318 Mass. 496 | Mass. | 1945
This action, with counts in contract and in tort, rests upon the alleged failure of the defendant to perform its duty to the plaintiff in the matter of collecting four drafts or bills of exchange (G. L. [Ter. Ed.] c. 107, § 149), whereby the plaintiff claims that it suffered loss.
Each draft was for the purchase price of a carload of fruit consigned by the plaintiff in Florida to E. C. Fitz & Co. in Boston. All four drafts were in the same form, drawn by the plaintiff upon E. C. Fitz & Co., payable on demand to First State Bank, Eustis, Florida, through the defendant. The bills of lading were not attached. The drafts bore different dates from November 16, 1940, to December 11, 1940, and aggregated in amount $2,284.42. They were all indorsed by First State Bank “Pay to the order of any Bank, Banker or Trust Co.” and were forwarded by First State Bank to the defendant with instruction slips identical in form addressed to the defendant, each slip stating that the item was enclosed “For Collection and Remittance.” Opposite the word “Protest” was the word “No.” There,
1. There was no error in denying the defendant’s motion for a directed verdict.
(a) There was evidence for the jury that title to the drafts did not pass to the First State Bank upon their deposit there by the plaintiff, and therefore that the plaintiff was the proper party to bring the action.
The general rule is that where the forwarding bank (here the First State Bank) receives the paper as the equivalent of cash, gives final credit to the depositor for it, and permits him to draw against it, the paper becomes the property of that bank; but where it is agreed that the deposit is for collection only, although the depositor indorses without express restriction, the bank is a mere agent and not the beneficial owner of the paper. Moors v. Goddard, 147 Mass. 287. Manufacturers’ National Bank v. Continental Bank, 148 Mass. 553. Freeman’s National Bank v. National Tube Works Co. 151 Mass. 413, 417. Shawmut National Bank v. Manson, 168 Mass. 425, 427. Taft v. Quinsigamond National Bank, 172 Mass. 363. Salem Elevator Works, Inc. v. Commissioner of Banks, 252 Mass. 366, 370-371. Boston-Continental National Bank v. Hub Fruit Co. 285 Mass. 187. American Barrel Co. v. Commissioner of Banks, 290 Mass. 174. Douglas v. Federal Reserve Bank, 271 U. S. 489. In so far as the law of Florida has been called to our attention it appears to favor the agency relationship at least to as great an extent as does our own law. Florida Power & Light Co. v. Newsom, 111 Fla. 154. Dakin v. Bayly, 290 U. S. 143, 147.
The plaintiff’s office manager, called by the plaintiff,
If the First State Bank was an agent to collect, it had authority to forward the drafts to the defendant to make the collection in Boston, and under the rule long recognized in this Commonwealth and known generally as the “Massachusetts rule” the defendant as collecting bank became an agent of the plaintiff responsible to it and was not an agent of the First State Bank. Fabens v. Mercantile Bank, 23 Pick. 330. Dorchester & Milton Bank v. New England Bank, 1 Cush. 177. Lord v. Hingham National Bank, 186 Mass. 161, 163-164. Central Trust Co. v. Hanover Trust Co. 242 Mass. 265, 267. American Barrel Co. v. Commissioner of Banks, 290 Mass. 174, 180. We understand that this rule prevails in Florida where the original agency was created.
(b) There was evidence for the jury that the defendant. failed in the full performance of its duty to the plaintiff in the matter of collecting the drafts.
It is commonly said that the duty of a collecting bank is to be determined according to the law and established customs of the place of collection. See Morse on Banks and Banking (6th ed.) § 220; Warren Bank v. Suffolk Bank, 10 Cush. 582. There was no evidence of any general custom in Boston, but undoubtedly the law itself requires the exercise of reasonable skill, diligence, and care consonant with the nature of the undertaking and the instructions given. Fabens v. Mercantile Bank, 23 Pick. 330. Mechanics Bank v. Merchants Bank, 6 Met. 13. Whitney v. Merchants’ Union Express Co. 104 Mass. 152, 154.
