205 Mich. 44 | Mich. | 1919
In this action, commenced in the circuit court of St. Clair county, on October 18, 1917, plaintiff recovered a judgment against defendants in the sum of $1,036.25 upon the following certified check:
“Palms, Mich., July 27, 1915.
“No......
“Palms Bank op Frank W. Hubbard & Co.
“Pay to the order of E. ,W. Mapes........$1,000, one thousand dollars.
“Eli Sawdon.”
Across the*face of this was written the following:
“Good when properly endorsed.
“B. D. Wright,
“Cash. July 27, ’15.”
Indorsed upon the back of said check were the following names, in the following order:' E. W. Mapes, Eli Sawdon, Flavel G. Briggs.
Bert D. Wright was and had been cashier of said bank for about 7 years. Eli Sawdon and his father-in-law, E. W. Mapes, were customers of said bank, and partners engaged in taking drainage contracts in different parts of the country. Flavel G. Briggs, one of the indorsers, was and is a resident of Arkansas, to whom Sawdon became indebted and delivered the check as collateral security to notes given therefor. Plaintiff was and is also a resident of Arkansas, who received the check from Briggs’ attorney in payment for an 80 acres of land purchased for Briggs. Briggs and plaintiff, who consecutively acquired this check each testified that he then had no'knowledge of any claim against its validity but took the same in good faith for a valuable consideration on the strength of its being what it purported. Smith testified in part as follows:
“Q. I ask you if you are now the owner of this check?
“A. Yes.
“Q. What did you give in exchange for this check?
“A. Traded 80 acres of land. * * * I have had some experience in dealing with banks and checks. I accepted this check at' face value because it was certified and written out in the usual manner and signed. I had no intimation that there would be any defense to the payment of said check.”
The date of the check, certification and genuineness of signatures are conceded. The authority of Wright to certify the check and the innocence of plaintiff as holder are not admitted, and it is further contended that the delay which intervened between the time of issuance and time of demanding payment estops recovery.
The case was tried before the court without a jury, and on request of counsel findings of fact with conclusions of law thereon were filed. The court’s find
“At the. time Smith accepted the check, he did not know that either the bank or Sawdon claimed the check to be invalid, nor did. he have any reason to believe that the check was not good, nor anything to put him on inquiry as to its validity. At this time Attorney Rachels had been advised that Sawdon claimed Briggs had obtained possession of the check by a wrongful act and also that the bank claimed the check to be invalid.”
Holding that under the undisputed evidence Rachels was agent of Briggs, and not plaintiff, when he paid the latter this certified check on the land purchase, the court found that plaintiff then became a bona' fide holder of the check in good faith for full value and the bank was bound by its certification to honor it.
Defendants’ assignments of error are directed against the court’s conclusions of law, refusal to make certain requested findings of proven facts, and certain findings made which are claimed to be contrary to the evidence.
For full consideration of the case defendants were permitted to show, against timely objection by plaintiff, that, needing a certified check for $1,000 to use in his drain bidding and only having $75 in his account at the bank, Sawdon arranged with the cashier, Wright, to issue him this certified check and take his note for that amount; that no record of the cértified check or the $1,000 note Sawdon gave was entered in the books of the bank, nor credit given Sawdon for the note in his account, the note has never been paid and Sawdon is, and then was, financially irresponsible. These facts, though not disputed, were rejected by the trial court as immaterial.
Of defendants’ claim that plaintiff adopted Rachels as his agent in connection with the transfer of the
It may be conceded that under the facts disclosed by defendant’s evidence Wright violated the banking law when he certified this check, and as between the bank, Sawdon and Mapes the certification is a nullity and the note given by Sawdon was, as defendant’s counsel contend, “a fictitious nullity which is prohibited by the statutes,” but the fundamental infirmity of the defense throughout is that plaintiff was not a party to any of those proceedings and knew nothing of them.
That defendant was operating as a private bank under a partnership organization furnishes it no immunity from the well-settled rules of law applicable to certified checks issued in the customary course of banking business. It was operating as a bank and
The practice and principles involved in certifying
This certified check from a bank in Michigan found its way to and was put afloat by its payor in Arkansas, had apparently passed through several hands and bore the signature of three indorsers, the last being Briggs, a business man in White county in that State, and, in a deal for some land in VanBuren county, was passed by his attorney and agent upon plaintiff with the assurance that it was genuine. Recognizing from his experience in dealing with banks and checks, that it was a certified check in usual form, with “no intimation that there would be any defense to its payment,” as he states, he accepted it in good faith in exchange for 80 acres of land. It was on its face under the law an absolute undertaking of the certifying bank to honor it when presented for payment at any time before barred by the statute of limitations. No obligation rested upon him to, at his peril, make investigation into the reason for and circumstances of its certification. We find nothing in the situation presented here which relieves defendant from'its obligations under the well-settled and somewhat emphatic rules of law established in recognition of the importance of the verity of certified checks as a medium of exchange in the business world under the law merchant.
The judgment is affirmed.