II. lIiORTH ATCHISOlli BANK:.
CARY et dl. v. LoVEJ,L MANUF'GCO., Limited.
(Oircuit Oourt,W: D. Pennsylvania. May 29,1889.)
A number of depositions, takeu in one or the other of two suits in other districts, brought by the present plaintiffs against other defendants for the infringement of the same patent, having been introduced by written agreement into this case. and read at the hearing "with the same force and effect as if taken in tbis suit," a solicitor's fee of $2.50 for each of said depositions is not he,retaxable under section 824, Rev. St.
In Equity. Sur exceptions to clerk's taxation of costs. John K. Halloc;k and W. Bakewell & Sons, for exceptants. Witter & Kenyon, contra. Before McKENNAN and ACHESON, JJ. PER CURiAM. By written agreement a number of depositions, taken in one or the other of two suits in other districts, brought by these plaintiffs against different. defendants for the infringement of the same patent, were introduced into this case, and read at the hearing thereof, "with the same force and effect as if taken in this suit," and the question now arising is whether a solicitor't> fee for each of said depDsitions is here taxable under section 824 He\'. St., which allows to the solicitor "for each deposition taken and admitted in evidence in a cause two dollars and fifty cents." Upon a like state of facts, Justice BLATCHFORD, in Wooster v. Handy, 23 Fed. Rep. 49, decided against the allowance of the fee, and so, also, did Judge SEVEHENS, in Winegar v. Cahn, 29 Fed. Rep. 676. We concur in this conclusion, which, we think, is in harmony with both the letter and the spirit of the statute. By its express terms the deposition must be "taken" as well as "admitted in evidence" in the cause, and the manifest intention of the statute was to compensate for the labor and expense of taking the deposition. We therefore sustain the exceptions to the allowance by the clerk of $102.50 solicitor's fees for depositions taken in the suits of Cary & kloen v. Domestic Spring-Bed Co. and Same v. R. H. Wo7ff & Co. But the exception to the allowance of $53.20, traveling expenses, etc., incurred by the master, is overruled.
GARRETTSON et al.
NORTH ATCHISON BANK.
l0'ircuit Oourt, W, D. Missouri, St. Joseph D:v. June 17.1889.)
BANKS AND BANKING-CHECKS-AcCEPTANCE.
A cattle company had agreed to sell to one T. certain cattle for $22,000. T. offered in payment his check on defendant bank. The vendor refused to accept it unless plaintiffs, to whom vendor was indebted. would accept it in payment of the debt. The payee in the check telegraphed to defendant, asking if it would pay T.'s check for $22.000. and defendant telegraphed: "T. is good. Send on your paper." The telegram was shown to plaintiffs,
who took the check in payme,nt, of th,eir debt,' He,ld, that tr,.e answer was an acceptance of the check ·for.the sum named .in the first ,telegram, and was sufficient, under Rev. St. Mo. § 533. providing that an acceptance of a bill of exchange must be in writing, and section 534, providing that an acceptance on a separate paper will bind the acceptor in favor of one to wbom it bas been shown who takes tbe bill on the faith thereof for a valuable consideration, to render defendant liable to. plaintiffs on the check. 2.
SAME-AoCEPTANCE BEFORE CHEOR DRAWN.
In' such case the evident purpose of the inquiry being to obtain assurance of payment before taldng the cbeck defendant, was liable under Rev. St. Mo, !'\ 53.), providing that an unconditional written promise to accept a bill before it is drawn shall be deemed an actual acceptance in favor of any person to whom it is shown, and who on the faith thereof receives the bill for a valuable consideration..
At Law. Action on a check. Demurrer to petition. Karnes, Holmes & Krauthoff, for plaintiffs·. Lancaster, Hall & Pike, for defendant. PHILIPS, J. This cause stands on demurrer to the petition. Omitting the formal matters, the petition alleges in suhstance that the Muscatine Cattle Company, on the 28th day of September, 1888, sold to one James Tate 1,000 head of cattle at the agreed price of $22,000. Tate tendered in payment thereof his check drawn on the defendant bank. The said cattle company, being indebted in a large sum at that time to plaintiffs, refused to deliver the cattle, or to accept said check, from said Tate unless plaintiff's would accept the said check in payment of said indebtedness of said cattle company to them, which plaintiffs declined to do unless defendant would certify said check to be good. Thereupon said cattle company sent or cauRed to be sent, from Pueblo, Colo., to defendant at Westboro, Mo., the following telegram: "Will you pay James Tate's check on you twenty-two thousand dollars? Answer." Which said telegram was received by defendant, whereupon it sent to said cattle company the following answer: "James Tate is good. Send on your paper." Upon the receipt of this answer said cattle company and Tate exhibited the same to plaintiffs, whereupon plaintiffs, in reliance upon said acceptance and certification of said check, agreed to accept the same for the purpose aforesaid; and the said cattle company, in reliance on said telegram, accepted said check, and delivered to said Tate said cattle, and, after duly indorsing said check to plaintiffs, delivered the same to them, which the plaintifl's accepted in reliance upon said acceptance or certification, and duly entered credit therefor on the indebtedness of said cattle company to them. The petition then alleges presentment for payment, and the refusal of defendant to pay the said check, and the due protest thereof. Judgment is asked for said sum, with interest and protest fees, damages, and costs. The demurrer is general that the petition does not state facts sufficient to constitute a cause of action. The argument in support of the demurrer is that there was no acceptance in writing, in contemplation of the statute; that the answer sent by from defendant was at most but a promise to pay, and, the petition not averring that said Tate had any funds at the time in the bank, the promise was wholly voluntary; that if the plaintiffs have any remedy it is against
GARRETTSONV·.NORTH ATCHISON BANK.
