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Articles 511 - 540 of 752

Full-Text Articles in Banking and Finance Law

Bills And Notes-Checks-Delay In Presenting For Payment Where Payee Has Deposited In Out-Of-Town Bank May 1935

Bills And Notes-Checks-Delay In Presenting For Payment Where Payee Has Deposited In Out-Of-Town Bank

Michigan Law Review

The defendant in Kenosha, Wisconsin, drew a check on a Kenosha bank and mailed it to the plaintiff in Chicago. Fallowing the practice of many other business houses in Chicago to avoid a high collection charge, the plaintiff, instead of depositing the check in Chicago, sent it by air mail the day after its receipt, for deposit and collection to the plaintiff's bank in Minneapolis, which collected the check through the Federal Reserve Bank in Chicago. The result was presentment to the drawee bank at least one business day later than would have been the case if the check had …

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Bills And Notes-Alteration By Collateral Written Agreement Apr 1935

Bills And Notes-Alteration By Collateral Written Agreement

Michigan Law Review

Defendant was accommodation indorser on two of four notes executed at the same time with different maturity dates. As part of the same transaction, but unknown to the defendant, the maker, two other indorsers, and the payee, plaintiff in the cause, entered into an agreement in writing whereby the maturity of the unpaid notes would be accelerated on default as to any due. Held, in, an action on the notes, that instruments simultaneously executed and referring to the same subject matter are to be construed together, and the effect of such integration here was to bring about an alteration …

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Banks And Banking - Incidence Of Loss Resulting From Payments By Drawee Bank Not In Accordance With Depositor's Orders Mar 1935

Banks And Banking - Incidence Of Loss Resulting From Payments By Drawee Bank Not In Accordance With Depositor's Orders

Michigan Law Review

The ordinary commercial deposit normally results in a debtor-creditor relationship between bank and depositor. It is familiar doctrine that in this situation a duty rests upon the bank to honor its creditor's properly drawn orders to the extent of the depositor's balance. Payments by the bank, ostensibly according to such orders, but which are in truth not in accordance therewith, are the bank's loss at least so far as the supposed drawer is concerned. In bookkeeping terms this means that payments by the bank not strictly in pursuance of genuine orders ordinarily cannot be charged against the account of the …

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Bills And Notes - Execution Of Instruments By Agents - Liability Under N.I.L. Mar 1935

Bills And Notes - Execution Of Instruments By Agents - Liability Under N.I.L.

Michigan Law Review

The liability of parties on negotiable instruments executed by agents or representatives is a matter which has not been satisfactorily settled by the cases under the N.I.L., due partly to the ambiguity of the statute itself and partly to the obstinate refusal of some courts to adopt the approach of the ordinary business man. Under the law merchant the agent ran a great risk of personal liability in executing a negotiable instrument unless he was careful to spell out that he was signing for a named principal as agent only. If he merely added to his name the phrase "agent …

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Bills And Notes - Excuse Of Presentment For Payment Mar 1935

Bills And Notes - Excuse Of Presentment For Payment

Michigan Law Review

The X bank at which a certificate of deposit was payable was in the hands of a receiver at the time of maturity of the certificate. Plaintiff, holder, sued defendant on his liability as an indorser. Defendant claimed a discharge of his liability because of plaintiff's failure to present for payment to the maker (X bank) at maturity. Held, plaintiff was excused from presenting for payment. O'Neal v. Clark, (Ala. 1934) 155 So. 562.

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Evidence-Use Of Photostatic Copies In Proving Books Of Account-Model Statute Feb 1935

Evidence-Use Of Photostatic Copies In Proving Books Of Account-Model Statute

Michigan Law Review

Private records, books of account, and documentary evidence in general present an evidenciary problem in litigation if one, in proving his case, must use the records and books of account of a third person outside the jurisdiction of the forum. A subpoena duces tecum is limited to the boundaries of the state of the forum. Written evidence in the hands of a third person outside the state where the litigation is being pursued can only be obtained by permission of the owner, and even if the owner does permit the transportation of records and books of account necessary to the …

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Banks And Banking - Priorities On Insolvency Of Bank Feb 1935

