting that if the Court should be of opinion that the bank had the right to have applied the fund in payment of Ganghorne’s note when it fell due, that they shall still be permitted to do so; or if the Court should consider this fund as assets of Ganghorne’s estate, to be disbursed in the ordinary course of administration, that they were entitled to charge the note to Ganghorne’s estate; and were bound to pay only the balance over to his administrator.
    When the cause came on to be heard, the Court below dissolved the injunction and dismissed the bill; and from this decree the Overseers of the poor obtained an ap-' peal to this Court.
    Geigh, and G. N. Johnson, for the appellants,
    insisted that wherever property or money in the hands of an agent, belonging to a principal, can be traced and distinguished, there the principal is entitled to recover it. And that the law is the same, whether the original property of the principal received by the agent is in specie, or it has been sold and the proceeds have been invested in other property, or are in possession of the agent, so as to be distinguishable from his own money. They cited Story on Agen. 22S, 277; Whitecomb v. Jacob, 1 Salk. R. 160; Scott v. Surman, Willes’ R. 400; Howard v. Jemmet, 3 Burr. R. 1369; Took v. Hollingworth, 5 T. R. 215; Taylor v. Plumer, 3 Mau. & Sel. 562; Veil & Petray v. Mitchel’s adm’r, 4 Wash. C. C. R. 105; Thompson v. Perkins, 3 Mason’s C. C. R. 232; Paley *on Agen. 90-96, 28 Gaw Gibr. 39-42; Burdet v. Willett, 2 Vern. R. 638. And they insisted that in this cáse the check given by Cooke to Ganghorne informed the Bank of Virginia whose money it was they were about to receive, and that the books of the bank shewed what money it was which stood there to the credit of Ganghorne.
    Robinson, for the appellees,
    insisted that the right of the principal to pursue his property in the hands of his agent, ceases when the means of ascertaining the property fails; and the means always fails when the property is converted into money, and this is blended in an undistinguished mass with the money of the agent. And he insisted, that in this case, the money received upon Cctoke’s check was so dealt with by Ganghorne. He cited Toll, on EJx’ors 238; Williams on EJx’ors 409-410, 1032; Price v. Ralston, 2 Dali. R. 67; Hourquebie & ais. v. Girard, 2 Wash. C. C. R. 213, 216-17; Thompson v. Perkins, 3 Mason’s C. C. R. 232; Paley on Agen. 81-82; Castairs v. Bates, 3 Camp. R. 300.
    
      
      Principai and Agent — Conversion by Agent. — In First Nat. Bankv. Armstrong, 36 Fed. Rep. 62, it is said: “In Overseers v. Bank, 2 Gratt. 544, an attorney, having collected money for his clients deposited the same in the bank in his own name, and mixed with his own funds. The rightful owner was allowed to recover it, tracing it simply as a gross sum; the court holding that whether the fund remain in the hands of the agent or of his representative or assignee, it mould be followed until it was transferred to some bona Me purchaser or assignee for value without notice.” The principal case is cited in this connection, in First Nat. Bank v. Payne, 85 Va. 898, 9 S. E. Rep. 153.
    
    
      
      Same — Same—Proceeds of Property . — For the proposition that the principal may follow his property into the hands of his agent or factor, and recover it, or its proceeds, from him, the principal case is cited In German Savings Institution v. Adae, 8 Fed. Rep. 109. See also, Veil v. Mitchel, 28 Fed. Cas. 1135.
      In Moorman v. Arthur, 90 Va. 477, 18 S. E. Rep. 869, itis said: “It is also true that if a trust be impressed upon one piece of property, which is afterwards exchanged for other property, the trust follows, and the latter is affected with the same trust. Cock v. Lullis, 18 Wall 342; Overseers of the Poor v. Bank of Virginia, 2 Gratt. 551; Tabb v. Cabell, 17 Gratt. 160; Oliver v. Piatt, 3 How. 485; Cook v. Wallace, 18 Wall. 341.
      Pleas in Abatement. — The principal case is cited in .Tilley v. Com., 89 Va. 153, 15 S. E. Rep. 526.
      See monographic note on “Abatement, Pleas in” appended to Warren v. Saunders, 27 Gratt. 259; and monographic note on “Indictments, Informations and Presentments” appended to Boyle v. Com., 14 Gratt. 674.
    
   STANARD, J.

James H. Ganghorne was the attorney of the appellants in a suit in which a judgment was recovered by them, for 2110 dollars 59 cents, and 8 dollars 93 cents costs, against the administrator of M. Cooke. On the day the judgment was rendered the administrator of Cooke gave Ganghorne a check in these words: ‘ ‘Cashier of Partners Bank at Norfolk, pay to J. H. Ganghorne, attorney, 2119 dollars 52 cents in full of a judgment in favour of the Overseers of the poor of Norfolk county against the estate of Mordecai Cooke, deceased, rendered the 21st instant.

(Signed) M. Cooke.”

This check was deposited in the Bank of Virginia at Portsmouth, for collection, and was collected by the bank, and the money was put by the bank to the credit *of Ganghorne. In a few days thereafter Ganghorne suddenly died, leaving the money, or the amount thereof, to his credit, except two small sums for which he had checked, in the Bank of Virginia at Portsmouth: and on the day of his death, a note of his that had been negotiated at said bank, fell due.