the payee named in the check, who might then have action against the defendant on the breach of promise. A brief recurrence to some gen,eral principle>' applicable to bank checks may not be impertinent, asa due regard to these will materially aid in a proper conclusion. Many text writers liken such checks, in their sub8tance, to inland bills of exchange, payable on demand. 1 Rand. Com. Paper, § 8; Byles, Bills, 13; 1 Edw. Bills, § 19. Mr. Justice SWAYNE, in Brmk v. Bank, 10 Wall. 647, very aptly note!'! the essential diflerence between checks and bills of exchange: "Bank checks are not inland bills of exchange, but have many of the properties of snch commercial paper; and many of the rules of the Jaw-merchant are alike applicable Lo both. Each is for a specific sum, payable in money. In both cases there is a drawer, a drawee, anll a payee. 'Without acceptance no action can be maintained by the holder upon either against the drawer. 'rhe chief points of difference are that a check is al W:lys drawn on a bank or banker. No days of grace are allowed. 'fhe drawer is not discharged by the laches of the holder in presl"utment for payment, unless he can show that he bas sustained some injury by the default. It is not due until payment is demanded, and the statute of limitations rnns only from that time. It is by its face the appropriation of so much money of the drawer in the hands of the drawee to the payment of an admitted liability of the drawer. It is not necessary that thl" drawer of a bill should have funds in the hands of the drawee. A chl"ck in such case would be a fraud. * * * By the law-merchant of this country the certificate of the bank that a check is good is equivalent to acceptance. " It would therefore follow that when a check has been certified, which is but the equivalent of acceptance, by the drawee, it stands, in its commercial relation, as an accepted bill of exchange. From its acceptance the implication arises that it is drawn upon sufficient funds of the drawer in the hands of the drawee, and that such fund is set apart, appropriHted, for the check whenever presented. It is not only an admission that the drawer then has in the hands of the drawee the required fund, but it imposes the obligation on the drawee to reserve and hold the fund for the redemption of the check when presented. Bank v. Bank, snpra. Nor is it material, as between a bona fide transferee of the check and the drawe8, that the drawer in fact hall no money in the bank at the time of the acceptance. The certification operates, in such case, an effectual estoppel against such defense. Cooke Y. Bank, 52 N. Y. 96; Bank v. Bank, supra; Jarris v. Wilson, 46 Conn. 90-92; 2 Daniell, Neg. Ins1. § 1603. Such accepted check, possessing the quality of commercial paper, passes by indorsement, and confers upon the indorsee the right of action, as upon any other chose in actiolJ. Preund v. Bank, 76 N. Y. 355, 356; Bank v. Hiduuds, 109 lUass. 4]3; Whilden v. Bank, 64 Ala. 29, 30; It only r8rnains, thereiore, to be determined whether or not the defembnt bank did accept the payment of the check in question, and, if it did accept, what are the rights of these plaintiffs? The check being dra wn on a Missouri bank, to be paid here, the state statute regulating the nwtfer of acceptances of such paper applies. "Sec. 533. Acceptance uf Bill of E:1:,ltange must be in Writing. No person within this state shall be charged as an acceptor of abill of exchange
unless bis aCCl'ptance sbllll .be writing, signed by himself or his lawful agent. Sec. 534. ACr'eptance W1'itten on Sepa1'ute Paperwill Bind Acceptor, when. If. snch acceptltllce be. wl'itten on a paper othl"'r than the bill, it shall not bind the acceptor, except in favor of Ii person to whom such acceptance shall have bElen shown, llnd who upon the faith thereof shall have received ,. the billfor:a 'valuable consideration," The statut.e had alread)( become the established common-law'tule, that the acceptance may be 'Written on a paper other than the bill, and of consequence, it may be .made by letter, and, if by lettel', also 'by telegram. Bank v. Bank, 1 N. Y. Leg. Obs. 26; Espy v. Bank, 18 Wall. 604; Whilden v. Bank, 64 Ala. 32, 33. "The statute requires the' promise to be in writing, but is silent as to the mode of communicating it to the patty cashing .the draft upon the faith of it. When it is in writing and thus acted upon, its mode of conveyance, whether by telegraph, mailpr otherwise, affects no rights, and such effect must be given to it as manifest justice, and' the exigencies of commerce call for in this class of communications." Bank v. Howard, 40 N. Y. Super. Ct. 20. The material facts disclosed by the petition are that, the Muscatine Cattle Company had contracted to sell to one James Tate 1,000 head ofcaUle at the price of $22.000. In payment, Tate tendered to the company his check for $22,000, drawn on the defendant bank. Before the vendor would accept said