Banks And Banking - Priorities On Insolvency Of Bank

Michigan Law Review

Plaintiff, clerk of court, deposited in a reputable bank a compensation award known by the bank to be such, pending review in an appropriation proceeding. On the insolvency of the bank, plaintiff sued for the immediate payment of the deposit in full, claiming a preference because: (a) "a special deposit, constituting a trust, was created"; (b) the unauthorized and, consequently, unlawful deposit-of any trust fund in a bank which knows the nature of the fund impresses a trust on the bank. Held, plaintiff was not entitled to a preference over the other depositors in the bank. Busher v. Fulton …

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Bills And Notes - Holder In Due Course -Antecedent Obligation As Value Feb 1935

Bills And Notes - Holder In Due Course -Antecedent Obligation As Value

Michigan Law Review

X, entrusted with the safekeeping of negotiable bearer bonds of A and B, stole A's bonds. On A's request for his securities, X, purporting to deliver what was requested, delivered B's bonds. The wrongdoing was not discovered for over a year. B then sued A to recover the bonds. Held, B may recover, for A is not a purchaser for value. State ex rel. Sorenson v. Nebraska State Sav. Bank, (Neb. 1934) 255 N. W. 52.

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Vendor And Purchaser - Mortgaging Of Land By Vendor - Effect On Vendee's Duty To Continue Installment Payments Jan 1935

Vendor And Purchaser - Mortgaging Of Land By Vendor - Effect On Vendee's Duty To Continue Installment Payments

Michigan Law Review

Plaintiffs agreed in writing to purchase a tract of land from the defendant, the purchase price to be paid in stated installments or in full at any time at the option of the plaintiffs. Two days after the formation of the contract the defendant mortgaged the land, and about eight months later placed a second mortgage on it. Plaintiffs denied having any knowledge of the mortgages until attempts were made to foreclose them. Previous to this, however, they had defaulted in their payments. In an action in general assumpsit to recover the amount of the installments paid it was held …

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Banks And Banking-Liability On Payment Of Incomplete Check Jan 1935

Banks And Banking-Liability On Payment Of Incomplete Check

Michigan Law Review

Plaintiff's agent signed a check in blank, and placed it in a safe. A thief broke into the safe, removed the check and other papers, inserted "Cash'' as the payee and $486.50 as the amount, and was paid by the drawee bank. In an action against the bank for charging plaintiff's account with this item, the court held that as between the parties, because the bank was negligent in paying the check without sufficient identification, it must bear the loss. Joseph Heimberg, Inc. v. Lincoln Nat. Bank, (N. J. L. 1934) 172 Atl. 528.

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Bills And Notes-Bonds Payable At Office Of Trustee Which Becomes Insolvent After Deposit According To Agreement But Before Bonds Presented, Ralph W. Aigler Jan 1935

Bills And Notes-Bonds Payable At Office Of Trustee Which Becomes Insolvent After Deposit According To Agreement But Before Bonds Presented, Ralph W. Aigler

Michigan Law Review

By the terms of a trust mortgage securing a large bond issue the debtor agreed that it would punctually pay the principal and interest of every bond according to the terms of the bond and coupons and would "deposit the necessary funds for such purpose with the trustee at least five days prior to the respective due dates." For the maturities of March 1st and September 1st, 1931, the requisite funds were deposited. Plaintiff's coupons of March and his bonds and coupons of September were not presented on the due dates and not until after the trustee had failed and …

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Bills And Notes - Rule Of Decision In Federal Courts - Application Of Swift V. Tyson To The Uniform Negotiable Instruments Law Jan 1935

Bills And Notes - Rule Of Decision In Federal Courts - Application Of Swift V. Tyson To The Uniform Negotiable Instruments Law

Michigan Law Review

Plaintiff, the transferee after maturity of certain promissory notes made by defendant in Florida, sued in his own name on the notes in the Federal District Court for Pennsylvania. Under the Pennsylvania practice, an assignee after maturity could not sue in his own name unless the notes were negotiable. The District Court concluded that the notes, which contained a provision for interest on overdue interest payments, were non-negotiable and sustained a demurrer. This was affirmed by the Circuit Court of Appeals for the Third Circuit on the ground that although the Florida Negotiable Instruments Law was the law of the …

