
    George Hoffmann, as Administrator, etc., of Julia Huf, Deceased, Respondent, v. Union Dime Savings Institution, Appellant.
    
      Savings bank deposit — withdrawal thereof by one acting under a power of attorney from the depositor after the latter's death — liability of the bank in an action to recover the deposit by the depositor's administrator — competency of the attorney who withdrew the money to testify in such action — the bank is not protected by its by-law—subrogation of the bank to the right of the attorney to show that the money was used for the decedent’s benefit.
    
    A depositor in a savings bank executed to one George Thoma a power of attor- ■ ney, which was filed with the bank, giving him full power and authority “to draw on my behalf and for my use ” the moneys deposited. After the depositor’s death, Thoma, who was aware thereof, presented to the bank the bank book and drafts signed by himself as attorney, in reliance upon which the bank paid to him the entire amount of the deposit. At the time the bank made the payments it had no notice of the depositor’s death, nor did it make any inquiry of Thoma as to whether the depositor was still alive.
    The by-laws of the bank, which were printed in its pass books and in its signature book, provided: “ Depositors alone shall be responsible for the safe keep- ■ ing of their books. And all payments.made to persons producing the deposit books, whether with or without an order or' letter of attorney, purporting to be" signed by the depositor, shall be deemed good and valid payments to depositors respectively and shall fully discharge the institution therefrom; ” and that “ on the decease of any depositor the amount standing to the credit of the deceased shall be paid to his or her legal representative.”
    In an action brought by the administrator of the depositor to recover the amount of the deposit, it was
    
      
      Reid, that in making the payment to Thoma the bank was not protected by the by-law authorizing payments to persons producing deposit books, as such by-law did not apply after the depositor’s death;-
    That the bank was bound to know that the power of attorney to Thoma was revoked eo instanti upon the death of the depositor;
    That it made the payment to Thoma at its peril and was bound to make the sum good to the depositor’s legal representative, unless it appeared that the power of attorney given to Thoma was coupled with such an interest'in Thoma as caused it to survive the depositor’s death;
    That Thoma, when called as a-witness for the defendant, was not incompetent, under section 829 of the Code of Civil Procedure, to testify to declarations made by the depositor and in regard to his own acts in relation to the depositor’s property with a view to showing that his power of attorney was coupled with an interest, as Thoma was not a party to the action nor a party from whom the defendant derived its interest, and, although interested in the question involved, was not interested in the event of the action and would not be boúnd by the judgment therein.
    
      Semble, that even though the -evidence were not sufficient to establish a gift to Thoma or that Thoma had any interest in the deposit, yet if it appeared that Thoma had paid the depositor’s funeral expenses, or in - other ways had established a right tó have moneys allowed from the fund because they had been properly paid by him for the 'benefit of the estate of the deceased, the court might hold that the defendant was equitably subrogated to thq tights of Thoma and entitled to credit for such payments.
    'Patterson, J., dissented. '
    Appeal by the defendant, the Union Dime Savings Institution, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the . 23d day of November, 19(13, upon the decision of the court rendered after a trial at the New York Trial Term, a jury having been waived. '
    
    
      C. N. Bovee, for the appellant.
    
      I. Balch Louis, for the respondent.
   O’Brien, J.:

The facts and the questions presented upon the trial are so fully and clearly stated in the opinion of' the learned trial justice that we take the liberty of quoting therefrom at length: /

