kept and the identical articles returned, we have a special deposit. The owner has the right to have the specific articles returned, and if the bank has made any profit by a wrongful use of articles, the depositor, who is in this case a bailor, is entitled to receive the profits also. The main function of the bank, in the beginning, was the safe keeping of valuables in this way, but in our times the safe deposit vaults are used for this purpose.

19. Power of Bank to Receive—A bank has power to receive special deposits. Although the right of a national bank to do so was questioned at one time, the power is now regarded as one of the incidental powers of the bank. The National Bank Act impliedly authorizes the taking of special deposits, for Section 5228 of the Revised Statutes of the United States provides for delivery of special deposits by banks which have defaulted in payment of circulating notes. Some of the States expressly authorize the State banks to receive special deposits.

20. Liability of Bank For-Where there is a special deposit the very thing deposited must be returned to the depositor, or held for the special purpose for which it was made. In the case of a general deposit we learned that the bank was debtor and the depositor creditor for the amount. Not so here. The bank is bailee and the property remains the property of the depositor, or a trust fund for the purpose for which it was made. If the bank use such diligence as a prudent man would use in attending to like affairs the bank will not be liable for a loss. In fact, in some States it is held that only 'such diligence need be exercised as the bank uses in its own affairs. Where the bank uses care in selecting its officers and employees and trusts its own property to them along with the property of the special depositor, and the officers or employees, outside of their line of duty, steal or embezzle the special deposit, the bank will not be liable. If the bank knew, or ought to have known, that the

employee or officer was dishonest, or might have known by using such care as a prudent man would use in such cases, I think the bank would be liable. While some cases have held that only such care as the bank uses in its own affairs need be exercised, banks nowadays usually have strong safe deposit vaults and facilities for keeping valuables, and they also usually have men whose reputation for honesty and integrity induces customers to make such deposits. The depositor having the right to feel secure, the bank ought to be called upon to use more care in the selection of its officers and employees than some banks do, and it ought to be held to the care that a prudent man would exercise. And the decisions are tending in that direction. Of course where the bank is compensated, or receives a direct benefit by accepting the special deposit, it will be held to a greater degree of care than where it performs the service of safe keeping without compensation.

21. Returning-If the bank is negligent and delivers the special deposit to the wrong person the bank will be liable. As where a bank delivers to a depositor's wife a special deposit, without requiring the production of the receipt or an order from the depositor; and where an order calling for coupons from bonds specially deposited is not carefully read and the bonds themselves delivered to the bearer of the order, the bank will be held liable.

22. Not Assets of Bank-As the bank is merely a bailee of property specially deposited, the title remains in the depositor and cannot be counted as assets of the bank for any purpose.

23. When Is A Deposit Special?-In speaking of gen eral deposits it was pointed out that many deposits ordinarily termed "special" are really general deposits. An express agreement when special deposits are taken would save trouble for all parties concerned. When there is no agreement or custom, a deposit of loose money or

paper will be regarded as a general deposit (leaving out the consideration of the question of collections), and a package, box or bag of money, sealed, or of other valuables, would be presumed to be a special deposit, to be held separately by the bank.

24. What May Be Subject of Special Deposit-Anything which a bank consents to receive on special deposit may be the subject of such deposit. First National Bank of Carlisle v. Graham, 100 U. S., 699. Preston v. Prather, 137 U. S., 604. Butcher v. Butler, 114 S. W., 564.

CHAPTER II.

THE DEPOSITORS.

25. Deposits, when classified according to the depositors for whose accounts they are carried, may be divided into individual, bank and public deposits.

All deposits by private individuals as such, by individuals as representatives of other individuals or bodies of individuals, by companies, firms, corporations, partnerships, etc., are individual deposits.

The general legal status of an individual depositor is no different from that of a bank which deposits in another bank, but as the national and state banking laws provide the manner of keeping reserves, public deposits, and deposits in other banks, and the banking authorities of the state and federal governments require separate accounting in regard to these different items in the re• ports made by banks, they are divided into individual deposits, public deposits, deposits in banks which are reserve agents and deposits in banks not reserve agents, etc. A subsequent chapter deals with reserves.

Except where otherwise noted, the principles stated herein relate to all deposits, whether individual deposits or deposits by banks.

26. Bank May Select Its Depositors-A railroad generally must accept such business as is tendered it; a hotel keeper admit all comers; i. e., they cannot at their own pleasure accept of refuse to accept passengers or guests. A bank, however, while it is in the nature of a public institution (called quasi-public), need not accept deposits tendered it unless it wishes to serve the one mak

ing the tender, and if a bank does not wish to retain the deposit of one who has been a depositor, it may close the account, tender him the balance due and refuse to receive further deposits from him. Likewise the depositor may terminate the relation at any time he sees fit, by withdrawing his balance, unless the bank has some lien or right of set-off against it, or there is a contract whereby the money must be left for a specified time. In the latter case, however, it would be a loan and not a deposit. Thatcher v. State Bank, 7 N. Y. Sup. Ct., 121.

27. Deposits of Public Moneys-The State statutes provide the manner in which deposits of public funds of the State, county or city shall be kept. These statutes should be carefully followed by the officers making deposits and by the banks receiving them. If the State law gives the county the right to make any regulations, or empowers the city, by its municipal government, to make ordinances regarding the keeping of the funds, all these should be carefully complied with. Be sure that the officer who makes a deposit of public moneys has authority to deposit it, and then be sure that he has authority to make the deposit in your bank. In some States the officer who holds public money is personally responsible for it, in which event he may, but ought not, treat it the same as his own money. In some States he is neither expressly authorized nor prohibited from depositing funds in banks and is not held liable if he uses care in selecting the bank, and in watching the conduct of the bank and its condition. If he has no discretion in making the selection, but must deposit in such depositary as is designated, he will not be personally liable if he obeys the law and the designated depositary fails. In case the officer is personally liable and makes good to the government, he will have a claim against the bank for the deposit. In that event, the money being