check, and part with his property, and before the plaintiffs would accept the check as payment 011 the indebtedness of the c.attle company to them, the payee named in the check telegraphed to defendant and received from it the answer alleged in the petition. The question raised by the argument on the demurrer is as to whether this correspondence constitutes an acceptance within the meaning of the law-merchant and the statute, or whether it amounts simply to a promise to accept or pay. Reading the two telegrams together, in the light of the ordinary understanding and acceptation of such terms among commercial men, it does seem to me that the plain meaning and purport of the answer was an acceptance of the check for the sum expressed in the first telegram. The language of the inquiry made in the first telep;ram clearly indicated that the check had been drawn by Tate on defendant for $22,000; and defendant was asked if it would pay it. It would seem to be a strained construction that the check named was to be sent on merely for acceptance. The answer was that "Tate is good. Send on your paper." If the check had been presented to the bank in the ordinary way, and the drawee had indorsed thereon the word "Good," undersigned by its proper officer, it would by aU the authorities have amounted to a certification of a check. Eftpyv. Bank. 18 Wall. 604; 2 Rand. Com. Paper, § 648. The language "send on your paper," taken in connection with both telegrams, clearly implies that it is to be sent on for payment, and not merely for acceptance. In Coolidge v. Pa.yson, 2 Wheat. 66, Chief Justice MARSHALL states the rule that "a letter, written within a reasonable time before or after the date of a bill of exchange, describing it in terms not to be mistaken, and pJ.:VJ.U.1Swg to accept it, is, if shown to the person who
WILLIAMS ".QUEEN'S INS. CO.
afterwards takes the bill on the crE;Jdit of the ll"jtter, a virtual acceptance, binding the person who makes the promise." Whilein the sUQsequent case of Boyce v. Edwards, 4 Pet. 111, the ruling in Coolidge v. Payson, was reviewed, the rule as stated by Chief Justice MARSHALl, was not disturbed where the letter of acceptance applies directly to a particular bill drawn or to be drawn. By section 53';>, Rev. St. Mo., it is prov;ided that" an unconditional promise in writing to accept a bill before it is drawn shall be deemed an actual acceptance in favor of every person to whom such written promise shall have been shown, and who upon the faith thereof shall have received the bill for a valuable consideration." It would be difficuit to perceive, on principle, what difference there could be in a promise to accept before drawing and the facts as disclosed in the petition. The defendant, in the very nature of such compurpose of the inmercial transactions, must have understood that quiry made of it was to have the payment of the check assured if taken by the party sending the telegram. The answer was shown to the plaintiffs, and in reliance upon the assurance it contained the plaintiffs accepted the check. As well settled in this jurisdiction, the application of the check by the plaintiffs to the indebtedness to them from the cattle company was for a valuable consideration, and coni"titutes them bona fide holders of the check, and as such the right of action thereon inures to them regardless of any equities between the original parties. Raib'oad Co. v. Bank, 102 U. S. 14-22; Pope v. Bank, 59 Barb. 226; Bank v. Howard, supra; Whilden v. Bank, 64 Ala. 1-30; Frettnd v. Bank, 76 N. Y. 353-358; JohmJon v. Clark, 39 N. Y. 216; Coolidgev. Payson, 2 Wheat. 66. The conclusion is that the petition does state facts sufficient to constitute a cause of action, and the demurrer is therefore overruled.
(Oircuit Oourt. D. Oonnecticut. June 24, 1889.)
INSURANCE-CONDITIOXS OF POLICy-PROOFS OF
Loss. An insurance policy provided that on a loss the policy-holder should, "if required, produce the certificate of a magistrate or notary public nearest to the place of fire, -* .. .. stating that he has investigated the circumstances of the fire, and believes that the owner has, without fraud. sustained loss to the amount claimed." The company's agent replied to proofs of loss sent by plaintiff, the policy-holder, which contained a certificate that such proofs were insufficient, because they did not meet the requirements of the policy in regard to the location of the magistrate or notary signing the certificate, and said: "For the above reasons, we decline to accept the proofs * ** as sufficient, under the requirements of the policy_" Plaintiff thereafter sent the certificate of the nearest justice of the peace. though there were notaries who were materially nearer. Heid. that there was a sufficient requirement of the certificate mentioned, which plaintiff recognized. Under such requirement, the certificate of the nearest offie-er of the classes named, whether magistrate or notary, is necessary.