Waterhouse v. Imbrie

Headnote

Banks and banking — action against insolvent bankers to recover difference between amount of promissory note and value of collateral deposited as security, therefor — defense that transaction had been had with firm as brokers not as bankers.

Waterhouse v. Imbrie, 206 App. Div. 695 , affirmed.

Appeal from a judgment of the Appellate Division of the Supreme Court in the first judicial department, entered July 5, 1923, affirming a judgment in favor of defendant entered upon a dismissal of the complaint by the court at a Trial Term without a jury. The action was brought by the plaintiff against the defendants doing business as private bankers under the name of Imbrie & Co., to recover a balance alleged to be due the plaintiff in the sum of $7,243.58, arising out of a transaction in which the plaintiff borrowed from the defendants the sum of $30,000 upon a demand promissory note, depositing as collateral therefor certain securities of the market

value approximating $38,000. The loan was made on September 23, 1920; on March 3, 1921, the affairs of the bankers became involved and their assets were taken over by the state banking department. On April 11, 1921, a claim was filed with the state banking department, setting forth the transaction, tendering payment of the amount with interest and demanding the return of the securities deposited, which claim was rejected by the state banking department. The question was as to whether the transaction in which the plaintiff had borrowed the money upon his note and deposited the securities as collateral therefor had been had with the defendants as private bankers, as claimed by the plaintiff, or whether, as claimed by the banking department, the transaction had been had with a separate firm composed of the same individuals as the defendants in this action, who were likewise copartners under the name of Imbrie & Co., transacting business as investment brokers.