Leach v. Castana Savings Bank

On March 5, 1924, Robert L. Leach, superintendent of banking, was appointed receiver for the Castana Savings Bank of Castana, 1. BANKS AND Iowa, by the district court of Woodbury County. BANKING: The recordshows nothing whatever as to the dissolution: assets of said bank, other than that it is non- conceded or conclusively shown that, at the time preference the bank was taken over by the receiver, there in deposits. was on hand in cash and cash items $1,575.47.

At the time the bank closed its doors, Monona County, through its treasurer, had on deposit the sum of $9,153.83, plus interest, making a total of $9,175.99. The Castana Savings Bank had furnished to the county a surety bond for $7,500, dated March 10, 1922, and continuation thereof for the year commencing March 1, 1923. The surety company is party defendant in this action. The county asks that this claim be declared a preferred claim.

The surety company filed a demurrer, on which no ruling was made, and apparently, in so far as the surety company is concerned, it is still pending. As between the receiver and the county, the record was stipulated, and no oral testimony was introduced except that of E.W. Baumann, who was cashier of the bank at the time it closed its doors. The case was submitted and order entered on the 9th of January, 1925.

It is apparent that, when this case was tried, the county relied for its preference wholly on Section 3825-a, Supplement to the Code, 1913, under the interpretation of that section as given in In re Receivership of Marathon Sav. Bank, 198 Iowa 692. Under the holding in that case and the showing herein made, if theMarathon Sav. Bank case controls, the ruling of the district court would be correct; but after the Marathon decision, and before the appointment of this receiver, Chapter 189, Acts of the Fortieth General Assembly (Section 9239, Code of 1924), became operative. After the passage of that section, this court again had before it the question of preference in cases of this character, and made pronouncement in the case of Leach v.Exchange St. Bank, 200 Iowa 185. The Exchange St. Bank case was not decided by this court until after the order in the case at bar was entered in the lower court. In the Exchange St. Bank case we held that the rule announced in the Marathon Sav. Bank case was no longer operative, by reason of the passage of the aforesaid Chapter 189, Acts of the Fortieth General Assembly. Hence the rule announced in the Exchange St. Bank case was the law at the time the district court entered the order in the instant case. Under the Exchange St. Bank case, the county, or its treasurer, was not entitled to the preference allowed by the district court herein. See In re Iowa St. Sav. Bank of Manning, 206 N.W. 140 (not officially reported).

The county now seeks to inject into the case the claim that it is entitled to a preference under the "trust theory," in that the record shows that the bond held by the county was for only $7,500, whereas the amount on deposit was 2. APPEAL AND something over $9,000; that, therefore, the ERROR: deposit, or at least that part above $7,500, was reservation wrongful, and to that extent it should be of grounds: allowed preference. This is apparently wholly an absence of afterthought, and there is nothing in the record reservation: showing that there was any such issue before the effect. court. If the record did show such an issue, the county has wholly failed to make a showing of the facts necessary to create a trust relation.

The court erred in holding the county entitled to a preference herein, and its action in so doing is hereby reversed. —Reversed.

De GRAFF, C.J., and EVANS and MORLING, JJ., concur.