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Bills And Notes - Holder's Right On Contract To Pay Checks Dec 1934

Bills And Notes - Holder's Right On Contract To Pay Checks

Michigan Law Review

Defendant bank agreed to honor checks drawn by a cattle buyer and carry them as cash items until funds were deposited from sales of stock. During an illness of the buyer the bank authorized buyer's agent to continue the practice, without informing said agent of large overdrafts on the account. The agent ordered the bank to draw a sight draft on a Chicago commission house and credit it to the account for the purpose of covering, among others, a check given to plaintiff, who apparently knew nothing of the arrangement between the drawer and drawee. The bank, however, applied the …

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Banks And Banking - Bank Stock Holding Company As Fraud On Double Liability Statute Dec 1934

Banks And Banking - Bank Stock Holding Company As Fraud On Double Liability Statute

Michigan Law Review

The question as to when, to prevent evasion of a statutory liability, a court will look behind a corporate entity in order to hold individual stockholders liable has been raised in two recent cases. The first, a federal case, involved the Detroit Bankers Company, a Michigan corporation formed for the purpose of holding and investing in bank stocks. Each corporate stock certificate of the holding company contained an "agreement" that the holder of the stock would be liable for his pro rata share of any assessment for which the corporation might become liable as a result of the failure of …

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Banks And Banking--Holder Of Draft Paid For By Check On Issuing Bank As Preferred Claim Upon Drawer's Insolvency Jun 1934

Banks And Banking--Holder Of Draft Paid For By Check On Issuing Bank As Preferred Claim Upon Drawer's Insolvency

Michigan Law Review

A depositor presented his own check to his bank and received in exchange a New York draft drawn by the bank payable to a third person. The drawer bank was closed and the draft was dishonored. The depositor redeemed the draft and sought to establish a preferred claim against the bank's assets. In Fulton v. Baker-Toledo Co. the court held that a trust existed in favor of the depositor, under an Ohio statute which declares that when a check drawn by a depositor is presented to his bank for "collection and payment," and such check is charged against the depositor's …

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Federal Housing And Home Loan Legislation And Its Consequences, Ernest M. Fisher May 1934

Federal Housing And Home Loan Legislation And Its Consequences, Ernest M. Fisher

Michigan Law Review

The laissez-faire policy characteristic of both federal and state policy prior to 1932 in connection with housing was first departed from in a provision in the "Emergency Relief and Construction Act of 1932," passed by the 72nd Congress just before adjournment in July. This provision authorized the Reconstruction Finance Corporation to "make loans to corporations, formed wholly for the purpose of providing housing for families of low incomes, or for reconstruction of slum areas, which are regulated by state or municipal law as to rents, charges, capital structure, rate of return, and areas and methods of operation, to aid in …

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Banks And Banking -- Relation Of Bank To Depositor Of Checks Unqualifiedly Indorsed -- Set-Off Against A Failing Correspondent Bank May 1934

Banks And Banking -- Relation Of Bank To Depositor Of Checks Unqualifiedly Indorsed -- Set-Off Against A Failing Correspondent Bank

Michigan Law Review

Checks drawn on the M bank of another city were deposited by the holders in the D bank pursuant to an agreement that "in receiving and handling items for deposit or collection . . . this bank acts only as depositor's collecting agent and assumes no responsibility beyond the exercise of due care. . . . It may decline to honor or pay checks drawn against conditional credits." The checks were unqualifiedly indorsed. The D bank credited each depositor's account and forwarded the checks to M bank which charged the accounts of the drawers and sent its draft to D …

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Banking Reform By Statute, Robert G. Rodkey May 1934

Banking Reform By Statute, Robert G. Rodkey

Michigan Law Review

The lamentable failure of our banking system to function satisfactorily in the performance of its duties to the public raises at the outset two kinds of questions. Is there something fundamentally unsound about the structure of our banking machinery or does the trouble reside merely in a lack of understanding on the part of bankers of the proper management of the detailed activities in which banks necessarily engage? Or may the unsatisfactory result be ascribed to a combination of these two alternatives? The position taken in this paper is that the structure of our banking system is inherently unsound and …

