*1 wished, by him.” the extent that Parissi would seem Under the circumstances it judicial expense

to conserve effort and save parties dispose of the entire

controversy in the court federal rather non-patent

than to send claims to

state court where the evidence would again presented.

have to be

Accordingly order reversed and

the cause remanded further proceed-

ings.

FULTON NAT. BANK UNITED STATES. OF CO. GEORGIA v.

TRUST UNITED STATES.

Nos. Appeals Court of Fifth Circuit. 18, 1952. Smith, Alex Smith, W. Alex Jr., W. A. Cleveland, Jr., Atlanta, Ga.,

G. *2 764 In Hockett Co. Atty., At- it to the drawer. Stephens, U. S. Jr., Asst. H. A. 467, Simmonds, Ohio App. N.E.2d v. 84 87

lanta, Ga., appellee. 739, syllabus: “Payment ato we find this HOLMES, and BORAH Before name of the person rightfully bearing the Judges. Circuit person check, in but not the payee of a payee be to by the drawer to the HOLMES, tended Judge. delivered, is ineffective the check was whom together argued were These two cases charge on such liability drawer with to the briefs. upon submitted consolidated and check.” United the were instituted actions Both of checks, each on two to recover States We think the United States- the Treasurer drawn on which was checks,, negligent mailing not in was these endorsed and States, been had United and estopped by nor is it ear its failure to checks When the holder. the collected wrongful payments. lier notice of the Sec appellants for presented barring Georgia Code, the tion 13-2052 of rubber-stamp respective endorsements recovery upon after part fol- thereon, reading in as lapse year, the of one guaranteed.” prior indorsements lows : “All the v. instant cases. In Clearfield Trust Co. hand left in lower One check indicated 573, States, 363, 318 U.S. 63 S.Ct. Tax “1945 that it was corner drawn 838, that, was held when the 87 L.Ed. it following Refund”; carried the other pays funds or United States disburses its payee: “A after the name notation debts, exercising a constitutional its is en- immediate Appellants’ 34222962.” R function, duties on com and its and solvent. are were and still governed by dorsers paper mercial so issued are law. See also Na federal rather than local of common-law crime While the Metropolitan tional Bank v. United require defraud as forgery may intent to 454, 354, 323 U.S. 89 L.Ed. 383. not an ingredients, scienter is one of its Similarly, right money paid! its recover unauthorized illegal in element essential pension bearing a bank on instruments un negotiable of endorsements payees not endorsements of the is Negotiable Instru Section 23 of the der upon giving conditioned notice of Code, Georgia, Georgia Sec. Law of discovery forgeries, since things, provides, among other 14-223,which bank, by pay presenting the checks for made “forged signature is if ment, genuineness. warranted their inopera wholly authority”, it is without the Exchange Bank v. National States cases, the indorsements instant tive. Providence, 302, 665, 29 53 S.Ct. persons, of the names of on the checks addition, here all en L.Ed. 1006. In thereof appeared on the face whose by appellants. guaranteed sig dorsements purported to be the payees, true as the persons payees, not of natures of only The bar the Govern name. United States v. the same damage resulted if bank D.C., York, 28 of New City Bank National by reason of' the drawee’s give' 147; Ex American Graves F.Supp. notice on forgery, 205; Lin Cohen v. Bank, 17 N.Y. change case, supra, page 318 U.S. at Brooklyn, 275 N.Y. Bank of Savings coln page 63 at S.Ct. 576. Both and re 457, 112 A.L.R. 1424. 399, 405, N.E.2d 10 injury required, sultant are which must be conjecture. established not left payee the true which The name U.S. 63 S.Ct. 573. In the instant reference to designated has in check is cases, no to have resulted person who was intended particular delay; person and the court payee; and a to be the drawer name, not find that the Government acciden below did was who precisely laches; guilty neither we. possession of do There into wrongfully comes tally or fore, present situation he is covered to it. If ob check, no title obtains case, supra, page at the bank on Clearfield U.S. money on it tains page 63 S.Ct. at drawn, is liable to make the bank it is which appealed our judgments separate stitutes from, though contract. Even opinion, correct and should 'be affirmed. the checks are on the drawn Treasurer of the United and liabilities

Affirmed. *3 against prior of an endorsee endorser on an to which the United States- Judge (dissenting). party by is not a controlled the law agree that no I cannot state where endorsements were- reason to have resulted to made, is, Georgia Am.Jur.,. by that law. Government’s Laws, Conflict of Section 148. In the forgery. notice on appears In both Company Trust v. United cases it that the United case of Clearfield forged States learned of the or unauthor- long expira- ized endorsements before L.Ed. 838 Clearfield year tion of could still recover one after the Company checks were Trust cashed, Company, prior appellants Penny endorser. but notify did not or any Court, prior now before the it seems cases endorser banks that the checks prior me is not true. Each of the bore a that that or unauthorized endorsement subsequent payees, whose until year more one pay- endorsers than after such forged, Georgia appellants, therefore, were banks in ment. had no protection 13- opportunity notify prior of Section entitled so endorser per- 2052, Georgia reading Code of banks and Georgia under the Statute the part: appellants rights tinent lost such . damaged by unjustified banks faith “No bank which has in delay of the United States. Under the paid un- a check or holding case, damages Clearfield indorsement shall be liable authorized resulting from that should be borne any person payment, for such either by and not by United States payment, reason of such the indorse- therefore, I, respectfully dissent. bank, ment of said check such guarantee by said prior bank of in- dorsements, year unless within one

after such indorsement bank, guarantee

such of indorse- bank, such the drawer of subsequent

said check or some indors-

er or holder thereof such notify shall writing bank in that said bore check UNITED STATES WESTFALL. forged or unauthorized indorse- No. 12966. * * * Appeals, Court It is that that Section direct Circuit. Ninth rights to the and duties United States on the checks because case held such and du- governed ties are than Federal rather A question

local presented, law. different

however, possible when we come to the appellants against prior

claims of endorsers. the Uniform Negotiable

Under Instruments payment

Law in Georgia, in effect appellants

amounts of subrogate States did not them re- but

mitted them to their former re- rights as parties.

gards Am.Jur., all Bills and

Notes, Section 826. Each endorsement con-