Chadd v. Byers State Bank

Citations

• 111 Kan. 279
• 206 P. 880
• 1922 Kan. LEXIS 226

Syllabus

<p>syllabus by the court.</p> <p>Banks and Banking — Numerous Checks Drawn by Depositor Received by Bank in Same Mail — Insufficient -Deposit to Meet All Checks — Order in Which Checks Should be Paid. A stock buyer purchased, cattle for which he gave his check, having no deposit sufficient to meet it. He shipped the cattle to a commission company in-Kansas City in the name of his minor son without his knowledge. The cattle were sold and the proceeds deposited in a Kansas City bank, which notified the bank, on which the check was; drawn of the deposit to its credit having been made by direction of the minor. The check referred to and>a number of others drawn by the same-person were sent for collection to the drawee bank, reaching it by the mail which brought the notice. The drawer'óf the check told the bank cashier that the money belonged to him a$d requested that it be credited to his account, which was done. The bank used the money as far as it would go in payment of the checks, but did not pay that first referred to, the holder of which sued the bank on the theory 'of his having a prior claim against the fund. It is held—</p> <p>1. The direction given by the'actual shipper of the cattle that the fund should be placed to his credit was effective, inasmuch as his son had no real ownership of or interest in the cattle or. their proceeds.</p> <p>2. Knowledge by the bank that 'the plaintiff’s check was given for cattle and that the credit at Kansas City was the proceeds of cattle shipped by the drawer of the check in the name of his son was not sufficient to charge it with notice that the credit resulted from the sale of the plaintiff’s cattle.</p> <p>3. Where a bank received by th'e -shme mail a number of checks drawn against it by the same person, whose deposit is not large enough to meet all of them, if it applies the amount on hand so far as it will go to the payment of the checks in any order it sees fit;'it will not thereby render itself liable to the holder of a