231 F. 320 | S.D.N.Y. | 1916
(after stating the facts as above).
None, of the cases cited by the plaintiff have any bearing upon the facts here at bar. Coates v. First Nat. Bank of Emporia, 91 N. Y. 20, was not a case of a check given to the payee and presented by him. The Emporia bank asked the insolvent to remit funds to New York bankers on which it might draw. The insolvent advised the Emporia bank that it had done so, and in performance of its representation drew a draft upon the New York bankers and told them to credit the account of the Emporia bank. Whether the case was correctly decided or not, it was not a usual mercantile transaction consisting merely of the delivery of a check to the payee. Similarly, Fourth Street Bank v. Yardley, 165 U. S. 634, 17 Sup. Ct. 439, 41 L. Ed. 855, depended wholly upon the fact that it was a transaction out of the common and by special agreement to meet the embarrassments of the drawer. Such cases cannot control a case like this. National Union Bank v. Earle (C. C.) 93 Fed. 330, is indeed more nearly in point, but one of three things about it must be true: Either it violates the general rule, or it depends upon the fact that the drawer had been collecting funds for the payee, or that there was an actual payment of the check. I think that it depends upon the last point and shall consider it later. Throop Grain Gleaner Co. v. Smith, 110 N. Y. 83, 17 N. E. 671, was not a case of a check on a bank at all, and the drawer actually advised the drawee that he had “assigned.” Fortier v. Delgado, 122 Fed. 604, 59 C. C. A. 180, was a case of a check upon an especial fund set aside for laborer’s pay, and held, somewhat doubtfully in my judgment, to be on that account an assignment. Re Hollins, 215 Fed. 41, 131 C. C. A. 349, L. R. A. 1915B, 438, and Muller v. Kling, 209 N. Y. 239, 103 N. E. 138, are so remote as to require no notice. In all the cases cited some facts existed other than a mere advice to the drawee that the checks had been drawn and
I think it an extremely pernicious thing to throw doubt upon the scope of doctrines- governing negotiable paper which, though a mere skeleton of expression, is among the most useful inventions of mankind. To seek too readily for exceptions from the well-settled rules upon this branch of the law in pursuit of a supposed'equity, which incidentally does not exist here, is an evidence of insufficient understanding of the economies of finance and their immense value to.,industry.
It is true that the Bankers’ Trust Company drew its check on February 4th to make good the deficit, and in form that was a repayment, but it was not such in its whole setting; it was only to avoid garbling the original entries and the footings, and so confusing the bookkeeping. In just the same way a bank will always correct errors in. its aistomer’s account by a new check from the customer, rather than to correct its books and make a change in the books. The case cited, Columbia-Knickerbocker Trust Co. v. Miller, supra, required a decision that the provisional entries were not payments and proceeded upon that theory, because if the National Bank of Commerce had once collected the check it held the amount for the Columbia-Knickerbocker Trust Company, and they were responsible to Miller, the customer, if they did not collect. In that case, as well, the Nationality Bank drew a check to correct the provisional credit to itself, as "it was obliged to do by the clearing house rules. In Hentz v. National City Bank, 159 App. Div. 743, 144 N. Y. Supp. 979, the Appellate Division for the Eirst Department made a similar ruling, and it must, of course, be taken as a fixed rule of commercial law in the state of New York. Aside from the fact that it appears to me a correct decision, I should feel very doubtful of the propriety in such a matter of trying to start an opposite rule upon such a question, so that the decision might be one way when the suit was between citizens and another when this court had jurisdiction. Such a condition is always to be avoided unless it is absolutely necessary, although this court is, of course, not authoritatively bound by the rulings of state courts on matters of commercial law. I believe that Judge Dallas’
Therefore a decree may be entered on the merits, and that decree will be a dismissal of the complaint, with costs.