New York Court of Appeals
The People of the State of New York v. the Merchants and Mechanics’ Bank of Troy, Respondent; In the Matter of the…
September 30, 187978 N.Y. 269
Summary
The Court of Appeals affirmed the order denying the Chemical National Bank's petition for payment of a check from the receiver of the Merchants and Mechanics' Bank. It held that no trust was created because the bank had not set aside specific funds for the check, and the deposit account represented a general debt, not a trust fund. Consequently, the receiver was not obligated to pay the amount in preference to other creditors.