Thе plaintiff, Nutrena Feed Mills, Inc., appellant in this court, brought this action against the defendant, Superior Wholesale Grocery Company, a corporation engaged in the wholesale grocery business at Superior, Nebraska, for goods, wares and merchandise sold and delivered. The defendant answered, admitting the purchase and receipt of the goods and alleging рayment therefor. Trial was had to the court without a jury. The findings were for the defendant and judgment entered dismissing the cause, from which plaintiff has appealed to this court.
The plaintiff shipped thе merchandise in question to the defendant at Superior, Nebraska, and to insure payment at time of delivery drew a sight draft on the defendant for the amount of the purchase price, to whiсh it attached the bill of lading for the merchandise shipped, and sent these two, through its bank at Kansas City, to the State Bank of Superior, Nebraska, for collection and remittance, with instructions tо deliver the bill of lading upon' payment of the draft. Upon receipt of notice from the State Bank of Superior that the draft was in its hands for collection, the defendant, acting through its prеsident, personally delivered its check to the bank over the counter, for the full amount claimed. This check was drawn on the collecting bank against a deposit of the defendant with the bаnk, then more than sufficient to meet the same, and was by the bank accepted. Upon the receipt and acceptance of the check the bank marked the draft “Paid” and delivered the same, together with the bill of lading at
The plaintiff contends that the issuance and delivery of the check amounted tо a conditional payment only; that since the check was not by the bank charged against the account of the defendant it was never honored and the defendant parted with nothing of value; that the collecting bank had authority only to collect and remit and could accept nothing but cash or its equivalent in payment, and that the mere issuance and delivery of the chеck did not constitute a payment of the collection item. The defendant, on the other hand, insists that when a draft with a bill of lading attached is sent to a bank for collection, and the drawee of the draft tenders to the bank a check on the collecting bank, the drawee of the draft being a depositor in the collecting bank with sufficient funds on deposit to pay the check and the bank has sufficient cash on hand to pay the check, if the bank accepts such, check and marks the draft “Paid” and delivers it up to the drawee with the bill of lading-, the draft and the accоunt it represents are paid; that the check is, under such circumstances, equivalent to a payment in cash.
There seems to be no doubt that the State Bank of Superior was the agent of the plaintiff for the purpose of collecting and remitting the proceeds of the sight draft. First Nat. Bank of Pawnee City v. Sprague,
The plaintiff contends, however, that, even though the bank was its agent, the mere passing over the bank counter of defendant’s check, and the surrender of the bill of
While in this case there is no evidence that cash was .actually counted out or рhysically appropriated to the pay-, ment of the plaintiff’s draft, it is conclusively shown that the defendant presented its check which was accepted by the bank; that defendant had on deposit with the bank sufficient funds to pay the check and the bank had cash in its vaults more than sufficient to pay the amount and was then doing business in the usual manner, cashing all checks that were prеsented over its counter; and that upon receipt of the check it stamped the draft for which it was given “Paid” and delivered the same to the defendant. Under the circumstances, it became the duty of the bank to allocate a sufficient amount of its cash on hand to the payment of the check and from that time it held the amount as the funds of the plaintiff. It became no pаrt of defendant’s duty to follow the transaction further
The supreme court of South Dakota, having very much the same question before it, in Marland Refining Co. v. Penn Soo Oil Co., 54 S. Dak. 10, said: “By giving the check to appellant’s accredited agent, so much of respondent’s money on deposit in the bank as was necessary to pay the check was segregated from his account and was in the possession of appellant through his said agent. In this case there was an agreement clearly implied that the giving of the check should be payment. Respondent had sufficient funds on deposit to pay the check, and the bank had sufficient funds on hand to pay it. It was the bank’s duty to have charged the amount of thе check to respondent’s account and to have remitted the same to the appellant, but its failure to do so was not the fault of respondent, but of the bank who was acting as agеnt for appellant.” Had the defendant in the present case presented its check and demanded cash, then given back the cash in payment of the draft, there could be no questiоn that the bank then held it for the plaintiff. The result of the transaction was the same, and the fact that the parties did not go through the useless process of counting out the money and then transferring it back and forth would not change the situation. When the bank accepted the check and acknowledged the payment of the draft it amounted to a payment of the debt.
In Andrew v. State Bank of Dexter,
In this cаse the question arose on a claim of the principal for preferential payment out of the funds of the agent bank, it having become insolvent; but we can see no reason why the rule should be different in the present case. In each instance the delivery and acceptance of the check constituted payment, and the funds were thenceforth held by the collecting bank in trust for the principal.
The supreme court of Kansas in Goodyear Tire & Rubber Co. v. Hanover State Bank,
Undoubtedly in those cases where the bank accepts a check when it does not have funds on hand to pay the amount or whеn a check is accepted drawn on another bank, which is dishonored, such acceptance by the collecting bank would not constitute payment. Under the facts in the present case we hold that the acceptance of the check by the agent bank amounted to a payment of the debt.
The judgment of the district court dismissing the action is
Affirmed.