First Nat. Bank of Corona v. Coplen

SHAW, J.

On March

22,

1917, plaintiff held two notes made to it by defendant, one for one thousand two hundred dollars, secured by mortgage upon 150 tons of hay, the other,

[620]

unsecured, for two thousand dollars, and both of which were then due. Defendant was a general depositor in said bank and at the time had on deposit therewith $393.38, which sum the bank, without notice to him, applied upon the unsecured note of two thousand dollars. Upon learning of this fact, defendant telephoned the bank he wanted the deposit applied in liquidation of the secured note, with which request the plaintiff, upon the ground that it had already been credited as stated, refused to comply. Thereupon, on the following day, plaintiff brought this action to recover the balance of said note and attached the property held by it as security for the one thousand.two hundred dollar note.

Judgment went for plaintiff, from which defendant prosecutes this appeal.

That “a banker has a general lien, dependent on possession, upon all property in his hands belonging to a customer, for the balance due to him from such customer in the course of the business,” is declared by section 3054 of the Civil Code; and that a bank may, in the exercise of the right to enforce such lien, appropriate the money in its possession belonging to a customer in the extinguishment of the customer’s matured indebtedness, is declared in the case of

Melander

v.

Western Nat. Bank,

21 Cal. App. 462, [132 Pac. 265], and eases cited therein. To hold the right to so apply the deposit is dependent upon the consent of the depositor would destroy the right given. As stated, one of the notes was secured by a mortgage, and under section 726 of the Code of Civil Procedure, providing that there shall be but one action for the recovery of any debt secured by mortgage, the bank could not enforce its lien by applying the deposit in cancellation of the secured debt.

(McKean