Sherlock v. State

Headnote

State — loss through failure of hank — allegation that loss was occasioned through negligence on part of officials of state hanking department — when no legal liahility exists claimant cannot recover in absence of recognition by legislature of a moral liahility of state.

Sherlock v. State, 202 App. Div. 771 , affirmed.

Appeal, by permission, from a judgment of the Appellate Division of the Supreme Court in the third judicial department, entered July 12, 1922, which unanimously affirmed a judgment of the Court of Claims dismissing the claimant’s claim. The claimant alleged that she was a depositor in the Union Bank of Brooklyn; that the bank

was a domestic corporation; that it was subject to supervision, examination and control by the state banking department; that the bank became insolvent; that through such insolvency claimant lost the moneys deposited by her; that the directors of said bank were guilty of neglect of duty, wrongful acts and crimes set forth in detail; that the officials of the state banking department participated in or were privy to the commission of many of such wrongful acts; that these officials were themselves guilty of neglect of duty and positive wrong in connection with the examination and supervision of the bank; that they published statements concerning the solvency of the bank which were false and known to them to be false; and that the various omissions and wrongs committed by the officers of the bank and by the officials of the state banking department were the cause of the losses occasioned claimant. The Appellate Division held that no legal claim existed against the state and that the enabling act (L. 1919, ch. 418) did not acknowledge a moral obligation upon the theory of honor or justice.