On appeal from the Passaic County Circuit Court.
For the appellant, Peter Cohn.
For the respondent, Louis J. Cohen.
The opinion of the court was delivered by
CAMPBELL, CHANCELLOR. This is an appeal from a judgment in favor of the defendant bank, entered upon a directed verdict.
The plaintiff had been a depositor and customer of the Labor Bank of Paterson, which institution had not opened
for business after the "bank holiday" declared March 4th, 1932. Prior to that date she had issued checks against her account in that bank in payment of merchandise and other business claims, which checks, because of the closing of the bank, and its remaining closed, had not been paid. She was desirous of paying these claims, and, in fact, in the conduct of her business it was necessary that they should be, and further that she should have a sound and solvent bank with which she could do business. With this situation and condition confronting her, she, with her husband, went to the defendant bank and discussed the matter with its vice-president, to whom she says she made known the predicament in which she then was and she and her husband say that this officer of the defendant bank was informed that she desired to open an account or make a deposit from which to meet checks drawn thereon in replacement of the checks drawn upon the Labor bank which had not been paid. What took place at the time of the opening of the account is shown by the testimony of the plaintiff and her husband and the vice-president of the bank.
A careful examination of the proofs of the plaintiff and her husband shows that after making known the situation they were in, caused by the closing of the Labor bank and the outstanding unpaid checks upon it, they also made known that with some money they had borrowed and with some current receipts from business the plaintiff desired to open an account in the defendant bank but desired to be satisfied that it was safe so that the before mentioned outstanding checks would be paid through substitution of checks upon the defendant bank and were advised by the bank's vice-president, "we could place the money aside for you in a way that nobody or no one of the banks could touch, only to pay your accounts."
There is also testimony that the plaintiff desired a check book with her business name printed upon the checks for which the bank required a payment of two dollars and fifty ($2.50) cents against which plaintiff remonstrated, stating that she had done business with other banks for years and
always had such books furnished her without cost, to which the vice-president of the defendant replied, "Mrs. Maurello, that is only the cost of the book and the printing. * * * We are not investing that money. That money is kept aside for you."
From the cross-examination of the plaintiff the quite inescapable conclusion is that the proposed deposit was not exclusively for the purpose of meeting and paying checks to be issued against it for the payment of the outstanding unhonored checks against the Labor bank but also to meet checks in payment of current and subsequent business claims.
There is nothing in the proofs showing that the plaintiff or anybody for her disclosed or made known to the defendant bank at the time of opening the account or at any time the amount of the unpaid checks upon the Labor bank, the parties to whom they were drawn nor the respective amounts.
All of the proofs before referred to related to a conversation between the plaintiff and her husband and the vice-president of the bank held on March 20th, 1933, when an account was opened with an initial deposit of one hundred and fifty ($150) dollars in cash. Coincident therewith a signature card was prepared and signed by the plaintiff and a passbook issued and delivered to her. There is not the slightest suggestion or indication in any of these that the account so opened was other than an ordinary checking or demand account. Later, on the day of opening the account, there were two other deposits made thereto; one of $440.34 in cash and checks and the other of $13.71 in cash and a check. On the succeeding day, March 21st, there was a further deposit of $40.03 of cash and a check. All of the deposit slips are in form and character to those used in demand or general checking accounts and there is no suggestion thereon of the deposits being made to a special or trust account.
On March 23d, 1933, by order of the commissioner of banking and insurance, the usual, regular and full operation of the defendant bank was suspended and it was put upon a limited operation under the Altman act. Pamph. L. 1933, chs. 27, 66, pp. 27, 125.
From the opening of plaintiff's account on March 20th, 1933, to March 23d, 1933, the total deposits were $644.08 and the withdrawals $160.91 (included in which is the item of $2.50 for the check book) leaving a balance of $483.17.
Thereafter demand was made by the plaintiff upon the defendant bank for repayment to her of this balance and upon refusal, based upon the aforesaid order of the commissioner of banking and insurance she brought suit against the bank.
The complaint is in two counts which are much alike in that both allege that the moneys deposited were ...