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Banks And Banking - Bank Collection Code - Preference For Certified Check On Drawee Bank's Insolvency May 1934

Banks And Banking - Bank Collection Code - Preference For Certified Check On Drawee Bank's Insolvency

Michigan Law Review

The petitioner accompanied a bid on construction work with two certified checks drawn on the M Bank and payable to the government. On rejection of the bid the checks were returned, but in the meantime the drawee bank had been closed. The petitioner presented the checks to the receiver of the defunct bank who refused to honor them as preferred claims. An Illinois statute provided that when a bank has presented to it for payment an item drawn upon such bank, and such bank shall fail after having charged such item to the account of the drawer but without having …

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Banks And Banking - Reorganization Under Enabling Statutes Requiring Less Than Unanimous Agreement - Effect On Special Deposits Mar 1934

Banks And Banking - Reorganization Under Enabling Statutes Requiring Less Than Unanimous Agreement - Effect On Special Deposits

Michigan Law Review

The plaintiff issued drafts to the defendant bank under a special agreement that they were to cover certain checks already cashed or to be cashed. When a balance of such drafts stood at $2,000 in favor of the plaintiff, the defendant bank became insolvent. A North Dakota statute provided that if eighty per cent of the deposit creditors agreed to a plan of reorganization, and such plan was approved by the state bank examiner and the secretary of the guarantee fund commission, it was to be held binding on all other unsecured creditors. Eighty per cent of the depositors of …

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Banks And Banking - Public Moneys As Preferred Claims Mar 1934

Banks And Banking - Public Moneys As Preferred Claims

Michigan Law Review

The State claims a preference in the assets of an insolvent bank on the basis of sovereign prerogative. Held, that the State has no preference now because the prerogative right has been abrogated: first, by the passing of a comprehensive state banking law; and second, by a constitutional provision giving bill holders of insolvent banks preference in payment over all other creditors. Fry, State Treasurer v. Equitable Trust Co., 264 Mich. 165, 249 N. W. 619 (1933). (Potter and McDonald, JJ., dissenting).

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Constitutional Law - Emergency Banking Act - Delegation Of Power Jan 1934

Constitutional Law - Emergency Banking Act - Delegation Of Power

Michigan Law Review

Defendant was indicted in two counts: (1) for failure to file a return in respect to gold bullion held by him, and (2) for holding over $200,- 000 in gold bullion without a license, in violation of the Presidential Order of August 28, 1933, issued by authority of the Emergency Banking Act of March 9, 1933. This Act declared an emergency to exist, by Title I, sec. 2 amended the Trading with the Enemy Act by authorizing the President "during time of war or during any other period of national emergency declared" by him to regulate or prohibit (inter …

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Bills And Notes - Incorporation By Reference - Clause In Mortgage Limiting Bondholder's Right To Sue On Bond Jan 1934

Bills And Notes - Incorporation By Reference - Clause In Mortgage Limiting Bondholder's Right To Sue On Bond

Michigan Law Review

Plaintiff, a holder, sued for the principal of and interest on matured bearer bonds which were part of an issue secured by a trust mortgage. Each bond, which was otherwise negotiable, recited that it was secured by a mortgage, "to which indenture reference is hereby made for a statement of the rights of the holders of said bonds." The mortgage provided that all rights of action on the bonds were vested in the trustee and that no bondholder could sue on the primary indebtedness until he had fulfilled certain prerequisites relative to giving the trustee an opportunity to sue. These …

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Bills And Notes-Check Payable To A Party Under Assumed Name Jan 1934

Bills And Notes-Check Payable To A Party Under Assumed Name

Michigan Law Review

M appeared at the office of the B building association, represented himself as W and requested a loan to be secured by a mortgage upon property owned by W. After checking the land records and also the address given by M, B drew a check on the plaintiff bank, payable to W, and sent it to the address which M had given. M removed the check from the mail, endorsed W's name and deposited it in the defendant bank. Upon the discovery of the fraud, plaintiff bank restored the amount of the check to B's …

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Banks And Banking-Payment By Savings Bank To Other Than Depositor Jan 1934

