Bank of Commerce v. City of Gulfport

Citations

• 117 Miss. 591
• 78 So. 519

Syllabus

<p>1. Banks and Banking. Depositories. Municipal funds. Trust fund.</p> <p>The depository laws of the state are mandatory, and must he strictly followed in selecting a depository for public funds.</p> <p>2. Same.</p> <p>Under Laws 1910, chapter 138, section 1, requiring, municipalities'to select a depository in the manner provided for the selection of county depositories, section 2, providing that each depository shall enter into bond, or deposit securities with the clerk as required of county depositories and chapter 137, Laws 1910, providing that a county depository shall qualify by giving bonds of a surety company. Although an order was duly made by the municipal authorities making a bank its depository, but in lieu of a bond of a surety company the bank gave a personal bond signed by individual sureties. In such case the bank did not become a legal depository and the city, upon the bank going into liquidation, had the right to proceed under Code 1906, section 3485 (Hemingway’s Code, v section 2823), providing that public money deposited in a bank shall constitute a trust fund not liable to be taken by creditors.</p> <p>3. Same.</p> <p>In such case since the bank did not become the legal municipal depository and the city having the right to proceed under this section, it was not necessary for the city to put in suit the bonds given by the individual sureties, and such sureties were not necessary parties to the suit to recover the funds deposited with the bank by the city. ,</p> <p>4. Estoppel. Suits to recover municipal funds.</p> <p>In a suit by a city to recover funds in an insolvent bank, under, Code 1906, section 3485 (Hemingway’s Code, section 2823), providing that such deposits should be a trust fund, where the bank failed to give a surety company bond as required by Laws 1910, chapter 138, and thus failed to become a legal depository, there could be no estoppel against the city for the acts of its officers in treating the bank as though it were a legal dep