On the 4th of April, 1900, Julia Huf opened a deposit account with the defendant, and as evidence thereof received a bank book No. 354,443', in which were printed certain of the by-laws of the bank. She signed her name in the signature book of the bank and also signed an identification card. The signature book which she signed contained the by-laws of the defendant then in force. On the 19th of July, 1900, there was filed with defendant a duly executed power of attorney acknowledged by Julia Huf July 17,1900, in which she ‘ made, constituted and appointed ’ George Thoma her true and lawful attorney ‘ for me and in my place and stead, and to my use, to deposit in any bank or banks he sees fit, moneys belonging to me, in my possession or under my control, or moneys belonging to me and in the possession of other person or persons, after collecting the same on my behalf. I also give said George Thoma full power and authority to draw on my behalf and for my use any sum or sums of money at any bank or at all banks in which my said funds shall be deposited hereafter or may now be deposited, giving my said attorney full power to do everything whatsoever requisite and necessary to be done in the premises, as fully as I could do 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.’ George Thoma, at the time of filing said power of attorney also signed as attorney Mrs. Huf’s identification card. Julia Huf, who was a woman upwards of eighty-five years, died September 14, 1900. Upon that day the amount standing to her credit on the books of the defendant was $2,454.80. On the fifteenth day of September, the day after her death, George Thoma, who was aware of her death, presented to the bank the bank book and an order in writing, signed by himself as attorney, in the sum of $454.80, and was paid said amount. On the eighteenth of September, three days thereafter, he again presented the book and a similar order for $2,000, the entire balance, and the bank paid the same, closing the account. At the time of payment the bank had received no notice of the death of Julia Huf. At the time of the presentation of each draft and the payment thereof, the bank, by its officers, made no inquiry whatever as to whether the depositor, Julia Huf, was still alive. The above facts being clearly established, the administrator claims to recover upon the ground that the death of Julia Huf revoked the power of attorney and that, therefore, the payment to Thoma was unwarranted and unlawful. The bank defends upon the ground, first, that one of its by-laws provides: 8. Depositors alone shall be responsible for the safe keeping of their books. And all payments made to persons producing the deposit books, whether with or without an order or letter of attorney, purporting to be signed by the depositor, shall be deemed good and ; valid payments to depositors respectively and shall fully discharge the institution therefrom; ’ and, secondly, that this power of attorney was coupled with such an interest in George Thoma that it was not revoked by Julia Huf’s death. As to the first contention, ' Section 6 of the defendant’s by-laws provides: on the decease of any depositor the amount standing to the credit of .the deceased shall be paid to his or her legal representative.’ The holder of a naked power of attorney is not such legal representative — the administrator is. The learned Appellate Division held in Podmore v. South Brooklyn Sav. Inst., 48 App. Div. 218, construing similar provisions: That by-law contemplates and was aimed to secure continuous vigilance on the depositor’s part to prevent fraudulent possession of his pass book. It surely was not intended to apply when he was no longer here to guard his pass book. That the contract on that event was to cease at his death is clearly evidenced by the independent by-law providing for the bank’s duty with regard to paying after that event.’ See, also, Farmer v. Manhattan Sav. Inst., 60 Hun, 462. The Podmore case went to the Court of Appeals, as Mahon v. South Brooklyn Sav. Inst., 175 N. Y. 69. Evidence was offered and excluded tending to show that the bank exercised due care in making the payment. Said the court: We think the evidence was properly excluded. The rule of diligence invoked by the defendant bank applies only to the case of a living depositor. When through a depositor’s carelessness his bank book gets into the hands of a third person, who presents it to the bank, the latter may show its care and. diligence in making payment to the person presenting the pass book, and thus protect itself against a second demand for payment by the careless depositor. But this by-law, which is designed tó protect the bank in such a case, must be read in connection with the other by-law, which provides that after the depositor’s death payment must be made to his or her legal representative.’ This latter by-law is for the protection of the depositor who could no longer protect himself, and, therefore, the bank was bound to see that payment was made to the proper person. Payment to any other person was made at the bank’s peril.’ So far as the case at bar is concerned, the bank had on file a plain, simple power of attorney, which it was bound to know became revoked eo i/nstcmti upon the death of Julia Huf. It paid two drafts, comprising the whole account, within three days upon the strength of that power of attorney, without an inquiry as to whether Julia Huf was alive or dead. It paid at its peril and is bound by its own by-laws to make good to Julia Huf’s legal representative unless the proof has clearly established that said power was coupled with such an interest in George Thoma as caused it to survive Julia Huf’s death. There is no such clear, strong and convincing proof as would warrant any such finding of fact. The power of attorney certainly contains no suggestion. That was to deposit and to draw for Julia Huf’s use solely. Some oral testimony is offered to show first a gift. The evidence falls far short of establishing a gift either injyrwsenti or causa mortis. Again, it is claimed that certain statements made from time to time by decedent as to having masses said for her and to see that she had a nice funeral established such an interest in George Thoma in this fund as made the power irrevocable. I do not think so. The evidence is weak, uncertain and unreliable. I do'not believe it. It seems to me that it was a bold attempt on George Thoma’s part tó get possession of Julia Huf’s estate for his own purposes by taking advantage of the power of attorney and by concealing the fact of her death from the bank. The bank paid without taking ordinary precaution and its defense is not made out.” (Hoffman v. Union Dime Sav. Inst., 41 Misc. Rep. 517).

