120 Misc. 804 | N.Y. Sup. Ct. | 1923
The plaintiff moves for summary judgment under rule 113 of the Buies of Civil Practice. The action is based upon the claim of an implied promise to repay money under a mistake of fact.
In June, 1921, the plaintiff issued to one M. H. Minor a policy of insurance for $1,500 covering a dwelling and furniture therein at Hopkinsville, Ky. The policy was issued through the Giant
The main point raised here is whether or not the draft is to be considered as payable to a fictitious or non-existing person in such manner as to make it payable to bearer under section 28 of the Negotiable Instruments Law. Subdivision 3 of that section reads, “ when it is payable to the order of a fictitious or non-existing person and such fact was known to the person maldng it so payable ” the instrument is payable to bearer.
The moving papers state that the plaintiff believed Minor to be a real and existing person, and intended the draft to be for a person of that name who owned certain property and who had suffered certain loss. It did not intend to make it payable to B. O. McReynolds or to a fictitious person or to bearer. The circumstances under which the draft was drawn and the papers submitted on the application for insurance policies tend to show that the plaintiff had no idea that Minor was not a real person owning the property that was destroyed.
The question of checks drawn to fictitious payees has been passed upon frequently in our courts. Shipman v. Bank S. N. Y., 128 N. Y. 318; Seaboard Nat. Bank v. Bank of America, 193 id. 26; United Cigar Stores Co. v. Am. Raw Silk Co., Inc., 184 App. Div. 217; affd., 229 N. Y. 532; National Surety Co. v. National City Bank, 184
Were this the only point in question here I would be inclined to say that the present case fell within the holding in United Cigar Stores Co. v. Am. Raw Silk Co., Inc., supra. But the answer alleges negligence upon the part of the plaintiff, and the affidavits are not sufficient to dispose of that question.
A bank is permitted to escape liability for repayment of amounts paid out on forged or fictitious checks by showing that it made the payments in good faith and without negligence upon its part, and that the payment was brought about or at least contributed to by the negligence of the depositor or maker. In other words, that the payment was made by reason of the negligence of the depositor or drawer to do “ those things dictated by ordinary business customs and prudence and fair dealing towards the bank which, if done, would have prevented the wrongdoing which resulted from their omission.” Morgan v. United States Mortgage & Trust Co., 208 N. Y. 218. It may be that the defendant can prove such negligence as would work an estoppel as against the plaintiff. If any event the separate defense of negligence here, in view of the peculiar circumstances of the case and of the apparent lack of full knowledge upon the part of the plaintiff of its agent’s or representative’s acts, presents a question that should not be disposed of on affidavits.
Motion denied, without costs.
Ordered accordingly.