
    O’Connor v. Mechanics’ Bank.
    
    (Supreme Court, General Term, First Department.
    
    November 7, 1889.)
    1. Banks and Banking—Deposits—Receivers.
    On supplementary proceedings against one of the heirs of a decedent’s estate, the cashier of a bank disclosed that funds had been deposited in the bank to the credit of the estate. A receiver was appointed, who sent to the bank a written notice stating the appointment of the receiver, and demanding payment of the heir’s share of the deposit, and alleging that the amount was due the heir by virtue of a check drawn by the executor of the estate in favor of the heir, and sent to the heir. The bank disregarded the demand, and paid the check when presented. Meld, that the-receiver could recover of the bank so much of the heir’s share as was necessary to satisfy the execution, together with interest, costs, and commissions.
    2. Judgment—Premature Entry.
    The court cannot direct judgment for an estimated amount pending the determination of the exact amount which the receiver can recover, but the amount must be ascertained before judgment is entered.
    S. Execution—Supplementary Proceedings—Appointment oe Receiver.
    Under Code Civil Proc. N. Y. § 2464, providing for appointment of the receiver, and dispensing with notice to the judgment debtor if the judge is satisfied that the judgment debtor cannot with reasonable diligence be found in the state, in which case the order must recite the fact, a recital that it was brought to the attention of the judge that the debtor was a resident of a distant territory is sufficient to justify the judge in dispensing with service of the notice.
    Appeal from circuit court, New York county.
    Action by Charles E. O’Connor, as receiver, against the Mechanics’ Bank. Both parties appeal. For opinion at circuit, see 2 N. Y. Supp. 225.
    Argued before Van Brunt, P. J., and Brady and Daniels, JJ.
    
      Edwin R. Leavitt, for plaintiff. W, O. Beeeher, for defendant.
    
      
       Reversing 2 N. Y. Supp. 235.
    
   Daniels, J.

The plaintiff was appointed receiver of the property of Herbert F. Beecher in supplementary proceedings taken upon the return of an execution unsatisfied, issued upon a judgment recovered against him. The proceedings were taken under subdivision 3 of section 2432 of the Code of Civil Procedure. In those proceedings the cashier of the defendant was examined as a witness, and from his testimony it was made to appear that moneys had been deposited in the bank to the credit of the estate of Henry Ward Beecher. This had been done by his executore, and they concluded to make a distribution of such money among the persons entitled to receive it under the will of the testator, Henry Ward Beecher. In making this distribution, they allotted to the judgment debtor the sum of $2,286.92, and on the 30th of January, 1888, drew their check, payable to his order, upon the defendant, for that sum of money, and the check was paid by the defendant on the 10th of March, 1888. The order by which the plaintiff was appointed receiver was made on the 3d of February, 1888, and on the 8th of the same month his bond as receiver, approved by one of the justices of this court, was filed in the office of the clerk of the county of Hew York. On the same day a demand was made upon the bank in writing for the delivery or payment to the receiver, or to his attorneys, of any and all personal property, of any kind, nature, or description, money or funds, belonging to Herbert Foote Beecher, and in the custody or under the control of the bank. This demand was further extended by an additional written demand, served on the same day, stating the appointment of the plaintiff as receiver, and demanding payment to him “of the sum of $2,000, amount of the funds of the estate of Henry Ward Beecher, deceased, now on deposit with you, belonging to the judgment debtor, or due to him from you by virtue of a certain check drawn against said funds by Henry B. Beecher, as executor of said estate, within two or three weeks past, to said judgment debtor’s order, and being sent to him (said judgment debtor) by said executor at°Port Townsend, Washington Territory, being for the balance of his share in the distributions of the personal effects of the said estate.” These demands were disregarded by the defendant, and the money paid over upon the presentation of the check; and it was because of that payment, with these facts previously brought to the attention of the officers of the bank, that the action was brought by the receiver for the recovery of the money.

It has been objected that his appointment did not authorize the plaintiff to maintain this suit, for the reason that notice of the application for it was not given to the judgment debtor, but from a recital in the order it is to be inferred that knowledge of the fact was brought to the attention of the judge that the judgment debtor was a resident of Washington Territory, and for that reason the notice required to be given could not be served upon him; and that was sufficient, under section 2464 of the Code of Civil Procedure, to justify the judge in dispensing with that service. It is no do.ubt true, as a general legal proposition, that the deposit of money with a banking institution creates no more than the relation of debtor and creditor between the bank and the person or persons to whose credit the deposit is made; but that principle does not control the rights of the parties to this action, for the moneys which were received by the executors, and deposited with the bank, were placed there as the property of this estate, and not of the person or persons making the deposit. It was, upon the face of the account, impressed with a trust in favor of the persons who should prove to be entitled to participate in its distribution. The judgment debtor was one of these persons; and after a division of the money on deposit was made by the executors, and an apportionment of this part of the money made in favor of the judgment debtor, the check was drawn in his favor for its payment to him, and this allotment and division of the fund was sufficient to entitle him to this part of the money. It, in substance, became his property, and was thenceforth subjected to the rights of the plaintiff as receiver, by the proceedings which had been taken, and the demand which was served, accompanied by the information contained in it, before either the check itself was paid, or had appeared to pass into the hand's of a bona fide holder. That the money did become the property of the judgment debtor by the division which the executors made is sustained by what was held by the court in Van Alen v. Bank, 52 N. Y. 1; Baker v. Bank, 100 N. Y. 31, 2 N. E. Rep. 452; Viets v. Bank, 101 N. Y. 563, 5 N. E. Rep. 457. If the bank was not fully apprised of the grounds upon which the receiver claimed to be entitled to this money, it did have sufficient information to render it the duty of its officers to inquire into the circumstances, and to ascertain from the executors the true situation of this part of the fund on deposit; and, having been placed in that position in this manner, it could not disregard the duty created, and pay over the money as it did, without incurring the risk of again making payment to the plaintiff as receiver. When the check was paid, the money, so far as it was required to pay the judgment and expenses, had become, in fact, the property of the receiver in his official capacity; and as it was paid over, in disregard of his rights, after such information had been received by the officers of the defendant as would reasonably, if its indications had been properly followed, have fully informed them of the existence of this right, it was paid without authority, and to that extent the plaintiff was entitled to recover.

It was not, however, proved upon- the trial what the precise amount was which would be necessary to pay the judgment on which the supplementary proceedings had been instituted, the interest upon the amount, the costs of the proceedings, and the commissions and disbursements of the receiver; but the court directed a judgment for the sum of $1,300 until these various amounts could be fixed and determined. This was not authorized. What the plaintiff, in his official capacity, was entitled to recover, was so much money only as would pay the judgment, with interest upon it, the costs of the supplementary proceedings, and the disbursements and commissions of the receiver, together with the costs of the action; and that should have been ascertained definitely, and fixed by the judgment, before it was allowed to be entered, and upon that execution could regularly be issued against the defendant for the collection of the amount. In this particular the judgment was defective, and it should be vacated, and further proceedings directed to ascertain and determine the amount required to pay and satisfy these various items; and when that amount shall have been ascertained, either by a reference or otherwise, then the plaintiff will be entitled to a judgment for the recovery of that sum. These directions will dispose of the appeals of each of the parties, and neither should recover costs of either of the appeals.

Brady, J», concurs. Van Brunt, P. J., concurs in reversal of judgment only. 
      
       Code Civil Proc. N. Y. § 2464, providing for appointment of a receiver in supplementary proceedings, authorizes the judge to dispense with notice to the debtor if he is satisfied that he cannot with reasonable diligence be found in the state, and requires the order to recite the fact.
     