Grafton Bank v. Hunt

4 N.H. 488 | Superior Court of New Hampshire | 1828

The opinion of the court was delivered by

Richardson, C. J.

It seems to be well settled, that if forged bank bills are delivered in payment of a debt, it is no satisfaction of the demand. 2 Johns. Rep. 455, Markle v. Hatfield; 5 Taunt. 488, Jones v. Ryde.

And where a counterfeit bill was received in payment of a promissory note, it has been held that the amount of the bill so received might be recovered of him who paid it, in an action for money had and received. 6 Mass. Rep. 182, Young v. Adams.

So if a seller of goods takes notes or bills for them without agreeing to run the risk of their being paid, and the notes turn out to be worth nothing, this will not be considered as payment. 7 D. & E. 64, Owenson v. Morse; 9 Johns. Rep. 310, Johnson v. Weed.

And a draft upon a third person, delivered in payment of a debt, is no satisfaction unless it be accepted and paid. 6 D. & E. 52, Puckford v. Maxwell; 1 Esp. N. P. C. 3 Stedman v. Gooch.

Certain bills of exchange purporting to have among others the endorsement of Harvey and Company, bankers, at Manchester, were presented for payment in London, at a house where the acceptance appointed them to be páid, and payment being refused, the notary who presented them, took them to Wilkinson and others, the London correspondents of Harvey and Company, and asked them to take up the bills for the honor of Harvey and Company, They djd so, and the money was paid to Johnson and others, the holders. It turned out that the names of the drawer, acceptor, and of Harvey and Company were forgeries, it was decided, that the money was paid by Wilkinson and others through mistake, and might be recovered back, on the ground that the fault of paying upon a forged signature, was not entirely their fault, but began, at least, with the person who called upon them. 3 B. & C. 428, Wilkinson v. Johnson.

So it has been held, that if a banker of a supposed acceptor of a forged bill discount it for the agent of one of the endorsers, on the discovery of the forgery, the banker so discounting may recover back the money he paid on the bill, notwithstanding he was the banker of the supposed acceptor, and therefore might be taken to know his hand writing. 1 C. & P. 197, Fuller v. Smith.

But when a forged bill of exchange is accepted by the drawee and paid to the endorsee, the money thus paid cannot be recovered back. 3 Burr. 1354, Price v. Neal; 17 Mass. Rep. 33, Gloucester Bank v. Salem Bank; 6 Taunt. 76, Smith v. Mercer; 1 Binn. 27, Levy v. The Bank of the United States.

One of the grounds on which these decisions rest, is, that it is incumbent upon the acceptor to be satisfied that the bill drawn upon him is the drawer’s hand before he accepts.

In this case, we see nothing in the relation between the bank and those whose names were upon the forged note, that made it particularly incumbent upon the bank to know their signatures. This case then cannot be placed upon the ground of an order, or a bill of exchange accepted and paid. If Hunt had in the first instance carried the note to the bank himself, or had sent it, and procured it to be discounted, and had received the money, it would have been simply a case of passing a forged note, and the bank might have recovered back the money. So if Hunt had in the first instance received the forged note of Ross, and sent it to thfe bank and delivered it in satisfaction of his notes to the bank, it would only have been a case of passing in payment a forged note, and would certainly have been no satisfaction.

But if the forged note was discounted upon the application of Ross or Knight, and upon their account, although the money may have afterwards been loaned ta the defendant and applied to the payment of the note» there is no pretence that it was not a satisfaction.

The real question, in this case, then, is, was the forged note discounted on Hunt’s account ? If it were, the plaintiffs are entitled to judgment. If it were not, this action cannot be maintained.

There is no dispute with respect .to the facts in this ease. The forged note was made payable to the bank. It had been sent to the bank by Caleb Knight for discount, and encouragement had been given at the bank that it would be discounted, before it was delivered to the defendant. It was delivered to him with the view that the proceeds of it should constitute part of a loan of money Ross was making to him ; and it is most manifest, that it was received by the defendant and sent to the bank on the strength of the encouragement which had been given that it would be there received.

The contract, between Hunt and Ross, as to the loan, was not closed before the note was discounted. For the case states that Hunt accounted with Ross for the proceeds of the note after it was discounted. The understanding between Ross and Hunt must have been, that if the note was discounted at the bank, Hunt was to account for the proceeds ; if not discounted, that he should return the note to. Ross. It is clear, then, from the nature of the transaction, that the forged note was never the property of Hunt, and that the discount must be considered as in fact made on account of Ross or Knight.

This view of the case is decisive against the plaintiffs, unless Hunt has so, conducted with the note that the bank arc entitled now to consider it as discounted on his account. But we sec nothing in Hunt’s conduct which ean give the bank any claim so to consider it. There is nothing on which such a claim can rest except the circumstance that the note passed through the hands of Hunt. But it passed through his hands in the same manner as through the hands of Mr. Pay son. Both were mere agents, and this alone can furnish no legal foundation for such a claim.

Indeed, we are at a loss to conjecture on what ground of law, equity or justice, these plaintiffs can hope to recover in this case. If a loss has happened, which must be borne by one of these parties, on what principle is it to be shifted from the plaintiffs to the defendant r The bank had seen the forged note, examined it, and given encouragement that the note would be there discounted. After this the defendant merely sent the note to the bank to be discounted for others. He had no occasion to en-quire or examine whether it were genuine, or not. It was enough for him to know that it. had been examined at the bank and no objection seen there. If then there was any negligence, any fault, it all belongs to the hank.

We are, therefore, of opinion, that the verdict must be set aside and a new trial granted.

New trial granted.