70 Md. 515 | Md. | 1889
delivered the opinion of the Court.
When this case was before the Court on the first appeal, it was decided that the Manufacturers’ Bank and Swift were both responsible to the trustees of the Bull estate for the full amount of the sum now in controversy. It was held that the question of primary
We will mention some of the prominent facts which show the relations between the parties in respect to this matter; and then we will consider other matters in evidence which are sitpposed to change or modify these relations. Yeazey was the trustee of the Gazette Publishing Company, and in that capacity was required to pay to Swift the sum of fourteen thousand one hundred and forty-four dollars and eighty-two cents. On the fifteenth day of'July, 1886, he delivered to E. O. Hinkley, Esq., Swift’s solicitor, a check for this amount on the Manufacturers’ Bank, signed “I. Parker Yeazey, Trustee,” and received from him a release of Swift’s claim. This check was paid by the said Bank, although Yeazey had no funds in the Bank at the time of payment properly applicable to this purpose. If there were nothing further in the case, the question would be of the simplest possible description. It is the duty of a Bank to know the state of its depositor’s account, and if it makes a mistake in this respect it must abide the consequences. The presentation of a check is a demand for payment; if it is paid, all the rights of the payee have been satisfied, and he is not entitled to ask any questions. It would forever'destroy the character of a Bank in all commercial circles, if when it was ready
In Levy vs. Bank of the United States, 1 Binney, 27, and 4 Dallas, 234, one Thomas passed to Levy a check on the Bank purporting to be drawn by one Wharton in favor of Thomas, or bearer; this check was received by the teller, and entered to Levy’s credit in his bank book as cash. On the same day, in the course of a few hours, it was discovered that the signature to the check was a forgery; and, as soon as the discovery was made, notice of it was given to Levy. It was held that the loss must fall on the Bank. This decision is cited with approval by the Supreme Court of the United States in United States Bank vs. Bank of Georgia, 10 Wheaton, 333. It is also approved by this Court in Commercial and Farmers National Bank vs. First National Bank, 30 Md., 19; where the case in Wheaton, and other cases of similar bearing, are also adopted. Unless there is something to take the present case out of the general rule, we think it very clear that the payment of Yeazey’s check was conclusively binding-on the Manufacturers’ Bank.
When Mr. Hinkley received this check from Mr. Yeazey, he deposited it in the Union Bank to the credit of Hinkley & Morris, a legal firm of which he was the.senior member. On the following day it was sent through the Clearing House to the Manufacturers’ Bank; and payment of it being refused, it was returned to the Union Bank. Thereupon it was delivered to
The foregoing considerations are intended to show how the Bank and Swift stand in reference to each other. On the former appeal it was held that as against the representatives of the Bull trust, Swift could not be “allowed to retain the money, which had been paid to him from a fund on which he had no claim, and which was charged against that fund and no other.” But in the present controversy the Bull trust is in no wise interested; it has been fully reimbursed for the conversion of its money. This conversion was effected by the wrongful change in the signature of the Yeazey check after it had been paid; — a change made without Hinkley’s knowledge or consent; and after the check had passed out of his possession and beyond his control. The simplest principles of justice require .that those who did this great wrong to the trust fund should redress the injury which they committed. They should be compelled to restore the spoliated trust fund to its original integrity. But assuredly there is nothing in the transaction which can give them recourse against any other person. The responsibilities of third persons are measured by their own conduct. If they have done the agents of this mischief no wrong, they cannot be required to make them any compensation. The Bank can derive no special claim from the fact that it was dealing in this unauthorized way with trust funds. While with respect to the Bank, Swift stands like any other holder of a check who presents it in the ordinary
In our opinion the matters which we have stated settle the rights and responsibilities of these parties. And it is perhaps not strictly necessary that we should give our views upon other questions which have been discussed at the bar. We, how'ever, take occasion to say that while the officers of the Manufacturers’ Bank committed great errors of judgment, there was not the least purpose to do any intentional wrong to anybody. We regard the conduct of Mr. Hinkley as highly becoming to an upright and intelligent solicitor. We are satisfied that he did not know, and had no reason to believe that Yeazey was committing a breach of trust. A gentleman from his office, who, at his request called on Yeazey for the money due from the Gazette Publishing Company, had been told by Yeazey “that it was out on call, that he would have to give some notice, and that it would take several days to get it in.” Yeazey also told Hinkley that he would have to give “notice” before he could get it. When he received Yeazey’s check, it was in a form sufficient and appro- ' priate to pay the money of the Gazette Publishing Company, and it was deposited in Bank in strict conformity to the usual course of business. With regard to Mr. Hindes’ testimony in reference to a conversation which he says he held with him in the Union Bank on the sixteenth of July about half past twelve o’clock, we are constrained to think there is some error. He says that he told Hinkley that the check would not be paid, and that Mr. Williams was associated in the matter. Hinkley positively and emphatically denies that any such conversation took place, and says that he does not remember that he was in the Union Bank on that day, except on one occasion, and that was about eleven o’clock, immediately after he had been assured both
The decision of the Circuit Court is in accordance with our views, and it will be affirmed, with costs.
Order affirmed, with costs.