Whitney v. Eliot National Bank, 137 Mass. 351

137 Mass. 351 | Mass. | 1884

Field, J.

The bill has been taken as confessed against Smith and Northam; and it is manifest that, upon the allegations of the bill, they are not entitled to the money. They sold the meal to Hatheway and Company; but it does not appear ' that the title did not pass to Hatheway and Company by this sale, and no facts appear which give Smith, Northam, and Company any lien upon the proceeds of the sale made by Hatheway and Company to Morrison. If the drafts or bills of exchange constitute an assignment of the debt due, or to become due, to Hatheway and Company from Morrison, Hatheway and Company received the two checks sent by Morrison to the use of the bank; but if there has been no assignment, they received the checks to their own use, although they may be personally liable to the bank as drawers. The bank has acquired no additional rights to the money from the fact that Hatheway and Company placed the checks in the hands of the plaintiffs for the benefit of whom it might concern; and, under the facts in the case, the bank has lost none of its rights to the money in the hands of the plaintiffs, if it acquired any, by discounting the bills of exchange. The delivery of the checks to the plaintiffs was not an assignment to the bank. Hatheway and Company, having suspended payment, might well be in doubt whether the checks belonged to the bank, or to themselves, and might well hesitate whether to collect them and mingle the proceeds with their other assets, or to deliver them to the bank, and thus perhaps run the risk of being refused a discharge in insolvency, if they became insolvent debtors. They therefore delivered the checks to the plaintiffs, in order that the rights of the different claimants to receive the proceeds of them might be determined by law.

The drafts or bills of exchange are in the ordinary form of negotiable sight bills, except that they each contain the direction to “ charge the same to account of 250 bbls. meal ex schooner Aurora Borealis.” This direction to charge the amount of the bills to a particular account, we think, does not make them payable conditionally, or out of a particular fund; they are still payable absolutely, and are negotiable, and do not constitute an assignment of a particular fund, or of a part of a particular fund. Robey & Co.’s Perseverance Iron Works v. Ollier, L. R. 7 Ch. 695. In re Entwistle, 3 Ch. D. 477. Griffin v. Weatherby, L. R. 3 Q. B. 753. Banner v. Johnston, L. R. 5 H. L. 157. Haussoullier v. Hartsinck, 7 T. R. 733. Macleed v. Snee, 2 Stra. 762. Wells v. Brigham, 6 Cush. 6. Redman v. Adams, 51 Maine, 429. Corbett v. Clark, 45 Wis. 403. Coursin v. Ledlie, 31 Penn. St. 506. Kelley v. Brooklyn, 4 Hill (N. Y.) 263. Early v. Mc Cart, 2 Dana, 414. Spurgin v. McPheeters, 42 Ind. 527.

In Brill v. Tuttle, 81 N. Y. 454, some of the New York cases are reviewed, and it is held that, when the language is ambiguous and the order not negotiable, “ the attendant circumstances may be shown to determine the intention and understanding of the parties,” but the case does not purport to be an authority, if the order is in form a negotiable bill of exchange. See Wheeler v. Souther, 4 Cush. 606.

In the case at bar, the two drafts were drawn on different days, and although, taken together, they are equal to the whole amount due, or to become due, from Morrison for five hundred barrels of meal, each is drawn for a certain sum of money, which is in fact one half of the debt, and is to be charged to the account of two hundred and fifty barrels of the meal. Either standing alone would not, in an action at law, constitute an assignment of the sum of money expressed in it, as it is for a part of the debt due from Morrison. Gribson v. Cooke, 20 Pick. 15. Palmer v. Merrill, 6 Cush. 282. Bullard v. Randall, 1 Gray, 605. Dana v. Third National Bank, 13 Allen, 445. Carr v. Security National Bank, 107 Mass. 45. The dictum in Gibson v. Cooke, ubi supra, that “ a draft by the creditor on his debtor in the form of a bill of exchange, to the amount of the debt or the whole fund in his hands, is a good and valid assignment of the debt, or fund,” is qualified in Dana v. Third National Bank, as perhaps meaning “a draft on a particular fund,” and, so qualified, is said to be “ undeniably correct.” If, under this view of the law, the first draft, on being discounted, assigned to the bank no part of the debt, the second draft would not be an order for the whole amount of the debt, and it is difficult to see how, taken together, the drafts would, in an action at law, constitute an assignment of the whole debt; but we do not intend to put the decision on this ground, or to decide whether in equity there may not be an assignment of a part of a debt. See Exchange Bank v. McLoon, 73 Maine, 498. For the reason given in the cases first cited, we think these drafts are negotiable bills of exchange, not payable out of a particular fund, and do not constitute an assignment of the fund.

It is agreed that Morrison directed Hatheway and Company “ not to draw upon him for this consignment of meal,” but that this was not communicated to the bank until a considerable time after the drafts were discounted, and that the bill of lading was not attached to the drafts. It does not appear that the bill of lading was ever delivered, or intended to be delivered, to the bank. Morrison was therefore under no obligation to accept the bills of exchange, although Hatheway and Company notified him that they had drawn upon him for the price of the consignment before he sent the checks. It does not appear that he had received notice that the draft, or drafts, had been discounted. Ho property, general or special, in the meal was transferred to the bank; and there are no facts from which an agreement can he inferred, between Hatheway and Company and the bank, that the debt due, or to become due, from Morrison should be assigned to the bank, or that the bank should have a specific charge upon it. Robey & Co.’s Perseverance Iron Works v. Ollier, ubi supra. In re Entwistle, ubi supra. Ranken v. Alfaro, 5 Ch. D. 786.

For these reasons, a majority of the court are of opinion that there must be a decree that the money in the hands of the plaintiffs be paid to the assignee in insolvency.

So ordered.