The defendant’s cashier testified that the defendant had the drafts in its possession from the time they were received until January 31, 1941 — a period ranging from about a month and a half in the case of the latest draft to well over two months in the case of the earliest draft; that all were received to collect and remit;' and that “it was the practice . . . [of the defendant] upon receipt of such a draft to present it to E. C. Fitz & Co. for payment.” In answer to interrogatories the same witness stated that “the defendant did not present said drafts for collection.” He also answered that the defendant sent E. C. Fitz & Co. “written notification or demand as to each draft” on a form in common use by the defendant, copies of which were not kept; that “as far as he knew such notices were sent to E. C. Fitz & Co. immediately upon receipt of said drafts”; that his information was that there were also oral communications at intervals, but after inquiry and examining the bank’s records he could not specify their dates. He further testified that until January 31 he never notified the First State Bank or the plaintiff that E. C. Fitz & Co. had not paid the drafts; that those were “straight demand drafts” and “not the type of draft that is presented for acceptance”; that “an employee of the bank sent a messenger
Bearing in mind that the jury could reject evidence and inferences favorable to the defendant and could adopt those favorable to the plaintiff, we cannot say that a finding that the defendant failed in the performance of its duty was unwarranted. The jury could find that although it was the practice of the defendant to present such drafts to E. C. Fitz & Co. for payment, the defendant did not do that with the drafts in question. The jury may have been skeptical as to the notices to E. C. Fitz & Co. and the telephone conversations of which the defendant had no record. Or they may have believed that a time came when E. C. Fitz &
We do not mean to say that any rule of law required the defendant to make a formal presentment of paper on which protest was not required. See G. L. (Ter. Ed.) c. 107, § 134. We say only that in our opinion failure of the defendant to deal with the drafts in question as it usually dealt with similar drafts might be thought by the jury to be of some significance in connection with the other evidence in this case. But it seems that as a general rule failure of the collecting bank promptly to inform the forwarding bank of the status of collection items can be found to be a breach of duty on the part of the former.
(c) It cannot be said that there was no evidence for the jury that the defendant’s neglect resulted in the loss to the plaintiff of the amounts of the drafts. They could find that E. C. Fitz & Co. continued to do business for weeks after the drafts arrived, and that they could have paid the drafts by checks upon the defendant. During the period in ques
2. The defendant’s exception based upon its objection to a cross-interrogatory filed by the plaintiff for the purpose of taking the deposition of one Stockwell must be overruled, since the record fails to show what answer, if any, was made to the question. Cecconi v. Rodden, 147 Mass. 164, 169.
3. There was no error in the failure to give in terms the defendant’s third request for ruling in view of the instruction given that the plaintiff “was at perfect liberty to sue” even if the drafts were in Boston, and in view of the granting of the defendant’s fourth request.
4. There was no error in denying the defendant’s fourteenth request. The judge cannot be required to instruct the jury that they must not find every conceivable fact of which there is no evidence, which no one contends existed, and which there is no reason to suppose the jury will find. It was apparent that no directions were given by the forwarding bank to the defendant other than those contained
5. The denial of the defendant’s motion for new trial based on the grounds that the verdicts were against the evidence and the weight of the evidence and that the damages were excessive gave the defendant no sound exception. Bartley v. Phillips, 317 Mass. 35, 41-44.
Exceptions overruled.
Bank of Mobile v. Huggins, 3 Ala. 206, 212. Perry State Bank v. Myers, 159 Ark. 253, 256-257. Continental National Bank v. Discount & Deposit State Bank, 199 Ind. 290, 309-310. Sprague v. Farmers’ National Bank, 63 Kans. 12. Feeders Supply Co. v. First National Bank, 103 Kans. 654 (syllabus by the court). Olds Motor Works v. First State Savings Bank, 258 Mich. 269. Bank of Shaw v. Ransom, 112 Miss. 440, 451. Dern v. Kellogg, 54 Neb. 560. Bown Brothers, Inc. v. Merchants Bank, 243 N. Y. 366. Fahey v. Irving Trust Co. 247 App. Div. (N. Y.) 767. Kershaw v. Ladd, 34 Ore. 375, 383. Wingate v. Mechanics’ Bank, 10 Penn. St. 104, 109-110. Sahlien v. Bank, 90 Tenn. 221, 233. Mound City Paint & Color Co. v. Commercial National Bank, 4 Utah, 353. Merchants’ & Manufacturers’ Bank v. Stafford National Bank, Fed. Cas. No. 9438. Bank of Bay Biscayne v. Monongahela National Bank, 126 Fed. 436. Ungerleider v. Citizens Commercial & Savings Bank, 104 Fed. (2d) 718. Michie on Banks and Banking, c. 10, §§ 11, 22, 59, 60, 62, 63, 72. See Colt v. Noble, 5 Mass. 167.