10. Lost Book

A depositor not infrequently loses his book; and then he demands another. ' His duty to give notice of its loss is imperative, and founded on the soundest reasons. Every savings bank contains a rule of this kind, and depositors should be swift to comply with it. For, as a bank may make a mistake and pay the wrong person if the book is presented, and yet be protected unless it was negligent in so doing, it behooves a depositor to lose no time in notifying his bank in order to prevent a loss to himself.

On the other hand, a bank should exercise the utmost caution in issuing another book. Very often the depositor is told to go home and renew his search, which is often rewarded with the joyful discovery of the book. But when the book can not be found, then a bond of indemnity is usually required before giving another in order to protect the bank should the first one ever be found and presented. It is proper to require such a bond; a depositor can not object if he is able to procure one. It is true that this is not always possible; he may have no friend who is willing to incur the liability. And when he can not, a bank is not justified in withholding the payment of his deposit. Says Chief Justice Beasley, "A by-law declaring that those depositors in one of these banks who by inevitable accident shall have lost their deposit books, shall thereby forfeit to the company their respective claims, would seem to be so inconsistent with the general purpose for which these institutions have been called into existence that it would be, to say the least in its disfavor, of exceedingly doubtful validity." 1 Though such a rule is proper, it must be executed in a reasonable manner, as a bank has no claim to a depositor's money. This would be a harsh rule indeed, to forfeit a depositor's deposit on the loss of his book it he could not give a bond of indemnity. Yet, we repeat, the rule is highly proper and should be applied in every possible case, and banks are protected by the law in doing this.

1 Mulcahey v. Emigrant Industrial Savings Bank, 89 N. Y. 435.

This rule can not be applied to an administrator with the same rigor as to other persons. In one of the cases an administrator was unable to obtain the book from the family of the deceased, and the bank refused to pay the money without the usual bond, which he declined to give. The court said he was not required to give one, nor could he be compelled to resort to the expense of a legal proceeding to obtain possession of the book.1 Having demanded the hook and been refused, he had done enough.

1 Wagner v Howard savings Institution,52 N. J.Law.

There is another reason besides the protection of the bank for adopting this rule concerning the presentation of the book. A depositor may die or give away his deposit; and if a bank were governed by only the two rules first mentioned, the real owners could not get what belongs to them, or not without resorting to costly legal methods. When, therefore, if at all, can this rule be used as a defense for paying a donee or heir without resorting to legal proceedings?