60 Minn. 208 | Minn. | 1895
The Farmers and Merchants State Bank, being insolvent, on May 15, 1893, closed its doors, and stopped payment, and on June 20 made an assignment of all its property to plaintiff for the benefit of its creditors pursuant to the provisions of “the insolvent law” of 1881. Among the assets of the bank at the time of its failure was a note for $102.50 against defendant Rogers as maker and defendant Paulson as indorser. The Farmers Accident and Mutual Life Association was a depositor of the bank, and on May 13, and from that date down to June 20, had a deposit with it, subject to check, to the amount of over $300. On May 13 the Accident and Mutual Life Association, in payment of a debt which it owed defendant Rogers, gave him a check on the bank in the usual form for $105. This check had not been presented for payment when the bank closed its doors on May 15, and, as we construe the answer, there is-no allegation that it ever has been presented. The sole question is-whether, upon these facts, the defendants may set off the check in a suit brought on the note by the assignee of the bank. The case-has been argued by the respective counsel upon the assumption that the answer to this question depends upon the further question whether a check is an assignment of the funds of the drawer to the-amount of the check, so that, if the drawee bank improperly refuses-payment, the holder may sue the bank. But we do not find it necessary to. decide that question in the present case. It is the settled doctrine of the English and federal courts and of the great majority of the state courts that a check is not an assignment of the drawer’s; funds, either as between drawer and payee or as between the payee- and the drawee; that if the check is not paid on presentation, the-holder’s only recourse is against the drawer; although some of these-courts have sometimes, and under certain conditions, given effect to a check at least as an equitable assignment as between drawer and payee. That an unaccepted draft or ordinary bill of exchange will not, before acceptance, operate as an assignment to the payee of a debt due from the drawee to the drawer is the settled law every
Order reversed.