Seaboard Surety Co. v. State Savings Bank of Ann Arbor , 307 Mich. 48 ( 1943 )

I question whether the statutes cited and relied on by Mr. Justice WIEST "specifically regulate" or "clearly limit the power of the county clerk in the premises" — this being the sole basis for the conclusion reached. 1 Comp. Laws 1929, § 1313 (Stat. Ann. § 5.832), merely outlines the condition of the bond required of county clerks. 1 Comp. Laws 1929, § 1266 (Stat. Ann. § 5.686), and 1 Comp. Laws 1929, § 1193 (Stat. Ann. § 5.531), define the duties of the county treasurer — to receive all money belonging to the county and deposit the same in designated banks. However, I believe that there are additional circumstances sufficient to establish that the bank had notice of the fact that these funds were public moneys, and therefore a participant in the misapplication of these funds.

Under a resolution adopted by the supervisors of Washtenaw county, agreements were entered into between the county and various cities and townships within the county, whereby these cities and townships were to reimburse the county for the expense of administering welfare relief in their respective municipal subdivisions. The county clerk was designated as the recognized representative of the county, to notify the county welfare relief commission as to what units were entitled to relief, and the welfare relief commission was to give the county clerk a monthly statement of the amount chargeable to each participating township and city. Under the agreements, the township or city agreed to pay to "the county of Washtenaw" the amount thus expended, within 15 days after notification by the county clerk of the amount due. In making such payments, the several checks in question were made payable to Gibb as county clerk. These checks were received by the bank for deposit in Gibb's personal account. On their face, these checks were notice to the bank that this was public money, not private funds. They were drawn by public officers (city mayor and clerk, township treasurer) "from poor fund," payable to Gibb as county clerk and indorsed by Gibb as county clerk. It must have been apparent to the bank that the Washtenaw county clerk was receiving "poor funds" for welfare purposes, when the bank allowed the checks to be deposited to the personal credit of Gibb.

Under these circumstances, I agree that the bank had sufficient notice to put it on inquiry, when it permitted Gibb to deposit these checks in his personal account. The situation is entirely different from the facts in Columbia Land Co. v. Empson,305 Mich. 220, and also entirely different from the statute law inEmployers' Liability Assurance Corp., Ltd., of London, England v. Hudson River Trust Co., 250 App. Div. 159 (294 N.Y. Supp. 698), relied upon by Mr. Justice WIEST. In the latter case, a county treasurer deposited county funds in a bank in his personal account. The New York statute, as in Michigan, expressly requires the county treasurer to deposit county moneys in a designated depository and withdraw such moneys only on order of the board of supervisors or other lawful authority. (See 1 Comp. Laws 1929, § 1193 [Stat. Ann. § 5.531], and 1 Comp. Laws 1929, § 1266 [Stat. Ann. § 5.686],supra.) Both the New York and Michigan statutes definitely prescribe the duties of the county treasurer. Michigan has no similar statute law prescribing the duties of the county clerk.

Because of the above circumstances, I concur in the result reached by Mr. Justice WIEST.

SHARPE, J., concurred with BOYLES, C.J.