Henderson v. O'Conor

Citations

• 106 Cal. 385
• 39 P. 786
• 1895 Cal. LEXIS 618

Syllabus

<p>Insolvent Bank—Proceeds of Draft Deposited for Collection— Agency—Trust.—Where a draft on a bank in another state is deposited for collection in a bank of this state the relation between the depositor and the bank is that of principal and agent, and the bank has no title to the draft, or to the proceeds thereof, nor is the receipt of the money by its correspondent as subagent of the bank a collection of it by the bank; and where the bank authorized to collect the draft becomes insolvent after notice of collection of the draft by its correspondent, and, after placing to the credit of the depositor on its books the amount of the draft without authority from the depositor, the subsequent receipt of the money collected on the draft by the receiver of the insolvent bank is a receipt of money held in trust for the depositor of the draft, and not a part of the assets of the bank to be distributed to its creditors, and the depositor may recover such proceeds from the receiver.</p>