5_-_S59.2.23_E[1].doc
[Title]
Time for determining whether the standard of care necessary for the application by analogy of Article 478 of the Civil Code has been met with respect to the Offsetting of a Deposit Claim against a Loan Claim given to a Person that the Financial Institution mistook as the Depositor of a Registered Term Deposit
[Deciding Court]
First Petty Bench of the Supreme Court
[Date of Decision]
23 February 1984
[Case No.]
Case No. 260 (o) of 1980
[Case Name]
Demand for Repayment of Deposit
[Source]
Minshu Vol. 38 No. 3: 445
Saibansho Jiho No. 886: 1
Hanrei Jiho No. 1108: 82
Hanrei Taimuzu No. 521: 129
Kinyu Shoji Hanrei No. 691: 3
Saiko Saibansho Saibanshu Minji No. 141: 249
[Party Names]
Y The Kanda Shinkin Bank (Defendant, Intermediate Appellee, Final Appellant)
Vs.
X Toshio Ishijima (Plaintiff, Intermediate Appellant, Final Appellee)
[Summary of Facts]
Credit Union Y granted a loan in the amount of 4.5 million yen (4,500,000 yen) to a third party A (a dummy borrower), who pretended to be a depositor, X, and used X’s registered term deposit with Credit Union Y in the same amount as a security. Subsequently, when the depositor X demanded repayment of the said term deposit, Credit Union Y argued that the term deposit certificate and the seal impression on file were examined before the loan was given, that the loan as well as the setoff were processed in the belief that the dummy borrower A was the depositor X, and that Credit Union Y was discharged from liability by the analogous application of Article 478 of the Civil Code.
The court at first instance regarded this case as a case of a loan granted to an apparent depositor, and allowed the discharge of liability on the part of Credit Union Y through to analogous application of Article 478 of the Civil Code to the circumstances when the loan was given. On the other hand, the lower court allowed X’s demand for repayment, and ruled that this case was not a case of a loan granted to an apparent depositor, that there was no loan to the true depositor X, and that Credit Union Y’s acts at the time of the setoff were not entirely without knowledge or negligence. Credit Union Y then filed a final appeal.
[Summary of Decision]
In a case where a financial institution has given a loan to a third party, A, after acknowledging the third party A to be a depositor, X, with respect to a registered term deposit, it is sufficient if the financial institution exercised the duty of care proper for a financial institution in ascertaining A to be the actual depositor at the time the loan was given, in order for a setoff (treating the loan claim as the automatic claim and the deposit claim as the passive claim), to be valid against X through the analogous application of Article 478 of the Civil Code. Decision reversed and remanded to lower court.
[Keywords]
1