126 A. 812 | Pa. | 1924
Argued October 14, 1924. Defendant appeals from a judgment in favor of plaintiff, in a feigned issue framed to determine which of the parties was entitled to a fund in court. The litigants agree that the facts are not in dispute; stating them most favorably to appellant, they are as follows:
A consignee sold several lots of goods belonging to his consignor; instead of sending the proceeds to the latter, the consignee deposited them in his own bank account, and sent the consignor five checks covering the amount. Before any of the checks were presented to the bank on *471 which they were drawn, but after three of them had been endorsed over to defendant, plaintiff issued and had served a foreign attachment against the consignor, making the bank and the consignee garnishees. Subsequently the other two checks were endorsed to defendant, which claims that as to all five of the checks it was an innocent holder for value, without notice of the foreign attachment. During all the time covered by these proceedings the consignee's bank account was more than sufficient to pay the amount due the consignor. When the checks were presented for payment, the bank refused to pay them, because of the pendency of the attachment, but set apart the fund in a special account, to await a determination of the rights of the parties; later, upon leave, it paid the fund into court, to await a decision of the relative claims of the parties under the feigned issue framed in this case.
Appellant pleaded that the money in court "was not and is not the property" of the consignor, and that as an innocent holder of the checks, for value and without notice of any adverse claim, it was entitled to the fund. Upon the issue thus made up, — and, of course, we can consider no other on this appeal, — we are clear that the court below was correct in deciding that the attaching creditor's right was superior to that of appellant.
The money in bank was the property of the consignor to the extent that it represented the proceeds of his goods, was his property, and could have been recovered by him, by a proper proceeding brought against the bank and the consignee, so long as there was a sufficient balance in the bank account to make good the amount (Webb v. Newhall,
On the other hand, defendant, as against the bank, acquired no right to the funds in its hands, merely because of the ownership of checks, which had not been accepted or certified. Section 189 of the Negotiable Instruments Law of May 16, 1901, P. L. 194, 219, says that "A check, of itself, does not operate as an assignment of any part of the funds to the credit of the drawer with the bank, and the bank is not liable to the holder unless and until it accepts or certifies the check." This was, indeed, the rule in Pennsylvania before the enactment of that statute: Maginn v. Dollar Savings Bank,
The authorities relied upon by defendant are not in point. Fulweiler v. Hughes,
Mutual Trust Company v. Parrish,
But one other matter requires consideration. The consignor, as defendant in the foreign attachment, has filed an affidavit of defense to plaintiff's claim therein, and that controversy is still pending. In view of this, it was bad practice to try the feigned issue before judgment for plaintiff in the foreign attachment, for non constat but that a judgment for defendant will be recovered in that suit, in which event plaintiff would have no claim upon the fund, and the trial in the court below, and the argument here, will be wasted labor. Probably because its attention was not called to the status of the attachment proceedings, the court below entered the usual form of judgment in such feigned issues, viz, that "judgment be entered in favor of the plaintiff, and that it take the fund paid into court by *474 the William Penn Trust Company." Appellee admits the insertion of the last clause was an inadvertent error, and hence we shall amend the judgment accordingly, leaving to the court below the duty to properly distribute the fund, after the final disposition of the foreign attachment.
The judgment of the court below is modified by striking out the words "and that it [plaintiff] take the fund paid into court by the William Penn Trust Company," and, as thus modified, the judgment is affirmed.