Banks and Banking – Bank’s Right of Set-Off-Deposit of Funds by a Fiduciary
Plaintiff employed A as agent to sell plaintiff’s tractor. A was to keep any amount received over $5,000. A sold the tractor, receiving a $6,120 check from the purchaser payable to A. A deposited the check in his personal checking account in defendant bank. Defendant took the deposit without knowledge of plaintiff’s interests and applied it against a past due obligation of A. Plaintiff brought suit for $4,500, the amount of checks from A to plaintiff which defendant refused to pay. The trial court held for defendant. On writ of error, held, reversed, two judges dissenting. No equity was created in defendant superior to that of plaintiff, the beneficial owner of the deposit. Cox v. Metropolitan State Bank, 138 Colo. 576, 336 P. (2d) 742 (1959).