The appellants claim this money or the credit therefor in the bank, as the specific and identified proceeds of the claim on Cooke. The Bank of Virginia claims to set off against the credit therefor, the debt of Ganghorne to the bank, that became due on the day of Gatighorne’s death: and the administrator of Ganghorne claims it as assets of his estate, to be disposed of in a due course of administration.

The well settled principles of law entitle a principal, in all cases where he can trace his property, whether it be in the hands of the agent, or of his representatives, or assignees, to reclaim it, unless it has been transferred bona fide to a purchaser of it, or assignee for value, without notice. In such cases, it is wholly immaterial whether the property be in its original state, or has been converted, into money, securities, negotiable instruments or other property; if it be distinguishable, and separable from the other property or assets; and has an earmark, or other appropriate identity. Taylor v. Plumer, 3 Mau. & Sel. R. 562; Veil v. Mitchel, 4 Wash. C. C. R. 105; Thompson v. Perkins, 3 Mason’s R. 232; Scott v. Surman, Willes’ R. 400; Whitecomb v. Jacob, 1 Salk. R. 160; Jackson v. Clarke, 1 Y. & Jer. 216. The product, or substitute of the original thing, has the nature of the original thing itself imparted to it, as long; as it can be ascertained to be such product, or substitute; and the right of the principal thereto ceases only when the means of ascertainment fail; and this is the case when the subject is turned into money, and is mixed and confounded in a general mass of the same description, and becomes incapable of being- distinguished from *the mass of the moneys of the agent. Under the influence of this doctrine of the law, if an agent should sell the goods of the principal, the purchaser may be held responsible to the principal; or the principal is entitled to anj- negotiable or other securities for the purchase money, unless they should have passed into the hands of an assignee for value without notice; and (subject to the like qualification) to securities or property for which the original securities may have been substituted ; or into which they may have been converted; and (where money has been received by the agent) to the specific money, when it can be identified; as where it has been kept apart from other money, as money in a bag, or coin marked for the purpose of being distinguished.

Such being the doctrine of the law, the question is, does the case under consideration present a fit occasion for its application in favour of the appellants, the principals claiming title to the debt due from, or found in the hands of the Bank of Virginia? In other words, is not that fund, or debt, sufficiently identified as the product of the claim of the principals, on the estate of Mordecai Cooke. It was conceded, as it ought to have been, by the counsel of the appellee, that if there had been nothing to the credit of Banghorne, in the Bank of Virginia, at the time he deposited the check for collection, and when it was collected, and passed to his credit on the books of the bank, that that credit would have been completely identified as the proceeds of the appellants’ claim; and they would be entitled to it; but it is urged that the then existing credit to him of 1 dollar 58 cents, was a subject with which the collection of the check, by being passed to his credit, was mingled, and thereby his receipt as agent was mixed and confounded therewith; and the title of his principals to the fund or credit arising from the check has been lost, and they are but creditors of Banghorne for the amount of the check. To this proposition I cannot assent. The ^credits to Banghorne with the bank are severable, and the sources of each distinctly identified. The bank in its entries is chargeable with two distinct sums, one for the money of Banghorne, the other the proceeds of the claim of the appellants. They are as distinct and distinguishable as the3 would be were they in separate parcels, in the hands of Bang-horne, with labels on each designating the sources from whence they were derived. In the case of an agent selling on credit, the principal is entitled to claim the money from the purchaser; and it never has been, as far as I am informed, contended, certainly, I think, not adjudicated, that the principal would lose his title to claim from the purchaser, the amount for which his goods may have sold, because the purchaser was indebted to the agent for sales of his own, or other property.

It is objected that the rights of the parties, on the facts of this case, are such as they would be had Banghorne received the money on the check for the Farmers Bank, and deposited that money to his credit in the Bank of Virginia. The difference between the cases would be, that in the case supposed, there might be a defect of proof, as to the identity of the money received from the Banners Bank by Banghorne, with that deposited by him in the Bank of Virginia. But suppose that fact fully proved or admitted, and forming a part of the supposed case, the adjudications, before cited, would sustain the title of the appellants to the credit on, or debt due from the Bank of Virginia, arising from such de-posite. Those adjudications sustain that title as between the appellants and Bang-horne, to the- debt created by passing the specific money to the hands of a third person, and taking his note therefor; or to goods or property purchased with the specific money. And between such a case and the case supposed, no distinction is perceived. The utmost effect that can be ascribed to the acts of Banghorne, and the collection of *the check by the Bank of Virginia, is to create a debt from the Bank of Virginia, in the name of the agent, out of the specific and distinctly traced funds of his principals; and the law, according to the adjudications, sustains the title of the principals, in the precise case so defined.

The title of the appellants to the credit in the bank necessarily overreaches the claim of the bank to set off against that credit the debt of Banghorne, that credit with the bank having in its creation imparted to the officers of the bank full and distinct notice that it arose from the debt of Cooke’s estate to the appellants. On the face of the check collected by the bank, it was for money that Banghorne was to receive as the agent of the appellants. The appropriation of it by Banghorne to the payment of his private debt, would have been a gross breach of trust, and the bank, or its officers, consenting to such appropriation, with full notice of the trust, would be participant in the breach of it, and chargeable as if no such appropriation had been attempted. Surely, if the law would not have allowed the discount of Bang-horne’s debts to be effectual, though expressly agreed to by him and the bank, it will not sustain the claim of discount or set off as the legal consequence of the same facts, unaided by the express agreement of the parties.

The other Judges concurred.

Decree of the Court below reversed, and decree rendered in favour of the appellants against the bank for the amount due them, after deducting Banghorne’s commissions.  