With the conclusion thus reached by the learned trial justice we might agree were it not for errors in the rulings excluding certain evidence offered by the defendant. The questions propounded to the witness George Thoma by counsel for the defendant called for testimony of declarations by the depositor, and acts of Thoma in relation to the depositor’s property, with a view of showing an interest in Thoma in the property which was the subject of the power. All of this testimony was objected to under section 829 of the Code of Civil Procedure, and excluded upon the ground that Thoma was a person interested in the event. We think that these rulings were erroneous, for the reason that Thoma was not a party, and, though interested in the question involved, he was not interested in the event of the action and would not be bound ór concluded by the judgment of the court in this action, nor was ■ he a person through whom the defendant derived its interest, within the meaning of section 829 of the Code of Civil Procedure. (Rosseau v. Rouss, 91 App. Div. 230; Albany County Savings Bank v. McCarty, 149 N. Y. 71; Eisenlord v. Clum, 126 id. 552; Hobart v. Hobart, 62 id. 80 ; Lecour v. Importers & Traders’ Nat. Bank, 61 App. Div. 163; Benjamin v. VerNooy, 36 id. 581; affd., 168 N. Y. 578 ; Gourlay v. Hamilton, 41 Hun, 437; Wallace v. Straus, 113 N. Y. 238; Putnam v. Lincoln Safe Deposit Co., 87 App. Div. 13 ; Connelly v. O’Connor, 117 N. Y. 91.)

Section 829 of the Code of Civil Procedure provides that “a party or a person interested in the event or a person from, through or under whom such' a party or interested person derives his interest or title, by assignment or otherwise, shall not be examined * * * concerning a personal transaction or communication between the witness and the deceased person.”' In Rosseau v. Rouss (supra) the authorities are collated, and reference is made to Connelly v. O’Connor (supra), where the court say: “ In construing that section it has been held that the test of interest, where the-witness is not a party, is that the witness ‘ will either gain or lose by the direct legal operation of the judgment, or that the record will be legal evidence for or against him in some other action. It must be a present, certain and vested interest, and not an interest uncertain, remote or contingent.’ ” The subject is also discussed, at length and the rule reaffirmed by this court in Lecour v. Importers & Traders’ Nat. Bank (supra). And in Albany County Savings Bank v. McCarty (supra) it was said by the Court of Appeals: “ An interest in the question is not enough to disqualify, as that is not an interest in the event. Unless ,the witness will gain or lose by the event, either directly, as in money, or indirectly, because the record could be used as evidence for or against him, he is not disqualified.” This principle is also stated in Putnam v. Lincoln Safe Deposit Co. (supra), and therein Redfield v. Redfield (110 N. Y. 671), cited by the respondent, is referred to as having been repudiated by the Court of Appeals.

Under the rule, therefore, Thoma had no interest in the event. He was not a party, would take nothing by the judgment, and it could not bind him. At most, the result as to him was contingent; namely, if the bank were unsuccessful in the action, then it might sue him for moneys paid to him.

We think, therefore, that the testimony of Thoma was competent and material, as bearing upon the defenses urged that this fund was a gift to Thoma, or that, in addition to his naked power of attorney, he had some interest in the fund. How far the evidence might-or might not change the -result we are unable, in its absence, to determine. But as the defendant was entitled to the benefit of the testimony for what it was worth, the rulings excluding it were erroneous. Even though the evidence were not sufficient to show either a gift to Thoma or an interest in the fund, still, if it appeared therefrom ■ that out of such fund Thoma had paid the funeral expenses, or in other ways had established a right to have moneys allowed to him from the fund because properly paid by him for the benefit of the estate of the deceased, it may be that the learned trial justice would have held that to such extent the defendant was equitably subrogated to the rights of Thoma and entitled to credit for such payments. We do not undertake to determine whether such allowance could or could not legally be made, but we think that the defendant was entitled to have all the evidence bearing upon the defenses interposed presented.

For the errors assigned, therefore, we think that the judgment should be reversed and a new trial ordered, with costs to the appellant to abide the event.

Ingraham, McLaughlin and Hatch, JJ., concurred; Patterson, J., dissented.

Judgment reversed, new . trial ordered, costs to appellant to abide event.  