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pledge. On the question of whether Government, as pledgee, exercised ordinary diligence, paragraph 25 of Story on Bailment, 9th. Edition, reads - "It follows from this principle that a pledgee is not responsible for losses resulting from irresistible force ..
By irresistible force is meant such an interposition of human agency as is from its nature and power, absolutely uncontrollable. Of this nature are losses occasioned by the inroads of a hostile army or as the phrase commonly is, by the King's enemies". It would thus appear, that in the case of Security Deposits, Government also has no legal liability.
SUPREME COURT DEPOSITS.
8.
These were monies deposited with officers of the Court under provisions of the local law. They included such funds as the Suitor's Funds Account, the Official Trustee Account, the Official Administrator's Account, and the Companies Liquidation Account. These funds were not included in the general Government Account in the bank, but were placed in special accounts in the name of the Registrar. The Japanese confiscated only one of these accounts, namely the Companies Liquidation Account, amounting to a trivial total of approximately $4,000.
9. Liability in respect of these deposits seems to be governed by the statement of the law in paragraph 620 of Story, 9th. Edition;" In respect of property in the custody of officers of a Court, pending process and proceedings, such officers are undoubtedly responsible for good faith and reasonable diligence. But they are not liable as of course because there has been a loss by embezzlement or theft. In order to charge them in such cases, the loss must have arisen from culpable negligence or fraud either of themselves, or of the agents or servants employed by or under them.....The degree of diligence which Officers of the Court are bound to exert in the custody of the property seems to be such ordinary diligence as belongs to a prudent and honest discharge of their duties and such as is required of all persons who receive compensation for their services. It would seem quite clear that there is in this case also no Government liability for the confiscated monies.
10. In this apparently unanswerable case for denial of Government liability, there is a weakness occasioned by the fact that the Trust Funds and the Security Deposits were not placed in separate accounts, but were included in the general Government Account. In so far as Trust Monies are concerned this does not appear to have been of any great significance, if it is accepted that the Secretary for Chinese Affairs, as Trustee, kept the monies as he would keep his own. But the matter is somewhat different in the case of Security Deposits. Here there is little question that in ordinary commercial practice such monies would be credited to accounts separate and distinct from the ordinary working business accounts. Probably this practice is due to the possibility of insolvency of the business, whereas in the case of Government
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