Banks And Banking-Payment By Savings Bank To Other Than Depositor

Michigan Law Review

The plaintiff, depositor in a savings bank, sued the bank to recover for a payment made, upon presentation of the passbook together with a forged receipt, to one known to have previously acted as the depositor's agent. In order to protect itself in such a case the bank had provided the following bylaw: "The passbook shall be the voucher of the depositor, and the possession of the passbook shall be sufficient authority to the bank to warrant any deposit or payment made or entered therein." Held, the bank was liable to the depositor, despite the by-law, as it was …

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Bank Reorganization And Recapitalization In Michigan, Ellis B. Merry Dec 1933

Bank Reorganization And Recapitalization In Michigan, Ellis B. Merry

Michigan Law Review

On January 2, 1933, 420 state and 68 national banks were operating in Michigan. On February 13, the Governor of Michigan proclaimed a banking holiday for eight days which was extended in effect on February 22. On March 4, the President proclaimed a national banking holiday until March 9. Under the provisions of the President's proclamation lifting the national banking holiday, 198 state and approximately 30 national banks were reopened by the appropriate authorities as "sound" banks. State bank conservators assumed the management and custody of 215 state banks which did not open, on appointment by the Commissioner of the …

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Bills And Notes - Forged Indorsement - Liability Of Collecting Bank To Drawer Dec 1933

Bills And Notes - Forged Indorsement - Liability Of Collecting Bank To Drawer

Michigan Law Review

Plaintiff drew a check payable to V. It was stolen by H, plaintiff's employee, and delivered to a confederate who forged V's indorsement and deposited the check in the defendant bank which collected on the instrument. Plaintiff was reimbursed by H's bonding company, and then sought to recover the amount of the check from the defendant. Held, that though plaintiff could ordinarily recover the proceeds of its stolen, undelivered check from the collecting bank, recovery here would be denied because plaintiff had already been reimbursed for its loss. Washington Mechanics' Savings Bank v. District Title …

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Banks And Banking-Liability Of Drawee Bank For Payment On Forged Indorsement Dec 1933

Banks And Banking-Liability Of Drawee Bank For Payment On Forged Indorsement

Michigan Law Review

Plaintiff's depositor gave to A a check, payable to A and B, in return for a chattel mortgage and a note, both signed by A and B. The check was indorsed and presented to the defendant bank for collection. The plaintiff paid the check, debiting the drawer's account. Two years later, when the note came due, it was found that B's name had been forged to the note, the mortgage, and the check. Plaintiff then credited its depositor's account with the amount of the check, and now seeks to recover from the defendant. The court held that …

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Constitutional Law - Bank Reorganization Legislation - Composition With Depositors And Other Creditors, Maurice S. Culp Dec 1933

Constitutional Law - Bank Reorganization Legislation - Composition With Depositors And Other Creditors, Maurice S. Culp

Michigan Law Review

Twenty States and the federal government now have laws permitting the reorganization and reopening of insolvent or failing banks. The usual statute provides for the reorganization of a bank upon some plan approved by a large majority of the general creditors of the institution; the plan must also have the approval of state banking officials and of a court of general jurisdiction, although the last is by no means a universal requirement. The reorganization, when approved, becomes binding upon all depositors and general creditors of the bank regardless of consent. By the terms of a few statutes, non-assenting creditors are …

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Bills And Notes-Bonds Payable At Office Of Trustee Which Becomes Insolvent After Due Date But Before Bonds Presented, Ralph W. Aigler Dec 1933

Bills And Notes-Bonds Payable At Office Of Trustee Which Becomes Insolvent After Due Date But Before Bonds Presented, Ralph W. Aigler

Michigan Law Review

In Morley v. University of Detroit, decided May 16, 1933, the Supreme Court of Michigan reaches a conclusion not only of intense interest as a matter of legal doctrine, but also tremendously important, if followed, in determining the location of losses that may run into large sums. The defendant had floated a large bond issue secured by trust mortgage to a Trust Company. Among the obligor's undertakings in the mortgage was one to the effect that it would punctually pay the principal and interest of every bond according to the terms of the bond and coupons and would "deposit …

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