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Keywords

damagesnegligenceappealfiduciarytrustsustainedoverruled
plaintiffdefendantdamagesnegligencefiduciarytrustsustained

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Carey v. Squire, 63 Ohio App. 476, 27 N.E.2d 175, 17 O.O. 204

Facts

On July 9, 1937, Carey was a rent-paying tenant at Hotel Monticello in Toledo. She fell and sustained injuries due to unsafe conditions in the hotel. The Commercial Savings Bank & Trust Company was the trustee of the hotel trust and was under the control of S. H. Squire, the Superintendent of Banks, who was responsible for its liquidation. Carey alleged that the Superintendent was operating the hotel in a fiduciary capacity for the trust's beneficiaries.

The petition alleges that on July 9, 1937, plaintiff was a rent-paying tenant in Hotel Monticello in Toledo; and that due to the unsafe condition of the premises that day she fell and sustained injuries for which she seeks damages. She further alleges that the defendant, the Commercial Savings Bank & Trust Company (hereinafter referred to as the bank), at that time was and now is the duly authorized and acting trustee of the trust created for the holding and operation of the hotel and was operating it for and on behalf of beneficiaries of the trust, whose names are unknown to plaintiff and too numerous to specify; that the bank was in the hands of defendant, S. H. Squire, Superintendent of Banks of Ohio (hereinafter referred to as the superintendent), for liquidation; that he was in charge of the business and duties of the bank in its fiduciary capacity as trustee of that hotel, and as such trustee was operating it for and in behalf of that trust.

Issue

Whether the Superintendent of Banks, acting as trustee of an insolvent bank, can be held liable for damages due to negligence in the operation of a hotel.

The major question is whether the superintendent as such trustee can be required to respond in damages for negligence of his officers and agents in the performance of such trust.

Rule

Sections 710–90 and 710–92 of the General Code apply only to claims against the bank in existence at the date of its closing, and not to claims arising out of the operation of the bank by the superintendent.

Sections 710–90 and 710–92, General Code, providing for the filing of claims with the Superintendent of Banks, apply only to claims against the bank in existence at the date of its closing, and not to claims arising out of the operation of the bank by the superintendent.

Analysis

The court analyzed whether the Superintendent, as trustee, could be held liable for the negligence of his officers and agents. It distinguished this case from previous rulings by noting that the claim was against the trust and not the bank's general assets. The court inferred that the expenses of operating the hotel were paid from the trust's assets, suggesting that the trust should respond to claims like Carey's.

Whether rightly or wrongly, the superintendent was operating that hotel as a commercial enterprise for the benefit of the trust. While it is not expressly alleged in the petition, it may be inferred that the expenses of such operation were paid, not from bank assets, but from the assets of the trust including rent paid by plaintiff and other receipts of that business.

Conclusion

The court concluded that the demurrer to Carey's petition should have been overruled, reversing the lower court's judgment and remanding the case for further proceedings.

For this error, the judgment is reversed and the cause remanded for further proceedings.

Who won?

Carey prevailed in the appeal because the court found that the Superintendent could potentially be liable for negligence as a trustee, allowing her claim to proceed.

Judgment reversed, and cause remanded for further proceedings.

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